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XXXXXXX XXXXX XXXXXX HOLDINGS INC.
and
CITIBANK, N.A., Warrant Agent
and
XXXXXXX XXXXX BARNEY INC., Determination Agent
-------------------------
WARRANT AGREEMENT
dated as of September 29, 2000
-------------------------
_________ Call Warrants
on the 2000 TEN+(SM) Index
Expiring ______, 2002
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TABLE OF CONTENTS
PAGE
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ARTICLE I ISSUANCE OF WARRANTS AND FORM, EXECUTION,
DELIVERY AND REGISTRATION OF WARRANTS.......................................1
SECTION 1.01. Issuance of Warrants.......................................................1
SECTION 1.02. Form, Execution and Delivery of Warrant Certificates.......................2
SECTION 1.03. Mutilated or Missing Warrant Certificates..................................3
ARTICLE II DURATION AND EXERCISE OF WARRANTS................................................4
SECTION 2.01. Duration of Warrants; Exercise Notice......................................4
SECTION 2.02. Exercise and Delivery of Warrants..........................................5
SECTION 2.03. Market Disruption Events..................................................10
SECTION 2.04. Extraordinary Events......................................................12
SECTION 2.05. Cancellation of Warrants..................................................13
SECTION 2.06. Extension Events..........................................................14
SECTION 2.07. Delisting of Warrants.....................................................15
SECTION 2.08. Automatic Exercise of Warrants............................................15
SECTION 2.09. Maximum Number of Exercisable Warrants....................................16
SECTION 2.10. Covenant of the Company...................................................17
SECTION 2.11. Return of Money Held Unclaimed for Two Years..............................17
SECTION 2.12. Return of Global Warrant Certificate......................................17
ARTICLE III OTHER PROVISIONS RELATING TO RIGHTS OF WARRANTHOLDERS..........................17
SECTION 3.01. Warrantholder of Warrant May Enforce Rights...............................17
SECTION 3.02. Merger, Consolidation, Sale, Transfer or Conveyance.......................17
ARTICLE IV WARRANTS ACQUIRED BY THE COMPANY; PAYMENT OF TAXES..............................18
SECTION 4.01. Warrants Acquired by the Company..........................................18
SECTION 4.02. Payment of Taxes..........................................................18
ARTICLE V CONCERNING THE WARRANT AGENT.....................................................18
SECTION 5.01. Warrant Agent.............................................................18
SECTION 5.02. Conditions of Warrant Agent's Obligations.................................19
SECTION 5.03. Resignation and Appointment of Successor..................................20
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ARTICLE VI MISCELLANEOUS...................................................................22
SECTION 6.01. Amendment.................................................................22
SECTION 6.02. Successor Index...........................................................22
SECTION 6.03. Notices and Demands to the Company, the Warrant Agent and the
Determination Agent.....................................................22
SECTION 6.04. Addresses for Notices.....................................................23
SECTION 6.05. Notices to Holders........................................................23
SECTION 6.06. Obtaining of Approvals....................................................23
SECTION 6.07. Persons Having Rights Under This Agreement................................23
SECTION 6.08. Inspection of Agreement...................................................23
SECTION 6.09. Headings..................................................................23
SECTION 6.10. Counterparts..............................................................24
SECTION 6.11. Applicable Law............................................................24
TESTIMONIUM
SIGNATURES
EXHIBIT A - Form of Global Warrant Certificate
EXHIBIT B - Exercise Notice
EXHIBIT C - Confirmation of Exercise/Notice of Rejection
EXHIBIT D - Notice of Rejection Relating to Limit Option
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WARRANT AGREEMENT, dated as of September 29, 2000, among XXXXXXX XXXXX
XXXXXX HOLDINGS INC., a corporation organized and existing under the laws of the
State of New York (the "Company"), CITIBANK, N.A., a national banking
association organized and existing under the laws of the United States of
America (the "Warrant Agent"), and XXXXXXX XXXXX BARNEY INC., a corporation
organized and existing under the laws of the State of Delaware (the
"Determination Agent").
WHEREAS the Company proposes to sell warrants (the "Warrants" or,
individually, a "Warrant") representing the right to receive from the Company
the amount, if any, in U.S. dollars determined by reference to increases in the
value of the of 2000 TEN+(SM) Index (the "Index") on the terms and conditions
set forth in this Agreement; and
WHEREAS the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing so to act, in connection with the
issuance, transfer and exercise of the Warrants, and the Company desires to set
forth herein, among other things, the provisions of the Warrants and the terms
and conditions on which they may be issued, transferred, exercised and canceled;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
ISSUANCE OF WARRANTS AND FORM,
EXECUTION, DELIVERY AND REGISTRATION
OF WARRANTS
SECTION 1.01. Issuance of Warrants. (a) The Warrants will constitute
direct, unconditional and unsecured obligations of the Company and will rank on
a parity with the Company's other unsecured contractual obligations and with the
Company's unsecured and unsubordinated debt.
(b) The Warrants will be issued in book-entry form and represented by
one or more global certificates (each a "Global Warrant Certificate"). Each
Warrant shall represent the right, subject to the provisions contained herein,
to receive the Cash Settlement Value (as defined herein) of such Warrant upon
exercise. In no event shall a registered or beneficial holder of a Warrant (each
a "Warrantholder") be entitled to receive any interest on any Cash Settlement
Value. A Warrant will not require or entitle a Warrantholder to receive any of
the underlying stocks comprising the Index (the "Underlying Shares") from the
Company. The Company shall not be under any obligation to, nor will it, sell the
Underlying Shares to, or purchase or take delivery of any such Underlying Share
from, Warrantholders in connection with the exercise of any Warrants.
(c) Warrantholders shall not be entitled to hold Warrants in
certificated form through Clearstream Banking societe anonyme ("Clearstream") or
the Euroclear System operated by Xxxxxx Guaranty Trust's Brussels Office
("Euroclear").
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SECTION 1.02. Form, Execution and Delivery of Warrant Certificates. (a)
Each Global Warrant Certificate shall be evidenced by a certificate in
registered form substantially in the form set forth in Exhibit A hereto, with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Agreement, and may represent any number of
whole Warrants. Each Global Warrant Certificate may have imprinted or otherwise
reproduced thereon such letters, numbers or other marks of identification or
designation and such legends or endorsements as the officers of the Company
executing the same may approve (execution thereof to be conclusive evidence of
such approval) and which are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto, or with any rule or regulation of any stock
exchange on which the Warrants may be listed, or of the Depository (as defined
herein), or to conform to usage.
(b) The Warrant Agent is authorized, upon receipt of a Global Warrant
Certificate from the Company, duly executed on behalf of the Company, and a
written order from the Company, to countersign such Global Warrant Certificate.
The Global Warrant Certificate shall be manually countersigned and dated the
date of its countersignature by the Warrant Agent and shall not be valid for any
purpose unless so countersigned. The Warrant Agent shall deliver the Global
Warrant Certificate to or upon the order of the Company. One or more Global
Warrant Certificates may be executed by the Company and delivered to the Warrant
Agent on or after the date of execution of this Agreement; provided that only
one Global Warrant Certificate shall be outstanding at any one time.
The Company reserves the right to issue, from time to time after the
date of execution of this Agreement, additional Warrants, and in connection
therewith the Global Warrant Certificate may be exchanged for a new Global
Warrant Certificate to reflect the issuance by the Company of such additional
Warrants. To effect such an exchange the Company shall deliver to the Warrant
Agent a new Global Warrant Certificate duly executed on behalf of the Company
and a written instruction as provided in Section 1.02. The Warrant Agent shall
authenticate the new Global Warrant Certificate as provided in this Section and
shall deliver the new Global Warrant Certificate to the Depository in exchange
for, and upon receipt of, the Global Warrant Certificate then held by the
Depository. The Warrant Agent shall cancel the Global Warrant Certificate
delivered to it by the Depository, destroy such Global Warrant Certificate and
provide a certificate of destruction to the Company.
(c) In case any officer of the Company who shall have signed a Global
Warrant Certificate, either manually or by facsimile signature, shall cease to
be such officer before such Global Warrant Certificate shall have been
countersigned and delivered by the Warrant Agent to the Company or delivered by
the Company, such Global Warrant Certificate nevertheless may be countersigned
and delivered as though the person who signed such Global Warrant Certificate
had not ceased to be such officer of the Company; and the Global Warrant
Certificate may be signed on behalf of the Company by any person who, at the
actual date of the execution of such Global Warrant Certificate, shall be a
proper officer of the Company to sign such Global Warrant Certificate, although
at the date of the execution of this Warrant Agreement any such person was not
such officer.
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(d) The Global Warrant Certificate will initially be registered in the
name of a nominee of The Depository Trust Company (the "Depository", which term,
as used herein, includes any successor securities depository selected by the
Company). The Warrant holdings of the Depository participants (the
"Participants") will be recorded on the books of the Depository. The holdings of
customers of the Participants and the identity of the Warrantholders will be
reflected on the books and records of such Participants and will not be known to
the Warrant Agent, the Company, the Determination Agent or the Depository. The
Global Warrant Certificate will be held by the Depository or its agent.
The Company may from time to time select a new entity to act as
Depository with respect to the Warrants and, if such selection is made, the
Company shall promptly give the Warrant Agent written notice to such effect
identifying the new Depository, and the Global Warrant Certificate shall be
delivered to the Warrant Agent and shall be transferred to the new Depository as
provided below as promptly as possible. Appropriate changes may be made in the
forms of the Global Warrant Certificate, the Exercise Notice (as defined herein)
and the related notices to be delivered in connection with an exercise to
reflect the selection of the new Depository.
(e) Except as otherwise provided herein or in the Global Warrant
Certificate, the Warrant Agent shall from time to time register the transfer of
the Global Warrant Certificate in its records (which may be maintained
electronically), subject to such reasonable regulations as the Company or the
Warrant Agent may prescribe, only to the Depository, to another nominee of the
Depository, to a successor Depository or to a nominee of a successor Depository,
upon surrender of such Global Warrant Certificate, duly endorsed, or accompanied
by a written instrument or instruments of transfer in form satisfactory to the
Warrant Agent and the Company, duly executed by the registered holder thereof or
by the duly appointed legal representative thereof, or by its duly authorized
attorney, such signature to be guaranteed by a bank or trust company with a
correspondent office in The City of New York or by a member of a national
securities exchange. Upon any such registration of transfer, a new Global
Warrant Certificate shall be issued to the transferee and the surrendered Global
Warrant Certificate shall be canceled by the Warrant Agent.
The Global Warrant Certificate may be transferred as provided above at
the option of the holder thereof, when surrendered to the Warrant Agent's
Office, or at the office of any successor Warrant Agent (as provided in Section
5.03), for another Global Warrant Certificate of like tenor and representing an
equal number of unexercised Warrants.
(f) Except as provided in Section 1.03, no service charge shall be made
for any registration of transfer or exchange of Global Warrant Certificates, but
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 of
transfer or exchange of Global Warrant Certificates, other than exchanges
pursuant to this Section 1.02 not involving any transfer.
