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EXHIBIT 4.3
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CLUB XXXXXX RESORTS, INC.
WARRANT AGREEMENT
Dated as of December 5, 1997
IBJ XXXXXXXX BANK & TRUST COMPANY,
Warrant Agent
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WARRANT AGREEMENT ("Agreement"), dated as of December 5, 1997, by and
between CLUB XXXXXX RESORTS, INC., a Nevada corporation (together with any
successor thereto, the "Company"), and IBJ Xxxxxxxx Bank & Trust Company, as
warrant agent (with any successor Warrant Agent, the "Warrant Agent").
WHEREAS, the Company has entered into a purchase agreement (the
"Purchase Agreement") dated November 26, 1997 with Xxxxxxxxx & Company, Inc.
(the "Initial Purchaser") in which the Company has agreed to sell to the
Initial Purchaser 100,000 units (the "Units") consisting in the aggregate of
(i) $100,000,000 in aggregate principal amount of 13% Senior Notes due 2004
(the "Notes") of the Company and CR Resorts S. de X. X. de C. V. to be issued
under an indenture, dated as of the date hereof (the "Indenture"), by and
between the Company and IBJ Xxxxxxxx Bank & Trust Company, as trustee (in such
capacity, the "Trustee"), and (ii) 100,000 Warrants (the "Warrants"), each
representing the right to purchase initially 18.69962 shares of Common Stock,
par value $.001 per share, of the Company (the "Common Stock");
WHEREAS, the Company desires the Warrant Agent to assist the Company
in connection with the issuance, exchange, cancellation, replacement and
exercise of the Warrants, and in this Agreement wishes to set forth, among
other things, the terms and conditions on which the Warrants may be issued,
exchanged, canceled, replaced and exercised;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
SECTION 1. Appointment of Warrant Agent. The Company hereby appoints
the Warrant Agent to act as agent for the Company in accordance with the
instructions set forth hereinafter in this Agreement, and the Warrant Agent
hereby accepts such appointment.
SECTION 2. Warrant Certificates. The certificates evidencing the
Warrants (the "Warrant Certificates") shall be in registered form only and
shall be substantially in the form set forth in Exhibit A attached hereto and
shall, prior to the Separation Date (as defined herein), bear the legend set
forth in Exhibit B attached hereto.
Certain of the Warrants initially will be issued in global form (the
"Global Warrants"), substantially in the form of Exhibit A attached hereto
(including the text referred to in footnotes 1 and 2 thereto).
The Global Warrant shall represent such of the outstanding Warrants as
shall be specified therein and shall provide that it shall represent the
aggregate amount of outstanding Warrants from time to time endorsed thereon and
that the aggregate amount of outstanding Warrants represented thereby may from
time to time be reduced or increased, as appropriate, to reflect exchanges and
exercises. Any endorsement of the Global Warrant to reflect the amount of any
increase or decrease in the amount of outstanding Warrants represented thereby
shall be made by the Warrant Agent or the depositary with respect to the Global
Warrants (the "Depositary") in accordance with instructions given by the holder
thereof. The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Warrants in global form.
Each Global Warrant shall bear the following legend on the face
thereof:
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"Unless and until it is exchanged in whole or in part for
Warrants in definitive form, this Warrant may not be
transferred except as a whole by the Depositary to a nominee
of the Depositary or by a nominee of the Depositary to the
Depositary or another nominee of the Depositary or by the
Depositary or any such nominee to a successor Depositary or a
nominee of such successor Depositary. The Depository Trust
Company shall act as the Depositary until a successor shall be
appointed by the Company. Unless this certificate is presented
by an authorized representative of The Depository Trust
Company (55 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx) ("XXX"), to the
Company or its agent for registration of transfer, exchange or
payment, and any certificate issued is registered in the name
of Cede & Co. or such other name as may be requested by an
authorized representative of DTC (and any payment is made to
Cede & Co. or such other entity as may be requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co.,
has an interest herein."
Beneficial owners of interests in a Global Warrant may receive
Warrants in definitive form (the "Definitive Warrants"), substantially in the
form of Exhibit A attached hereto (but without the text referred to in
footnotes 1 and 2 thereto) in the name of such beneficial owners in accordance
with the procedures of the Warrant Agent and the Depositary. In connection with
the execution and delivery of such Definitive Warrants, the Warrant Agent shall
reflect on its books and records a decrease in the principal amount of the
relevant Global Warrant equal to the amount of such Definitive Warrants and the
Company shall execute and the Warrant Agent shall countersign and deliver one
or more Definitive Warrants in an equal aggregate amount.
SECTION 3. Execution of Warrant Certificates. (a) Warrant
Certificates shall be signed on behalf of the Company by its Chairman of the
Board, Chief Executive Officer, its President or a Vice President and by its
Secretary or an Assistant Secretary. Each such signature upon the Warrant
Certificates may be in the form of a facsimile signature of the present or any
future Chairman of the Board, Chief Executive Officer, President, Vice
President, Secretary or Assistant Secretary and may be imprinted or otherwise
reproduced on the Warrant Certificates and for that purpose the Company may
adopt and use the facsimile signature of any person who shall have been
Chairman of the Board, Chief Executive Officer, President, Vice President,
Secretary or Assistant Secretary, notwithstanding the fact that at the time the
Warrant Certificates shall be countersigned and delivered or disposed of he
shall have ceased to hold such office. The seal of the Company may be in the
form of a facsimile thereof and may be impressed, affixed, imprinted or
otherwise reproduced on the Warrant Certificates.
(b) In case any officer of the Company who shall have
signed any of the Warrant Certificates shall cease to be such officer before
the Warrant Certificates so signed shall have been countersigned by the Warrant
Agent, or disposed of by the Company, such Warrant Certificates nevertheless
may be countersigned and delivered or disposed of as though such person had not
ceased to be such officer of the Company; and any Warrant Certificate may be
signed on behalf of the Company by any person who, at the actual date of the
execution of such Warrant Certificate, shall be a proper officer of the Company
to sign such Warrant Certificate, although at the date of the execution of this
Warrant Agreement any such person was not such officer.
(c) Warrant Certificates shall be dated the date of
countersignature by the Warrant Agent.
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SECTION 4. Registration and Countersignature. (a) The Warrant Agent,
on behalf of the Company, shall number and register the Warrant Certificates in
a register as they are issued by the Company.
(b) Warrant Certificates shall be manually countersigned
by the Warrant Agent and shall not be valid for any purpose unless so
countersigned. The Warrant Agent shall, upon written instructions of the
Chairman of the Board, the Chief Executive Officer, the President, a Vice
President, the Treasurer or the Controller of the Company, initially
countersign, issue and deliver Warrant Certificates entitling the holders
thereof to purchase not more than the number of Warrant Shares referred to
above in the first recital hereof and shall countersign and deliver Warrant
Certificates as otherwise provided in this Agreement.
(c) The Company and the Warrant Agent may deem and treat
the registered holder(s) of the Warrant Certificates as the absolute owner(s)
thereof (notwithstanding any notation of ownership or other writing thereon
made by anyone) for all purposes, and neither the Company nor the Warrant Agent
shall be affected by any notice to the contrary.
SECTION 5. Registration of Transfers and Exchanges. (a) Transfer
and Exchange of Global Warrants. A Global Warrant may not be transferred as a
whole except by the Depositary to a nominee of the Depositary, by a nominee of
the Depositary to the Depositary or to another nominee of the Depositary, by
the Depositary or any such nominee to a successor Depositary or a nominee of
such successor Depositary. All Global Warrants will be exchanged by the Company
for Definitive Warrants if (i) the Company delivers to the Warrant Agent notice
from the Depositary that it is unwilling or unable to continue to act as
Depositary or that it is no longer a clearing agency registered under the
Securities Exchange Act of 1934, as amended, and, in either case, a successor
Depositary is not appointed by the Company within 120 days after the date of
such notice from the Depositary or (ii) the Company in its sole discretion
determines that the Global Warrants (in whole but not in part) should be
exchanged for Definitive Warrants and delivers a written notice to such effect
to the Warrant Agent. Upon the occurrence of either of the preceding events in
(i) or (ii) above, Definitive Warrants shall be issued in such names as the
Depositary shall instruct the Warrant Agent. Global Warrants also may be
exchanged or replaced, in whole or in part. Every Warrant authenticated and
delivered in exchange for, or in lieu of, a Global Warrant or any portion
thereof, pursuant to this Section 5, shall be authenticated and delivered in
the form of, and shall be, a Global Warrant. A Global Warrant may not be
exchanged for another Warrant other than as provided in this Section 5(a);
however, beneficial interests in a Global Warrant may be transferred and
exchanged as provided in Section 5(b) or (c) hereof.
(b) Transfer and Exchange of Beneficial Interests in the
Global Warrants. The transfer and exchange of beneficial interests in the
Global Warrants shall be effected through the Depositary, in accordance with
the provisions of this Warrant Agreement and the rules and procedures of the
Depositary that apply to such transfer or exchange (the "Applicable
Procedures"). Beneficial interests in a Global Warrant bearing the Private
Placement Legend (as defined herein) (a "Restricted Global Warrant") shall be
subject to restrictions on transfer comparable to those set forth herein to the
extent required by the Securities Act. Transfers of beneficial interests in the
Global Warrants also shall require compliance with either subparagraph (i) or
(ii) below, as applicable, as well as one or more of the other following
subparagraphs, as applicable:
(i) Transfer of Beneficial Interests in the Same Global
Warrant. Beneficial interests in any Restricted
Global Warrant may be transferred to persons who take
delivery thereof in the form of a beneficial interest
in the same Restricted
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Global Warrant in accordance with the transfer
restrictions set forth in the legend set forth in
Section 5(f) hereof (the "Private Placement Legend").
Beneficial interests in any Unrestricted Global
Warrant (defined for purposes hereof as any Global
Warrant in the form of Exhibit A hereto that bears
the legend set forth in Section 2 hereof and that has
the "Schedule of Exchanges of Global Warrants"
attached thereto, and that is deposited with or on
behalf of the Depositary, representing Warrants that
do not bear the Private Placement Legend) may be
transferred to persons who take delivery thereof in
the form of a beneficial interest in an Unrestricted
Global Warrant. No written orders or instructions
shall be required to be delivered to the Warrant
Agent to effect the transfers described in this
Section 5(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Warrant. In connection with all
transfers and exchanges of beneficial interests that
are not subject to Section 5(b)(i) above, the
transferor of such beneficial interest must deliver
to the Warrant Agent either (A)(1) a written order
from a person who has an account with the Depositary
(a "Participant") or with a person who has an account
with a Participant (an "Indirect Participant") given
to the Depositary in accordance with the Applicable
Procedures directing the Depositary to credit or
cause to be credited a beneficial interest in another
Global Warrant in an amount equal to the beneficial
interest to be transferred or exchanged and (2)
instructions given in accordance with the Applicable
Procedures containing information regarding the
Participant account to be credited with such increase
or (B)(1) a written order from a Participant or an
Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing
the Depositary to cause to be issued a Definitive
Warrant in an amount equal to the beneficial interest
to be transferred or exchanged and (2) instructions
given by the Depositary to the Warrant Agent
containing information regarding the person in whose
name such Definitive Warrant shall be registered to
effect the transfer or exchange referred to in (1)
above. Upon satisfaction of all of the requirements
for transfer or exchange of beneficial interests in
Global Warrants contained in this Warrant Agreement
or otherwise applicable under the Securities Act, the
Warrant Agent shall adjust the amount of the relevant
Global Warrant(s) pursuant to Section 5(g) hereof.
(iii) Transfer of Beneficial Interests to Another
Restricted Global Warrant. A beneficial interest in
any Restricted Global Warrant may be transferred to a
person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global
Warrant if the transfer complies with the
requirements of Section 5(b)(ii) above and the
Warrant Agent receives the following:
(A) if the transferee will take delivery in the
form of a beneficial interest in the 144A
Global Warrant (defined for purposes hereof
as any Global Warrant in the form of Exhibit
A hereto that bears the Private Placement
Legend and the legend set forth in Section 2
hereof and that is deposited with or on
behalf of, and registered in the name of, the
Depositary or its nominee that will be issued
in an amount equal to the amount of Warrants
sold in reliance on Rule 144A under the
Securities Act), then
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the transferor must deliver a certificate in
the form of Exhibit C hereto, including the
certifications in item (1) thereof;
(B) if the transferee will take delivery in the
form of a beneficial interest in the IAI
Global Warrant (defined for purposes hereof
as any Global Warrant in the form of Exhibit
A hereto that bears the Private Placement
Legend and the legend set forth in Section 2
hereof and that is deposited with or on
behalf of, and registered in the name of, the
Depositary or its nominee that will be issued
in an amount equal to the amount of Warrants
sold to institutional "accredited investors"
(as defined in Rule 501(a)(1), (2), (3) or
(7) of Regulation D under the Securities Act)
("Institutional Accredited Investors")), then
the transferor must deliver a certificate in
the form of Exhibit C hereto, including the
certifications and certificates and Opinion
of Counsel required by item (2) thereof, if
applicable.
(iv) Transfer and Exchange of Beneficial Interests in a
Restricted Global Warrant for Beneficial Interests in
the Unrestricted Global Warrant. A beneficial
interest in any Restricted Global Warrant may be
exchanged by any holder thereof for a beneficial
interest in an Unrestricted Global Warrant or
transferred to a person who takes delivery thereof in
the form of a beneficial interest in an Unrestricted
Global Warrant if the exchange or transfer complies
with the requirements of Section 5(b)(ii) above and:
(A) such transfer is effected pursuant to a
Registration Statement in accordance with the
Warrant Shares Registration Rights Agreement;
or
(B) the Warrant Agent receives the following:
(1) if the holder of such beneficial
interest in a Restricted Global
Warrant proposes to exchange such
beneficial interest for a beneficial
interest in an Unrestricted Global
Warrant, a certificate from such
holder in the form of Exhibit D
hereto, including the certifications
in item (l)(a) thereof; or
(2) if the holder of such beneficial
interest in a Restricted Global
Warrant proposes to transfer such
beneficial interest to a person who
shall take delivery thereof in the
form of a beneficial interest in an
Unrestricted Global Warrant, a
certificate from such holder in the
form of Exhibit C hereto, including
the certifications in item (3)
thereof;
and, in each such case set forth in this subparagraph (B),
if the Warrant Agent so requests or if the Applicable
Procedures so require, an opinion of counsel from legal
counsel reasonably acceptable to the Warrant Agent and the
Company (an "Opinion of Counsel") to the effect that such
exchange or transfer is in compliance with the Securities
Act and that the restrictions on transfer contained herein
and in the Private Placement Legend are no longer required
in order to maintain compliance with the Securities Act.
