Exhibit 4.10
WARRANT AGREEMENT
DATE: ________, 1997
PARTIES: Wilsons The Leather Experts Inc.
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxx Xxxx, Xxxxxxxxx 00000
Norwest Bank Minnesota, National Association
Stock Transfer
161 North Concord Exchange
X.X. Xxx 000
Xxxxx Xxxxx Xxxx, Xxxxxxxxx 00000-0000
RECITALS:
A. Wilsons The Leather Experts Inc., a Minnesota corporation (the
"Company"), proposes to issue at least 1,100,000 and up to 1,265,000 Redeemable
Common Stock Purchase Warrants (the "Warrants") evidencing the right to purchase
an aggregate of up to 1,265,000 authorized but previously unissued shares of
Common Stock, $.01 par value, of the Company (the "Common Stock"). The Warrants
would be issued in connection with the issuance by the Company of at least
1,100,000 and up to 1,265,000 Units, each Unit consisting of one share of Common
Stock and one Warrant, in connection with the Company's Registration Statement
on Form S-1.
B. The Company desires Norwest Bank Minnesota, National Association
(the "Warrant Agent") to act on behalf of the Company, and the Warrant Agent
desires so to act, in connection with the issuance, registration, transfer,
exchange and exercise of the Warrants.
AGREEMENT:
The Company and the Warrant Agent, each intending to be legally bound,
hereby covenant and agree as follows:
ARTICLE I.
APPOINTMENT OF WARRANT AGENT;
ISSUANCE, FORM AND EXECUTION OF WARRANT CERTIFICATES
Section 1.1. Appointment of Warrant Agent. The Company hereby
appoints the Warrant Agent to act as agent for the Company, and the Warrant
Agent hereby accepts the
agency established herein and agrees to perform its agency duties in accordance
with the terms and conditions of this Warrant Agreement.
Section 1.2. Warrant Certificates. The Company shall execute and deliver to
the Warrant Agent certificates which the Company has authorized to represent the
Warrants ("Warrant Certificates"). The Warrant Certificates shall be
substantially as set forth in Exhibit A hereto and may have such legends,
summaries or endorsements printed, lithographed or engraved thereon as the
Company may deem appropriate and as are not inconsistent with the provisions of
this Warrant Agreement, or as may be required to comply with any law or with any
rule or regulation relating to listing of the Warrants on the NASDAQ system,
including the National Market System, or on any stock exchange or to conform to
usage. The Warrant Certificates shall be dated with the date of their issuance.
Section 1.3. Execution of Warrant Certificates. The Warrant Certificates
shall be executed on behalf of the Company by a duly authorized officer of the
Company, either manually or by facsimile signature printed thereon. The Warrant
Certificates shall be manually countersigned by the Warrant Agent and shall not
be valid for any purpose unless so countersigned. Any Warrant Certificate may be
signed on behalf of the Company by the person who at the actual date of the
signing of such Warrant Certificate shall have been the proper officer of the
Company, although at the date of issuance of such Warrant Certificate any such
person has ceased to be such officer of the Company.
ARTICLE II.
EXERCISE OF WARRANTS
Section 2.1. Exercise. Any or all of the Warrants represented by each
Warrant Certificate may be exercised by the holder thereof on or before 5:00
p.m., Minneapolis time, on ___________, 2000 unless extended by the Company, by
surrender of the Warrant Certificate with the Purchase Form, which is printed on
the reverse thereof (or a reasonable facsimile thereof), duly executed by such
holder, to the Warrant Agent at its principal office in Minneapolis, Minnesota,
accompanied by payment, in cash or by certified or official bank check payable
to the order of the Company, in an amount equal to the product of the number of
shares of Common Stock issuable upon exercise of the Warrant represented by such
Warrant Certificate, as adjusted pursuant to the provisions of Article III
hereof, multiplied by the exercise price of $13.50, as adjusted pursuant to the
provisions of Article III hereof (such price as so adjusted from time to time
being herein called the "Purchase Price"), and such holder shall be entitled to
receive such number of fully paid and nonassessable shares of Common Stock, as
so adjusted, at the time of such exercise.
Section 2.2. Time of Exercise. Each exercise of Warrants shall be deemed to
have been effective immediately prior to the close of business on the business
day on which the Warrant Certificate relating to such Warrants shall have been
surrendered to the Warrant Agent as provided in Section 2.1, and at such time
the person or persons in whose name or names any
-2-
certificate or certificates for shares of Common Stock shall be issuable upon
such exercise as provided in Section 2.3, shall be deemed to have become the
holder or holders of record thereof.