SECTION 1.03. Mutilated or Missing Warrant Certificates. (a) If any
Global Warrant Certificate is mutilated, lost, stolen or destroyed, the Company
may in its discretion execute, and the Warrant Agent may countersign and
deliver, in exchange and substitution for and upon cancellation of the mutilated
Global Warrant Certificate, or in lieu of the Global
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Warrant Certificate lost, stolen or destroyed, a new Global Warrant Certificate
of like tenor and representing an equal number of unexercised Warrants, bearing
an identification number not contemporaneously outstanding, but only (in case of
loss, theft or destruction) upon receipt of evidence satisfactory to the Company
and the Warrant Agent of such loss, theft or destruction of such Global Warrant
Certificate, written direction from the Company, and security or indemnity, if
requested, also satisfactory to them. Applicants for such substitute Global
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.
(b) In case all of the Warrants evidenced by any such mutilated, lost,
stolen or destroyed Global Warrant Certificate have been or are about to be
exercised, or deemed to be exercised, the Company in its absolute discretion
may, instead of issuing a new Global Warrant Certificate, direct the Warrant
Agent in writing to treat the same as if it had received an Exercise Notice in
proper form in respect thereof, as provided herein, or as being subject to
automatic exercise (pursuant to Section 2.08) , as the case may be.
(c) Each new Global Warrant Certificate issued pursuant to this Section
1.03 in lieu of any lost, stolen or destroyed Global Warrant Certificate shall
be an original, additional contractual obligation of the Company, whether or not
the lost, stolen or destroyed Global Warrant Certificate shall at any time be
enforceable by anyone, and shall be entitled to the same benefits under this
Agreement equally and proportionately with any and all other Global Warrant
Certificates duly issued hereunder.
(d) Upon the issuance of any new Global Warrant Certificate in
accordance with this Section 1.03, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Warrant Agent and the reasonable fees of its counsel) connected therewith.
(e) The provisions of this Section 1.03 are exclusive and shall preclude
(to the extent lawful) any other rights and remedies with respect to the
replacement or payment of mutilated, lost, stolen or destroyed Global Warrant
Certificates.
ARTICLE II
DURATION AND EXERCISE OF WARRANTS
SECTION 2.01. Duration of Warrants; Exercise Notice. Subject to the
limitations set forth herein and in Section 2.08, each Warrant may be
irrevocably exercised in whole but not in part, at or prior to 3:00 p.m., New
York City time, on any Business Day from September 29, 2000 until 3:00 p.m., New
York City time, on the earlier of (i) the fourth Business Day immediately
preceding _________, 2002 (the "Expiration Date") and (ii) the Delisting Date
(as defined herein), if any. Except in the event of automatic exercise, each
Warrant shall be irrevocably exercised upon receipt by the Warrant Agent of such
Warrant delivered free on the records of the Depository to the Warrant Agent's
Depository Participant Account (entitled Citibank, N.A. Corporate Trust Warrant
Agent Account, No. [ ], or such other account at the
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Depository as the Warrant Agent shall designate in writing to the Company) (the
"Warrant Account") pursuant to an Exercise Notice to the Warrant Agent from a
Participant, in the case of Warrants held through the facilities of the
Depository, Clearstream, in the case of Warrants held through Clearstream, or a
Euroclear participant, in the case of Warrants held through Euroclear, acting,
directly or indirectly, on behalf of the Warrantholder; provided, however, that
Exercise Notices are subject to rejection by the Warrant Agent as provided
herein. An Exercise Notice shall be unconditional. Except as provided in Section
2.02(b), the Warrant Agent shall be entitled, with no duty of inquiry, to rely
conclusively on any Exercise Notice received by it. "Exercise Notice" means an
irrevocable exercise notice to the Warrant Agent at its address, which notice
shall be substantially in the form set forth in Exhibit B hereto or such other
form as the Company and the Warrant Agent may approve and may be given by
facsimile transmission. For purposes of this Agreement, "Business Day" means any
day other than a Saturday or Sunday or a day on which either the Chicago Board
Options Exchange (the "CBOE") is not open for securities trading or commercial
banks in New York City are required or authorized by law or executive order to
remain closed.
SECTION 2.02. Exercise and Delivery of Warrants. (a) Except for Warrants
subject to automatic exercise or held through the facilities of Clearstream or
Euroclear, and subject to the Limit Option, the "Exercise Date" for a Warrant
will be (i) the Business Day on which the Warrant Agent receives the Warrant and
Exercise Notice in proper form with respect to such Warrant, if received at or
prior to 3:00 p.m., New York City time, on such day, or (ii) if the Warrant
Agent receives such Warrant and Exercise Notice after 3:00 p.m., New York City
time, on a Business Day, then the Business Day next succeeding such Business
Day. In the case of Warrants held through the facilities of Clearstream or
Euroclear, except for Warrants subject to automatic exercise, and subject to the
Limit Option, the "Exercise Date" for a Warrant will be (i) the Business Day on
which the Warrant Agent receives the Exercise Notice in proper form with respect
to such Warrant if such Exercise Notice is received at or prior to 3:00 p.m.,
New York City time, on such day; provided that the Warrant is received by the
Warrant Agent by 3:00 p.m., New York City time, on the Valuation Date (as
defined below), or (ii) if the Warrant Agent receives such Exercise Notice after
3:00 p.m., New York City time, on a Business Day, then the Business Day next
succeeding such Business Day; provided that the Warrant is received by 3:00
p.m., New York City time, on the Valuation Date relating to exercises of
Warrants on such succeeding Business Day. In the event that a Warrant is
received after 3:00 p.m., New York City time, on the Valuation Date, then the
Exercise Date for such Warrant will be the day on which such Warrant is received
or, if such day is not a Business Day, the next succeeding Business Day. In the
case of Warrants held through the facilities of Euroclear, (a) participants must
also transmit, by facsimile, to the Warrant Agent a copy of the Exercise Notice
submitted to Euroclear by 3:00 p.m., New York City time, on the desired Exercise
Date and (b) Euroclear must confirm (a "Euroclear Confirmation") by telex to the
Warrant Agent by 9:00 a.m., New York City time, on the Valuation Date that the
Warrants will be received by the Warrant Agent on such date; provided that if
such telex communication is received after 9:00 a.m., New York City time, on the
Valuation Date, the Company will be entitled to direct the Warrant Agent to
reject the related Exercise Notice or waive the requirement for timely delivery
of such telex communication.
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The "Valuation Date" for a Warrant will be the first Business Day
following the Exercise Date, subject to postponement as a result of the exercise
of a number of Warrants exceeding the limits on exercise described in Section
2.09 or pursuant to Section 2.06.
(b) The Warrant Agent shall, in the case of Warrants other than those
held through Clearstream or Euroclear, following receipt of proper delivery of a
Warrant in accordance with Section 2.02(a), accompanied by a completed Exercise
Notice, and, in the case of Warrants held through Clearstream or Euroclear,
following receipt of proper delivery of a completed Exercise Notice in
accordance with Section 2.02(a):
(i) promptly (1) for Warrants not held through Clearstream or Euroclear,
determine whether such Exercise Notice has been duly completed and is in proper
form and (2) for Warrants held through Clearstream or Euroclear, determine
whether such Exercise Notice has been duly completed and is in proper form duly
executed by Clearstream or the Euroclear participant tendering such Warrant, as
applicable; and, in either case, if the Warrant Agent determines that the
Exercise Notice has not been duly completed or is not in proper form, the
Warrant Agent promptly shall (X) reject such Exercise Notice and shall send to
the entity that executed such Exercise Notice a notice of rejection
substantially in the form set forth in Exhibit C hereto and shall redeliver such
Warrants (to the extent received in the case of Warrants held through
Clearstream or Euroclear) free through the facilities of the Depository to the
account from which they were transferred to the Warrant Agent and (Y) shall not
take the actions required by clauses (ii)-(ix) below with respect to such
Exercise Notice or the related Warrants; provided, however, that the Warrant
Agent shall deliver a copy of the Exercise Notice relating to such Warrants to
the Company as required by Section 2.02(b)(ix) below and the Company may waive
any defect in the form of such Exercise Notice;
(ii) with respect to each Warrant held through Euroclear for which an
Exercise Notice was received, promptly telephone Euroclear to determine whether
Euroclear anticipates that it will be able to provide a Euroclear Confirmation
as required by Section 2.02(a);
(iii) notify the Company and the Determination Agent (and such other
parties (not to exceed two) as the Company shall designate in writing) by 5:00
p.m., New York City time, on the Business Day that such Exercise Notice has been
received (or shall be deemed to have been received) of (A) the total number of
Warrants covered by such Exercise Notice, (B) the number of such Warrants
subject to the Limit Option (as defined in Section 2.02(f)), (C) the number of
such Warrants not subject to the Limit Option and (D) the number of such
Warrants, if any, as to which Euroclear has not advised the Warrant Agent that
it anticipates being able to provide a Euroclear Confirmation as required by
Section 2.02(a);
(iv) with respect to Warrants held through Euroclear, determine whether
the Warrant Agent has received by 9:00 a.m., New York City time, on the
Valuation Date relating to such Warrants, Euroclear Confirmations with respect
to such Warrants as required by Section 2.02(a), and if the Warrant Agent has
not received any such Euroclear Confirmation by such time, notify the Company
(and such other parties (not to exceed two) as the Company shall designate in
writing) by 10:00 a.m., New York City time, on such Valuation Date of the number
of such Warrants in respect of which the Warrant Agent has not received such
Euroclear Confirmations and (except to the extent the Company has notified the
Warrant Agent that it has
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waived the requirement of timely delivery of such Euroclear Confirmation) send
to the Euroclear participant that executed such Exercise Notice for which no
related Euroclear Confirmation was received (at the address specified in such
notice) a notice of rejection substantially in the form set forth in Exhibit C
hereto;
(v) if any of the Warrants covered by such Exercise Notice constitute
Warrants subject to the Limit Option, the Warrant Agent shall, by 5:00 p.m., New
York City time, on the first Business Day following the Exercise Date for such
Warrants, (A) obtain from the Determination Agent the Spot Index Value (as
defined herein) for such Warrants for the Business Day that, but for the
provisions of Section 2.02(f), would be the Valuation Date for such Warrants,
(B) determine in accordance with Section 2.02(f) whether such Warrants will be
subject to exercise after giving effect to the Limit Option and, if such
Warrants will not be subject to exercise, send to the Participant that submitted
such Exercise Notice a notice of rejection substantially in the form set forth
in Exhibit D hereto with respect to such Warrants and (to the extent received in
the case of Warrants held through Clearstream and Euroclear), redeliver the
Warrants free through the facilities of the Depository to the account of such
Participant and (C) notify the Company and the Determination Agent as to whether
such Warrants will be subject to exercise;
(vi) by 5:00 p.m., New York City time, on the Exercise Date for such
Warrants, (A) determine the sum of (1) the number of such Warrants not subject
to the Limit Option (i.e., the number of Warrants determined pursuant to clause
(iii)(C) above) plus (2) the number of such Warrants with respect to which the
Limit Option has been elected but that, notwithstanding such election, will be
subject to exercise (i.e., the number of Warrants so identified pursuant to
clause (v)(B) above) (all of such Warrants determined pursuant to (1) and (2),
the "Exercised Warrants") and (B) notify the Company and the Determination Agent
of the total number of Exercised Warrants so determined (if such number is zero,
the Warrant Agent shall not take the actions required by clauses (vii) and
(viii) with respect to such Exercise Notice or the related Warrants);
(vii) obtain from the Determination Agent the calculation of the Cash
Settlement Value of the Exercised Warrants (excluding any Warrants held through
Clearstream or Euroclear as to which timely delivery of the related Warrant has
not been made) as of their Valuation Date in the manner set forth in Section
2.02(c) by no later than 3:00 p.m., New York City time, on the Business Day next
succeeding the Valuation Date;
(viii) notify the Company (and such other parties (not to exceed two) as
the Company shall designate in writing) by 5:00 p.m., New York City time, on the
Business Day next succeeding the Valuation Date of the Cash Settlement Value
payable in respect of the Exercised Warrants, and send notices of confirmation
substantially in the form included in Exhibit C to the appropriate Participant
specifying therein the reference number assigned by the Warrant Agent to each
accepted Exercise Notice; and
(ix) promptly deliver a copy of each Exercise Notice to the Company and
advise the Company of such other matters relating to the Exercised Warrants as
the Company shall reasonably request. Any notice to be given to the Company by
the Warrant Agent pursuant to this Section 2.02 shall be by telephone (promptly
confirmed in writing) or telecopy.