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If any such transfer is effected pursuant to subparagraph
(B) above at a time when an Unrestricted Global Warrant
has not yet been issued, the Company shall issue and the
Warrant Agent shall countersign one or more Unrestricted
Global Warrants in an aggregate amount equal to the
aggregate amount of beneficial interests transferred
pursuant to subparagraph (B) above.
Beneficial interests in an Unrestricted Global Warrant
cannot be exchanged for, or transferred to persons who
take delivery thereof in the form of, a beneficial
interest in a Restricted Global Warrant.
(c) Transfer or Exchange of Beneficial Interests for
Definitive Warrants.
(i) Beneficial Interests in Restricted Global Warrants to
Restricted Definitive Warrants. If any holder of a
beneficial interest in a Restricted Global Warrant
proposes to exchange such beneficial interest for a
Restricted Definitive Warrant or to transfer such
beneficial interest to a person who takes delivery
thereof in the form of a Restricted Definitive
Warrant, then, upon receipt by the Registrar of the
following documentation:
(A) if the holder of such beneficial interest in
a Restricted Global Warrant proposes to
exchange such beneficial interest for a
Restricted Definitive Warrant, a certificate
from such holder in the form of Exhibit D
hereto, including the certifications in item
(2)(a) thereof;
(B) if such beneficial interest is being
transferred to a "qualified institutional
buyer" as defined in Rule 144A under the
Securities Act (a "QIB") in accordance with
Rule 144A under the Securities Act, a
certificate to the effect set forth in
Exhibit C hereto, including the
certifications in item (1) thereof;
(C) if such beneficial interest is being
transferred pursuant to an exemption from the
registration requirements of the Securities
Act in accordance with Rule 144 under the
Securities Act, a certificate to the effect
set forth in Exhibit C hereto, including the
certifications in item (2)(a) thereof;
(D) if such beneficial interest is being
transferred to an Institutional Accredited
Investor in reliance on an exemption from the
registration requirements of the Securities
Act other than those listed in subparagraphs
(B) and (C) above, a certificate to the
effect set forth in Exhibit C hereto,
including the certifications, certificates
and Opinion of Counsel required by item (2)
thereof, if applicable;
(E) if such beneficial interest is being
transferred to the Company or any of its
subsidiaries, a certificate to the effect set
forth in Exhibit C hereto, including the
certifications in item (2)(b) thereof; or
(F) if such beneficial interest is being
transferred pursuant to an effective
registration statement under the Securities
Act, a certificate to the effect
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set forth in Exhibit C hereto, including the
certifications in item (2)(c) thereof,
the Warrant Agent shall cause the aggregate amount of
the applicable Global Warrant to be reduced
accordingly pursuant to Section 5(g) hereof, and the
Company shall execute and the Warrant Agent shall
authenticate and deliver to the person designated in
the instructions a Definitive Warrant in the
appropriate amount. Any Definitive Warrant issued in
exchange for a beneficial interest in a Restricted
Global Warrant pursuant to this Section 5(c) shall be
registered in such name or names and in such
authorized denomination or denominations as the
holder of such beneficial interest shall instruct the
Warrant Agent through instructions from the
Depositary and the Participant or Indirect
Participant. The Warrant Agent shall deliver such
Definitive Warrants to the persons in whose names
such Warrants are so registered. Any Definitive
Warrant issued in exchange for a beneficial interest
in a Restricted Global Warrant pursuant to this
Section 5(c)(i) shall bear the Private Placement
Legend and shall be subject to all restrictions on
transfer contained therein.
(ii) Beneficial Interests in Restricted Global Warrants to
Unrestricted Definitive Warrants. A holder of a
beneficial interest in a Restricted Global Warrant
may exchange such beneficial interest for an
Unrestricted Definitive Warrant or may transfer such
beneficial interest to a person who takes delivery
thereof in the form of an Unrestricted Definitive
Warrant only if:
(A) such transfer is effected pursuant to a
Registration Statement in accordance with the
Warrant Shares Registration Rights Agreement;
or
(B) the Warrant Agent receives the following:
(1) if the holder of such beneficial
interest in a Restricted Global
Warrant proposes to exchange such
beneficial interest for a Definitive
Warrant that does not bear the
Private Placement Legend, a
certificate from such holder in the
form of Exhibit D hereto, including
the certifications in item (l)(b)
thereof; or
(2) if the holder of such beneficial
interest in a Restricted Global
Warrant proposes to transfer such
beneficial interest to a person who
shall take delivery thereof in the
form of a Definitive Warrant that
does not bear the Private Placement
Legend, a certificate from such
holder in the form of Exhibit C
hereto, including the certifications
in item (3) thereof;
and, in each such case set forth in this subparagraph
(B), if the Warrant Agent so requests or if the
Applicable Procedures so require, an Opinion of
Counsel in form reasonably acceptable to the Warrant
Agent to the effect that such exchange or transfer is
in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the
Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.
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(iii) Beneficial Interests in Unrestricted Global Warrants
to Unrestricted Definitive Warrants. If any holder
of a beneficial interest in an Unrestricted Global
Warrant proposes to exchange such beneficial interest
for a Definitive Warrant or to transfer such
beneficial interest to a person who takes delivery
thereof in the form of a Definitive Warrant, then,
upon satisfaction of the conditions set forth in
Section 5(b)(ii) hereof, the Warrant Agent shall
cause the aggregate principal amount of the
applicable Global Warrant to be reduced accordingly
pursuant to Section 5(g) hereof, and the Company
shall execute and the Warrant Agent shall countersign
and deliver to the person designated in the
instructions a Definitive Warrant in the appropriate
amount. Any Definitive Warrant issued in exchange
for a beneficial interest pursuant to this Section
5(c)(iii) shall be registered in such name or names
and in such authorized denomination or denominations
as the holder of such beneficial interest shall
instruct the Warrant Agent through instructions from
the Depositary and the Participant or Indirect
Participant. The Warrant Agent shall deliver such
Definitive Warrants to the persons in whose names
such Warrants are so registered. Any Definitive
Warrant issued in exchange for a beneficial interest
pursuant to this Section 5(c)(iii) shall not bear the
Private Placement Legend.
(d) Transfer and Exchange of Definitive Warrants for Beneficial
Interests.
(i) Restricted Definitive Warrants to Beneficial
Interests in Restricted Global Warrants. If any
holder of a Restricted Definitive Warrant proposes to
exchange such Warrant for a beneficial interest in a
Restricted Global Warrant or to transfer such
Restricted Definitive Warrants to a person who takes
delivery thereof in the form of a beneficial interest
in a Restricted Global Warrant, then, upon receipt by
the Warrant Agent of the following documentation:
(A) if the holder of such Restricted Definitive
Warrant proposes to exchange such Warrant for
a beneficial interest in a Restricted Global
Warrant, a certificate from such holder in
the form of Exhibit D hereto, including the
certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Warrant is
being transferred to a QIB in accordance with
Rule 144A under the Securities Act, a
certificate to the effect set forth in
Exhibit C hereto, including the
certifications in item (1) thereof;
(C) if such Restricted Definitive Warrant is
being transferred pursuant to an exemption
from the registration requirements of the
Securities Act in accordance with Rule 144
under the Securities Act, a certificate to
the effect set forth in Exhibit C hereto,
including the certifications in item (2)(a)
thereof;
(D) if such Restricted Definitive Warrant is
being transferred to an Institutional
Accredited Investor in reliance on an
exemption from the registration requirements
of the Securities Act other than those listed
in subparagraphs (B) and (C) above, a
certificate to the effect set forth in
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Exhibit C hereto, including the
certifications, certificates and Opinion of
Counsel required by item (2) thereof, if
applicable;
(E) if such Restricted Definitive Warrant is
being transferred to the Company or any of
its subsidiaries, a certificate to the effect
set forth in Exhibit C hereto, including the
certifications in item (2)(b) thereof; or
(F) if such Restricted Definitive Warrant is
being transferred pursuant to an effective
registration statement under the Securities
Act, a certificate to the effect set forth in
Exhibit C hereto, including the
certifications in item (2)(c) thereof,
the Warrant Agent shall cancel the Restricted
Definitive Warrant, increase or cause to be increased
the aggregate amount of, in the case of clause (A)
above, the appropriate Restricted Global Warrant, in
the case of clause (B) above, the 144A Global Warrant
and in all other cases, the IAI Global Warrant.
(ii) Restricted Definitive Warrants to Beneficial
Interests in Unrestricted Global Warrants. A holder
of a Restricted Definitive Warrant may exchange such
Warrant for a beneficial interest in an Unrestricted
Global Warrant or transfer such Restricted Definitive
Warrant to a person who takes delivery thereof in the
form of a beneficial interest in an Unrestricted
Global Warrant only if:
(A) such transfer is effected pursuant to a
Registration Statement in accordance with the
Warrant Shares Registration Rights Agreement;
or
(B) the Warrant Agent receives the following:
(1) if the holder of such Definitive
Warrants proposes to exchange such
Warrants for a beneficial interest
in the Unrestricted Global Warrant,
a certificate from such holder in
the form of Exhibit D hereto,
including the certifications in item
(l)(c) thereof; or
(2) if the holder of such Definitive
Warrants proposes to transfer such
Warrants to a person who shall take
delivery thereof in the form of a
beneficial interest in the
Unrestricted Global Warrant, a
certificate from such holder in the
form of Exhibit C hereto, including
the certifications in item (3)
thereof;
and, in each such case set forth in this subparagraph
(B), if the Warrant Agent so requests or if the
Applicable Procedures so require, an Opinion of
Counsel in form reasonably acceptable to the Warrant
Agent to the effect that such exchange or transfer is
in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the
Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.
Upon satisfaction of the conditions of any of the
subparagraphs in this Section 5(d)(ii), the Warrant
Agent shall cancel the Definitive Warrants and
increase or cause to be increased the aggregate
amount of the Unrestricted Global Warrant.
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(iii) Unrestricted Definitive Warrants to Beneficial
Interests in Unrestricted Global Warrants. A holder
of an Unrestricted Definitive Warrant may exchange
such Warrant for a beneficial interest in an
Unrestricted Global Warrant or transfer such
Definitive Warrants to a person who takes delivery
thereof in the form of a beneficial interest in an
Unrestricted Global Warrant at any time. Upon receipt
of a request for such an exchange or transfer, the
Warrant Agent shall cancel the applicable
Unrestricted Definitive Warrant and increase or cause
to be increased the aggregate amount of one of the
Unrestricted Global Warrants.
If any such exchange or transfer from a Definitive
Warrant to a beneficial interest is effected pursuant
to subparagraphs (ii) or (iii) above at a time when
an Unrestricted Global Warrant has not yet been
issued, the Company shall issue and the Warrant Agent
shall authenticate one or more Unrestricted Global
Warrants in an aggregate amount equal to the amount
of Definitive Warrants so transferred.
(e) Transfer and Exchange of Definitive Warrants for
Definitive Warrants. Upon request by a holder of Definitive Warrants and such
holder's compliance with the provisions of this Section 5(e), the Warrant Agent
shall register the transfer or exchange of Definitive Warrants. Prior to such
registration of transfer or exchange, the requesting holder shall present or
surrender to the Warrant Agent the Definitive Warrants duly endorsed or
accompanied by a written instruction of transfer in form satisfactory to the
Warrant Agent duly executed by such holder or by his attorney, duly authorized
in writing. In addition, the requesting holder shall provide any additional
certifications, documents and information, as applicable, required pursuant to
the following provisions of this Section 5(e).
(i) Restricted Definitive Warrants to Restricted
Definitive Warrants. Any Restricted Definitive
Warrant may be transferred to and registered in the
name of persons who take delivery thereof in the form
of a Restricted Definitive Warrant if the Warrant
Agent receives the following:
(A) if the transfer will be made pursuant to Rule
144A under the Securities Act, then the
transferor must deliver a certificate in the
form of Exhibit C hereto, including the
certifications in item (1) thereof;
(B) if the transfer will be made pursuant to any
other exemption from the registration
requirements of the Securities Act, then the
transferor must deliver a certificate in the
form of Exhibit C hereto, including the
certifications, certificates and Opinion of
Counsel required by item (2) thereof, if
applicable.
(ii) Restricted Definitive Warrants to Unrestricted
Definitive Warrants. Any Restricted Definitive
Warrant may be exchanged by the holder thereof for an
Unrestricted Definitive Warrant or transferred to a
person or persons who take delivery thereof in the
form of an Unrestricted Definitive Warrant if:
(A) any such transfer is effected pursuant to a
Registration Statement in accordance with the
Warrant Shares Registration Rights Agreement;
or
(B) the Warrant Agent receives the following:
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(1) if the holder of such Restricted
Definitive Warrants proposes to exchange such
Warrants for an Unrestricted Definitive
Warrant, a certificate from such holder in
the form of Exhibit D hereto, including the
certifications in item (l)(d) thereof; or
(2) if the holder of such Restricted
Definitive Warrants proposes to transfer such
Warrants to a person who shall take delivery
thereof in the form of an Unrestricted
Definitive Warrant, a certificate from such
holder in the form of Exhibit C hereto,
including the certifications in item (3)
thereof;
and, in each such case set forth in this subparagraph
(B), if the Warrant Agent so requests, an Opinion of
Counsel in form reasonably acceptable to the Company
to the effect that such exchange or transfer is in
compliance with the Securities Act and that the
restrictions on transfer contained herein and in the
Private Placement Legend are no longer required in
order to maintain compliance with the Securities Act.
(iii) Unrestricted Definitive Warrants to Unrestricted
Definitive Warrants. A holder of Unrestricted
Definitive Warrants may transfer such Warrants to a
person who takes delivery thereof in the form of an
Unrestricted Definitive Warrant.