Section 2.3. Issuance of Shares of Common Stock; No Fractional Shares. As
soon as practicable after the exercise of any Warrant, and in any event within
ten (10) days after receipt by the Company of the notice of exercise under
Section 2.1, the Company at its expense (including the payment by it of any
applicable issue taxes) will cause to be issued in the name of and delivered to
the holder thereof or as such holder (upon payment by such holder of any
applicable transfer taxes) may direct,
(a) a certificate or certificates for the number of fully paid and
nonassessable shares of Common Stock to which such holder shall be entitled
upon such exercise plus, in lieu of any fractional share to which such
holder would otherwise be entitled, an amount in cash equal to such
fraction multiplied by the then current value of a share of Common Stock,
such current value to be determined as follows:
(i) if the Common Stock shall be listed or admitted to
unlisted trading privileges on any single national securities
exchange, then such current value shall be computed on the basis of
the last reported sale price of the Common Stock on such exchange on
the last business day prior to the date of the exercise of such
Warrant upon which a sale shall have been effected; or
(ii) if the Common Stock shall not be so listed or admitted
to unlisted trading privileges and bid and asked prices therefor in
the over-the-counter market shall be reported by NASDAQ, including the
National Market System, then such current value shall be computed on
the basis of the Last Reported Sale Valuation Method or, in the event
such method is not then used by NASDAQ, the average of the closing bid
and asked prices on the last business day prior to the date of the
exercise of such Warrant as so reported; or
(iii) if the Common Stock shall be listed or admitted to
unlisted trading privileges on more than one national securities
exchange or one or more national securities exchanges and in the over-
the-counter market, then such current value shall, if different as a
result of calculation under the applicable method(s) described above
in this Section, be deemed to be the higher number calculated in
connection therewith; or
(iv) if the Common Stock shall not be so listed or admitted
to unlisted trading privileges and such bid and asked prices shall not
be so reported, then such current value shall be computed on the basis
of the book value of Common Stock as of the close of business on the
last day of the month immediately preceding the date upon which such
Warrant was exercised, as determined by the Company; and
(b) in case such exercise includes only part of the Warrants
represented by any Warrant Certificate, a new Warrant Certificate or
Warrant Certificates of like tenor, calling in the aggregate on the face or
faces thereof for the number of shares of Common Stock
-3-
equal (without giving effect to any adjustment therein) to the number of
such shares called for on the face of such Warrant Certificate minus the
number of such shares designated by the holder for such exercise as
provided in Section 2.1. Warrants represented by a properly assigned
Warrant Certificate may be exercised by a new holder without first having a
new Warrant Certificate issued.
Section 2.4. Extension of Exercise Period; Change of Exercise Price. The
Company may, upon notice given to the Warrant Agent, and without the consent of
the holders of the Warrant Certificates, (a) reduce the Purchase Price during
all or any portion of the originally stated exercise period or (b) extend the
period over which the Warrants are exercisable beyond __________, 2000 and
increase or decrease the Purchase Price for any period the Warrant exercise
period is extended. In the case of the extension of the exercise period or a
change in the Purchase Price, the Company must provide the Warrant Agent and the
Warrantholders of record notice of such extension of the exercise period,
specifying, as the case may be, the time to which such exercise period is
extended, or specifying the new Purchase Price and the periods for which such
new Purchase Price is in effect, a reasonable time prior to the date such
extension or new Purchase Price is to take effect, such reasonable time to be
commercially reasonable and consistent with applicable securities laws and
regulations.
ARTICLE III.
ANTIDILUTION PROVISIONS
Section 3.1. Adjustment of Purchase Price.
(a) The Purchase Price shall be subject to the following
adjustments. In the event that:
(i) any dividends on any class of stock of the Company
payable in Common Stock or securities convertible into Common Stock
shall be paid by the Company;
(ii) the Company shall subdivide its then outstanding
shares of Common Stock into a greater number of shares; or
(iii) the Company shall combine outstanding shares of
Common Stock, by reclassification or otherwise;
then, in any such event, the Purchase Price in effect immediately prior to
such event shall (until adjusted again pursuant hereto) be adjusted
immediately after such event to a price (calculated to the nearest full
cent) determined by dividing (A) the number of shares of Common Stock
outstanding immediately prior to such event, multiplied by the then
existing Purchase Price, by (B) the total number of shares of Common Stock
outstanding immediately after such event (including the maximum number of
shares of Common Stock issuable in respect of any securities convertible
into Common Stock), and the resulting quotient shall be the adjusted
Purchase Price per share.
-4-
(b) No adjustment of the Purchase Price shall be made if the amount
of such adjustments shall be less than $.05 per share, but in such case any
adjustment that would otherwise be required then to be made shall be
carried forward and shall be made at the time and together with the next
subsequent adjustment which, together with any adjustment or adjustments so
carried forward, shall amount to not less than $.05 per share.
Section 3.2. Adjustment of Number of Shares Purchasable on Exercise of
Warrants. Upon each adjustment of the Purchase Price pursuant to Section 3.1
above, the registered holder of each Warrant shall thereafter (until another
such adjustment) be entitled to purchase at the adjusted Purchase Price the
number of shares, calculated to the nearest full share, obtained by multiplying
the number of shares specified in such Warrant (as adjusted as a result of all
adjustments in the Purchase Price in effect prior to such adjustment) by the
Purchase Price in effect prior to such adjustment and dividing the product so
obtained by the adjusted Purchase Price.
Section 3.3. Notice as to Adjustment. Upon any adjustment of the Purchase
Price and an increase or decrease in the number of shares of Common Stock
purchasable upon the exercise of the Warrants, then, and in each such case, the
Company shall within ten (10) days after the effective date of such adjustment
give written notice thereof, by first class mail, postage prepaid, addressed to
each registered Warrantholder at the address of such Warrantholder as shown on
the books of the Company, which notice shall state the adjusted Purchase Price
and the increased or decreased number of shares purchasable upon the exercise of
the Warrants, setting forth in reasonable detail the method of calculation and
the facts upon which such calculation is based.