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Except in the case of Warrants subject to automatic exercise, if on any
Valuation Date the Cash Settlement Value for any Warrants then exercised would
be zero, then the attempted exercise of such Warrants shall be void and of no
effect and the Warrants shall be transferred by the Warrant Agent back to the
Participant (including Clearstream and Euroclear) that submitted them free to
the Warrant Agent on the records of the Depository (to the extent received in
the case of Warrants held through Clearstream or Euroclear) and, in either case,
the Warrants in question shall remain outstanding and exercisable thereafter.
(c) The Company shall make available to the Warrant Agent, not later
than 3:00 p.m., New York City time, on the third Business Day following the
Valuation Date (the "Settlement Date"), funds in an amount sufficient to pay the
aggregate Cash Settlement Value of such Warrants. Subject to such funds having
been made available as provided in the preceding sentence, the Warrant Agent
will be responsible for making funds available to the Depository in accordance
with procedures agreed upon between the Depository and the Warrant Agent,
against receipt of the Global Warrant Certificate, after 3:00 p.m., New York
City time, but prior to the close of business, on the Settlement Date, such
funds to be in an amount equal to the aggregate Cash Settlement Value of the
Warrants that were delivered to the Warrant Agent (together with the related
Exercise Notice) as provided in Sections 2.01 and 2.02(a) and (b). The
Depository will be responsible for disbursing such funds to each appropriate
Participant, and such Participant will be responsible for disbursing such
payments to the Warrantholders it represents and to each brokerage firm for
which it acts as agent. Each such brokerage firm will be responsible for
disbursing funds to the Warrantholders it represents.
The "Cash Settlement Value" of a Warrant will equal an amount in U.S.
dollars which is equal to the greater of (A) zero and (B) the product (rounded
down to the nearest cent) of (i) the quotient obtained by dividing (x) the
amount, if any, by which the Spot Index Value (as defined below) for the
applicable Valuation Date exceeds the Strike Index Value (as defined below) by
(y) the Initial Index Value and (ii) $10.
The "Initial Index Value" means the value of the Index at the close of
trading on the CBOE on September [ ], 2000.
The "Strike Index Value" means 80% of the Initial Index Value.
The "Spot Index Value" means the value of the Index at the close of
trading on the CBOE on the applicable Valuation Date; provided, however, that
the Spot Index Value with respect to the Expiration Date, any Early Extended
Expiration Date (as defined below) or any Extended Expiration Date (as defined
below) means the value of the Index at the opening of trading on the CBOE on the
applicable Valuation Date.
The Spot Index Value used to determine the Cash Settlement Value on any
Valuation Date will be rounded to the second decimal place (e.g., 110.00),
rounding up if the next succeeding decimal place, without regard to rounding, is
five or higher and rounding down if the next succeeding decimal place, without
regard to rounding, is four or lower. Any such Cash Settlement Value will be
rounded downwards, if necessary, to the nearest cent.
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(d) The Warrant Agent shall cause its records, which may be kept
electronically, to be marked to reflect the reduction in the number of Warrants
represented by the Global Warrant Certificate by the number of Warrants that
were delivered to the Warrant Agent and for which payment has been made as
provided in Section 2.02(c) promptly after such delivery and payment. Absent
manifest error, the Warrant Agent's records shall be conclusive evidence of such
matters.
(e) The Company has appointed Xxxxxxx Xxxxx Xxxxxx Inc., and Xxxxxxx
Xxxxx Barney Inc. accepts such appointment, to be the Company's Determination
Agent to make such calculations as may be required, including, without
limitation, calculation of the Initial Index Value, the Strike Index Value and
any Spot Index Value. The Determination Agent shall timely communicate the
Initial Index Value, the Strike Index Value and each Spot Index Value to the
Warrant Agent. The Determination Agent shall act as an independent expert and
not as an agent of the Company, and, unless otherwise provided by this
Agreement, its calculations and determinations under this Agreement shall,
absent manifest error, be final and binding on the Company, the Warrant Agent,
the Warrantholders and any Participant. Any such calculations will be made
available to a Warrantholder for inspection at the Warrant Agent's Office.
The Company agrees, for the benefit of the Warrantholders from time to
time, that there shall at all times be a Determination Agent hereunder until all
the Warrants are no longer outstanding or until monies for the payment of all
outstanding Warrants, if any, shall have been paid to the Warrant Agent and
shall have been returned to the Company as provided in Section 2.11, whichever
occurs earlier. Resignation, removal and appointment of the Determination Agent
shall be in accordance with the procedures set forth for the resignation,
removal and appointment of the Warrant Agent, as provided in Section 5.03,
except that a successor Determination Agent need not be a banking institution
with offices south of Xxxxxxxx Street in the Borough of Manhattan, The City of
New York, and may only be appointed if such successor has been nominated by the
Company and approved by the predecessor Determination Agent.
The Company agrees promptly to pay the Determination Agent the
compensation to be agreed upon with the Company for all services rendered by the
Determination Agent hereunder. The Company also agrees to indemnify the
Determination Agent for, and to hold it harmless against, any loss, liability,
cost or expense (including reasonable attorneys' fees and expenses) incurred by
the Determination Agent by reason of its being made a party to a suit or claim
arising out of this Agreement; provided, however, that such indemnity shall in
no event apply to the extent that any such loss, liability, cost or expense is a
result of the negligence, bad faith or breach of this Agreement on its part in
connection with the services rendered by it hereunder. The indemnity obligation
of the Company shall continue notwithstanding the termination of this Agreement
or the resignation or removal of the Determination Agent.
(f) Except in the event of an automatic exercise (as described in
Section 2.07 below), in connection with any exercise of Warrants, the related
Exercise Notice may specify that such exercise is subject to the condition that
the Spot Index Value that would otherwise be used to determine the Cash
Settlement Value of such Warrants shall not have declined by five or more points
from the Limit Option Index Value for such Warrants. "Limit Option Index Value",
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with respect to any Warrants subject to the Limit Option, means the Spot Index
Value on the Business Day that such Exercise Notice has been received (or shall
be deemed to have been received). The option of a Warrantholder to condition an
exercise of Warrants as provided in this Section 2.02(f) is herein referred to
as the "Limit Option". If a Warrantholder elects the Limit Option in connection
with any exercise of Warrants, the following provisions shall apply:
(i) To be valid, such election must be specified in the related Exercise
Notice. Each of the Warrant Agent and the Company shall be entitled to rely
conclusively on such Exercise Notice, as received by the Warrant Agent, in
determining whether such election has been validly made. Participants shall be
required to certify that the number of Warrants exercised on behalf of any
Warrantholder pursuant to the related Exercise Notice that is subject to the
Limit Option is not more than 100,000.
(ii) The Limit Option Index Value shall be determined by the
Determination Agent, which determination shall be conclusive and binding for all
purposes relating to such exercise.
(iii) In the event that the Spot Index Value for the first Business Day
following the Business Day that such Exercise Notice has been received (or shall
be deemed to have been received) (i.e., for the day that, but for the provisions
of this Section 2.02(f), would be the Valuation Date for such Warrants) has
declined by five or more points from the Limit Option Index Value for such
Warrants, such Warrants (A) shall not be subject to exercise and shall be
treated for all purposes of this Agreement and each Global Warrant Certificate
as if the related Exercise Notice had never been received by the Warrant Agent,
and (B) shall not constitute "Exercised Warrants" for purposes of Section
2.02(b). If such Spot Index Value has not declined by five or more points from
such Limit Option Index Value, such Warrants shall be subject to exercise as
provided in this Section 2.02 and shall be deemed to be "Exercised Warrants" for
such purposes. The Warrant Agent's determination shall be conclusive and binding
for all purposes relating to such Warrants.
(iv) Once elected by a Warrantholder in connection an exercise of
Warrants, the Limit Option will continue to apply, on the basis of the Limit
Option Index Value as initially determined for such Warrants, even if the
Valuation Date for such Warrants is postponed, except when such Valuation Date
is postponed to a date of automatic exercise of Warrants. Pursuant to the Limit
Option, such Warrants will either (a) be exercised on a delayed basis if the
Spot Index Value on any applicable postponed Valuation Date is not less than the
Limit Option Index Value by five or more points or (b) not be exercised if, on
any applicable postponed Valuation Date, the Spot Index Value is less than the
Limit Option Index Value by five or more points.
SECTION 2.03. Market Disruption Events (a) If the Company determines
that on a Business Day that would otherwise be a Valuation Date (an "Applicable
Business Day") a Market Disruption Event has occurred and is continuing, then
the Cash Settlement Value in respect of an exercise of Warrants shall be
calculated using as the Valuation Date the next Business Day following such
Applicable Business Day on which there is no Market Disruption Event or
Extraordinary Event (as defined below); provided that, if no such Business Day
shall occur prior to the Expiration Date or the Delisting Date, if any, then the
provisions of Section 2.06 or 2.07 will apply. The Company shall promptly give
notice to Warrantholders, by
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publication in a newspaper with a national circulation, if a Market Disruption
Event shall have occurred.
"Market Disruption Event" means any of the following events, as
determined by the Determination Agent.