Upon receipt of a request to register such a
transfer, the Warrant Agent shall register the
Unrestricted Definitive Warrants pursuant to the
instructions from the holder thereof.
(f) Legends. The following legend shall appear on the
face of all Global Warrants and Definitive Warrants issued under this Warrant
Agreement unless specifically stated otherwise in the applicable provisions of
this Warrant Agreement.
(i) Except as permitted by subparagraph (ii) below, each
Global Warrant and each Definitive Warrant (and all
Warrants issued in exchange therefor or substitution
thereof) shall bear the legend in substantially the
following form:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY STATE SECURITIES LAWS.
NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT
FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE
HEREOF AGREES NOT TO OFFER, SELL OR OTHERWISE
TRANSFER SUCH SECURITY, PRIOR TO THE DATE THAT IS TWO
YEARS (OR SUCH SHORTER PERIOD THAT MAY HEREAFTER BE
PROVIDED UNDER RULE 144(k) AS PERMITTING RESALES BY
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NON-AFFILIATES OF RESTRICTED SECURITIES WITHOUT
RESTRICTION) AFTER THE LATER OF THE ORIGINAL CLOSING
DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUERS OR
ANY AFFILIATE OF THE ISSUERS WAS THE OWNER OF THIS
SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY) EXCEPT
(A) TO THE ISSUERS, (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT, TO A PERSON IT REASONABLY BELIEVES IS
A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A) THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND
SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE
UNITED STATES WITHIN THE MEANING OF REGULATION S
UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501
(A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT
IS PURCHASING THE SECURITY FOR ITS OWN ACCOUNT, OR
FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL "ACCREDITED
INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A
VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH, ANY
DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR
(F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT,
SUBJECT TO THE ISSUERS' AND THE WARRANT AGENT'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO
CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATIONS AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH
OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN
THE FORM APPEARING ON THIS SECURITY IS COMPLETED AND
DELIVERED BY THE TRANSFEROR TO THE WARRANT AGENT."
(ii) Notwithstanding the foregoing, any Global Warrant or
Definitive Warrant issued pursuant to subparagraphs
(b)(iv), (c)(ii), (c)(iii), (d)(ii), (d)(iii),
(e)(ii) or (e)(iii) to this Section 5 and all
Warrants issued in exchange therefor or substitution
thereof) shall not bear the Private Placement Legend.
(g) Cancellation and/or Adjustment of Global Warrants.
At such time as all beneficial interests in a particular Global Warrant have
been exchanged for Definitive Warrants or a particular Global Warrant has been
redeemed, repurchased or canceled in whole and not in part, each such Global
Warrant shall be returned to or retained and canceled by the Warrant Agent in
accordance with Section 5(k). At any time prior to such cancellation, if any
beneficial interest in a Global Warrant is exchanged for or transferred to a
person who will take delivery thereof in the form of a beneficial interest in
another Global Warrant or for Definitive Warrants, the principal amount of
Warrants represented by
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such Global Warrant shall be reduced accordingly and an endorsement shall be
made on such Global Warrant by the Warrant Agent or by the Depositary at the
direction of the Warrant Agent to reflect such reduction; and if the beneficial
interest is being exchanged for or transferred to a person who will take
delivery thereof in the form of a beneficial interest in another Global
Warrant, such other Global Warrant shall be increased accordingly and an
endorsement shall be made on such Global Warrant by the Warrant Agent or by the
Depositary at the direction of the Warrant Agent to reflect such increase.
(h) Indemnification. Each holder of a Warrant
Certificate agrees to indemnify the Company and the Warrant Agent against any
liability that may result from the transfer, exchange or assignment of such
holder's Warrant Certificate in violation of any provision of this Agreement
and/or applicable U.S. Federal or state securities law.
(i) Depositary. Members of, or participants in, the
Depositary ("Agent Members") shall have no rights under this Agreement with
respect to the Global Warrants, as the case may be, held on their behalf by the
Depositary or the Warrant Agent as its custodian, and the Depositary may be
treated by the Company, the Warrant Agent and any agent of the Company or the
Warrant Agent as the absolute owner of such Global Warrant for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Warrant Agent or any agent of the Company or the Warrant Agent,
from giving effect to any written certification, proxy or other authorization
furnished by the Depositary or impair, as between the Depositary and its Agent
Members, the operation of customary practices governing the exercise of the
rights of a holder of any Warrants.
(j) Notices. The Warrant Agent shall retain copies of
all letters, notices and other written communications received pursuant to this
Section 5. The Company shall have the right to inspect and make copies of all
such letters, notices or other written communications at any reasonable time
upon the giving of reasonable written notice to the Warrant Agent.
(k) Cancellation of Warrant Certificates. Any Warrant
Certificate surrendered for registration of transfer, exchange or exercise of
the Warrants represented thereby shall, if surrendered to the Company, be
delivered to the Warrant Agent, and all Warrant Certificates surrendered or so
delivered to the Warrant Agent shall be promptly canceled by the Warrant Agent
and shall not be reissued by the Company and, except as provided in this
Section 5 in case of an exchange, Section 6 hereof in case of the exercise of
less than all the Warrants represented thereby or Section 8 hereof in case of a
mutilated Warrant Certificate, no Warrant Certificate shall be issued hereunder
in lieu thereof. The Warrant Agent shall deliver to the Company from time to
time or otherwise dispose of such canceled Warrant Certificates as the Company
may direct in writing.
(l) Countersignature of New Certificates. The Warrant
Agent is hereby authorized to countersign, in accordance with the provisions of
this Section 5 and of Section 4 hereof, the new Warrant Certificates required
pursuant to the provisions of this Section 5.
(m) Charges. No service charge shall be made for
registration of transfer or exchange upon surrender of any Warrant Certificate
at the office of the Warrant Agent maintained for that purpose. The Company may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration, transfer or
exchange of Warrant Certificates.
(n) Warrant Endorsement. Notwithstanding the foregoing
provisions of this Section 5, until Separated (as defined herein) each Warrant
will be held by the Trustee, as custodian for the registered holders of each
Note or Note in global form, and will be registered in the name of the
registered
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holder of such Note initially in the amount specified in writing to the Warrant
Agent by the Company. Such holder may, at any time, on or after the Separation
Date (as defined herein), at its option, by notice to the Trustee elect to
separate and/or separately transfer the Notes and the Warrants represented by
such Note or Note in global form containing a Warrant Endorsement (as defined
in the Indenture), in whole or in part, for a definitive Warrant Certificate or
Warrant Certificates or a beneficial interest in a Global Warrant evidencing
the underlying Warrants and for a Note or Notes or a beneficial interest in a
global Note of a like aggregate principal amount at maturity of authorized
denominations and not containing a Warrant Endorsement in accordance with the
Indenture (such surrender and exchange being referred to herein as a
"Separation" and the related Warrants being referred to as "Separated");
provided that no delay or failure on the part of the Trustee or the Warrant
Agent to exchange such Warrant Certificate and Note or Notes shall affect the
Separation of the Notes and the Warrants or their separate transferability.
Prior to Separation, record ownership of the Warrants will be evidenced by the
certificates for Notes or a global Note registered in the names of the holders
of the Notes or global Notes, which certificates or global Note will bear
thereon a Warrant Endorsement substantially in the form set forth in the
Indenture, and the right to receive or exercise Warrants will be transferable
only in connection with the transfer of such Notes or a beneficial interest in
a global Note.
All Notes and global Notes containing a Warrant
Endorsement presented for Separation shall be duly endorsed by the registered
holder or holders thereof or by the duly appointed legal representative thereof
or by a duly authorized attorney, and in the case of transfer, which signature
shall be medallion guaranteed by an institution which is a member of a
Securities Transfer Association recognized signature guarantee program. Upon
notice from the Trustee of a Separation, the Warrant Agent shall, with respect
to Definitive Warrants, deliver (or cause to be delivered) the Warrant
Certificate or Warrant Certificates executed by the Company and countersigned
by the Warrant Agent in the name of such registered holder or holders or such
transferee or transferees or shall, with respect to (i) 000X Xxxxxx Xxxxxxxx,
deliver (or cause to be delivered) a 000X Xxxxxx Xxxxxxx, and (ii) IAI Global
Warrants, deliver (or cause to be delivered) an IAI Global Warrant, in each
case, executed by the Company and countersigned by the Warrant Agent in the
name of the Depositary or its nominee for such aggregate amount of Warrants
(or, with respect to a Global Warrant, increasing the amount of Warrants
represented thereby in such amount) as shall equal one Warrant for each $1,000
principal amount at maturity of Notes so exchanged for Separation, bearing
numbers or other distinguishing symbols not contemporaneously outstanding, to
the person or persons entitled thereto. Upon registration of transfer or
exchange of a Warrant Certificate, the Warrant Agent shall countersign and
deliver by certified mail a new Warrant Certificate to the persons entitled
thereto.
SECTION 6. Separation, Terms and Exercise of Warrants. (a) The Notes
and Warrants will not be separately transferable until the close of business on
the earliest to occur of (i) June 1, 1998, (ii) such earlier date as the
Initial Purchaser may determine, (iii) the occurrence of a Change of Control
(as defined in the Indenture) and (iv) the date of effectiveness of the
Exchange Offer Registration Statement (as defined in the Indenture) (the
earliest of such dates, the "Separation Date"), at which time such Warrants
shall become separately transferable. Subject to the terms of this Agreement,
each Warrant holder shall have the right, which may be exercised during the
period commencing at the opening of business on the earlier to occur of (i)
June 30, 2000; (ii) the occurrence of a Change of Control, and (iii) the date
that is 180 days after consummation of an Initial Public Offering (the
"Exercise Commencement Date") (provided, however, that if the Company
consummates an Initial Public Offering prior to June 30, 2000, the Exercise
Commencement Date shall be the earlier to occur of (i) the occurrence of a
Change of Control and (ii) the date that is 180 days after the consummation of
such Initial Public Offering) and until 5:00 p.m., New York City time on
December 1, 2004 (the "Exercise Period"), to receive from the Company the
number of fully paid and nonassessable Warrant Shares which the holder may at
the time
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be entitled to receive on exercise of such Warrants and payment of the exercise
price (the "Exercise Price") then in effect for such Warrant Shares; provided
that holders shall be able to exercise their Warrants only if a registration
statement relating to the Warrant Shares is then in effect, or the exercise of
such Warrants is exempt from the registration requirements of the Securities
Act, and such securities are qualified for sale or exempt from qualification
under the applicable securities laws of the states in which the various holders
of the Warrants or other persons to whom it is proposed that the Warrant Shares
be issued on exercise of the Warrants reside. Each holder may exercise its
right, during the Exercise Period to receive Warrant Shares as follows: (1)
the holder makes a payment to the Company in cash (or in the form of certified
or official bank check payable to the order of the Company) in an amount equal
to the Exercise Price of the Warrants being exercised by such holder, (2) the
holder tenders Notes having an aggregate principal amount at maturity, plus
accrued and unpaid interest, if any thereon, to the date of exercise equal to
the Exercise Price of the Warrants being exercised by such holder, (3) the
holder tenders Warrants having a fair market value (as determined in good faith
by the Company's Board of Directors) equal to the Exercise Price or (4) by a
combination of clauses (1) (2) and (3) above, all at the option of the holder
electing to exercise. Each Warrant not exercised prior to 5:00 p.m., New York
City time, on December 1, 2004 (the "Expiration Date") shall become void and
all rights thereunder and all rights in respect thereof under this agreement
shall cease as of such time. No adjustments as to dividends will be made upon
exercise of the Warrants. The Company will give notice of expiration not less
than 90 and not more than 120 days prior to the Expiration Date to the
registered holders of the then outstanding Warrants. If the Company fails to
give such notice, the Warrants will not expire until 90 days after the Company
gives notice. In no event will holders of Warrants be entitled to any damages
or other remedy for the Company's failure to give such notice other than any
such extension.
(b) In order to exercise all or any of the Warrants
represented by a Warrant Certificate, (i) in the case of Definitive Warrants,
the holder thereof must surrender for exercise the Warrant Certificate to
Company at the office of the Warrant Agent at its corporate trust office set
forth in Section 19 (which office shall be maintained in New York) hereof, (ii)
in the case of a book-entry interest in a Global Warrant, the exercising Agent
Member whose name appears on a securities position listing of the Depositary as
the holder of such book-entry interest must comply with the Depositary's
procedures relating to the exercise of such book-entry interest in such Global
Warrant and (iii) in the case of both Global Warrants and Definitive Warrants,
the holder thereof or the Agent Member, as applicable, must deliver to the
Company at the office of the Warrant Agent in New York the form of election to
purchase on the reverse thereof duly filled in and signed, which signature
shall be medallion guaranteed by an institution which is a member of a
Securities Transfer Association recognized signature guarantee program, and
upon payment to the Warrant Agent in New York for the account of the Company of
the Exercise Price, which is set forth in the form of Warrant Certificate
attached hereto as Exhibit A, as adjusted as herein provided, for the number of
Warrant Shares in respect of which such Warrants are then exercised.
(c) Subject to the provisions of Section 7 hereof, upon
compliance with clause (b) above, the Company shall deliver or cause to be
delivered with all reasonable dispatch, to or upon the written order of the
holder and in such name or names as the Warrant holder or Agent Member may
designate, a certificate or certificates for the number of whole Warrant Shares
issuable upon the exercise of such Warrants or other securities or property to
which such holder is entitled hereunder, together with cash as provided in
Section 12 hereof; provided that if any consolidation, merger or lease or sale
of assets is proposed to be effected by the Company as described in Section
11(m) hereof, or a tender offer or an exchange offer for shares of Common Stock
shall be made, upon such surrender of Warrants and payment of the Exercise
Price as aforesaid, the Company shall, as soon as possible, but in any event
not later than two business days thereafter, deliver or cause to be delivered
the full number of Warrant
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Shares issuable upon the exercise of such Warrants in the manner described in
this sentence or other securities or property to which such holder is entitled
hereunder, together with cash as provided in Section 12 hereof. Such
certificate or certificates shall be deemed to have been issued and any person
so designated to be named therein shall be deemed to have become a holder of
record of such Warrant Shares as of the date of the surrender of such Warrants
and payment of the Exercise Price.