Section 3.4. Effect of Reorganization, Reclassification, Merger, Etc. If
at any time while any Warrant is outstanding there should be any capital
reorganization or reclassification of the capital stock of the Company (other
than the issue of any shares of Common Stock in subdivision of outstanding
shares of Common Stock by reclassification or otherwise and other than a
combination of shares provided for in Section 3.1 hereof) or any consolidation
or merger of the Company with another corporation or any sale, conveyance, lease
or other transfer by the Company of all or substantially all of its property to
any other corporation, the holder of any Warrant shall, during the remainder of
the period such Warrant is exercisable, be entitled to receive, upon payment of
the Purchase Price, the number of shares of stock or other securities or
property of the Company, or of the successor corporation resulting from such
consolidation or merger, or of the corporation to which the property of the
Company has been sold, conveyed, leased or otherwise transferred, as the case
may be, to which the Common Stock (and any other securities and property) of the
Company, deliverable upon the exercise of such Warrant, would have been entitled
upon such capital reorganization, reclassification of capital stock,
consolidation, merger, sale, conveyance, lease or other transfer if such Warrant
had been exercised immediately prior to such capital reorganization,
reclassification of capital stock, consolidation, merger, sale, conveyance,
lease or other transfer; and, in any such case, appropriate adjustment (as
determined by the Board of Directors of the Company) shall be made in the
application of the provisions set forth in this Warrant Agreement with respect
to the rights and interests thereafter of the Warrantholders to the end that the
provisions set forth in this Warrant Agreement (including the adjustment of the
Purchase Price and the number of shares issuable upon the exercise of the
Warrants) shall thereafter be applicable, as near as may be reasonably
practicable, in relation to any shares or other property thereafter deliverable
upon the exercise of the Warrants as if the Warrants had been exercised
-5-
immediately prior to such capital reorganization, reclassification of capital
stock, consolidation, merger, sale, conveyance, lease or other transfer and the
Warrantholders had carried out the terms of the exchange as provided for by such
capital reorganization, reclassification, consolidation or merger. The Company
shall not effect any such capital reorganization, consolidation, merger or
transfer unless, upon or prior to the consummation thereof, the successor
corporation or the corporation to which the property of the Company has been
sold, conveyed, leased or otherwise transferred shall assume by written
instrument the obligation to deliver to the holder of each Warrant such shares
of stock, securities, cash or property as in accordance with the foregoing
provisions such holder shall be entitled to purchase.
Section 3.5. Prior Notice as to Certain Events. In case at any time:
(a) the Company shall pay any dividend upon its Common Stock payable
in stock or make any distribution (other than cash dividends) to the
holders of its Common Stock; or
(b) 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 rights; or
(c) there shall be any capital reorganization or reclassification of
the capital stock of the Company, or consolidation or merger of the Company
with, or sale, conveyance, lease or other transfer of all or substantially
all of its assets to, another corporation; or
(d) there shall be 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 prior written
notice, by first class mail, postage prepaid, addressed to each registered
Warrantholder at the address of such Warrantholder as shown on the books of the
Company, of the date on which (x) the books of the Company shall close or a
record shall be taken for such stock dividend, distribution or subscription
rights or (y) such reorganization, reclassification, consolidation, merger,
sale, dissolution, liquidation or winding up shall take place, 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 such dividend, distribution or
subscription rights or shall be entitled to exchange their Common Stock for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation, or
winding up, as the case may be. Such written notice shall be given at least
twenty (20) days prior to the action in question and not less than twenty (20)
days prior to the record date or the date on which the Company's transfer books
are closed in respect thereto.
Section 3.6. Certain Obligations of the Company. The Company will not, by
amendment of its articles of incorporation or through any reorganization,
transfer of assets, consolidation, merger, dissolution, issue or sale of
securities or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant Agreement or the Warrant
Certificate, but will at all times in good faith assist in the carrying out of
all such terms.
-6-
Without limiting the generality of the foregoing, the Company (a) will take all
such action as may be necessary or appropriate in order that the Company may
validly and legally issue fully paid and nonassessable shares of such stock upon
the exercise of all Warrants from time to time outstanding, and (b) will not (i)
transfer all or substantially all of its properties and assets to any other
person or entity, or (ii) consolidate with or merge into any other entity where
the Company is not the continuing or surviving entity, or (iii) permit any other
entity to consolidate with or merge into the Company where the Company is the
continuing or surviving entity but, in connection with such consolidation or
merger, the Common Stock then issuable upon the exercise of the Warrants shall
be changed into or exchanged for shares or other securities or property of any
other entity unless, in any such case, the other entity acquiring such
properties and assets, continuing or surviving after such consolidation or
merger or issuing or distributing such shares or other securities or property,
as the case may be, shall expressly assume in writing and be bound by all the
terms of this Warrant Agreement and the Warrant Certificates.
Section 3.7. Reservation and Listing of Common Stock. The Company will at
all times reserve and keep available, solely for issuance and delivery upon the
exercise of the Warrants, all shares of Common Stock from time to time issuable
upon such exercise. All such shares shall be authorized and, when issued upon
such exercise, shall be validly issued, fully paid and nonassessable with no
liability on the part of the holder thereof. The Company, at its expense, will
list on the NASDAQ system, including the National Market System, if applicable,
and on each national securities exchange on which any Common Stock may at any
time be listed, subject to official notice of issuance, and will maintain such
listing of, the shares of Common Stock from time to time issuable upon the
exercise of the Warrants.