(i) The suspension or material limitation of trading in 20% or more of
the underlying stocks which then comprise the Index for more than two hours of
trading or during the one-half hour period preceding the close of trading on the
principal securities exchange on which such stocks are traded. For purposes of
this definition, limitations on trading during significant market fluctuations
imposed pursuant to any rule or regulation of similar scope to New York Stock
Exchange ("NYSE") Rule 80B (or any applicable rule or regulation (A) enacted or
promulgated by the NYSE, any other self regulatory organization or the SEC of
similar scope or as a replacement for Rule 80B, as determined by the
Determination Agent, or (B) enacted or promulgated by any such securities
exchange, any self regulatory organization or relevant regulatory authority, as
determined by the Determination Agent), shall be considered "material";
(ii) The suspension or material limitation, in each case, for more than
two hours of trading or during the one-half hour period preceding the close of
trading (whether by reason of movements in price otherwise exceeding levels
permitted by the relevant exchange or otherwise) in (A) if futures contracts
related to the Index or options on such futures contracts are then approved for
trading, and are traded on any major U.S. or foreign exchange, such contracts or
options or (B) options contracts related to the Index which are traded on any
major U.S. or foreign exchange; or
(iii) The unavailability, through a recognized system of public
dissemination of transaction information, for more than two hours of trading or
during the one-half hour period preceding the close of trading, of accurate
price, volume or related information in respect of 20% or more of the underlying
stocks which then comprise the Index or in respect of futures contracts related
to the Index, options on such futures contracts or options contracts related to
the Index, in each case traded on any major U.S. or foreign exchange.
For purposes of determining whether a Market Disruption Event has
occurred: (i) a limitation on the hours or number of days of trading will not
constitute a Market Disruption Event if it results from an announced change in
the regular business hours of the relevant exchange or market, (ii) a decision
to discontinue trading permanently in the relevant futures or options contract
will not constitute a Market Disruption Event, (iii) any suspension in trading
in a futures or options contract on the Index by a major securities market by
reason of (x) a price change violating limits set by such securities market, (y)
an imbalance of orders relating to such contracts or (z) a disparity in bid and
ask quotes relating to such contracts, will constitute a Market Disruption
Event, notwithstanding that the duration of such suspension or material
limitation is less than two hours, (iv) a "suspension or material limitation" on
an exchange or in a market will include a suspension or material limitation of
trading by one class of investors provided that such suspension continues for
more than two hours of trading or during the last one-half hour period preceding
the close of trading on the relevant exchange or market (but will not include
limitations imposed on certain types of trading under NYSE Rule 80A) and will
not include any time when such exchange or market is closed for trading as part
of such exchange's
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or market's regularly scheduled business hours and (v) the occurrence of an
Extraordinary Event described in clause (i) of the definition of Extraordinary
Event will not constitute, and will supersede the occurrence of, a Market
Disruption Event.
SECTION 2.04. Extraordinary Events (a) If the Company determines that an
Extraordinary Event has occurred and is continuing on an Applicable Business
Day, then the Cash Settlement Value with respect to an exercise of Warrants
shall be calculated on the basis that the Valuation Date shall be the next
Business Day following an Applicable Business Day on which there is no
Extraordinary Event or Market Disruption Event; provided that, if no such
Business Day shall occur prior to the Expiration Date or the Delisting Date, if
any, then the provisions of Section 2.06 or 2.07 will apply. The Company shall
promptly give notice to Warrantholders, by publication in a newspaper with a
national circulation, if an Extraordinary Event shall have occurred.
"Extraordinary Event" means any of the following events:
(i) a suspension, material limitation or absence of trading of all of
the stocks of U.S. issuers comprising the Index;
(ii) the enactment, publication, decree or other promulgation of any
statute, regulation, rule or order of any court of any jurisdiction, any
administrative agency or any other governmental authority that would make it
unlawful for the Company to perform any of its obligations under the Warrant
Agreement or the Warrants or that has had or is reasonably expected to have a
material adverse effect on the ability of (A) the Company to perform its
obligations under the Warrants or to hedge or modify the hedge of its position
with respect to the Warrants or (B) any affiliate of the Company to hedge or
modify the hedge of its position with respect to any hedging transaction entered
into with the Company in connection with the Company's obligations under the
Warrants; or
(iii) any outbreak or escalation of hostilities or other national or
international calamity or crisis (including, without limitation, natural
calamities that in the opinion of the Determination Agent may materially and
adversely affect the economy of the United States or the trading of securities
generally on the CBOE, NYSE or the National Association of Securities Dealers
Automated Quotations system, or any other securities exchange) that has had or
is reasonably expected to have a material adverse effect on the ability of (A)
the Company to perform its obligations under the Warrants or to modify the hedge
of its position with respect to the Warrants or (B) any affiliate of the Company
to hedge or modify the hedge of its position with respect to any hedging
transaction entered into with the Company in connection with the Company's
obligations under the Warrants.
For the purpose of determining whether an Extraordinary Event has
occurred: (i) a limitation on the hours or number of days of trading will not
constitute an Extraordinary Event if it results from an announced change in the
regular business hours of the relevant exchange or market and (ii) a "suspension
or material limitation" on an exchange or in a market will include a suspension
or material limitation of trading by one class of investors provided that such
suspension continues for more than two hours of trading or during the last
one-half hour period preceding the close of trading on the relevant exchange or
market (but will not include
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limitations imposed on certain types of trading under NYSE Rule 80A) and will
not include any time when such exchange or market is closed for trading as part
of such exchange's or market's regularly scheduled business hours.
SECTION 2.05. Cancellation of Warrants (a) If the Company at any time
prior to the Expiration Date or, if applicable, the Extended Expiration Date,
determines that an Extraordinary Event has occurred and is continuing, and if
the Extraordinary Event is expected by the Company to continue, the Company may
immediately cancel the Warrants by notifying the Warrant Agent of such
cancellation (the date such notice is given being the "Cancellation Date"), and
each Warrantholder's rights under the Warrants and the Warrant Agreement shall
thereupon cease; provided that each Warrant shall be automatically exercised
using as the Valuation Date the Cancellation Date, and the holder of each such
Warrant will receive, in lieu of the Cash Settlement Value of such Warrant, the
Alternative Settlement Amount (as defined herein), determined by the
Determination Agent. The Company shall promptly give Warrantholders, by
publication in a newspaper with a national circulation, notice of any such
cancellation.
The "Alternative Settlement Amount" (which will be calculated by the
Determination Agent) will equal an amount in U.S. dollars equal to the sum of
(A) the Intrinsic Value (as defined herein) and (B) the product of (i) the
quotient obtained by dividing $[ ] (the initial offering price per Warrant) by 2
and (ii) the quotient obtained by dividing (x) the total number of days from,
but excluding, the Cancellation Date or Delisting Date, whichever has given rise
to the payment of the Alternative Settlement Amount for such Warrants, to, and
including, the Expiration Date and (y) the total number of days from, but
excluding, the date on which sales of the Warrants were initially confirmed, to
and including the Expiration Date.
"Intrinsic Value" means the Cash Settlement Value of the Warrants
determined pursuant to Section 2.02(c) on the applicable Valuation Date but
calculated with a Spot Index Value on the applicable Valuation Date determined
by the Determination Agent which, subject to approval by the Company (such
approval not to be unreasonably withheld), in the reasonable opinion of the
Determination Agent, fairly reflects the Spot Index Value on the applicable
Valuation Date; provided, however, that if a Cancellation Date falls on (i) the
Expiration Date, (ii) the Extended Expiration Date or (iii) any of the two
Business Days immediately preceding either the Expiration Date or the Extended
Expiration Date, then the Spot Index Value with respect to such date shall be
calculated so as to reflect the value of the Index at the opening of trading on
the CBOE on such date.
In calculating the Alternative Settlement Amount on the Extended
Expiration Date or on any Cancellation Date or Delisting Date falling between
the Expiration Date and the Extended Expiration Date (inclusive), the
Alternative Settlement Amount shall equal the Intrinsic Value.
For the purposes of determining "Intrinsic Value", in the event that the
Determination Agent and the Company have not, after good faith consultation with
each other and within five days following the first day upon which such
Alternative Settlement Amount may be calculated, agreed upon a Spot Index Value
which fairly reflects the value of the Index on the Cancellation Date, Delisting
Date or Extended Expiration Date, whichever gives rise to
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the payment of the Alternative Settlement Amount, then the Determination Agent
shall promptly nominate a third party, subject to approval by the Company (such
approval not to be unreasonably withheld), to determine such figure and
calculate the Alternative Settlement Amount. Such party shall act as an
independent expert and not as an agent of the Company or the Determination
Agent, and its calculation and determination of the Alternative Settlement
Amount shall, absent manifest error, be final and binding on the Company, the
Warrant Agent, the Determination Agent and the Warrantholders. Any such
calculations will be made available to a Warrantholder for inspection at the
Warrant Agent's Office. Neither the Company, the Determination Agent, the
Warrant Agent nor any third party shall have any responsibility for good faith
errors or omissions in calculating the Alternative Settlement Amount.
SECTION 2.06. Extension Events (a) If a Market Disruption Event or an
Extraordinary Event is continuing on the Expiration Date (an "Extension Event"),
the term of any outstanding Warrants will be extended for a period of 30 days
(the thirtieth day following the Expiration Date being the "Extended Expiration
Date"); provided that, if the Cash Settlement Value of the Warrants would have
been zero if the Warrants had been exercised, using as the Valuation Date the
Measurement Date (as defined below), then, notwithstanding any other provision
of the Warrants, the term of the Warrants will not be extended, the Cash
Settlement Value will be zero and the Warrants will be deemed to be worthless.
Following an Extension Event, the Warrants will expire on the earlier of: (i)
the first Business Day on which no Market Disruption Event and no Extraordinary
Event shall be occurring (the "Early Extended Expiration Date"), (ii) a
Delisting Date falling between the Expiration Date and the Extended Expiration
Date, (iii) a Cancellation Date falling between the Expiration Date and the
Extended Expiration Date and (iv) the Extended Expiration Date. The Company will
give the Warrant Agent prompt notice by telephone, to be promptly confirmed in
writing, or facsimile transmission and will give prompt notice to the
Warrantholders by publication in a newspaper with a national circulation of the
occurrence of an Extension Event, any Extended Expiration Date and any Delisting
Date.
"Measurement Date" means the Business Day occurring most recently prior
to the Expiration Date on which none of the events described in the definition
of Market Disruption Event or Extraordinary Event had occurred or was
continuing.
(b) Any Warrants that expire on the Extended Expiration Date or the
Early Extended Expiration Date will be deemed to be exercised automatically on
the Extended Expiration Date or the Early Extended Expiration Date, as the case
may be, using as the Valuation Date for such exercise the Extended Expiration
Date or Early Extended Expiration Date, and the holder of each such Warrant will
receive the Cash Settlement Value, in the case of the Early Extended Expiration
Date, or the Alternative Settlement Amount in the case of the Extended
Expiration Date.
In the case of Warrants as to which there has been a postponed Valuation
Date resulting from an Extraordinary Event or a Market Disruption Event
(including an Extension Event) or as a result of the exercise of Warrants in a
number exceeding the maximum permissible amounts, the Company will be required
to make available to the Warrant Agent no later than 3:00 p.m., New York City
time, on the third Business Day following the date on which the Cash Settlement
Value or Alternative Settlement Amount, as the case may be, has been
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calculated (the "Alternative Funding Date"), New York Clearing House or next day
funds in an amount equal to, and for the payment of, the aggregate Cash
Settlement Value or Alternative Settlement Amount, as applicable, for such
Warrants. In the case of Warrants held through the facilities of the Depository,
if the Company has made such funds available by such time as noted above, the
Warrant Agent will thereafter be responsible for making funds available to the
Depository in an amount sufficient to pay the Cash Settlement Value or
Alternative Settlement Amount of the Warrants, if applicable, prior to the close
of business on the Alternative Funding Date. The Depository will be responsible
for disbursing such funds to each appropriate Participant and such Participant
will be responsible for disbursing such payments to the Warrantholders it
represents and to each brokerage firm for which it acts as agent. Each such
brokerage firm will be responsible for disbursing funds to the Warrantholders it
represents.