(d) The Warrants shall be exercisable, at the election of
the holders thereof, either in full or from time to time in part. If less than
all the Warrants represented by a Definitive Warrant are exercised, such
Definitive Warrant shall be surrendered and a new Definitive Warrant of the
same tenor and for the number of Warrants which were not exercised shall be
executed by the Company and delivered to the Warrant Agent and the Warrant
Agent shall countersign the new Definitive Warrant, registered in such name or
names as may be directed in writing by the holder, and shall deliver the new
Definitive Warrant to the person or persons entitled to receive the same. The
Warrant Agent shall make such notations on Schedule A to each Global Warrant as
are required to reflect any change in the number of Warrants represented by
such Global Warrant resulting from any exercise in accordance with the terms
hereof.
(e) All Warrant Certificates surrendered upon exercise of
Warrants shall be canceled by the Warrant Agent. Such canceled Warrant
Certificates shall then be disposed of by the Warrant Agent in a manner
satisfactory to the Company. The Warrant Agent shall account promptly to the
Company with respect to Warrants exercised and concurrently pay to the Company
all monies received by the Warrant Agent for the purchase of the Warrant Shares
through the exercise of such Warrants.
(f) The Warrant Agent shall keep copies of this Agreement
and any notices given or received hereunder available for inspection upon
reasonable notice by the registered holders during normal business hours at its
office. The Company shall supply the Warrant Agent from time to time with such
numbers of copies of this Agreement as the Warrant Agent may request.
SECTION 7. Payment of Taxes. The Company will pay all documentary
stamp taxes attributable to the initial issuance of Warrant Shares upon the
exercise of Warrants; provided that the Company shall not be required to pay
any tax or taxes which may be payable in respect of any transfer involved in
the issue of any Warrant Certificates or any certificates for Warrant Shares in
a name other than that of the registered holder of a Warrant Certificate
surrendered upon the exercise of a Warrant, and the Company shall not be
required to issue or deliver such Warrant Certificates unless or until the
person or persons requesting the issuance thereof shall have paid to the
Company the amount of such tax or shall have established to the satisfaction of
the Company that such tax has been paid.
SECTION 8. Mutilated or Missing Warrant Certificates. In case any of
the Warrant Certificates shall be mutilated, lost, stolen or destroyed, the
Company shall issue and the Warrant Agent may countersign, in exchange and
substitution for and upon cancellation of the mutilated Warrant Certificate, or
in lieu of and substitution for the Warrant Certificate lost, stolen or
destroyed, a new Warrant Certificate of like tenor and representing an
equivalent number of Warrants, but only upon receipt of evidence satisfactory
to the Company and the Warrant Agent of such loss, theft or destruction of such
Warrant Certificate and indemnity, if requested, also satisfactory to them.
Applicants for such substitute Warrant Certificates shall also comply with such
other reasonable regulations and pay such other reasonable charges as the
Company or the Warrant Agent may prescribe.
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SECTION 9. Reservation of Warrant Shares. (a) The Company will at
all times reserve and keep available, free from preemptive rights, out of the
aggregate of its authorized but unissued Common Stock or its authorized and
issued Common Stock held in its treasury, for the purpose of enabling it to
satisfy any obligation to issue Warrant Shares upon exercise of Warrants, the
maximum number of shares of Common Stock which may then be deliverable upon the
exercise of all outstanding Warrants.
(b) The Company or, if appointed, the transfer agent for
the Common Stock (the "Transfer Agent") and every subsequent transfer agent for
any shares of the Company's capital stock issuable upon the exercise of any of
the rights of purchase aforesaid will be irrevocably authorized and directed at
all times to reserve such number of authorized shares as shall be required for
such purpose. The Company will keep a copy of this Agreement on file with the
Transfer Agent and with every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the exercise of the rights of purchase
represented by the Warrants. The Company will furnish such Transfer Agent a
copy of all notices of adjustments, and certificates related thereto,
transmitted to each holder pursuant to Section 14 hereof. The Warrant Agent is
hereby irrevocably authorized to requisition from time to time from such
Transfer Agent the stock certificates required to honor outstanding Warrants
upon exercise thereof in accordance with the terms of this Agreement. The
Company will supply such Transfer Agent with duly executed certificates for
such purposes and will provide or otherwise make available any cash which may
be payable as provided in Section 12.
(c) Before taking any action which would cause an
adjustment pursuant to Section 11 hereof to reduce the Exercise Price below the
then par value (if any) of the Warrant Shares, the Company will take any
corporate action which may, in the opinion of its counsel (which may be counsel
employed by the Company), be necessary in order that the Company may validly
and legally issue fully paid and nonassessable Warrant Shares at the Exercise
Price as so adjusted.
(d) The Company covenants that all Warrant Shares which
may be issued upon exercise of Warrants will, upon issue, be fully paid,
nonassessable, free of preemptive rights and free from all taxes, liens,
charges and security interests with respect to the issuance thereof.
SECTION 10. Obtaining Stock Exchange Listings. The Company will from
time to time take all action which may be necessary so that the Warrant Shares,
immediately upon their issuance upon the exercise of Warrants, will be listed
on the principal securities exchanges and markets within the United States of
America, if any, on which other shares of Common Stock are then listed, if any.
Upon the listing of such Warrant Shares, the Company shall notify the Warrant
Agent in writing. The Company will obtain and keep all required permits and
records in connection with such listing.
SECTION 11. Adjustment of Exercise Price and Number of Warrant Shares
Issuable. The Exercise Price and the number of Warrant Shares issuable upon
the exercise of each Warrant are subject to adjustment from time to time upon
the occurrence of the events enumerated in this Section 11. For purposes of
this Section 11, "Common Stock" means shares now or hereafter authorized of any
class of common stock of the Company and any other stock of the Company,
however designated, that has the right (subject to any prior rights of any
class or series of preferred stock) to participate in any distribution of the
assets or earnings of the Company without limit as to per share amount.
(a) Adjustment for Change in Capital Stock. If the
Company (i) pays a dividend or makes a distribution on its Common Stock in
shares of its Common Stock, (ii) subdivides its outstanding shares of Common
Stock into a greater number of shares, (iii) combines its outstanding shares of
Common Stock into a smaller number of shares, (iv) makes a distribution on its
Common Stock in shares
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of its capital stock other than Common Stock or (v) issues by reclassification
of its Common Stock any shares of its capital stock; then the Exercise Price in
effect immediately prior to such action shall be proportionately adjusted so
that the holder of any Warrant thereafter exercised may receive the aggregate
number and kind of shares of capital stock of the Company which he would have
owned immediately following such action if such Warrant had been exercised
immediately prior to such action.
The adjustment shall become effective immediately after the
record date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
If, after an adjustment, a holder of a Warrant upon exercise of it may receive
shares of two or more classes of capital stock of the Company, the Company
shall determine the allocation of the adjusted Exercise Price between the
classes of capital stock. After such allocation, the exercise privilege and the
Exercise Price of each class of capital stock shall thereafter be subject to
adjustment on terms comparable to those applicable to Common Stock in this
Section 11. Such adjustment shall be made successively whenever any event
listed above shall occur.
(b) Adjustment for Rights Issue. If the Company
distributes any rights, options or warrants to all holders of its Common Stock
entitling them for a period expiring within 45 days after the record date
mentioned below to purchase shares of Common Stock at a price per share less
than the less than the Fair Value (as defined herein) per share on that record
date, the Exercise Price shall be adjusted in accordance with the formula:
O + N x P
---------
E' = E x M
----------------
O + N
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
O = the number of shares of Common Stock outstanding on the
record date.
N = the number of additional shares of Common Stock offered.
P = the offering price per share of the additional shares.
M = the Fair Value per share of Common Stock on the record
date.
The adjustment shall be made successively whenever any such rights,
options or warrants are issued and shall become effective immediately after the
record date for the determination of stockholders entitled to receive the
rights, options or warrants. If at the end of the period during which such
rights, options or warrants are exercisable, not all rights, options or
warrants shall have been exercised, the Exercise Price shall be immediately
readjusted to what it would have been if "N" in the above formula had been the
number of shares actually issued.
(c) Adjustment for Other Distributions. If the Company
distributes to all holders of its Common Stock any of its assets (including,
without limitation, cash) or debt securities or any rights or
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warrants to purchase debt securities, assets or other securities of the
Company, the Exercise Price shall be adjusted in accordance with the formula:
E' = E x M - F
-----------
M
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
M = the current market price per share of Common Stock on the record
date mentioned below.
F = the fair market value on the record date of the assets,
securities, rights or warrants to be distributed in respect of
one share of Common Stock as determined in good faith by the
Board of Directors of the Company (the "Board of Directors").
The adjustment shall be made successively whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the
distribution.
This Section 11(c) does not apply to cash dividends or cash
distributions paid out of consolidated current or retained earnings as shown on
the books of the Company prepared in accordance with generally accepted
accounting principles. Also, this Section 11(c) does not apply to rights,
options or warrants referred to in Section 11(b) hereof.
(d) Adjustment for Common Stock Issue. If the Company
issues shares of Common Stock for a consideration per share less than the Fair
Value per share on the date the Company fixes the offering price of such
additional shares, the Exercise Price shall be adjusted in accordance with the
formula:
P
-
E' = E x O + M
----------
A
where:
E' = the adjusted Exercise Price.
E = the then current Exercise Price.
0 = the number of shares outstanding immediately prior to the issuance
of such additional shares.
P = the aggregate consideration received for the issuance of such
additional shares.
M = the Fair Value per share on the date of issuance of such additional
shares.
A = the number of shares outstanding immediately after the issuance of
such additional shares.
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The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
This subsection (d) does not apply to:
(1) any of the transactions described in subsections (b) and (c)
of this Section 11,
(2) the exercise of Warrants, or the conversion or exchange of
other securities convertible or exchangeable for Common Stock,
(3) Common Stock issued in a bona fide public offering pursuant to
a firm commitment underwriting managed by a nationally recognized firm, or
(4) Common Stock issued to the Company's employees under bona fide
employee benefit plans adopted by the Board of Directors and approved by the
holders of Common Stock when required by law, if such Common Stock would
otherwise be covered by this subsection (d) (but only to the extent that the
aggregate number of shares excluded hereby and issued after the date of this
Warrant Agreement shall not exceed 10% of the Common Stock outstanding at any
time, exclusive of antidilution adjustments thereunder),
(5) Common Stock issued upon the exercise of rights or warrants
issued to the holders of Common Stock, or
(6) Common Stock issued to shareholders of any person which merges
into the Company in proportion to their stock holdings of such person
immediately prior to such merger, upon such merger; or
(7) Common Stock issued to employees of the Company in return for
services, not to exceed in the aggregate 1% of the Common Stock outstanding as
of the date hereof.
(e) Adjustment for Convertible Securities Issue. If the
Company issues any securities convertible into or exchangeable for Common Stock
(other than securities issued in transactions described in subsections (b) and
(c) of this Section 11) for a consideration per share of Common Stock initially
deliverable upon conversion or exchange of such securities less than the Fair
Value per share on the date of issuance of such securities, the Exercise Price
shall be adjusted in accordance with this formula:
P
-
E' = E x O + M
----------
O + D
where:
E' = the adjusted Exercise Price.
E = the then current Exercise Price.
O = the number of shares outstanding immediately prior to the issuance
of such securities.
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P = the aggregate consideration received for the issuance of such
securities.
M = the Fair Value per share on the date of issuance of such
securities.
D = the maximum number of shares deliverable upon conversion or in
exchange for such securities at the initial conversion or
exchange rate.
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
If all of the Common Stock deliverable upon conversion or exchange of
such securities have not been issued when such securities are no longer
outstanding, then the Exercise Price shall promptly be readjusted to the
Exercise Price which would then be in effect had the adjustment upon the
issuance of such securities been made on the basis of the actual number of
shares of Common Stock issued upon conversion or exchange of such securities.
This subsection (e) does not apply to:
(1) convertible securities issued to shareholders of any person
which merges into the Company, or with a subsidiary of the Company, in
proportion to their stock holdings of such person immediately prior to such
merger, upon such merger,
(2) convertible securities issued in a bona fide public offering
pursuant to a firm commitment underwriting managed by a nationally recognized
firm, or
(3) convertible securities issued in a bona fide private placement
through a placement agent which is a member firm of the National Association of
Securities Dealers, Inc. (except to the extent that any discount from the
current market price attributable to restrictions on transferability of Common
Stock issuable upon conversion, as determined in good faith by the Board of
Directors and described in a Board resolution which shall be filed with the
Warrant Agent, shall exceed 20% of the then current market price).
(f) Consideration Received. For purposes of any
computation respecting consideration received pursuant to subsections (d) and
(e) of this Section 11, the following shall apply:
(1) in the case of the issuance of shares of Common Stock for
cash, the consideration shall be the amount of such cash, provided that in no
case shall any deduction be made for any commissions, discounts or other
expenses incurred by the Company for any underwriting of the issue or otherwise
in connection therewith;
(2) in the case of the issuance of shares of Common Stock for a
consideration in whole or in part other than cash, the consideration other than
cash shall be deemed to be the fair market value thereof as determined in good
faith by the Board of Directors (irrespective of the accounting treatment
thereof), whose determination shall be conclusive, and described in a Board
resolution which shall be filed with the Warrant Agent;
(3) in the case of the issuance of securities convertible into or
exchangeable for shares, the aggregate consideration received therefor shall be
deemed to be the consideration received by the Company for the issuance of such
securities plus the additional consideration, if any, to be received by
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the Company upon the conversion or exchange thereof (the consideration in each
case to be determined in the same manner as provided in clauses (1) and (2) of
this subsection); and
(4) in the case of the issuance of shares of Common Stock pursuant
to rights, options or warrants which rights, options or warrants were
originally issued together with one or more other securities as part of a unit,
the consideration shall be deemed to be (i) the fair value of such rights,
options or warrants at the time of issuance thereof as determined in good faith
by the Board of Directors whose determination shall be conclusive and described
in a Board resolution which shall be filed with the Warrant Agent plus (ii) the
additional consideration, if any, to be received by the Company upon the
exercise, conversion or exchange thereof (as determined in the same manner as
provided in clause (1) and (2) of this subsection).