Section 3.8. Registration or Exemption for Common Stock. The Company will
use its best efforts (a) at all times the Warrants are exercisable to maintain
an effective registration statement under the Securities Act of 1933, as amended
(the "Act"), covering Common Stock issuable upon exercise of the Warrants, (b)
from time to time to amend or supplement the prospectus contained in such
registration statement to the extent necessary in order to comply with
applicable law, (c) to qualify for exemption from the registration requirements
of the Act the Common Stock issuable upon exercise of the Warrants, and (d) to
maintain exemptions or qualifications, in those jurisdictions in which the
original registration statement relating to the Warrants was initially
qualified, to permit the exercise of the Warrants and the issuance of the Common
Stock pursuant to such exercise. The Warrant Agent shall have no responsibility
for the maintenance of such exemptions or qualifications or for liabilities
arising from the exercise or attempted exercise of Warrants in jurisdictions
where exemptions or qualifications have not been maintained or are otherwise
unavailable.
ARTICLE IV.
REDEMPTION OF WARRANTS
Section 4.1. Redemption Price. The Warrants may be redeemed at the option
of the Company in whole, at any time on or after ________, 1997, and on or
before __________, 2000, upon notice as set forth in Section 4.2, and at a
redemption price equal to $.01 per Warrant, provided that (a) the last reported
sale price of the Common Stock on a national securities
-7-
exchange, if the Common Stock shall be listed or admitted to unlisted trading
privileges on a national securities exchange, or (b) the closing bid price of
the Common Stock on the NASDAQ system, if the Common Stock is not so listed or
admitted to unlisted trading privileges, exceeds $14.50 per share (such price
subject to adjustment from time to time in the same manner as the Purchase Price
pursuant to the provisions of Article III hereof) for any 10 consecutive trading
days prior to the date such notice of redemption is given.
Section 4.2. Notice of Redemption. In the case of any redemption of
Warrants, the Company or, at its request, the Warrant Agent in the name of and
at the expense of the Company, shall give notice of such redemption to the
holders of the Warrants to be redeemed as hereinafter provided in this Section
4.2. Notice of redemption to the holders of Warrants shall be given by mailing
by first-class mail a notice of such redemption not less than 30 days prior to
the date fixed for redemption. Any notice which is given in the manner herein
provided shall be conclusively presumed to have been duly given, whether or not
the holder receives the notice. In any case, failure duly to give such notice,
or any defect in such notice, to the holder of any Warrant Certificate shall not
affect the validity of the proceedings for the redemption of Warrants
represented by any other Warrant Certificate. Each such notice shall specify the
date fixed for redemption, the place of redemption and the redemption price of
$.01 at which each Warrant is to be redeemed, and shall state that payment of
the redemption price of the Warrants will be made on surrender of the Warrants
at such place of redemption, and that if not exercised by the close of business
on the date fixed for redemption, the exercise rights of the Warrants identified
for redemption shall expire unless extended by the Company. Such notice shall
also state the current Purchase Price and the date on which the right to
exercise the Warrants will expire unless extend ed by the Company.
Section 4.3. Payment of Warrants on Redemption; Deposit of Redemption
Price. If notice of redemption shall have been given as provided in Section 4.2,
the redemption price of $.01 per Warrant shall, unless the Warrant is
theretofore exercised pursuant to the terms hereof, become due and payable on
the date and at the place stated in such notice. On and after such date of
redemption, provided that cash sufficient for the redemption thereof shall then
be deposited by the Company with the Warrant Agent for that purpose, the
exercise rights of the Warrants identified for redemption shall expire. On
presentation and surrender of Warrant Certificates at such place of payment
specified in such notice, the Warrants identified for redemption shall be paid
and redeemed at the redemption price of $.01 per Warrant. Prior to the date
fixed for redemption, the Company shall deposit with the Warrant Agent an amount
of money sufficient to pay the redemption price of all the Warrants identified
for redemption. Any monies which shall have been deposited with the Warrant
Agent for redemption of Warrants and which are not required for that purpose by
reason of exercise of Warrants shall be repaid to the Company upon delivery to
the Warrant Agent of evidence satisfactory to it of such exercise.
-8-
ARTICLE V.
CERTAIN OTHER PROVISIONS RELATING TO
RIGHTS OF HOLDERS OF WARRANT CERTIFICATES
Section 5.1. No Rights of Shareholders. The Warrant Certificates shall be
issued in registered form only. No Warrant Certificate shall entitle the holder
thereof to any of the rights of a holder of shares of Common Stock of the
Company, including, without limitation, the right to vote, to receive dividends
and other distributions, or to receive any notice of, or to attend, meetings of
holders of Common Stock or any other proceedings of the Company.
Section 5.2. Loss, Theft, Destruction or Mutilation of Warrant
Certificates. Upon receipt by the Warrant Agent of evidence reasonably
satisfactory to the Warrant Agent of the loss, theft, destruction or mutilation
of any Warrant Certificate, and (a) in the case of any such loss, theft, or
destruction, upon delivery to the Warrant Agent of an indemnity bond in form and
amount, and issued by a bonding company, reasonably satisfactory to the Company,
or (b) in the case of any such mutilation, upon surrender to and cancellation by
the Warrant Agent of such Warrant Certificate, the Company at its expense will
execute and cause the Warrant Agent to countersign and deliver, in lieu thereof,
a new Warrant Certificate of like tenor.