SECTION 2.07. Delisting of Warrants In the event the Warrants are
delisted from, or permanently suspended from trading on (within the meaning of
the Securities and Exchange Act of 1934, as amended), the CBOE and not accepted
at the same time for listing on another United States national securities
exchange, Warrants not previously exercised will be deemed automatically
exercised on the Delisting Date, and the Cash Settlement Value or, in the event
that the Company determines that a Market Disruption Event or Extraordinary
Event has occurred and is continuing on the Delisting Date, the Alternative
Settlement Amount, as the case may be, shall be calculated and settled as
provided in Section 2.05; provided, however, that if a Delisting Date falls on
(i) the Expiration Date, (ii) the Extended Expiration Date or (iii) any of the
two Business Days immediately preceding either the Expiration Date or the
Extended Expiration Date, then the Spot Index Value with respect to such date
shall be calculated so as to reflect the value of the Index at the opening of
trading on the CBOE on such date. The Company will notify the Warrant Agent in
writing, who will notify the Warrantholders as soon as practicable of such
delisting or trading suspension. However, if the Company first receives notice
of the delisting or suspension on the same day on which the Warrants are
delisted or suspended, such day will be deemed the Delisting Date.
SECTION 2.08. Automatic Exercise of Warrants. All Warrants for which the
Warrant Agent has not received an Exercise Notice in proper form at or prior to
3:00 p.m., New York City time, on the earlier of (i) the fourth Business Day
preceding the Expiration Date (subject to extension), (ii) the Extended
Expiration Date, (iii) the Early Extended Expiration Date, (iv) the Cancellation
Date or (v) the Delisting Date, or for which the Warrant Agent has received an
Exercise Notice in proper form but with respect to which timely delivery of the
relevant Warrants has not been made, will be deemed automatically exercised on
such date without any requirement of an Exercise Notice to the Warrant Agent.
The Exercise Date for such Warrants shall be the Expiration Date, the Extended
Expiration Date, the Early Extended Expiration Date, the Cancellation Date or
the Delisting Date, as the case may be, or if such date is not a Business Day,
the next succeeding Business Day.
The Warrant Agent shall by 5:00 p.m., New York City time, on the
Expiration Date, the Extended Expiration Date, the Early Extended Expiration
Date, the Cancellation Date or the Delisting Date, as the case may be, notify
the Company (and such other parties (not to exceed two) as the Company shall
designate in writing) of the number of Warrants to be automatically exercised on
such day. The Warrant Agent shall (i) by 3:00 p.m., New York City
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time, on the Business Day next succeeding the Valuation Date, obtain from the
Determination Agent the calculation of the Cash Settlement Value or Alternative
Settlement Amount, as the case may be (as determined by the Determination Agent
in the manner provided in Section 2.02(c)) of the Warrants to be automatically
exercised, (ii) by 5:00 p.m., New York City time, on the Business Day next
succeeding such Valuation Date, notify the Company (and such other parties (not
to exceed two) as the Company shall designate in writing) of the Cash Settlement
Value or Alternative Settlement Amount, as the case may be, payable in respect
of such exercised Warrants and (iii) advise the Company of such other matters
relating to the exercised Warrants as the Company shall reasonably request.
The Company shall make available to the Warrant Agent, not later than
3:00 p.m., New York City time, on the third Business Day after the applicable
Valuation Date for automatically exercised Warrants (the "Automatic Settlement
Date"), funds in an amount sufficient to pay the aggregate Cash Settlement Value
or Alternative Settlement Amount, as the case may be, of such Warrants. Subject
to such funds having been made available as provided in the preceding sentence,
the Warrant Agent will be responsible for making funds available to the
Depository in accordance with procedures agreed upon between the Depository and
the Warrant Agent, against receipt of the Global Warrant Certificate, after 3:00
p.m., New York City time, but prior to the close of business, on the Automatic
Settlement Date, such funds to be in an amount equal to the aggregate Cash
Settlement Value or Alternative Settlement Amount, as the case may be, of the
Warrants subject to such automatic exercise. The Depository will be responsible
for disbursing such funds to each appropriate Participant, and such Participant
will be responsible for disbursing such payments to the Warrantholders it
represents and to each brokerage firm for which it acts as agent. Each such
brokerage firm will be responsible for disbursing funds to the Warrantholders it
represents.
SECTION 2.09. Maximum Number of Exercisable Warrants. All exercises of
Warrants (except in the case of automatic exercise of Warrants) shall be
subject, at the Company's option, to the limitation that not more than 250,000
Warrants in total may be exercised on any Exercise Date and not more than
100,000 Warrants may be exercised by or on behalf of any person or entity,
either individually or in concert with any other person or entity, on any
Exercise Date. If any Business Day would otherwise, under the terms hereof, be
the Exercise Date in respect of more than 250,000 Warrants, then at the
Company's election (by giving notice thereof to the Warrant Agent not later than
5:00 p.m., New York City time, on the Business Day immediately following such
Exercise Date), 250,000 of such Warrants shall be deemed exercised on such
Exercise Date (selected by the Warrant Agent on a pro rata basis), and the
remainder of such Warrants (the "Remaining Warrants") shall be deemed exercised
on the following Business Day (subject to successive applications of this
Section 2.09). Remaining Warrants shall be deemed exercised in the order of
their respective initial Exercise Dates, and Remaining Warrants shall be deemed
exercised before any other Warrants initially exercised after such Remaining
Warrants. If any individual Warrantholder attempts to exercise more than 100,000
Warrants on any Business Day, then at the Company's election (as notified to the
Warrant Agent by giving written notice thereof to the Warrant Agent not later
than 5:00 p.m., New York City time, on the Business Day following such Business
Day) 100,000 of such Warrants shall be deemed exercised on such Business Day and
the remainder shall be deemed exercised on the following Business Day (subject
to successive applications of this Section 2.09).
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The date on which any Warrant is deemed exercised under the preceding sentences
shall for all purposes of this Agreement be the "Exercise Date" in respect of
such Warrant.
SECTION 2.10. Covenant of the Company. The Company covenants, for the
benefit of the Warrantholders, that (a) it will use its best efforts to maintain
the listing of the Warrants on the CBOE and that it will not seek the delisting
of the Warrants, or suspension of their trading on, the CBOE unless prior to
such delisting or suspension the Warrants shall have been listed, and shall be
trading, on another national securities exchange or securities association and
(b) upon written request it will furnish any Warrantholder with a list of the
then current Underlying Shares.
SECTION 2.11. Return of Money Held Unclaimed for Two Years. Except as
otherwise provided herein, any money deposited with or paid to the Warrant Agent
for the payment of the Cash Settlement Value or Alternative Settlement Amount,
as the case may be, of any Warrants and not applied but remaining unclaimed for
two years after the date upon which such Cash Settlement Value or Alternative
Settlement Amount, as the case may be, shall have become due and payable shall
be repaid by the Warrant Agent to the Company and the holders of such Warrants
shall thereafter look only to the Company for any payment which such holders may
be entitled to collect and all liability of the Warrant Agent with respect to
such money shall thereupon cease; provided, however, that the Warrant Agent,
before making any such repayment, may at the expense of the Company notify the
Participants concerned, that said money has not been so applied and remains
unclaimed and that after a date named in the notification any unclaimed balance
of said money then remaining will be returned to the Company.
SECTION 2.12. Return of Global Warrant Certificate. At such time as all
of the Warrants evidenced by a Global Warrant Certificate have been exercised
(including pursuant to an automatic exercise) and all payments to the
Participants made as provided herein, the Warrant Agent shall, upon written
direction from the Company, destroy the canceled Global Warrant Certificate
(unless instructed by the Company in writing to deliver the Global Warrant
Certificate to the Company) and shall provide a certificate of destruction to
the Company.
ARTICLE III
OTHER PROVISIONS RELATING TO
RIGHTS OF WARRANTHOLDERS
SECTION 3.01. Warrantholder May Enforce Rights. Notwithstanding any of
the provisions of this Agreement, any Warrantholder, without the consent of the
Warrant Agent, may, in and for its own behalf, enforce, and may institute and
maintain, any suit, action or proceeding against the Company suitable to
enforce, or otherwise in respect of, its right to exercise, and to receive
payment for, its Warrants as provided in this Agreement.
SECTION 3.02. Merger, Consolidation, Sale, Transfer or Conveyance If at
any time there shall be a merger or consolidation involving the Company or a
sale, transfer, conveyance (other than by way of lease) or other disposition of
substantially all of the assets of the Company, then the successor or assuming
corporation shall succeed to and be substituted for
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the Company under this Agreement and the Warrants, with the same effect as if it
had been named herein and in any Global Warrant Certificate as the Company. The
Company shall thereupon be relieved of any further obligation hereunder or under
the Warrants and may at any time thereafter be dissolved, wound up or
liquidated. In any case of any such consolidation or merger involving the
Company or sale, transfer, conveyance or other disposition of substantially all
of the assets of the Company, any changes in phraseology and form (but not in
substance) that may be appropriate may be made in the Global Warrant
Certificates delivered thereafter.
The Warrant Agent may rely on a written opinion of counsel as conclusive
evidence that any such consolidation or merger involving the Company or sale,
transfer, conveyance (other than by way of lease) or other disposition of
substantially all of the assets of the Company complies with the provisions of
this Section 3.02.
ARTICLE IV
WARRANTS ACQUIRED BY THE COMPANY;
PAYMENT OF TAXES
SECTION 4.01. Warrants Acquired by the Company. In the event the Company
shall purchase or otherwise acquire Warrants, such Warrants may, at the option
of the Company, be surrendered free through a Participant to the Depository for
credit to the account of the Warrant Agent maintained at the Depository, and if
so credited, the Warrant Agent shall promptly note the cancellation of such
Warrants by notation on the records of the Warrant Agent. Such Warrants may
also, at the option of the Company, be resold by the Company directly or to or
through any of its affiliates in lieu of being surrendered to the Depository.
Any canceled Global Warrant Certificate held by the Warrant Agent under
this Agreement shall be destroyed by the Warrant Agent unless otherwise directed
in writing by the Company, and the Warrant Agent shall deliver a certificate of
destruction to the Company evidencing the same.
SECTION 4.02. Payment of Taxes. The Company will pay all stamp,
withholding and other duties, if any, attributable to the initial issuance of
Warrants; provided, however, that, anything in this Agreement to the contrary
notwithstanding, the Company shall not be required to pay any tax or other
governmental charge which may be payable in respect of any transfer involving
any beneficial or record interest in, or ownership interest of, any Warrants,
which tax or other governmental charge shall be paid by the appropriate
Warrantholder.