(g) Fair Value. In Sections 11(b), (c), (d) and (e)
hereof, the "Fair Value" per security at any date of determination shall be (1)
in connection with a sale by the Company to a party that is not an Affiliate of
the Company in an arm's-length transaction (a "Non-Affiliate Sale"), the price
per security at which such security is sold and (2) in connection with any sale
by the Company to an Affiliate of the Company, (a) the last price per security
at which such security was sold in a Non-Affiliate Sale within the three-month
period preceding such date of determination or (b) if clause (a) is not
applicable, the fair market value of such security determined in good faith by
a nationally recognized investment banking, appraisal or valuation firm, which
is not an Affiliate of the Company, in each case, taking into account, among
all other factors deemed relevant by such investment banking, appraisal or
valuation firm, the trading price and volume of such security on any national
securities exchange or automated quotation system on which such security is
traded. Notwithstanding the foregoing, any sale to the Initial Purchaser (or
any successor thereto) pursuant to an underwritten public offering registered
under the Securities Act shall be deemed to be and treated as a Non-Affiliate
Sale.
For purposes of this Section 11(g), "Affiliate" of any specified
person means (A) any other person directly or indirectly controlling or
controlled by or under direct or indirect common control with such specified
person and (B) any director, officer or employee of such specified person. For
purposes of this definition "control" (including, with correlative meanings,
the terms "controlling," "controlled by" and "under common control with") as
used with respect to any person, shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such person, whether through the ownership of voting securities, by
agreement or otherwise.
(h) When De Minimis Adjustment May Be Deferred. No
adjustment in the Exercise Price need be made unless the adjustment would
require an increase or decrease of at least 1% in the Exercise Price. Any
adjustments that are not made shall be carried forward and taken into account
in any subsequent adjustment. All calculations under this Section 11 shall be
made to the nearest 1/1000th of a cent or to the nearest 1/l000th of a share,
as the case may be.
(i) No Dilution of Impairment. The Company will not, by
amendment of its certificate of incorporation or through any consolidation,
merger, reorganization, transfer of assets, 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 the Warrants, 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 of the Warrants against dilution or other impairment.
Without limiting the generality of the foregoing, the Company (1) 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 Common Stock
on the exercise of the Warrants from time to time outstanding and (2) will not
take
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any action which results in any adjustment of the Exercise Price if the total
number of Warrant Shares issuable after the action upon the exercise of all of
the Warrants would exceed the total number of shares of Common Stock then
authorized by the Company's certificate of incorporation and available for the
purpose of issue upon such exercise. A consolidation, merger, reorganization
or transfer of assets involving the Company covered by Section 11(m) shall not
be prohibited by or require any adjustment under this Section 11(i).
(j) Notice of Adjustment. Whenever the Exercise Price is
adjusted, the Company shall provide the notices required by Section 13 hereof.
(k) Voluntary Reduction. The Company from time to time
may reduce the Exercise Price by any amount for any period of time, if the
period is at least 20 days and if the reduction is irrevocable during the
period; provided that in no event may the Exercise Price be less than the par
value of a share of Common Stock. Whenever the Exercise Price is reduced, the
Company shall mail to Warrant holders a notice of the reduction. The Company
shall mail the notice at least 15 days before the date the reduced Exercise
Price takes effect. The notice shall state the reduced Exercise Price and the
period in which it will be in effect. A reduction of the Exercise Price does
not change or adjust the Exercise Price otherwise in effect for purposes of
Sections 11(a), (b), (c), (d), (e) and (g) hereof.
(1) Notice of Certain Transactions. If (i) the Company
takes any action that would require an adjustment in the Exercise Price
pursuant to Section 11(a), (b), (c), (d), (e) or (r) hereof, (ii) the Company
takes any action that would require a supplemental Warrant Agreement pursuant
to Section 11(m) hereof or (iii) there is a liquidation or dissolution of the
Company, then the Company shall mail to Warrant holders a notice stating the
proposed record date for a dividend or distribution or the proposed effective
date of a subdivision, combination, reclassification, consolidation, merger,
transfer, lease, liquidation or dissolution. The Company shall mail the notice
at least 15 days before such date. Failure to mail the notice or any defect in
it shall not affect the validity of the transaction.
(m) Reorganization of Company. If the Company
consolidates or merges with or into, or transfers or leases all or
substantially all its assets to, any person, upon consummation of such
transaction the Warrants shall automatically become exercisable for the kind
and amount of securities, cash or other assets which the holder of a Warrant
would have owned immediately after the consolidation, merger, transfer or lease
if the holder had exercised the Warrant immediately before the effective date
of the transaction. Concurrently with the consummation of such transaction,
the corporation formed by or surviving any such consolidation or merger if
other than the Company, or the person to which such sale or conveyance shall
have been made, shall enter into a supplemental Warrant Agreement so providing
and further providing for adjustments which shall be as nearly equivalent as
may be practical to the adjustments provided for in this Section 11(m). The
successor Company shall mail to Warrant holders a notice describing the
supplemental Warrant Agreement. If the issuer of securities deliverable upon
exercise of Warrants under the supplemental Warrant Agreement is an affiliate
of the formed, surviving, transferee or lessee corporation, that issuer shall
join in the supplemental Warrant Agreement.
(n) When No Adjustment Required. No adjustment need be
made for a transaction referred to in Section 11(a), (b), (c), (d), (e) or (r)
hereof, if Warrant holders are to participate in the transaction on a basis and
with notice that the Board of Directors determines to be fair and appropriate
in light of the basis and notice on which holders of Common Stock participate
in the transaction. No adjustment need be made for (i) rights to purchase
Common Stock pursuant to a Company plan for reinvestment of dividends or
interest or (ii) a change in the par value or no par value of the Common
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Stock. To the extent the Warrants become convertible into cash, no adjustment
need be made thereafter as to the cash. Interest will not accrue on the cash.
(o) Warrant Agent's Disclaimer. The Warrant Agent has no
duty to determine when an adjustment under this Section 11 should be made, how
it should be made or what it should be. The Warrant Agent has no duty to
determine whether any provisions of a supplemental Warrant Agreement under
Section 11(m) hereof are correct. The Warrant Agent makes no representation as
to the validity or value of any securities or assets issued upon exercise of
Warrants. The Warrant Agent shall not be responsible for the Company's failure
to comply with this Section 11.
(p) When Issuance or Payment May Be Deferred. In any case
in which this Section 11 shall require that an adjustment in the Exercise Price
be made effective as of a record date for a specified event, the Company may
elect to defer until the occurrence of such event (i) issuing to the holder of
any Warrant exercised after such record date the Warrant Shares and other
capital stock of the Company, if any, issuable upon such exercise over and
above the Warrant Shares and other capital stock of the Company, if any,
issuable upon such exercise on the basis of the Exercise Price and (ii) paying
to such holder any amount in cash in lieu of a fractional share pursuant to
Section 12 hereof; provided that the Company shall deliver to such holder a due
xxxx or other appropriate instrument evidencing such holder's right to receive
such additional Warrant Shares, other capital stock and cash upon the
occurrence of the event requiring such adjustment.
(q) Adjustment in Number of Shares. Upon each adjustment
of the Exercise Price pursuant to this Section 11, each Warrant outstanding
prior to the making of the adjustment in the Exercise Price shall thereafter
evidence the right to receive upon payment of the adjusted Exercise Price that
number of shares of Common Stock (calculated to the nearest hundredth) obtained
from the following formula:
N' = N x E
--------
E'
where:
N' = the adjusted number of Warrant Shares issuable upon
exercise of a Warrant by payment of the adjusted Exercise
Price.
N = the number or Warrant Shares previously issuable upon
exercise of a Warrant by payment of the Exercise Price
prior to adjustment.
E' = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
(r) Additional Adjustments. In addition, in the event
that any other transaction or event occurs (including, without limiting the
generality of the foregoing, the issuance by the Company of shares of Common
Stock, or securities convertible into or exchangeable for Common Stock, for a
consideration per share less than the Exercise Price per share on the date the
Company fixes the offering price for such additional shares) as to which the
foregoing adjustment provisions are not strictly applicable but the failure to
make any adjustment would adversely affect the rights represented by the
Warrants in accordance with the essential intent and principles of such
provisions, then, in each such case, subject to Section 11(h), the Company
shall appoint an investment banking firm of recognized
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national standing, or any other financial expert that does not (or whose
directors, officers, employees, affiliates or stockholders do not) have a
direct or material indirect financial interest in the Company or any of its
subsidiaries, who has not been, and, at the time it is called upon to give
independent financial advice to the Company, is not (and none of its directors,
officers, employees, affiliates or stockholders are) a promoter, director or
officer of the Company or any of its subsidiaries, which will give their
opinion upon the adjustment, if any, on a basis consistent with the essential
intent and principles established in the foregoing adjustment provisions,
necessary to preserve, without dilution, the rights represented by the
Warrants. Upon receipt of such opinion or determination, the Company shall
promptly mail a copy thereof to the holders of the Warrants and will make the
adjustments described therein.
(s) Form of Warrants. Irrespective of any adjustments in
the Exercise Price or the number or kind of shares purchasable upon the
exercise of the Warrants, Warrants theretofore or thereafter issued may
continue to express the same price and number and kind of shares as are stated
in the Warrants initially issuable pursuant to this Agreement.
SECTION 12. Fractional Interests. The Company shall not be required
to issue fractional Warrant Shares on the exercise of Warrants. If more than
one Warrant shall be presented for exercise in full at the same time by the
same holder, the number of full Warrant Shares which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
Warrant Shares purchasable on exercise of the Warrants so presented. If any
fraction of a Warrant Share would, except for the provisions of this Section
12, be issuable on the exercise of any Warrants (or specified portion thereof),
the Company shall pay an amount in cash equal to the Fair Value per Warrant
Share, as determined on the day immediately preceding the date the Warrant is
presented for exercise, multiplied by such fraction, computed to the nearest
whole U.S. cent.
SECTION 13. Notices to Warrant Holders. (a) Upon any adjustment of
the Exercise Price pursuant to Section 11 hereof, the Company shall promptly
thereafter (i) cause to be filed with the Warrant Agent a certificate of a firm
of independent public accountants of recognized standing selected by the Board
of Directors of the Company (who may be the regular auditors of the Company)
setting forth the Exercise Price after such adjustment and setting forth in
reasonable detail the method of calculation and the facts upon which such
calculations are based and setting forth the number of Warrant Shares (or
portion thereof) issuable after such adjustment in the Exercise Price, upon
exercise of a Warrant and payment of the adjusted Exercise Price, which
certificate shall be conclusive evidence of the correctness of the matters set
forth therein, and (ii) cause to be given to each of the registered holders of
Warrants at the address appearing on the Warrant register for each such
registered holder written notice of such adjustments by first-class mail,
postage prepaid. Where appropriate, such notice may be given in advance and
included as a part of the notice required to be mailed under the other
provisions of this Section 13.
(b) In case:
(i) the Company shall authorize the issuance to
all holders of shares of Common Stock of rights, options or warrants to
subscribe for or purchase shares of Common Stock or of any other subscription
rights or warrants;
(ii) the Company shall authorize the distribution
to all holders of shares of Common Stock of evidences of its indebtedness or
assets (other than cash dividends or cash distributions
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27
payable out of consolidated earnings or earned surplus or dividends payable in
shares of Common Stock or distributions referred to in Section 11(a) hereof);
(iii) of any consolidation or merger to which the
Company is a party and for which approval of any stockholders of the Company is
required, or of the conveyance or transfer of the properties and assets of the
Company substantially as an entirety, or of any reclassification or change of
Common Stock issuable upon exercise of the Warrants (other than a change in par
value, or from par value to no par value, or from no par value to par value, or
as a result of a subdivision or combination), or a tender offer or exchange
offer for shares of Common Stock;
(iv) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company;
(v) a Change of Control occurs; or
(vi) the Company proposes to take any action which
would require an adjustment of the Exercise Price pursuant to Section 11
hereof;
then the Company shall cause to be filed with the Warrant Agent and shall cause
to be given to each of the registered holders of Warrants at his address
appearing on the Warrant register, at least 20 days (or 10 days in any case
specified in clauses (i) or (ii) above) prior to the applicable record date
hereinafter specified, or promptly in the case of events for which there is no
record date, by first-class mail, postage prepaid, a written notice stating (x)
the date as of which the holders of record of shares of Common Stock to be
entitled to receive any such rights, options, warrants or distribution are to
be determined, (y) the initial expiration date set forth in any tender offer or
exchange offer for shares of Common Stock, or (z) the date on which any such
consolidation, merger, conveyance, transfer, dissolution, liquidation or
winding up is expected to become effective or consummated, and the date as of
which it is expected that holders of record of shares of Common Stock shall be
entitled to exchange such shares for securities or other property, if any,
deliverable upon such reclassification, consolidation, merger, conveyance,
transfer, dissolution, liquidation or winding up. The failure to give the
notice required by this Section 13 or any defect therein shall not affect the
legality or validity of any distribution, right, option, warrant,
consolidation, merger, conveyance, transfer, dissolution, liquidation or
winding up, or the vote upon any action.
(c) Nothing contained in this Agreement or in any of the
Warrant Certificates shall be construed as conferring upon the holders of
Warrants the right to vote or to consent or to receive notice as stockholders
in respect of the meetings of stockholders or the election of directors of the
Company or any other matter, or any rights whatsoever as stockholders of the
Company.
SECTION 14. Merger, Consolidation or Change of Name of Warrant Agent.
Any corporation into which the Warrant Agent may be merged or with which it may
be consolidated, or any corporation resulting from any merger or consolidation
to which the Warrant Agent shall be a party, or any corporation succeeding to
the business of the Warrant Agent, shall be the successor to the Warrant Agent
hereunder without the execution or filing of any paper or any further act on
the part of any of the parties hereto, provided that such corporation would be
eligible for appointment as a successor warrant agent under the provisions of
Section 16 hereof. In case at the time such successor to the Warrant Agent
shall succeed to the agency created by this Agreement, and in case at that time
any of the Warrant Certificates
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shall have been countersigned but not delivered, any such successor to the
Warrant Agent may adopt the countersignature of the original Warrant Agent; and
in case at that time any of the Warrant Certificates shall not have been
countersigned, any successor to the Warrant Agent may countersign such Warrant
Certificates either in the name of the predecessor Warrant Agent or in the name
of the successor to the Warrant Agent; and in all such cases such Warrant
Certificates shall have the full force and effect provided in the Warrant
Certificates and in this Agreement.