Section 5.3. Transfer Agent; Cancellation of Warrant Certificates;
Unexercised Warrants. Norwest Bank Minnesota, National Association (and any
successor), as transfer agent (the "Transfer Agent"), is hereby irrevocably
authorized and directed at all times to reserve such number of authorized and
unissued shares of Common Stock as shall be sufficient to permit the exercise in
full of all Warrants from time to time outstanding. The Company will keep a copy
of this Agreement on file with the Transfer Agent. The Warrant Agent, and any
successor thereto, is hereby irrevocably authorized to requisition from time to
time from the Transfer Agent certificates for shares of Common Stock required
for exercise of Warrants. The Company will supply the Transfer Agent with duly
executed certificates for shares of Common Stock for such purpose and will make
available any cash required in settlement of fractional share interests. All
Warrant Certificates surrendered upon the exercise or redemption of Warrants
shall be cancelled by the Warrant Agent and shall thereafter be delivered to the
Company; such cancelled Warrant Certificates, with the Purchase Form on the
reverse thereof duly filled in and signed, shall constitute conclusive evidence
as between the parties hereto of the numbers of shares of Common Stock which
shall have been issued upon exercises of Warrants. Promptly after the last day
on which the Warrants are exercisable (set forth in Section 2.1 above), the
Warrant Agent shall certify to the Company the aggregate number of Warrants then
outstanding and unexercised. No shares of Common Stock shall be subject to
reservation with respect to Warrants not exercised prior to the time and date
identified in Section 2.1 above as the last time and date at which Warrants may
be exercised.
ARTICLE VI.
TRANSFER AND EXCHANGE OF WARRANT CERTIFICATES
Section 6.1. Warrant Register; Transfer or Exchange of Warrant
Certificates. The Warrant Agent shall cause to be kept at the principal office
of the Warrant Agent a register (the
-9-
"Warrant Register") in which, subject to such reasonable regulations as the
Company may prescribe, provisions shall be made for the registration of
transfers and exchanges of Warrant Certificates. Upon surrender for transfer or
exchange of any Warrant Certificates, properly endorsed, to the Warrant Agent,
the Warrant Agent at the Company's expense will issue and deliver to or upon the
order of the holder thereof a new Warrant Certificate or Warrant Certificates of
like tenor, in the name of such holder or as such holder (upon payment by such
holder of any applicable transfer taxes) may direct, calling in the aggregate on
the face or faces thereof for the number of shares of Common Stock called for on
the face of the Warrant Certificate so surrendered. Any Warrant Certificate
surrendered for transfer or exchange shall be cancelled by the Warrant Agent and
shall thereafter be delivered to the Company.
Section 6.2. Identity of Warrantholders. Until a Warrant Certificate is
transferred in the Warrant Register, the Company and the Warrant Agent may treat
the person in whose name the Warrant Certificate is registered as the absolute
owner thereof and of the Warrants represented thereby for all purposes,
notwithstanding any notice to the contrary, except that, if and when any Warrant
Certificate is properly assigned in blank, the Company and the Warrant Agent may
(but shall not be obligated to) treat the bearer thereof as the absolute owner
of the Warrant Certificate and of the Warrants represented thereby for all
purposes, notwithstanding any notice to the contrary.
ARTICLE VII.
CONCERNING THE WARRANT AGENT
Section 7.1. Taxes. The Company will, from time to time, promptly pay to
the Warrant Agent, or make provision satisfactory to the Warrant Agent for the
payment of, all taxes and charges that may be imposed by the United States or
any State upon the Company or the Warrant Agent upon the transfer or delivery of
shares of Common Stock upon the exercise of Warrants, but the Company shall not
be obligated to pay any tax imposed in connection with any transfer involved in
the delivery of a certificate for shares of Common Stock in any name other than
that of the registered holder of the Warrant Certificate surrendered in
connection with the purchase thereof.
Section 7.2. Replacement of Warrant Agent in Certain Circumstances.
(a) The Warrant Agent may resign its duties and be discharged from
all further duties and liabilities hereunder after giving thirty (30) days
notice in writing to the Company, except that such shorter notice may be
given as the Company shall, in writing, accept as sufficient. The Company
may discharge the Warrant Agent at any time with or without reason,
effective upon thirty (30) days written notice to the Warrant Agent or such
shorter period as the Warrant Agent shall, in writing, accept as
sufficient. If the office of Warrant Agent becomes vacant by resignation,
discharge, incapacity to act or otherwise, the Company shall appoint in
writing a new Warrant Agent, the principal office of which shall be in
Minnesota. If the Company shall fail to make such appointment within a
period of thirty (30) days after it has been notified in writing of such
resignation or incapacity by the resigning or incapacitated Warrant Agent
or by the holder of a Warrant Certificate, then the holder of any Warrant
Certificate may apply to any court of competent jurisdiction for the
-10-
appointment of a new Warrant Agent. Any new Warrant Agent, whether
appointed by the Company or by such a court, shall be a corporation
organized and doing business under the laws of the United States or of the
State of Minnesota, of good standing, and having its principal office in
Minnesota, which is authorized under such laws to exercise corporate trust
powers and is subject to supervision or examination by Federal or State
authority. Any new Warrant Agent appointed hereunder shall execute,
acknowledge and deliver to the Company an instrument accepting such
appointment hereunder and thereupon such new Warrant Agent without any
further act or deed shall become vested with all the rights, powers, duties
and responsibilities of the Warrant Agent hereunder with like effect as if
it had been named as the Warrant Agent; but if for any reason it becomes
necessary or expedient to have the former Warrant Agent execute and deliver
any further assurance, conveyance, act or deed, the same shall be done and
shall be legally and validly executed and delivered by the former Warrant
Agent. Not later than the effective date of any such appointment the
Company shall file notice thereof with the former Warrant Agent. The
Company shall promptly give notice of any such appointment to the holders
of the Warrant Certificates by mail to their addresses as shown in the
Warrant Register. Failure to file or give such notice, or any defect
therein, shall not affect the legality or validity of the appointment of
the successor Warrant Agent.