ARTICLE V
CONCERNING THE WARRANT AGENT
SECTION 5.01. Warrant Agent. (a) The Company hereby appoints Citibank,
N.A. ("Citibank") as Warrant Agent of the Company in respect of the Warrants
upon the terms and subject to the conditions set forth herein; and Citibank
hereby accepts such appointment.
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The Warrant Agent shall have the powers and authority granted to and conferred
upon it in this Agreement and such further powers and authority to act on behalf
of the Company as the Company may hereafter grant to or confer upon it. All of
the terms and provisions with respect to such powers and authority contained in
any Global Warrant Certificate are subject to and governed by the terms and
provisions hereof.
(b) Citibank covenants and agrees to maintain an office, staffed by
qualified personnel, with adequate facilities for the discharge of its
responsibilities under this Agreement, including, without limitation, the
payment of the Cash Settlement Value, as calculated by the Determination Agent,
and the timely settlement of the Warrants upon exercise thereof.
SECTION 5.02. Conditions of Warrant Agent's Obligations. The Warrant
Agent accepts its obligations herein set forth upon the terms and conditions
hereof, including the following, to all of which the Company agrees and to all
of which the rights hereunder of the Warrantholders shall be subject:
(a) The Company agrees promptly to pay the Warrant Agent the
compensation to be agreed upon with the Company for all services rendered by the
Warrant Agent and to reimburse the Warrant Agent for its reasonable
out-of-pocket expenses (including reasonable attorneys' fees and expenses)
incurred by the Warrant Agent without negligence, bad faith or breach of this
Agreement on its part in connection with the services rendered by it hereunder.
The Company also agrees to indemnify the Warrant Agent and its officers,
directors, agents and employees for, and to hold it and them harmless against,
any loss, liability or expense (including reasonable attorneys' fees and
expenses) incurred without negligence, bad faith or breach of this Agreement on
the part of the Warrant Agent, arising out of or in connection with its acting
as such Warrant Agent hereunder, as well as the reasonable costs and expenses of
defending against any claim of liability in the premises. This section shall
survive the termination of this Agreement and the earlier removal or resignation
of the Warrant Agent.
(b) In acting under this Agreement, the Warrant Agent is acting solely
as agent of the Company and does not assume any obligation or relationship of
agency or trust for or with any of the owners or holders of the Warrants.
(c) The Warrant Agent may consult with counsel satisfactory to it, and
the opinion of such counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with the opinion of such counsel.
(d) The Warrant Agent shall be fully protected and shall incur no
liability for or in respect of any action taken or thing suffered by it in
reliance upon any notice, direction, consent, certificate, affidavit, statement
or other paper or document believed by it to be genuine and to have been
presented or signed by the proper parties, and the Warrant Agent may, if it
shall deem it necessary or desirable, request such papers or documents prior to
taking any action hereunder.
(e) The Warrant Agent, and its officers, directors, agents and
employees, may become the owner of, or acquire any interest in, any Warrants or
other obligations of the
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Company, with the same rights that it or they would have if it were not the
Warrant Agent hereunder and, to the extent permitted by applicable law, it or
they may engage or be interested in any financial or other transaction with the
Company and may act on, or as depository, trustee or agent for, any committee or
body of holders of Warrants or other obligations of the Company as freely as if
it were not the Warrant Agent hereunder.
(f) The Warrant Agent shall not be under any liability for interest on
any monies at any time received by it pursuant to any of the provisions of this
Agreement nor shall it be obligated to segregate such monies from other monies
held by it, except as required by law. The Warrant Agent shall not be
responsible for advancing funds on behalf of the Company.
(g) The Warrant Agent shall not be under any responsibility with respect
to the validity or sufficiency of this Agreement or the execution and delivery
hereof (except the due execution and delivery hereof by the Warrant Agent) or
with respect to the validity or execution of the Global Warrant Certificates
(except its countersignature thereof).
(h) The recitals contained herein and in the Global Warrant Certificates
(except as to the Warrant Agent's countersignature thereon) shall be taken as
the statements of the Company, and the Warrant Agent assumes no responsibility
for the correctness of the same.
(i) The Warrant Agent shall be obligated to perform such duties as are
herein specifically set forth, and no implied duties or obligations shall be
read into this Agreement against the Warrant Agent. The Warrant Agent shall not
be under any obligation to take any action hereunder likely to involve it in any
expense or liability, the payment of which is not, in its reasonable opinion,
assured to it. The Warrant Agent shall not be accountable or under any duty or
responsibility for the application by the Company of any proceeds. The Warrant
Agent shall have no duty or responsibility in case of any default by the Company
in the performance of its covenants or agreements contained in any Global
Warrant Certificate or in the case of the receipt of any written demand from a
holder of a Warrant with respect to such default, including, without limiting
the generality of the foregoing, any duty or responsibility to initiate or
attempt to initiate any proceedings at law or otherwise or, except as provided
in Section 6.02 hereof, to make any demand upon the Company.
(j) The Warrant Agent shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, entitlement order,
approval or other paper or document.
(k) The Warrant Agent may execute any of the trusts or powers hereunder
or perform any duties hereunder either directly or by or through agents,
attorneys, custodians or nominees appointed with due care, and shall not be
responsible for any misconduct or negligence on the part of any agent, attorney,
custodian or nominee so appointed.
SECTION 5.03. Resignation and Appointment of Successor. (a) The Company
agrees, for the benefit of the Warrantholders, that there shall at all times be
a Warrant Agent hereunder until all the Warrants are no longer outstanding or
until monies for the payment of all outstanding Warrants, if any, shall have
been paid to the Warrant Agent and shall have been returned to the Company as
provided in Section 2.11, whichever occurs earlier.
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24
(b) The Warrant Agent may at any time resign as such agent by giving
written notice to the Company of such intention on its part, specifying the date
on which its desired resignation shall become effective, subject to the
appointment of a successor Warrant Agent and acceptance of such appointment by
such successor Warrant Agent as hereinafter provided. The Warrant Agent
hereunder may be removed at any time by the filing with it of an instrument in
writing signed by or on behalf of the Company and specifying such removal and
the date when it shall become effective. Such resignation or removal shall take
effect upon the appointment by the Company, as hereinafter provided, of a
successor Warrant Agent (which shall be a banking institution organized under
the laws of the United States of America or one of the states thereof and having
an office south of Xxxxxxxx Street in the Borough of Manhattan, The City of New
York) and the acceptance of such appointment by such successor Warrant Agent. In
the event a successor Warrant Agent has not been appointed and accepted its
duties within 90 days of the Warrant Agent's notice of resignation or its
removal, the Warrant Agent may apply to any court of competent jurisdiction for
the designation of a successor Warrant Agent. The obligation of the Company
under Section 5.02(a) shall continue to the extent set forth therein
notwithstanding the resignation or removal of the Warrant Agent.
(c) In case at any time the Warrant Agent shall give notice of its
intent to resign, or shall be removed, or shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or make an assignment for the benefit
of its creditors, or consent to the appointment of a receiver or custodian of
all or any substantial part of its property, or shall admit in writing its
inability to pay or meet its debts as they mature, or if a receiver or custodian
of it or of all or any substantial part of its property shall be appointed, or
if any public officer shall have taken charge or control of the Warrant Agent or
of its property or affairs for the purpose of rehabilitation, conservation or
liquidation, a successor Warrant Agent, qualified as aforesaid, shall be
promptly appointed by the Company by an instrument in writing, filed with the
successor Warrant Agent. Upon the appointment as aforesaid of a successor
Warrant Agent and acceptance by the latter of such appointment, the Warrant
Agent so superseded shall cease to be Warrant Agent hereunder.
(d) Any successor Warrant Agent appointed hereunder shall execute,
acknowledge and deliver to its predecessor and to the Company an instrument
accepting such appointment hereunder, and thereupon such successor Warrant
Agent, without any further act, deed or conveyance, shall become vested with all
the authority, rights, powers, trust, immunities, duties and obligations of such
predecessor with like effect as if originally named as Warrant Agent hereunder,
and such predecessor, upon payment of its charges and disbursements then due and
unpaid, shall thereupon become obligated to transfer, deliver and pay over, and
such successor Warrant Agent shall be entitled to receive, all monies,
securities and other property on deposit with or held by such predecessor, as
Warrant Agent hereunder.
(e) Any corporation into which the Warrant Agent hereunder may be merged
or converted or any corporation with which the Warrant Agent may be
consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Warrant Agent shall be a party, or any corporation to
which the Warrant Agent shall sell or otherwise transfer all or substantially
all the corporate trust assets and business of the Warrant Agent, provided that
it shall be qualified as aforesaid, shall be the successor Warrant Agent under
this Agreement
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25
without the execution or filing of any paper or any further act on the part of
any of the parties hereto.
ARTICLE VI
MISCELLANEOUS
SECTION 6.01. Amendment. (a) This Agreement and the terms of the
Warrants may be amended by the Company, the Warrant Agent and the Determination
Agent, without the consent of the Warrantholders, for the purpose of curing any
ambiguity, or of curing, correcting or supplementing any defective or
inconsistent provision contained herein or therein, to maintain the Warrants'
listing on the CBOE or any other national securities exchange or securities
association on which they are then listed, to reflect the issuance by the
Company of additional warrants or in any other manner which the Company may deem
necessary or desirable and which, as determined by the Company in its sole
discretion, will not adversely affect the interests of the holders of the
Warrants.
(b) The Company, the Warrant Agent and the Determination Agent may
modify or amend this Agreement, with the consent of Warrantholders holding not
less than a majority in number of the then outstanding Warrants affected by such
modification or amendment, for any purpose; provided, however, that no such
modification or amendment that changes the determination of the Cash Settlement
Value or Alternative Settlement Amount of a Warrant (or any aspects of such
determination) so as to reduce the amount receivable upon exercise of a Warrant,
shortens the period of time during which the Warrants may be exercised, or
otherwise materially and adversely affects the exercise rights of the
Warrantholders or reduces the percentage of the number of outstanding Warrants,
the consent of whose holders is required for modification or amendment of this
Agreement, may be made without the consent of each Warrantholder affected
thereby. The Warrant Agent may, but shall not be obligated to, enter into any
amendment of this Agreement that affects its rights, duties, immunities or
indemnities hereunder.
SECTION 6.02. Successor Index. In the event that the Company, in its
sole discretion, determines that it is necessary or appropriate to use a
Successor Index (as defined in Exhibit A hereto) to the Index, the Company shall
give written notice to the Warrant Agent, which shall then promptly notify the
Warrantholders (in the manner provided in Section 6.05), to the effect that (a)
a Successor Index will replace the Index and (b) pursuant to the Warrant
Agreement and the Warrants, such Successor Index will be used in place of the
Index for all purposes relating to the Warrants, and the Company shall make
available to the Warrantholders, upon request, a written description of the
manner in which such Successor Index is determined.
SECTION 6.03. Notices and Demands to the Company, the Warrant Agent and
the Determination Agent. If the Warrant Agent or the Determination Agent shall
receive any notice or demand addressed to the Company by any Warrantholder
pursuant to the provisions of this Agreement, the Warrant Agent or the
Determination Agent, as the case may be, shall promptly forward such notice or
demand to the Company.