In case at any time the name of the Warrant Agent shall be changed and
at such time any of the Warrant Certificates shall have been countersigned but
not delivered, the Warrant Agent whose name has been changed may adopt the
countersignature under its prior name, and in case at that time any of the
Warrant Certificates shall not have been countersigned, the Warrant Agent may
countersign such Warrant Certificates either in its prior name or in its
changed name, and in all such cases such Warrant Certificates shall have the
full force and effect provided in the Warrant Certificates and in this
Agreement.
SECTION 15. Warrant Agent. The Warrant Agent undertakes the duties
and obligations imposed by this Agreement upon the following terms and
conditions, by all of which the Company and the holders of Warrants, by their
acceptance thereof, shall be bound:
(a) The statements contained herein and in the Warrant
Certificates shall be taken as statements of the Company and the Warrant Agent
assumes no responsibility for the correctness of any of the same except as such
describe the Warrant Agent or action taken or to be taken by it. The Warrant
Agent assumes no responsibility with respect to the distribution of the Warrant
Certificates except as herein otherwise expressly provided.
(b) The Warrant Agent shall not be responsible for any
failure of the Company to comply with any of the covenants contained in this
Agreement or in the Warrant Certificates to be complied with by the Company.
(c) The Warrant Agent may consult at any time with
counsel satisfactory to it (who may be counsel for the Company) and the Warrant
Agent shall incur no liability or responsibility to the Company or to any
holder of any Warrant Certificate in respect of any action taken, suffered or
omitted by it hereunder in good faith and in accordance with the opinion or the
advice of such counsel.
(d) The Warrant Agent shall incur no liability or
responsibility to the Company or to any holder of any Warrant Certificate for
any action taken in reliance on any Warrant Certificate, certificate of shares,
notice, resolution, waiver, consent, order, opinion, certificate, or other
paper, document or instrument believed by it to be genuine and to have been
signed, sent or presented by the proper party or parties.
(e) The Company agrees to pay to the Warrant Agent
reasonable compensation for all services rendered by the Warrant Agent in the
execution of this Agreement, to reimburse the Warrant Agent for all expenses
(including the fees and expenses of its counsel), taxes and governmental
charges and other charges of any kind and nature incurred by the Warrant Agent
in the execution of this Agreement and to indemnify the Warrant Agent. The
Company shall indemnify the Warrant Agent against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Warrant Agreement,
including the costs and expenses of enforcing this Warrant Agreement against
the Company (including this Section 15) and defending itself against any claim
(whether asserted by the Company or any holder or any other person) or
liability in connection with the exercise or performance of any of its powers
or duties hereunder, except to the extent any such loss, liability or expense
may be attributable to its negligence or bad faith.
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The Warrant Agent shall notify the Company promptly of any claim for which it
may seek indemnity. Failure by the Warrant Agent to so notify the Company
shall not relieve the Company of its obligations hereunder. The Company shall
defend the claim and the Warrant Agent shall cooperate in the defense. The
Warrant Agent may have separate counsel and the Company shall pay the
reasonable fees and expenses of such counsel. The Company need not pay for any
settlement made without its consent, which consent shall not be unreasonably
withheld.
(f) The Warrant Agent shall be under no obligation to
institute any action, suit or legal proceeding or to take any other action
likely to involve expense unless the Company or one or more registered holders
of Warrants shall furnish the Warrant Agent with reasonable security and
indemnity for any costs and expenses which may be incurred, but this provision
shall not affect the power of the Warrant Agent to take such action as it may
consider proper, whether with or without any such security or indemnity. All
rights of action under this Agreement or under any of the Warrants may be
enforced by the Warrant Agent without the possession of any of the Warrant
Certificates or the production thereof at any trial or other proceeding
relative thereto, and any such action, suit or proceeding instituted by the
Warrant Agent shall be brought in its name as Warrant Agent and any recovery of
judgment shall be for the ratable benefit of the registered holders of the
Warrants, as their respective rights or interests may appear.
(g) The Warrant Agent, and any stockholder, director,
officer or employee of it, may buy, sell or deal in any of the Warrants or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend
money to the Company or otherwise act as fully and freely as though it were not
Warrant Agent under this Agreement. Nothing herein shall preclude the Warrant
Agent from acting in any other capacity for the Company or for any other legal
entity.
(h) The Warrant Agent shall act hereunder solely as agent
for the Company, and its duties shall be determined solely by the provisions
hereof. The Warrant Agent shall not be liable for anything which it may do or
refrain from doing in connection with this Agreement except for its own gross
negligence or bad faith.
(i) The Warrant Agent shall not at any time be under any
duty or responsibility to any holder of any Warrant Certificate to make or
cause to be made any adjustment of the Exercise Price or number of the Warrant
Shares or other securities or property deliverable as provided in this
Agreement, or to determine whether any facts exist which may require any of
such adjustments, or with respect to the nature or extent of any such
adjustments, when made, or with respect to the method employed in making the
same. The Warrant Agent shall not be accountable with respect to the validity
or value or the kind or amount of any Warrant Shares or of any securities or
property which may at any time be issued or delivered upon the exercise of any
Warrant or with respect to whether any such Warrant Shares or other securities
will when issued be validly issued and fully paid and nonassessable, and makes
no representation with respect thereto.
(j) The Warrant Agent shall exercise such of the rights
and powers vested in it by this Warrant Agreement, and use the same degree of
care and skill in its exercise, as a prudent man would exercise or use under
the circumstances in the conduct of his own affairs. The duties of the Warrant
Agent shall be determined solely by the express provisions of this Warrant
Agreement and the Warrant Agent need perform only those duties that are
specifically set forth in this Warrant Agreement and no others, and no implied
covenants or obligations shall be read into this Warrant Agreement against the
Warrant Agent. In the absence of bad faith on its part, the Warrant Agent may
conclusively rely, as
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to the truth of the statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the Warrant Agent and
conforming to the requirements of this Warrant Agreement. However, the Warrant
Agent shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Warrant Agreement.
(l) Unless otherwise specifically provided in this
Warrant Agreement, any demand, request, direction or notice from the Company
shall be sufficient if signed by an officer of the Company.
SECTION 16. Resignation and Removal of Warrant Agent. No resignation
or removal of the Warrant Agent and no appointment of a successor warrant agent
shall become effective until the acceptance of appointment by the successor
warrant agent as provided herein. The Warrant Agent may resign its duties and
be discharged from all further duties and liability hereunder (except liability
arising as a result of the Warrant Agent's own negligence or willful
misconduct) after giving written notice to the Company. The Company or the
holders of a majority of the unexercised Warrants may remove the Warrant Agent
upon written notice, and the Warrant Agent shall thereupon in like manner be
discharged from all further duties and liabilities hereunder, except as
aforesaid. The Warrant Agent shall, at the Company's expense, cause to be
mailed (by first class mail, postage prepaid) to each holder of a Warrant at
his last address as shown on the register of the Company maintained by the
Warrant Agent a copy of said notice of resignation or notice of removal, as the
case may be. Upon such resignation or removal, the Company shall appoint in
writing a new warrant agent. If the Company shall fail to make such
appointment within a period of 30 days after it has been notified in writing of
such resignation by the resigning Warrant Agent or after such removal, then the
resigning Warrant Agent or the holder of any Warrant may apply to any court of
competent jurisdiction for the appointment of a new warrant agent. Any new
warrant agent, whether appointed by the Company or by such a court, shall be a
corporation doing business under the laws of the United States or any state
thereof, in good standing and having a combined capital and surplus of not less
than $50,000,000. The combined capital and surplus of any such new warrant
agent shall be deemed to be the combined capital and surplus as set forth in
the most recent annual report of its condition published by such warrant agent
prior to its appointment, provided that such reports are published at least
annually pursuant to law or to the requirements of a federal or state
supervising or examining authority. After acceptance in writing of such
appointment by the new warrant agent, it shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named herein
as the Warrant Agent, without any further assurance, conveyance, act or deed;
but if for any reason it shall be necessary or expedient to execute and deliver
any further assurance, conveyance, act or deed, the same shall be done at the
expense of the Company and shall be legally and validly executed and delivered
by the resigning or removed Warrant Agent. Not later than the effective date
of any such appointment, the Company shall give notice thereof to the resigning
or removed Warrant Agent. Failure to give any notice provided for in this
Section 16, however, or any defect therein, shall not affect the legality or
validity of the resignation of the Warrant Agent or the appointment of a new
warrant agent, as the case may be.
SECTION 17. Registration. The Initial Purchaser and each subsequent
holder of Warrants shall be able to exercise their Warrants only if a
registration statement relating to the Warrant Shares is then in effect, or the
exercise of such Warrants is exempt from the registration requirements of the
Securities Act, and such securities are qualified for sale or exempt from
qualification under the applicable securities laws of the states in which the
various holders of the Warrants or other persons to whom it is proposed that
the Warrant Shares be issued on exercise of the Warrants reside. The Initial
Purchaser and each subsequent holder of Warrants shall have the registration
rights set forth in the Warrant Shares Registration Rights Agreement, dated as
of the date hereof, by and between the Company and the Initial Purchaser (the
"Warrant Registration Rights Agreement").
29
31
SECTION 18. Reports. (a) Whether or not required by the rules and
regulations of the Securities and Exchange Commission (the "Commission"), so
long as any Warrants are outstanding, the Company shall furnish to the Warrant
Agent and the holders of Warrants (i) all quarterly and annual financial
information that would be required to be contained in a filing with the
Commission on Form 10-Q if the Company were required to file such Forms,
including a "Management's Discussion and Analysis of Financial Condition and
Results of Operations" and, with respect to the annual information only, a
report thereon by the Company's certified independent accountants and (ii) all
current reports that would be required to be filed with the Commission on Form
8-K if the Company were required to file such reports. In addition, whether or
not required by the rules and regulations of the Commission, the Company shall
file a copy of all such information and reports with the Commission for public
availability (unless the Commission shall not accept such a filing) and make
such information available to securities analysts and prospective investors upon
request. In addition, for so long as any Warrants remain outstanding, the
Company shall furnish to the holders of Warrants and to securities analysts and
prospective investors, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act.
(b) Concurrently with the delivery of the reports
required to be delivered pursuant to clause (a) above, the Company shall file
with the Warrant Agent and cause to be delivered to each holder annual and
quarterly financial statements with appropriate footnotes of the Company and
its Restricted Subsidiaries, all prepared and presented in a manner
substantially consistent with those of the Company and its subsidiaries on a
consolidated basis as required by the preceding paragraph.
(c) The Company shall provide the Warrant Agent with a
sufficient number of copies of all such reports that the Warrant Agent may be
required to deliver to the holders of the Warrants under this Section 18.
SECTION 19. Notices to Company and Warrant Agent. Any notice or
demand authorized by this Agreement to be given or made by the Warrant Agent or
by the registered holder of any Warrant to or on the Company shall be
sufficiently given or made when and if deposited in the mail, first class or
registered, postage prepaid, addressed (until another address is filed in
writing by the Company with the Warrant Agent) as follows:
Club Xxxxxx Resorts, Inc.
00000 Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Secretary
With a copy (which shall not constitute notice) to:
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
1900 Pennzoil Place - South Tower
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx, Esq.
In case the Company shall fail to maintain such office or agency or
shall fail to give such notice of the location or of any change in the location
thereof, presentations may be made and notices and demands may be served at the
principal office of the Warrant Agent.
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32
Any notice pursuant to this Agreement to be given by the Company or by
the registered holder(s) of any Warrant to the Warrant Agent shall be
sufficiently given when and if deposited in the mail, first-class or
registered, postage prepaid, addressed (until another address is filed in
writing by the Warrant Agent with the Company) to the Warrant Agent as follows:
IBJ Xxxxxxxx Bank & Trust Company
Xxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Corporate Trust Administration
SECTION 20. Supplements and Amendments. The Company and the Warrant
Agent may from time to time supplement or amend this Agreement without the
approval of any holders of Warrants in order to cure any ambiguity or to
correct or supplement any provision contained herein which may be defective or
inconsistent with any other provision herein, or to make any other provisions
in regard to matters or questions arising hereunder which the Company and the
Warrant Agent may deem necessary or desirable and which shall not in any way
adversely affect the interests of the holders of Warrants. Any amendment or
supplement to this Agreement that has a material adverse effect on the
interests of the holders of Warrants shall require the written consent of the
holders of a majority of the then outstanding Warrants (excluding Warrants held
by the Company or any of its affiliates). The consent of each holder of
Warrants affected shall be required for any amendment pursuant to which the
Exercise Price would be increased or the number of Warrant Shares purchasable
upon exercise of Warrants would be decreased (other than pursuant to
adjustments provided in this Agreement).
SECTION 21. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company or the Warrant Agent shall bind
and inure to the benefit of their respective successors and assigns hereunder,
whether so expressed or not.
SECTION 22. Termination. This Agreement shall terminate at 5:00 p.m.,
New York City time on December 1, 2004.
SECTION 23. GOVERNING LAW. THIS AGREEMENT AND EACH WARRANT
CERTIFICATE ISSUED HEREUNDER SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE
LAWS OF THE STATE OF NEW YORK AND FOR ALL PURPOSES SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF SAID STATE, WITHOUT REGARD TO THE CONFLICT
OF LAW RULES THEREOF. The Company hereby irrevocably and unconditionally: (i)
submits itself and its property in any legal action or proceeding relating to
this Agreement or for recognition and enforcement of any judgment in respect
thereof, to the non-exclusive jurisdiction of the courts of the State of New
York and the courts of the United States of America for the Southern District
of New York, and appellate courts thereof, and consents and agrees to such
action or proceeding being brought in such courts; and (ii) waives any
objection that it may now or hereafter have to the venue of any such action or
proceeding in any such court or that such action or proceeding was brought in
any inconvenient court and agrees not to plead or claim the same.
SECTION 24. Benefits of This Agreement. (a) Nothing in this
Agreement shall be construed to give to any person or corporation other than
the Company, the Warrant Agent and the registered holders of Warrants any legal
or equitable right, remedy or claim under this Agreement; but this Agreement
shall be for the sole and exclusive benefit of the Company, the Warrant Agent
and the registered holders of Warrants.