(b) Any company into which the Warrant Agent or any new Warrant Agent
may be merged or converted or with which it may be consolidated or any
company resulting from any merger, conversion or consolidation to which the
Warrant Agent or any new Warrant Agent shall be a party shall be the
successor Warrant Agent under this Warrant Agreement without any further
act; provided that if such company would not be eligible for appointment as
a successor Warrant Agent under the provisions of paragraph (a) of this
Section 7.2 the Company shall forthwith appoint a new Warrant Agent in
accordance with such provisions. Any such successor Warrant Agent may adopt
the prior countersignature of any predecessor Warrant Agent and deliver
Warrant Certificates countersigned and not delivered by such predecessor
Warrant Agent or may countersign Warrant Certificates either in the name of
any predecessor Warrant Agent or the name of the successor Warrant Agent.
Section 7.3. Remuneration of Warrant Agent. The Company will pay the
Warrant Agent reasonable remuneration for its services as Warrant Agent
hereunder and will reimburse the Warrant Agent upon demand for all expenditures
that the Warrant Agent may reasonably incur in the execution of its duties
hereunder.
Section 7.4. Further Assurances. The Company will perform, exercise,
acknowledge and deliver or cause to be performed, executed, acknowledged and
delivered all such further and other acts, instruments and assurances as may
reasonably be required by the Warrant Agent for the carrying out or performing
by the Warrant Agent of the provisions of this Warrant Agreement.
Section 7.5. Limitations on Liabilities of the Warrant Agent.
(a) The Warrant Agent may consult with legal counsel (who may be
legal counsel for the Company), and the opinion of such counsel shall be
full and complete
-11-
authorization and protection of the Warrant Agent as to any action taken or
omitted by it in good faith and in accordance with such opinion.
(b) Whenever, in the performance of its duties under this Warrant
Agreement, the Warrant Agent shall deem it necessary or desirable that any
matter be proved or established, or that any instructions with respect to
the performance of its duties hereunder be given, by the Company prior to
taking or suffering any action hereunder, such matter (unless other
evidence in respect thereof be herein specifically prescribed) may be
deemed to be conclusively proved and established, or such instructions may
be given, by a certificate or instrument signed by an officer of the
Company and delivered to the Warrant Agent; and such certificate or
instrument shall be full authorization to the Warrant Agent for any action
taken or suffered in good faith by it under the provisions of this Warrant
Agreement in reliance upon such certificate or instrument; but in its
discretion the Warrant Agent may in lieu thereof accept other evidence of
such matter or may require such further or additional evidence as it may
deem reasonable.
(c) The Warrant Agent shall be liable hereunder only for its own
negligence or willful misconduct. The Warrant Agent shall act hereunder
solely as agent, and its duties shall be determined solely by the
provisions hereof. The Company agrees to indemnify the Warrant Agent and
save it harmless against any and all liabilities, including judgments,
costs and counsel fees, for anything done or omitted by the Warrant Agent
in the execution of this Warrant Agreement except as a result of the
Warrant Agent's negligence or willful misconduct.
(d) The Warrant Agent shall not be liable for or by reason of any of
the statements of fact or recitals contained in this Warrant Agreement or
in the Warrant Certificates (except its countersignature thereof) or be
required to verify the same, but all such statements and recitals are and
shall be deemed to have been made by the Company only.
(e) The Warrant Agent shall not be under any responsibility in
respect to the validity or execution of any Warrant Certificate (except its
countersignature thereof); nor shall it be responsible for any breach by
the Company of any covenant or condition contained in this Warrant
Agreement or in any Warrant Certificate; nor shall it be responsible for
the making of any adjustment in the Purchase Price, or number of shares
issuable upon exercise of the Warrant Certificates or responsible for the
manner, method or amount of any such adjustment or the facts that would
require any such adjustment; nor shall it by any act hereunder be deemed to
make any representation or warranty as to the authorization or reservation
of any shares of Common Stock to be issued pursuant to this Warrant
Agreement or any Warrant Certificate or as to whether any shares of Common
Stock or other securities are or will be validly authorized and issued and
fully paid and nonassessable.
Section 7.6. Amendment and Modification. The Warrant Agent may, without
the consent or concurrence of the holders of the Warrant Certificates, by
supplemental agreement or otherwise, join with the Company in making any changes
or corrections in this Warrant Agreement
-12-
that they shall have been advised by counsel (a) are required to cure any
ambiguity or to correct any defective or inconsistent provision or clerical
omission or mistake or manifest error herein contained, (b) add to the
obligations of the Company in this Warrant Agreement further obligations
thereafter to be observed by it, or surrender any right or power reserved to or
conferred upon the Company in this Warrant Agreement, or (c) do not or will not
adversely affect, alter or change the rights, privileges or immunities of the
holders of Warrant Certificates not provided for under this Warrant Agreement;
provided, however, that any term of this Warrant Agreement or any Warrant
Certificate may be changed, waived, discharged or terminated by an instrument in
writing signed by each party against which enforcement of such change, waiver,
discharge or termination is sought, or by which the same is to be performed or
observed.
ARTICLE VIII.
OTHER MATTERS
Section 8.1. Successors and Assigns. All the covenants and provisions of
this Warrant Agreement by or for the benefit of the Company or the Warrant Agent
shall bind and inure to the benefit of their respective successors and assigns.
Section 8.2. Notices. Any notice or demand authorized by this Warrant
Agreement to be given or made by the Warrant Agent or by the holder of any
Warrant Certificate to or on the Company shall be sufficiently given or made if
sent by first class or registered mail, postage prepaid, addressed (until
another address is filed in writing by the Company with the Warrant Agent) as
follows:
Wilsons The Leather Experts Inc.