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26
SECTION 6.04. Addresses for Notices. Any communications to the Warrant
Agent with respect to this Agreement shall be addressed to Citibank, N.A., 000
Xxxx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Corporate Trust
Department (telephone: (000) 000-0000; facsimile: (000) 000-0000), and any
communications to the Company with respect to this Agreement shall be addressed
to Xxxxxxx Xxxxx Xxxxxx Holdings Inc., 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Chief Financial Officer (telephone: (000) 000-0000; facsimile:
(000) 000-0000), and any communications to the Determination Agent with respect
to this Agreement shall be addressed to Xxxxxxx Xxxxx Barney Inc., 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx Xxxxx (telephone: (212)
000-0000; facsimile: (000) 000-0000) (or such other address as shall be
specified in writing by the Warrant Agent, the Company or the Determination
Agent, respectively).
SECTION 6.05. Notices to Holders. The Company may cause to have notice
given to the Warrantholders by providing the Warrant Agent with a form of notice
to be distributed by the Depository to Participants in accordance with the
custom and practices of the Depository.
SECTION 6.06. Obtaining of Approvals. The Company will from time to time
take all action which may be necessary to obtain and keep effective (a) any and
all permits, consents and approvals of governmental agencies and authorities and
the CBOE or any successor United States national securities exchange and (b) any
and all filings or notices under United States Federal and state securities
laws, which may be or become required in connection with the issuance, sale,
trading, transfer or delivery of the Global Warrant Certificates or the exercise
of the Warrants.
SECTION 6.07. Persons Having Rights Under This Agreement. Nothing in
this Agreement expressed or implied and nothing that may be inferred from any of
the provisions hereof is intended, or shall be construed, to confer upon, or
give to, any person or corporation other than the Company, the Warrant Agent,
the Determination Agent, the registered holder of the Global Warrant
Certificates and the Warrantholders any right, remedy or claim under or by
reason of this Agreement or of any covenant, condition, stipulation, promise or
agreement hereof; and all covenants, conditions, stipulations, promises and
agreements contained in this Agreement shall be for the sole and exclusive
benefit of the Company, the Warrant Agent, the Determination Agent, and their
respective successors, the registered holder of the Global Warrant Certificates
and of the Warrantholders.
SECTION 6.08. Inspection of Agreement. A copy of this Agreement shall be
available at all reasonable times at the Warrant Agent's Office for inspection
by the Warrantholders, Participants or any person certified by any Participant
to be an indirect participant of the Depository or any person certified by any
Participant to be a Warrantholder, in each case, on behalf of whom such
Participant holds Warrants.
SECTION 6.09. Headings. The descriptive headings of the several Articles
and Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
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SECTION 6.10. Counterparts. This Agreement may be executed by the
parties hereto in any number of counterparts, each of which counterpart, when so
executed and delivered, shall be deemed to be an original, but all such
counterparts taken together shall constitute but one and the same instrument.
Delivery of an executed counterpart of a signature page of this Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart of this Agreement.
SECTION 6.11. APPLICABLE LAW. THIS AGREEMENT AND EACH WARRANT SHALL BE
GOVERNED BY, AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO ITS CONFLICTS OF LAWS PRINCIPLES.
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IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto as of the day and year first above written.
XXXXXXX XXXXX XXXXXX HOLDINGS INC.
By:
------------------------------------
Name:
Title:
CITIBANK, N.A., as Warrant Agent
By:
------------------------------------
Name:
Title:
XXXXXXX XXXXX BARNEY INC.
By:
------------------------------------
Name:
Title:
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EXHIBIT A
[FORM OF GLOBAL WARRANT CERTIFICATE]
No. 1 CUSIP No. _________
XXXXXXX XXXXX XXXXXX HOLDINGS INC.
__________ Call Warrants
on the 2000 TEN+(SM) Index
Expiring _______, 2002
This certifies that CEDE & Co., or registered assigns, is the registered
holder of _________ Call Warrants on the 2000 TEN+(SM) Index Expiring ________,
2002 (the "Warrants"). Each Warrant entitles the beneficial owner thereof (each
a "Warrantholder") to receive, subject to the conditions set forth herein and in
the Warrant Agreement (as defined below), from Xxxxxxx Xxxxx Xxxxxx Holdings
Inc. (the "Company") the cash settlement value in U.S. dollars (rounded down to
the nearest cent) (the "Cash Settlement Value") which is the greater of (A) zero
and (B) the product (rounded down to the nearest cent) of (i) the quotient
obtained by dividing (x) the amount, if any, by which the Spot Index Value (as
defined below) for the applicable Valuation Date exceeds the Strike Index Value
(as defined below) by (y) the Initial Index Value and (ii) $10. In no event
shall a Warrantholder be entitled to any interest on any Cash Settlement Value.
The "Initial Index Value" means the value of the Index at the close of
trading on the CBOE on September [ ], 2000.
The "Strike Index Value" means 80% of the Initial Index Value.
The "Spot Index Value" means the value of the Index at the close of
trading on the CBOE on the applicable Valuation Date; provided, however, that
the Spot Index Value with respect to the Expiration Date, any Early Extended
Expiration Date or any Extended Expiration Date means the value of the Index at
the opening of trading on the CBOE on the applicable Valuation Date.
Subject to the terms of the Warrant Agreement, each Warrant may be
irrevocably exercised in whole but not in part, at or prior to 3:00 p.m., New
York City time, on any Business Day from September 29, 2000 until 3:00 p.m., New
York City time, on the earlier of (i) the fourth Business Day immediately
preceding ______, 2002 (the "Expiration Date") and (ii) the Delisting Date, if
any. Except in the event of automatic exercise, each Warrant shall be
irrevocably exercised upon receipt by the Warrant Agent of such Warrant
delivered free on the records of the Depository to the Warrant Agent's
Depository Participant Account (entitled
X-0
00
Xxxxxxxx, N.A. Corporate Trust Warrant Agent Account, No. [ ] or such other
account at the Depository as the Warrant Agent shall designate in writing to the
Company) (the "Warrant Account") pursuant to an Exercise Notice to the Warrant
Agent from a Participant, in the case of Warrants held through the facilities of
the Depository, Clearstream, in the case of Warrants held through Clearstream,
or a Euroclear participant, in the case of Warrants held through Euroclear,
acting, directly or indirectly, on behalf of the Warrantholder; provided,
however, that Exercise Notices are subject to rejection by the Warrant Agent as
provided herein. An Exercise Notice shall be unconditional.
This Global Warrant Certificate shall not be valid unless countersigned
by the Warrant Agent.
The Warrants evidenced by this Global Warrant Certificate are part of a
duly authorized issue of Warrants issued by the Company pursuant to a Warrant
Agreement, dated as of September 29, 2000 (the "Warrant Agreement"), among the
Company, Citibank, N.A. (the "Warrant Agent") and Xxxxxxx Xxxxx Barney Inc. (the
"Determination Agent"), and is subject to the terms and provisions contained in
the Warrant Agreement, to all of which terms and provisions the Warrantholders,
the entities through which such Warrantholders hold their beneficial interests
in the Warrants and the registered holder of this Global Warrant Certificate
consent by acceptance of this Global Warrant Certificate by the Depository and
which Warrant Agreement is hereby incorporated by reference in and made a part
of this Global Warrant Certificate. A copy of the Warrant Agreement is on file
at the Warrant Agent's Office, which is located at 000 Xxxx Xxxxxx, 0xx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000.
The Warrants constitute direct, unconditional and unsecured obligations
of the Company and rank on a parity with the Company's other unsecured
contractual obligations and with the Company's unsecured and unsubordinated
debt.
Subject to the terms of the Warrant Agreement and this Global Warrant
Certificate, and except for Warrants subject to automatic exercise or held
through the facilities of Clearstream or Euroclear, and subject to the Limit
Option, the "Exercise Date" for a Warrant will be (i) the Business Day on which
the Warrant Agent receives the Warrant and Exercise Notice in proper form with
respect to such Warrant, if received at or prior to 3:00 p.m., New York City
time, on such day, or (ii) if the Warrant Agent receives such Warrant and
Exercise Notice after 3:00 p.m., New York City time, on a Business Day, then the
Business Day next succeeding such Business Day. In the case of Warrants held
through the facilities of Clearstream or Euroclear, except for Warrants subject
to automatic exercise, and subject to the Limit Option, the "Exercise Date" for
a Warrant will be (i) the Business Day on which the Warrant Agent receives the
Exercise Notice in proper form with respect to such Warrant if such Exercise
Notice is received at or prior to 3:00 p.m., New York City time, on such day;
provided that the Warrant is received by the Warrant Agent by 3:00 p.m., New
York City time, on the Valuation Date (as defined below), or (ii) if the Warrant
Agent receives such Exercise Notice after 3:00 p.m., New York City time, on a
Business Day, then the Business Day next succeeding such Business Day; provided
that the Warrant is received by 3:00 p.m., New York City time, on the Valuation
Date relating to exercises of Warrants on such succeeding Business Day. In the
event that a Warrant
A-2
31
is received after 3:00 p.m., New York City time, on the Valuation Date, then
the Exercise Date for such Warrant will be the day on which such Warrant is
received or, if such day is not a Business Day, the next succeeding Business
Day. In the case of Warrants held through the facilities of Euroclear, (a)
participants must also transmit, by facsimile, to the Warrant Agent a copy of
the Exercise Notice submitted to Euroclear by 3:00 p.m., New York City time, on
the desired Exercise Date and (b) Euroclear must confirm by telex to the Warrant
Agent by 9:00 a.m., New York City time, on the Valuation Date that the Warrants
will be received by the Warrant Agent on such date; provided that if such telex
communication is received after 9:00 a.m., New York City time, on the Valuation
Date, the Company will be entitled to direct the Warrant Agent to reject the
related Exercise Notice or waive the requirement for timely delivery of such
telex communication.
The "Valuation Date" for a Warrant will be the first Business Day
following the Exercise Date, subject to postponement pursuant to the Warrant
Agreement.
Subject to the terms of the Warrant Agreement and except in the event of
automatic exercise, in connection with any exercise of Warrants, the related
Exercise Notice may specify that such exercise is subject to the condition that
the Spot Index Value that would otherwise be used to determine the Cash
Settlement Value of such Warrants shall not have declined by five or more points
from the Limit Option Index Value for such Warrants. "Limit Option Index Value",
with respect to any Warrants subject to the Limit Option, means the Spot Index
Value on the Business Day that such Exercise Notice has been received (or shall
be deemed to have been received). The option of a Warrantholder to condition an
exercise of Warrants is herein referred to as the "Limit Option". To be valid,
such election must be specified in the related Exercise Notice. Each of the
Warrant Agent and the Company shall be entitled to rely conclusively on such
Exercise Notice, as received by the Warrant Agent, in determining whether such
election has been validly made.
The valuation of and payment for any exercised Warrant may be postponed
as a result of an Extraordinary Event or a Market Disruption Event or as a
result of the exercise of a number of Warrants exceeding the maximum permissible
amount as described herein, in which case the Warrantholder will receive the
Cash Settlement Value or, under certain circumstances, the Alternative
Settlement Amount for such Warrant, in either case determined as of a later
date. In addition, the term of any outstanding Warrants may be extended for a
period not to exceed 30 days if a Market Disruption Event or an Extraordinary
Event is continuing on the Expiration Date; provided that such Warrants are not
deemed to be worthless at that time.