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33
(b) All rights of action in respect of this Agreement are
vested in the holders of the Warrants Certificates, and any holder of any
Warrant Certificates, without the consent of the Warrant Agent or the holder of
any other Warrant Certificates, may, on such holder's own behalf and for such
holder's own benefit, enforce, and may institute and maintain any suit, action
or proceeding against the Company suitable to enforce, or otherwise in respect
of, such holder's rights hereunder, including the right to exercise, exchange
or surrender for purchase such holder's Warrants in the manner provided in this
Agreement.
SECTION 25. Counterparts. This Agreement may be executed in any
number of counterparts and each of such counterparts shall for all purposes be
deemed to be an original, and all such counterparts shall together constitute
but one and the same instrument.
[Signature Page Follows]
32
34
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
CLUB XXXXXX RESORTS, INC.
By:
----------------------------------------
Name:
Title:
IBJ XXXXXXXX BANK & TRUST COMPANY,
as Warrant Agent
By:
----------------------------------------
Name:
Title:
S-1
35
EXHIBIT A
[FORM OF WARRANT]
[FACE OF WARRANT CERTIFICATE]
WARRANT CERTIFICATE
CLUB XXXXXX RESORTS, INC.
No. [ ] [ ] Warrants
CUSIP Number [ ]
This Warrant Certificate certifies that [ ], or
registered assigns, is the registered holder of ________________ (_______)
warrants (the "Warrants") to purchase shares of common stock, par value $.001
per share (the "Common Stock"), of CLUB XXXXXX RESORTS, INC., a Nevada
corporation (the "Company"). Each Warrant entitles the holder upon exercise to
receive from the Company commencing on the Exercise Commencement Date (as
defined in the Warrant Agreement) until 5:00 p.m. New York City Time on
December 1, 2004, the number of fully paid and nonassessable Warrant Shares as
set forth in the Warrant Agreement, subject to adjustment as set forth in
Section 11 of the Warrant Agreement, at the initial exercise price (the
"Exercise Price") of $.01 per share payable pursuant to the provisions of
Section 6 of the Warrant Agreement upon surrender of this Warrant Certificate
and payment of the Exercise Price at the office or agency of the Warrant Agent,
but only subject to the conditions set forth herein and in the Warrant
Agreement referred to on the reverse hereof. The Exercise Price and number of
Warrant Shares issuable upon exercise of the Warrants are subject to adjustment
upon the occurrence of certain events set forth in the Warrant Agreement.
Subject to the provisions of the Warrant Agreement, no Warrant may be exercised
after 5:00 p.m., New York City Time on December 1, 2004, and to the extent not
exercised by such time such Warrants shall become void. Reference is hereby
made to the further provisions of this Warrant Certificate set forth on the
reverse hereof and such further provisions shall for all purposes have the same
effect as though fully set forth at this place. This Warrant Certificate shall
not be valid unless countersigned by the Warrant Agent, as such term is used in
the Warrant Agreement. This Warrant Certificate shall be governed and
construed in accordance with the internal laws of the State of New York.
Reference is hereby made to the further provisions on the reverse
hereof which provisions shall for all purposes have the same effect as though
fully set forth at this place.
Terms used and not otherwise defined in this Warrant Certificate shall
have the meanings given them in the Warrant Agreement.
This Warrant Certificate shall not be valid unless countersigned by
the Warrant Agent, as such term is used in the Warrant Agreement.
This Warrant Certificate shall be governed by and construed in
accordance with the internal laws of the State of New York.
A-1
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IN WITNESS WHEREOF, Club Xxxxxx Resorts, Inc. has caused this Warrant
Certificate to be signed by its authorized officers and may cause its corporate
seal to be affixed hereunto or imprinted hereon.
Dated:
---------------------
[SEAL]
CLUB XXXXXX RESORTS, INC.
By:
---------------------------
Name:
Title:
By:
---------------------------
Name:
Title:
Countersigned:
IBJ XXXXXXXX BANK & TRUST COMPANY,
as Warrant Agent
By: _______________________________________________________
Authorized Signatory
A-2
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[FORM OF WARRANT]
[REVERSE OF WARRANT CERTIFICATE]
[Unless and until it is exchanged in whole or in part for
Warrants in certificated form, this Warrant may not be transferred except as a
whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or by the
Depositary or any such nominee to a successor Depositary or a nominee of such
successor Depositary. Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to the issuer or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or such
other name as requested by an authorized representative of DTC (and any payment
is made to Cede & Co. or such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co., has an interest herein.(1)
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES
LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN
MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS
SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES
NOT TO OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE
DATE THAT IS TWO YEARS (OR SUCH SHORTER PERIOD THAT MAY HEREAFTER BE
PROVIDED UNDER RULE 144(k) AS PERMITTING RESALES BY NON-AFFILIATES OF
RESTRICTED SECURITIES WITHOUT RESTRICTION) AFTER THE LATER OF THE
ORIGINAL CLOSING DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUERS OR
ANY AFFILIATE OF THE ISSUERS WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY) EXCEPT (A) TO THE ISSUERS, (B) PURSUANT
TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED
IN RULE 144A) THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF
A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO
OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED
STATES WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT,
(E) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
RULE 501 (A)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS
PURCHASING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF
SUCH AN INSTITUTIONAL "ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES
AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION WITH,
__________________________________
(1) This paragraph is to be included only if the Warrant is in global
form.
A-3
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ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, OR (F) PURSUANT
TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT, SUBJECT TO THE ISSUERS' AND THE WARRANT AGENT'S
RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE
(D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATIONS AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM,
AND IN EACH OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE
FORM APPEARING ON THIS SECURITY IS COMPLETED AND DELIVERED BY THE
TRANSFEROR TO THE WARRANT AGENT.
[THE WARRANTS EVIDENCED BY THIS CERTIFICATE ARE NOT
TRANSFERABLE SEPARATELY FROM THE NOTES ORIGINALLY SOLD AS A UNIT WITH
THE WARRANTS UNTIL THE EARLIEST TO OCCUR OF (I) JUNE 1, 1998, (II)
SUCH EARLIER DATE AS XXXXXXXXX & COMPANY, INC. MAY DETERMINE, (III)
THE OCCURRENCE OF A CHANGE IN CONTROL (AS DEFINED IN THE INDENTURE
RELATING TO THE NOTES) AND (IV) THE EFFECTIVENESS OF THE EXCHANGE
OFFER REGISTRATION STATEMENT (AS DEFINED IN THE INDENTURE RELATING TO
THE NOTES). PRIOR TO SUCH DATE, THE WARRANTS EVIDENCED BY THIS
CERTIFICATE MAY BE TRANSFERRED ONLY WITH THE SIMULTANEOUS TRANSFER TO
THE TRANSFEREE OF $1,000 PRINCIPAL AMOUNT OF NOTES FOR EACH WARRANT SO
TRANSFERRED.]
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants expiring December 1, 2004 entitling the holder on
exercise to receive shares of Common Stock, and are issued or to be issued
pursuant to a Warrant Agreement dated as of December 5, 1997 (the "Warrant
Agreement"), duly executed and delivered by the Company to IBJ Xxxxxxxx Bank &
Trust Company, as warrant agent (the " Warrant Agent"), which Warrant Agreement
is hereby incorporated by reference in and made a part of this instrument and
is hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Warrant Agent, the Company
and the holders (the words "holders" or "holder" meaning the registered holders
or registered holder) of the Warrants. A copy of the Warrant Agreement may be
obtained by the holder hereof upon written request to the Company.
Warrants may be exercised at any time on or after the Exercise
Commencement Date and on or before December 1, 2004; provided that holders
shall be able to exercise their Warrants only if a registration statement
relating to the Warrant Shares is then in effect, or the exercise of such
Warrants is exempt from the registration requirements of the Securities Act of
1933, as amended (the "Securities Act"), and such securities are qualified for
sale or exempt from qualification under the applicable securities laws of the
states in which the various holders of the Warrants or other persons to whom it
is proposed that the Warrant Shares be issued on exercise of the Warrants
reside. In order to exercise all or any of the Warrants represented by this
Warrant Certificate, (i) in the case of Definitive Warrants, the holder must
surrender for exercise this Warrant Certificate to the Warrant Agent at its
corporate trust office set forth in Section 19 of the Warrant Agreement, (ii)
in the case of a book-entry interest in a Global Warrant, the exercising Agent
Member whose name appears on a securities position listing of the Depositary as
the holder of such book-entry interest must comply with the Depositary's
procedures relating to the exercise of such book-entry interest in such Global
Warrant and (iii) in the case of both Global Warrants and Definitive Warrants,
the holder thereof or the Agent Member, as applicable, must deliver to the
Warrant Agent the form of election to purchase on the reverse hereof duly
filled in and
A-4
39
signed, which signature shall be medallion guaranteed by an institution which
is a member of a Securities Transfer Association recognized signature guarantee
program, and upon payment to the Warrant Agent for the account of the Company
of the Exercise Price, as adjusted as provided in the Warrant Agreement, for
the number of Warrant Shares in respect of which such Warrants are then
exercised. No adjustment shall be made for any dividends on any Common Stock
issuable upon exercise of this Warrant.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price set forth on the face hereof may, subject to certain
conditions, be adjusted. If the Exercise Price is adjusted, the Warrant
Agreement provides that the number of shares of Common Stock issuable upon the
exercise of each Warrant shall be adjusted. No fractions of a share of Common
Stock will be issued upon the exercise of any Warrant, but the Company will pay
the cash value thereof determined as provided in the Warrant Agreement.
The holders of the Warrants shall have the registration rights set
forth in the Warrant Shares Registration Rights Agreement, dated as of the date
hereof, by and between the Company and the Initial Purchaser.
Warrant Certificates, when surrendered at the office of the Warrant
Agent by the registered holder thereof in person or by legal representative or
attorney duly authorized in writing, may be exchanged, in the manner and
subject to the limitations provided in the Warrant Agreement, but without
payment of any service charge, for another Warrant Certificate or Warrant
Certificates of like tenor evidencing in the aggregate a like number of
Warrants.
Upon due presentation for registration of transfer of this Warrant
Certificate at the office of the Warrant Agent a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided in the Warrant
Agreement, without charge except for any tax or other governmental charge
imposed in connection therewith.
The Company and the Warrant Agent may deem and treat the registered
holder(s) thereof as the absolute owner(s) of this Warrant Certificate
(notwithstanding any notation of ownership or other writing hereon made by
anyone), for the purpose of any exercise hereof, of any distribution to the
holder(s) hereof, and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary. Neither the
Warrants nor this Warrant Certificate entitles any holder hereof to any rights
of a stockholder of the Company.
A-5
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[FORM OF]
ELECTION TO EXERCISE)
(To be executed upon exercise of Warrants)
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to receive [ ] shares
of Common Stock and herewith tenders payment for such shares to the order of
the Company in the amount of $[ ] in accordance with Section 6 of
the Warrant Agreement. The undersigned requests that a certificate for such
shares be registered in the name of [
], whose address is [ ] and that such shares be delivered
to [ ] whose address is [ ]. If said
number of shares is less than all of the shares of Common Stock purchasable
hereunder, the undersigned requests that a new Warrant Certificate representing
the remaining balance of such shares be registered in the name of [
], whose address is [ ],
and that such Warrant Certificate be delivered to [ ], whose
address is [ ].
Date:____________________________
________________________________________
(Signature)
Note: The above signature must
correspond with the name as
written upon the face of this
Warrant Certificate in every
particular, without
alteration or enlargement or
any change whatever.
________________________________________
(Signature Guaranteed)
Note: Signature must be guaranteed
by an "eligible guarantor
institution" meeting the
requirements of the
Registrar, which requirements
include membership or
participation in the
Securities Transfer Agents
Medallion Program ("STAMP")
or such other "signature
guarantee program" as may be
determined by the Registrar
in addition to, or in
substitution for, STAMP, all
in accordance with the
Securities Exchange Act of
1934, as amended.
Tax Identification or
Social Security Number:_____________________
Address:__________________________________
A-6
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[FORM OF]
ASSIGNMENT
For value received [ ] hereby sells, assigns and
transfers unto [ ] the within Warrant Certificate,
together with all right, title and interest therein, and does hereby
irrevocably constitute and appoint [ ] attorney,
to transfer said Warrant Certificate on the books of the within-named Company,
with full power of substitution in the premises.
Date
--------------------------
--------------------------------------
(Signature)
Note: The above signature must
correspond with the name as
written upon the face of this
Warrant Certificate in every
particular, without
alteration or enlargement or
any change whatever.
--------------------------------------
(Signature Guaranteed)
Note: Signature must be guaranteed
by an "eligible guarantor
institution" meeting the
requirements of the
Registrar, which requirements
include membership or
participation in the
Securities Transfer Agents
Medallion Program ("STAMP")
or such other "signature
guarantee program" as may be
determined by the Registrar
in addition to, or in
substitution for, STAMP, all
in accordance with the
Securities Exchange Act of
1934, as amended.
A-7
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EXHIBIT B
Each Certificate evidencing Warrants originally issued as part of a
Unit of Notes and Warrants issued by the Company (and each Certificate
evidencing Warrants issued on registration of transfer thereof or in exchange
or substitution therefor prior to the close of business on the Separation Date
(as defined)) shall bear a legend, which may be affixed by stamp or sticker, in
substantially the following form:
THE WARRANTS EVIDENCED BY THIS CERTIFICATE ARE NOT TRANSFERABLE
SEPARATELY FROM THE NOTES ORIGINALLY SOLD AS A UNIT WITH THE WARRANTS
UNTIL THE EARLIEST TO OCCUR OF (I) JUNE 1, 1998, (II) SUCH EARLIER
DATE AS XXXXXXXXX & COMPANY, INC. MAY DETERMINE, (III) THE OCCURRENCE
OF A CHANGE IN CONTROL (AS DEFINED IN THE INDENTURE RELATING TO THE
NOTES) AND (IV) THE EFFECTIVENESS OF THE EXCHANGE OFFER REGISTRATION
STATEMENT (AS DEFINED IN THE INDENTURE RELATING TO THE NOTES). PRIOR
TO SUCH DATE, THE WARRANTS EVIDENCED BY THIS CERTIFICATE MAY BE
TRANSFERRED ONLY WITH THE SIMULTANEOUS TRANSFER TO THE TRANSFEREE OF
$1,000 PRINCIPAL AMOUNT OF NOTES FOR EACH WARRANT SO TRANSFERRED.