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxx Xxxx, Xxxxxxxxx 00000
Attention: Chief Financial Officer
Any notice or demand authorized by this Warrant Agreement to be given or made by
the holder of any Warrant Certificate or by the Company to or on the Warrant
Agent shall be sufficiently given or made if sent by first class or registered
mail, postage prepaid, addressed (until another address is filed in writing by
the Warrant Agent with the Company) as follows:
Norwest Bank Minnesota, National Association
Stock Transfer
161 North Concord Exchange
X.X. Xxx 000
Xxxxx Xxxxx Xxxx, Xxxxxxxxx 00000-0000
Sections 8.3. Governing Law. This Warrant Agreement and the Warrant
Certificates are being delivered in the State of Minnesota and shall be
construed and enforced in accordance with and governed by the laws of such
State.
-13-
Section 8.4. No Benefits Conferred. Nothing in this Warrant Agreement
expressed and nothing that may be implied from any of the provisions hereof is
intended, or shall be construed, to confer upon, or give to, any person or
corporation other than the Company, the Warrant Agent, and the holders of the
Warrant Certificates, any right, remedy or claim under or by reason of this
Agreement or of any covenant, condition, stipulation, promise or agreement
herein; and all covenants, conditions, stipulations, promises and agreements in
this Warrant Agreement contained shall be for the sole and exclusive benefit of
the Company, the Warrant Agent, their respective successors and the holders of
the Warrant Certificates.
Section 8.5. Headings. The descriptive headings used in this Warrant
Agreement are inserted for convenience only and shall not control or affect the
meaning or construction of any of the provisions hereof.
IN WITNESS WHEREOF, this Warrant Agreement has been duly executed by the
parties hereto as of the day and year first above written.
WILSONS THE LEATHER EXPERTS INC.
By___________________________________
Its__________________________________
NORWEST BANK MINNESOTA,
NATIONAL ASSOCIATION
By___________________________________
Its__________________________________
-14-
EXHIBIT A
---------
THIS WARRANT CERTIFICATE MAY BE
TRANSFERRED SEPARATELY FROM THE COMMON STOCK CERTIFICATE
WITH WHICH IT IS INITIALLY ISSUED
EXERCISABLE ON OR BEFORE, AND VOID AFTER
5:00 P.M. MINNEAPOLIS TIME, _____________, 2000
No. W - ________ Certificate for ________ Warrants
----------------------------------
UNIT CUSIP
WARRANT CUSIP
----------------------------------
WARRANTS TO PURCHASE COMMON STOCK OF
WILSONS THE LEATHER EXPERTS INC.
INCORPORATED UNDER THE LAWS OF THE STATE OF MINNESOTA
THIS CERTIFIES that ___________________________________________ or assigns,
is the owner of the number of Warrants set forth above, each of which represents
the right to purchase from Wilsons The Leather Experts Inc., a Minnesota
corporation (the "Company"), at any time on or before 5:00 p.m., Minneapolis
time, ___________, 2000, upon compliance with and subject to the conditions set
forth herein and in the Warrant Agreement hereinafter referred to, one share
(subject to adjustments referred to below) of the Common Stock of the Company
(such shares or other securities or property purchasable upon exercise of the
Warrants being herein called the "Shares"), by surrendering this Warrant
Certificate, with the Purchase Form on the reverse side duly executed, at the
principal office of Norwest Bank Minnesota, National Association, or its
successor, as warrant agent (the "Warrant Agent"), and by paying in full, in
cash or by certified or official bank check payable to the order of the Company,
the purchase price of $13.50 per share.
Upon any exercise of less than all the Warrants evidenced by this Warrant
Certificate, there shall be issued to the holder a new Warrant Certificate in
respect of the Warrants as to which this Warrant Certificate was not exercised.
Upon the surrender for transfer or exchange hereof, properly endorsed, to
the Warrant Agent, the Warrant Agent at the Company's expense will issue and
deliver to the order of the holder hereof, a new Warrant Certificate or Warrant
Certificates of like tenor, in the name of such holder or as such holder (upon
payment by such holder of any applicable transfer taxes) may
A-1
direct, calling in the aggregate on the face or faces thereof for the number of
shares of Common Stock called for on the face hereof.
The Warrant Certificates are issued only as registered Warrant
Certificates. Until this Warrant Certificate is transferred in the Warrant
Register, the Company and the Warrant Agent may treat the person in whose name
this Warrant Certificate is registered as the absolute owner hereof and of the
Warrants represented hereby for all purposes, notwithstanding any notice to the
contrary.
This Warrant Certificate is issued under the Warrant Agreement dated as of
__________, 1997, between the Company and the Warrant Agent and is subject to
the terms and provisions contained in said Warrant Agreement, to all of which
terms and provisions the registered holder of this Warrant Certificate consents
by acceptance hereof. Copies of said Warrant Agreement are on file at the
principal office of the Warrant Agent in Minneapolis, Minnesota, and may be
obtained by writing to the Warrant Agent.
The number of Shares receivable upon the exercise of the Warrants
represented by this Warrant Certificate and the purchase price per share are
subject to adjustment upon the happening of certain events specified in the
Warrant Agreement (which provisions are contained in Article III of the Warrant
Agreement and are hereby incorporated by reference).
No fractional Shares of the Company's Common Stock will be issued upon the
exercise of Warrants. As to any final fraction of a share which a holder of
Warrants exercised in the same transaction would otherwise be entitled to
purchase on such exercise, the Company shall pay a cash adjustment in lieu of
any fractional Share determined as provided in the Warrant Agreement.