Subject to the terms of the Warrant Agreement, in the event the Warrants
are delisted from, or permanently suspended from trading on (within the meaning
of the Securities and Exchange Act of 1934, as amended), the CBOE and not
accepted at the same time for listing on another United States national
securities exchange, Warrants not previously exercised will be deemed
automatically exercised on the Delisting Date, in which case the Warrantholder
will receive the Cash Settlement Value or, under certain circumstances, the
Alternative Settlement Amount.
A-3
32
All Warrants for which the Warrant Agent has not received an Exercise
Notice in proper form at or prior to 3:00 p.m., New York City time, on the
earlier of (i) the fourth Business Day preceding the Expiration Date (subject to
extension), (ii) the Extended Expiration Date, (iii) the Early Extended
Expiration Date, (iv) the Cancellation Date or (v) the Delisting Date, or for
which the Warrant Agent has received an Exercise Notice in proper form but with
respect to which timely delivery of the relevant Warrants has not been made,
will be deemed automatically exercised on such date without any requirement of
an Exercise Notice to the Warrant Agent.
Subject to the terms of the Warrant Agreement, all exercises of Warrants
(except in the case of automatic exercise of Warrants) shall be subject, at the
Company's option, to the limitation that not more than 250,000 Warrants in total
may be exercised on any Exercise Date and not more than 100,000 Warrants may be
exercised by or on behalf of any person or entity, either individually or in
concert with any other person or entity, on any Exercise Date.
Prior to due presentment for registration of transfer, the Company, the
Warrant Agent, and any agent of the Company or the Warrant Agent, may deem and
treat the registered owner hereof as the absolute owner of the Warrants
evidenced hereby (notwithstanding any notation of ownership or other writing
hereon) for any purpose whatsoever, and as the person entitled to exercise the
rights represented by the Warrants evidenced hereby, and neither the Company nor
the Warrant Agent, nor any agent of the Company or the Warrant Agent, shall be
affected by any notice to the contrary.
The Warrant Agent shall, in accordance with the Warrant Agreement, from
time to time register the transfer of this Global Warrant Certificate in its
records (which may be maintained electronically) to be maintained by it for that
purpose at the Warrant Agent's Office upon surrender hereof, duly endorsed, or
accompanied by a written instrument or instruments of transfer in form
satisfactory to the Warrant Agent, duly executed by the registered holder hereof
or by the duly appointed legal representative or duly authorized attorney
thereof, such signature to be guaranteed by a bank or trust company with a
correspondent office in The City of New York or by a member of a national
securities exchange. Upon any such registration of transfer, a new Global
Warrant Certificate shall be issued to the transferee.
Capitalized terms included herein but not defined herein have the
meanings assigned thereto in the Warrant Agreement.
The Warrant Agreement and the terms of the Warrants are subject to
amendment, as provided in the Warrant Agreement.
THIS GLOBAL WARRANT CERTIFICATE SHALL BE GOVERNED BY, AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS
CONFLICTS OF LAWS PRINCIPLES.
A-4
33
IN WITNESS WHEREOF, Xxxxxxx Xxxxx Xxxxxx Holdings Inc. has caused this
instrument to be duly executed.
Dated: September 29, 2000 XXXXXXX XXXXX BARNEY HOLDINGS INC.
By:
-------------------------
Name:
Title:
[Corporate Seal]
Attest:
------------------------
Assistant Secretary
Countersigned for authentication
purposes only as of the
date above written:
CITIBANK, N.A.
as Warrant Agent,
By:
-----------------------
Authorized Officer
A-5
34
EXHIBIT B
FORM OF EXERCISE NOTICE
For Warrants Represented by the Global Warrant Certificate
CUSIP No.: __________
Citibank, N.A.
c/o Citicorp Data Distribution Inc.
000 Xxxxx Xxxxx
Xxxxxxx, Xxx Xxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention:
1. We refer to the Warrant Agreement dated as of September 29, 2000 (the
"Warrant Agreement"), among Xxxxxxx Xxxxx Xxxxxx Holdings Inc. (the "Company"),
Citibank, N.A., as Warrant Agent (the "Warrant Agent"), and Xxxxxxx Xxxxx Barney
Inc., as Determination Agent (the "Determination Agent"). On behalf of certain
beneficial owners, each of whose Warrants have been, or will be, transferred to
the Warrant Agent in accordance with the provisions of the Representations
Letter relating to the Warrants, we hereby irrevocably exercise ______ Warrants
(the "Tendered Warrants"). We hereby acknowledge that the Warrants being
exercised and this Exercise Notice must be received by you by 3:00 p.m., New
York City time, on a Business Day in order for the Valuation Date for the
Tendered Warrants to be the Business Day following such Business Day and that,
if the Warrants being exercised and this Exercise Notice are received by you
after 3:00 p.m., New York City time, on a Business Day (or, in the case of
Warrants held through Clearstream or Euroclear, if the Warrants are not received
by 3:00 p.m., New York City time, on the first Business Day following such
Business Day) the Valuation Date of the Tendered Warrants shall be the Business
Day next succeeding such Business Day, in each case subject to certain
provisions of the Warrant Agreement.
2. If you determine that this Exercise Notice has not been duly
completed or is not in proper form, this Exercise Notice will be void and of no
effect and will be deemed not to have been delivered.
3. We hereby direct you to make payment to us of amounts payable to our
clients as a result of the exercise of the Warrants hereunder as follows:
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By cashier's check or an official bank check;
By wire transfer to the following U.S. Dollar
bank account in the United States:
(Minimum payments of $100,000 only)
Bank:
-----------------
Account No.:
-----------------------
ABA Routing No.:
-------------------
Reference:
-------------------------
4. The Tendered Warrants covered hereby [ARE/ARE NOT] subject to the
Limit Option.(1)
5. Each client on whose behalf we are exercising Warrants pursuant to
this Exercise Notice has certified to us that it is not exercising in excess of
100,000 Warrants on behalf of any beneficial owner or in concert with any other
beneficial owner on the date of this Exercise Notice.
FOR PARTICIPANTS ONLY
6. We hereby certify that we are a Participant of The Depository Trust
Company (the "Depository") with the present right to use and receive its
services.
Capitalized terms used but not defined herein have the meanings assigned
thereto in the Warrant Agreement.
Dated:
NAME OF DEPOSITORY PARTICIPANT
Participant Number
NAME OF EUROCLEAR PARTICIPANT
Participant Number
NAME OF CLEARSTREAM PARTICIPANT
Participant Number
By
------------------------------
Authorized Signature
Address:
Telephone: ( )
--------
(1) Separate Exercise Notices shall be submitted with respect to Warrants
subject to the Limit Option and Warrants not subject to the Limit Option.
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EXHIBIT C
CONFIRMATION OF EXERCISE
[Name of Depository Participant]
[Name of Euroclear Participant]
[Centrale de Livraison de Valeurs
Mobilieres S.A.]
[Address]
We hereby confirm receipt of your Exercise Notice with respect to
_______________ Warrants (the "Tendered Warrants") which were transferred by you
to our Depository Participant Account No. ______________. We have found such
Notice to be duly completed and in proper form, and we have verified, in the
manner provided in the Warrant Agreement, dated as of September 29, 2000 (the
"Warrant Agreement"), among Xxxxxxx Xxxxx Xxxxxx Holdings Inc., Citibank, N.A.
and Xxxxxxx Xxxxx Barney Inc., that you are a Depository Participant. The
Valuation Date of the Tendered Warrants was the close of business on
____________ in New York City.
[As set forth in your Exercise Notice, none of the Warrants covered
thereby is subject to the Limit Option. Accordingly, for purposes hereof, all
such Warrants shall constitute Tendered Warrants, which number we hereby confirm
to be __________________.] [Your Exercise Notice stated that the Warrants
covered thereby are subject to the Limit Option. The applicable Initial Index
Value for such Warrants is _______; the applicable Strike Index Value is
_______; and the Spot Index Value for the date that would otherwise be the
Valuation Date for such Warrants is ________________. Such Spot Index Value is
not less than the Limit Option Index Value by five or more points. Accordingly,
for purposes hereof, all such Warrants shall constitute Tendered Warrants. We
hereby confirm the number of such Tendered Warrants to be __________.]
We hereby confirm that the aggregate Cash Settlement Value of the
Tendered Warrants is $_____________ ($_____ per Warrant), which will be made
available to you by wire transfer to the bank account designated in your
Exercise Notice for payment on the fifth Business Day following the Valuation
Date for such Warrants.
Capitalized terms included herein but not defined have the meanings
assigned thereto in the Warrant Agreement.
Dated:
CITIBANK, N.A., as Warrant Agent,
By: ______________________________
Authorized Signature
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NOTICE OF REJECTION
[Name of Depository Participant]
[Name of Euroclear Participant]
[Centrale de Livraison de Valeurs
Mobilieres S.A.]
[Address]
Dated:
You are hereby notified that the Exercise Notice delivered by you was
determined by us not to have been [duly completed] [in proper form]] [such
Warrants were not transferred to our Depository Participant Account No.
___________ on a timely basis as provided in the Warrant Agreement] [we did not
receive from Euroclear a Euroclear Confirmation that proper delivery of the
Warrants to which the Exercise Notice delivered by you relates would be made on
a timely basis], as set forth in the Warrant Agreement, dated as of September
29, 2000 (the "Warrant Agreement"), among Xxxxxxx Xxxxx Xxxxxx Holdings Inc.,
Citibank, N.A. and Xxxxxxx Xxxxx Barney Inc. Accordingly, we have rejected your
Exercise Notice as being unsatisfactory as to form.
Capitalized terms included herein but not defined have the meanings
assigned thereto in the Warrant Agreement.
CITIBANK, N.A., as Warrant Agent,
By:
------------------------------
Authorized Signature
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EXHIBIT D
NOTICE OF REJECTION
RELATING TO LIMIT OPTION
[Name of Depository Participant]
[Name of Euroclear Participant]
[Centrale de Livraison de Valeurs
Mobilieres S.A.]
[Address]
We refer to your Exercise Notice dated ____________, _____, with respect
to __________ Warrants that were subject to the Limit Option. The applicable
Initial Index Value and Strike Index Value for such Warrants are _____ and
_____, respectively, and the Spot Index Value for the date that would otherwise
be the Valuation Date for such Warrants is ______. Such Spot Index Value is less
than the Limit Option Index Value for such Warrants by five or more points.
Accordingly, we have rejected such Exercise Notice pursuant to the Limit Option.
Capitalized terms included herein but not defined have the meanings
assigned thereto in the Warrant Agreement, dated as of September 29, 2000, among
Xxxxxxx Xxxxx Xxxxxx Holdings Inc, Citibank, N.A. and Xxxxxxx Xxxxx Barney Inc.
Dated:
CITIBANK, N.A., as Warrant Agent,
By:
-----------------------------
Authorized Signature
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