B-1
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EXHIBIT C
FORM OF CERTIFICATE OF TRANSFER
Club Xxxxxx Resorts, Inc.
00000 Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Secretary
IBJ Xxxxxxxx Bank & Trust Company
Xxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Warrants to Purchase Common Stock of Club Xxxxxx Resorts, Inc.
Reference is hereby made to the Warrant Agreement, dated as of
December 5, 1997 (the "Warrant Agreement"), between Club Xxxxxx Resorts, Inc.
(the "Company"), and IBJ Xxxxxxxx Bank & Trust Company, as warrant agent.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Warrant Agreement.
[ ], (the "Transferor") owns and proposes to
transfer the Warrant[s] or interest in such Warrant[s] specified in Annex A
hereto, in the amount of [ ] Warrants in such Note[s] or
interests (the "Transfer"), to [ ] (the "Transferee"), as
further specified in Annex A hereto. In connection with the Transfer, the
Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [ ] CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST
IN THE 144A GLOBAL WARRANT OR A DEFINITIVE WARRANT PURSUANT TO RULE 144A. The
Transfer is being effected pursuant to and in accordance with Rule 144A under
the United States Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Warrant is being transferred to a person that the
Transferor reasonably believed and believes is purchasing the beneficial
interest or Definitive Warrant for its own account, or for one or more accounts
with respect to which such person exercises sole investment discretion, and
such person and each such account is a "qualified institutional buyer" within
the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A
and such Transfer is in compliance with any applicable blue sky securities laws
of any state of the United States. Upon consummation of the proposed Transfer
in accordance with the terms of the Warrant Agreement, the transferred
beneficial interest or Definitive Warrant will be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the 144A
Global Warrant and/or the Definitive Warrant and in the Warrant Agreement and
the Securities Act.
2. [ ] CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN THE IAI GLOBAL WARRANT OR A DEFINITIVE WARRANT PURSUANT
TO ANY PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A. The Transfer is
being effected in compliance with the transfer restrictions applicable to
beneficial interests in Restricted Global Warrants and Restricted Definitive
Warrants and pursuant to and
C-1
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in accordance with the Securities Act and any applicable blue sky securities
laws of any state of the United States, and accordingly the Transferor hereby
further certifies that (check one):
(a) [ ] such Transfer is being effected pursuant to
and in accordance with Rule 144 under the Securities Act;
or
(b) [ ] such Transfer is being effected to the
Company or a subsidiary thereof;
or
(c) [ ] such Transfer is being effected pursuant to
an effective registration statement under the Securities Act and in compliance
with the prospectus delivery requirements of the Securities Act;
or
(d) [ ] such Transfer is being effected to an
Institutional Accredited Investor and pursuant to an exemption from the
registration requirements of the Securities Act other than Rule 144A, Rule 144
or Rule 904, and the Transferor hereby further certifies that it has not
engaged in any general solicitation within the meaning of Regulation D under
the Securities Act and the Transfer complies with the transfer restrictions
applicable to beneficial interests in a Restricted Global Warrant or Restricted
Definitive Warrants and the requirements of the exemption claimed, which
certification is supported by (1) a certificate executed by the Transferee in
the form of Exhibit E to the Warrant Agreement and (2) an Opinion of Counsel
provided by the Transferor or the Transferee (a copy of which the Transferor
has attached to this certification), to the effect that such Transfer is in
compliance with the Securities Act. Upon consummation of the proposed transfer
in accordance with the terms of the Warrant Agreement, the transferred
beneficial interest or Definitive Warrant will be subject to the restrictions
on transfer enumerated in the Private Placement Legend printed on the IAI
Global Warrant and/or the Definitive Warrants and in the Warrant Agreement and
the Securities Act.
3. [ ] Check if Transferee will take delivery of a beneficial interest
in an Unrestricted Global Warrant or of an Unrestricted Definitive Warrant.
(a) [ ] CHECK IF TRANSFER IS PURSUANT TO RULE 144.
(i) The Transfer is being effected pursuant to and in accordance with Rule 144
under the Securities Act and in compliance with the transfer restrictions
contained in the Warrant Agreement and any applicable blue sky securities laws
of any state of the United States and (ii) the restrictions on transfer
contained in the Warrant Agreement and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the terms of the
Warrant Agreement, the transferred beneficial interest or Definitive Warrant
will no longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Warrants, on
Restricted Definitive Warrants and in the Warrant Agreement.
(b) [ ] CHECK IF TRANSFER IS PURSUANT TO OTHER
EXEMPTION. (i) The Transfer is being effected pursuant to and in compliance
with an exemption from the registration requirements of the Securities Act
other than Rule 144, Rule 903 or Rule 904 under the Securities Act and in
compliance with the transfer restrictions contained in the Warrant Agreement
and any applicable blue sky securities
C-2
45
laws of any State of the United States and (ii) the restrictions on transfer
contained in the Warrant Agreement and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the terms of the
Warrant Agreement, the transferred beneficial interest or Definitive Warrant
will not be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Warrants or Restricted
Definitive Warrants and in the Warrant Agreement.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
------------------------------------
[Insert Name of Transferor]
By:
---------------------------------
Name:
Title:
Dated:
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46
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Warrant (CUSIP), or
(ii) [ ] IAI Global Warrant (CUSIP); or
(b) [ ] a Restricted Definitive Warrant.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [ ] a beneficial interest in the:
(i) [ ] 144A Global Warrant (CUSIP), or
(ii) [ ] IAI Global Warrant (CUSIP); or
(iii) [ ] Unrestricted Global Warrant (CUSIP); or
(b) [ ] a Restricted Definitive Warrant; or
(c) [ ] an Unrestricted Definitive Warrant,
in accordance with the terms of the Warrant Agreement.
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47
EXHIBIT D
FORM OF CERTIFICATE OF EXCHANGE
Club Xxxxxx Resorts, Inc.
00000 Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Secretary
IBJ Xxxxxxxx Bank & Trust Company
Xxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Warrants to Purchase Common Stock of Club Xxxxxx Resorts, Inc.
Reference is hereby made to the Warrant Agreement, dated as of
December 5, 1997 (the "Warrant Agreement"), between Club Xxxxxx Resorts, Inc.,
as issuer (the "Company"), and IBJ Xxxxxxxx Bank & Trust Company, as warrant
agent. Capitalized terms used but not defined herein shall have the meanings
given to them in the Warrant Agreement.
[ ], (the "Owner") owns and proposes
to exchange the Warrant[s] or interest in such Warrant[s] specified herein, in
the amount of [ ] Warrant[s] or interests (the "Exchange"). In
connection with the Exchange, the Owner hereby certifies that:
1. [ ] EXCHANGE OF RESTRICTED DEFINITIVE WARRANTS OR BENEFICIAL
INTERESTS IN A RESTRICTED GLOBAL WARRANT FOR UNRESTRICTED DEFINITIVE WARRANTS
OR BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL WARRANT
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST
IN A RESTRICTED GLOBAL WARRANT TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL
WARRANT. In connection with the Exchange of the Owner's beneficial interest in
a Restricted Global Warrant for a beneficial interest in an Unrestricted Global
Warrant in an equal amount, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to the Global Warrants and pursuant to and in accordance with the
United States Securities Act of 1933, as amended (the "Securities Act"), (iii)
the restrictions on transfer contained in the Warrant Agreement and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the beneficial interest in an Unrestricted Global
Warrant is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.
(b) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST
IN A RESTRICTED GLOBAL WARRANT TO UNRESTRICTED DEFINITIVE WARRANT. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Warrant for an Unrestricted Definitive Warrant, the Owner hereby
certifies (i) the Definitive Warrant is being acquired for the Owner's own
account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to the Restricted Global Warrants and
pursuant to and in accordance with the Securities Act, (iii) the restrictions
on transfer contained in the Warrant Agreement and the Private Placement Legend
are not required in order to maintain compliance with the Securities Act and
(iv) the Definitive Warrant is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
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48
(c) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED
DEFINITIVE WARRANT TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL WARRANT.
In connection with the Owner's Exchange of a Restricted Definitive Warrant for
a beneficial interest in an Unrestricted Global Warrant, the Owner hereby
certifies (i) the beneficial interest is being acquired for the Owner's own
account without transfer, (ii) such Exchange has been effected in compliance
with the transfer restrictions applicable to Restricted Definitive Warrants and
pursuant to and in accordance with the Securities Act, (iii) the restrictions
on transfer contained in the Warrant Agreement and the Private Placement Legend
are not required in order to maintain compliance with the Securities Act and
(iv) the beneficial interest is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.
(d) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED
DEFINITIVE WARRANT TO UNRESTRICTED DEFINITIVE WARRANT. In connection with the
Owner's Exchange of a Restricted Definitive Warrant for an Unrestricted
Definitive Warrant, the Owner hereby certifies (i) the Unrestricted Definitive
Warrant is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Warrants and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Warrant Agreement and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the Unrestricted
Definitive Warrant is being acquired in compliance with any applicable blue sky
securities laws of any state of the United States.
2. [ ] EXCHANGE OF RESTRICTED DEFINITIVE WARRANTS OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL WARRANTS FOR RESTRICTED DEFINITIVE WARRANTS OR
BENEFICIAL INTERESTS IN RESTRICTED GLOBAL WARRANTS
(a) [ ] CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST
IN A RESTRICTED GLOBAL WARRANT TO RESTRICTED DEFINITIVE WARRANT. In connection
with the Exchange of the Owner's beneficial interest in a Restricted Global
Warrant for a Restricted Definitive Warrant with an equal amount, the Owner
hereby certifies that the Restricted Definitive Warrant is being acquired for
the Owner's own account without transfer. Upon consummation of the proposed
Exchange in accordance with the terms of the Warrant Agreement, the Restricted
Definitive Warrant issued will continue to be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the Restricted
Definitive Warrant and in the Indenture and the Securities Act.
(b) [ ] CHECK IF EXCHANGE IS FROM RESTRICTED
DEFINITIVE WARRANT TO BENEFICIAL INTEREST IN A RESTRICTED GLOBAL WARRANT. In
connection with the Exchange of the Owner's Restricted Definitive Warrant for a
beneficial interest in the [CHECK ONE] O 144A Global Warrant, O IAI Global
Warrant with an equal amount, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer and
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Restricted Global Warrants and pursuant to and
in accordance with the Securities Act, and in compliance with any applicable
blue sky securities laws of any state of the United States. Upon consummation
of the proposed Exchange in accordance with the terms of the Warrant Agreement,
the beneficial interest issued will be subject to the restrictions on transfer
enumerated in the Private
Placement Legend printed on the relevant Restricted Global
Warrant and in the Warrant Agreement and the Securities Act.
This certificate and the statements contained herein are made
for your benefit and the benefit of the Company.
----------------------------------------
[Insert Name of Owner]
By:
------------------------------------
Name:
Title:
Dated:
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49
EXHIBIT E
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Club Xxxxxx Resorts, Inc.
00000 Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Secretary
IBJ Xxxxxxxx Bank & Trust Company
Xxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Re: Warrants to Purchase Common Stock of Club Xxxxxx Resorts, Inc.
Reference is hereby made to the Warrant Agreement, dated as of
December 5, 1997 (the "Warrant Agreement"), between Club Xxxxxx Resorts, Inc.,
as issuer (the "Company"), and IBJ Xxxxxxxx Bank & Trust Company, as warrant
agent. Capitalized terms used but not defined herein shall have the meanings
given to them in the Warrant Agreement.
In connection with our proposed purchase of [ ]
number of:
(a) [ ] a beneficial interest in a Global Warrant, or
(b) [ ] a Definitive Warrant,
we confirm that:
1. We understand that any subsequent transfer of the
Warrants or any interest therein is subject to certain restrictions and
conditions set forth in the Warrant Agreement and the undersigned agrees to be
bound by, and not to resell, pledge or otherwise transfer the Warrants or any
interest therein except in compliance with, such restrictions and conditions
and the United States Securities Act of 1933, as amended (the "Securities
Act").
2. We understand that the offer and sale of the Warrants
have not been registered under the Securities Act, and that the Warrants and
any interest therein may not be offered or sold except as permitted in the
following sentence. We agree, on our own behalf and on behalf of any accounts
for which we are acting as hereinafter stated, that if we should sell the
Warrants or any interest therein, we will do so only (A) to the Company or any
subsidiary thereof, (B) in accordance with Rule 144A under the Securities Act
to a "qualified institutional buyer" (as defined therein), (c) to an
institutional "accredited investor" (as defined below) that, prior to such
transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to
you and to the Company a signed letter substantially in the form of this letter
and an Opinion of Counsel in form reasonably acceptable to the Company to the
effect that such transfer is in compliance with the Securities Act, (D) outside
the United States in accordance with Rule 904 of Regulation S under the
Securities Act, (E) pursuant to the provisions of Rule 144(k) under the
Securities Act or (F) pursuant to an effective registration statement under the
Securities Act, and we
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50
further agree to provide to any person purchasing the Definitive Warrant or
beneficial interest in a Global Warrant from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising
such purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the
Warrants or beneficial interest therein, we will be required to furnish to you
and the Company such certifications, legal opinions and other information as
you and the Company may reasonably require to confirm that the proposed sale
complies with the foregoing restrictions. We further understand that the
Warrants purchased by us will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities
Act) and have such knowledge and experience in financial and business matters
as to be capable of evaluating the merits and risks of our investment in the
Warrants, and we and any accounts for which we are acting are each able to bear
the economic risk of our or its investment.
5. We are acquiring the Warrants or beneficial interest
therein purchased by us for our own account or for one or more accounts (each
of which is an institutional "accredited investor") as to each of which we
exercise sole investment discretion.
You are entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceedings or official inquiry with respect to the
matters covered hereby.
-----------------------------------
[Insert Name of Accredited Investor]
By:
--------------------------------
Name:
Title:
Dated:
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