The Warrants may be redeemed by the Company, in whole, at any time on or
after __________, 1997, and on or before __________, 2000, at a redemption price
of $.01 per Warrant, upon notice of such redemption as set forth below, provided
that (a) the last reported sale price of the Common Stock on a national
securities exchange, if the Common Stock shall be listed or admitted to unlisted
trading privileges on a national securities exchange, or (b) the closing bid
price of the Common Stock on the NASDAQ system, if the Common Stock is not so
listed or admitted to unlisted trading privileges, exceeds $14.50 per share
(subject to adjustment as provided in the Warrant Agreement) for any 10
consecutive trading days prior to the date such notice of redemption is given.
Notice of redemption shall be mailed not less than thirty (30) days prior to the
date fixed for redemption to the holders of Warrants at their last registered
addresses. If notice of redemption shall have been given as provided in the
Warrant Agreement and cash sufficient for the redemption be deposited by the
Company for that purpose, the exercise rights of the Warrants identified for
redemption shall expire at the close of business on such date of redemption
unless extended by the Company.
This Warrant Certificate shall not entitle the holder hereof to any of the
rights of a holder of Common Stock of the Company, including, without
limitation, the right to vote, to receive dividends and other distributions, to
exercise any preemptive right, or to receive any notice of, or to attend
meetings of holders of Common Stock or any other proceedings of the Company.
A-2
This Warrant Certificate shall be void and the Warrants and any rights
represented hereby shall cease unless exercised on or before 5:00 P.M.
Minneapolis time on __________, 2000, unless extended by the Company.
This Warrant Certificate shall not be valid for any purpose until it shall
have been countersigned by the Warrant Agent.
WITNESS the facsimile signatures of the Company's duly authorized officers.
Dated: WILSONS THE LEATHER EXPERTS INC.
By______________________________
Its_____________________________
Attest:
______________________________
Secretary
COUNTERSIGNED AND REGISTERED:
NORWEST BANK MINNESOTA, NATIONAL
ASSOCIATION, as Warrant Agent
By_____________________________
Authorized Signature
A-3
[REVERSE OF WARRANT CERTIFICATE]
THE ARTICLES OF INCORPORATION OF THE CORPORATION GRANT TO THE BOARD OF DIRECTORS
THE POWER TO ESTABLISH MORE THAN ONE CLASS OR SERIES OF SHARES AND TO FIX THE
RELATIVE RIGHTS AND PREFERENCES OF ANY SUCH DIFFERENT CLASS OR SERIES. THE
CORPORATION WILL FURNISH TO ANY SHAREHOLDER UPON REQUEST AND WITHOUT CHARGE A
FULL STATEMENT OF THE DESIGNATIONS, PREFERENCES, LIMITATIONS AND RELATIVE RIGHTS
OF THE SHARES OF EACH CLASS OR SERIES AUTHORIZED TO BE ISSUED, SO FAR AS THEY
HAVE BEEN DETERMINED, AND THE AUTHORITY OF THE BOARD TO DETERMINE THE RELATIVE
RIGHTS AND PREFERENCES OF SUBSEQUENT CLASSES OR SERIES.
TO: Wilsons The Leather Experts Inc.
c/o Norwest Bank Minnesota, National Association
Warrant Agent
PURCHASE FORM
(To be Executed by the Registered Holder in Order to Exercise Warrant
Certificates)
The undersigned hereby irrevocably elects to exercise _____________* of the
Warrants represented by the Warrant Certificate and to purchase for cash the
Shares issuable upon the exercise of said Warrants, and herewith makes payment
of $__________ therefor, and requests that certificates for such Shares shall be
issued in the name of
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER OF
REGISTERED HOLDER OF CERTIFICATE
---------------------------
---------------------------
------------------------------------
(Print Name)
------------------------------------
(Address)
------------------------------------
Dated: Signature(s)
------------------------
------------------------
-------------------
* Insert here the number of Warrants evidenced on the face of this Warrant
Certificate (or, in the case of a partial exercise, the portion thereof being
exercised), in either case without making any adjustment for additional Common
Stock or any other securities or property or cash which, pursuant to the
adjustment provisions referred to in this Warrant Certificate, may be
deliverable upon exercise.
A-4
ASSIGNMENT FORM
(To be Executed by the Registered Holder in Order to Transfer Warrant
Certificates)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
____________________** of the Warrants represented by this Warrant Certificate
unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER IDENTIFYING NUMBER OF ASSIGNEE
-----------------------------
-----------------------------
-------------------------------------
(Print name)
-------------------------------------
(Address)
-------------------------------------
and does hereby irrevocably constitute and appoint _________________________
Attorney to transfer this Warrant Certificate on the records of the Company with
full power of substitution in the premises.
Dated:_______________________ Signature(s)_________________________
_________________________
Signature(s)
Guaranteed:____________________________________
--------------------
** Insert here the number of Warrants evidenced on the face of this Warrant
Certificate (or, in the case of a partial assignment, the portion thereof being
assigned), in either case without making any adjustment for additional Common
Stock or any other securities or property or cash which, pursuant to the
adjustment provisions referred to in this Warrant Certificate, may be
deliverable upon exercise.
NOTICE
The Signature(s) to the Purchase Form or the Assignment Form must
correspond to the name(s) as written upon the face of this Warrant Certificate
in every particular without alteration or enlargement or any change whatsoever.
A-5
