BANK OF COMMERCE
AND
CHEMICAL MELLON SHAREHOLDER SERVICES L.L.C.
Warrant Agent
WARRANT AGREEMENT
Dated as of July 25, 1995
WARRANT AGREEMENT
THIS WARRANT AGREEMENT (the "AGREEMENT") is made and entered into by Bank
of Commerce, a California state-chartered bank (the "BANK"), and Chemical Mellon
Shareholder Services, L.L.C. (the "WARRANT AGENT") as of July 25, 1995, with
regard to the following:
A. The Bank proposes to issue "C" Warrants ("C WARRANTS") and D
Warrants ("D WARRANTS") (together, the "Warrants," individually, "WARRANT")
as evidenced by Warrant Certificates (the "WARRANT CERTIFICATES") initially
evidencing the right to purchase up to 500,000 shares of Common Stock, no par
value, of the Bank (the "COMMON STOCK") pursuant to the Offering Circular for
the public offering of Units of be Bank, each of which is composed of two
shares of Floating Rate Non-Cumulative Series B Preferred Stock, one C
Warrant and one D Warrant (the "OFFERING CIRCULAR").
B. The Company desires that the Warrant Agent act on behalf of The
Company in connection with, the issuance, transfer, exchange, exercise and
replacement of the Warrants and Warrant Certificates, and in this Agreement
wishes to set forth, among other things, the form and provisions of the Warrants
and Warrant Certificates and the terms and conditions on which they may be
issued, transferred, exchanged, exercised and replaced.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. ISSUANCE, EXECUTION AND DELIVERY OF WARRANTS
1.1 ISSUANCE OF WARRANTS. Warrants, as evidenced by Warrant Certificates
each in substantially the form of Exhibits A (C warrant) or B (D Warrant)
hereto, shall be issued. Each Warrant Certificate shall evidence the right,
subject to the provisions of this Agreement and of the Warrant Certificate, to
purchase that number of Warrant Shares as set forth on the face of the Warrant
Certificate, but not less than one whole Warrant Share. For the purposes of
this Agreement and the Warrant Certificates, "C WARRANT SHARES" means the number
of shares of Common Stock deliverable upon exercise of a C Warrant, and "D
WARRANT SHARES" means the number of shares of Common Stock deliverable upon
exercise of a D Warrant, as adjusted from time to time pursuant to the
provisions of Paragraph 3 hereof.
1.2 EXECUTION AND DELIVERY OF WARRANTS. Each Warrant Certificate shall
bear the facsimile signature of the Chief Executive Office and Corporate
Secretary, and shall be countersigned by the Warrant Agent. Except for the
countersignature of the Warrant Agent, the Bank may adopt and use as the
facsimile signature of any such officer the facsimile signature of any person
who on the date of this Agreement or at any time thereafter shall have been such
officer, whether or not he or she is such officer at the time of issue of any
Warrant Certificate. The Warrant Certificates shall be issued in registered
form only. For purposes of this Agreement and the Warrant Certificates, the
term "Registered Holder" shall mean the "PERSON" or "PERSONS".
in whose name or names a particular Warrant shall be registered on the books of
the Bank kept for that purpose in accordance with the terms of this Agreement.
For purposes of this Agreement and the Warrant Certificates the term "Person"
shall mean an individual partnership, corporation, trust, joint stock company,
association, joint venture, or any other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
2. EXERCISE PRICE, DURATION AND TRANSFER AND EXERCISE OF WARRANTS
2.1 EXERCISE PRICE. Each Warrant Certificate shall, when properly
countersigned by the Warrant Agent, entitle the Registered Holder thereof,
subject to the provisions of this Agreement and the Warrant Certificate, to
purchase from the Bank the number of Warrant Shares stated on the Warrant
Certificate, as such Warrant Shares are constituted on the date the Warrants
evidenced thereby are exercised, at the price of $12.00 per Warrant Share as to
C Warrants (the "C WARRANT EXERCISE PRICE") and $14.00 per share as to D
Warrants (the "D WARRANT EXERCISE PRICE") payable in full at the time such
warrants are exercised. The C Warrant Exercise Price Shall be adjusted from
time to time upon the adjustment of the number of shares that may be purchased
upon the exercise of all C Warrants issued pursuant to this Agreement in
accordance with Paragraph 3 hereof, so that the aggregate of the C Warrant
Exercise Price paid and payable upon the exercise of all C Warrants issued under
this Agreement shall not be greater at any time than $3,000,000. The D Warrant
Exercise Price shall be adjusted from time to time upon the adjustment of the
number of shares that may be purchased upon the exercise of all D Warrants
issued pursuant to this Agreement in accordance with Paragraph 3 hereof, so that
the aggregate of the D Warrant Exercise Price paid and payable upon exercise of
all D Warrants issued under this Agreement shall not be greater at any time than
$3,500,000.
2.2 DURATION. Warrants may be exercised only on or after the date of
issuance and on or before their respective expiration dates (the "EXPIRATION
DATES"). Each C Warrant shall expire on July 25, 1997, Each D Warrant shall
expire on July 25, 1999. The Bank shall advise the Warrant Agent of the date of
issuance of each Warrant and shall confirm with the Warrant Agent the Expiration
Date of each Warrant upon issuance. Each Warrant not exercised prior to its
Expiration Date shall become void, and all rights of the Registered Holder
thereunder and under this Agreement and the Warrant Certificate shall cease
after the close of business on the relevant Expiration Date.
2.3 TRANSFER AND EXERCISE.
2.3.1 The Bank shall keep, at the office of the Warrant Agent at
Los Angeles, California, a register, in which, subject to such reasonable
regulations as it may prescribe, the Bank shall register the Warrants at the
time of issuance thereof and shall transfer Warrants so registered as provided
in this Agreement. Upon surrender for transfer of any Warrant at such office,
the Bank shall execute and the Warrant Agent shall countersign and deliver to
the name of the transferees a new Warrant Certificate or Certificates evidencing
Warrants to purchase a like number of Warrant Shares. All Warrant Certificates
presented for transfer or exchange shall (if required by the Bank) be Duly
Endorsed or be accompanied by a written instrument of transfer in form
satisfactory to the Bank and Warrant Agent duly executed by the Registered
Holder or his
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or her attorney duly authorized. For purposes of this Agreement and the Warrant
Certificates, the term "DULY ENDORSED" shall mean duly endorsed in blank by the
Person or Persons in whose name a Warrant Certificate is registered or
accompanied by a duly executed assignment separate from the certificate with the
signatures thereon, guaranteed by a commercial bank, trust company or other
financial institution of nationally recognized standing in the United States.
2.3.2 A Registered Holder is entitled to exercise his or her
Warrants, in whole or in part, so long as the number of shares of Common Stock
is no less than the lesser of the full number subject to exercise under the
relevant Warrant Certificate or 100, at any time, or from time to time
commencing on the date of issuance, upon written notice to the Warrant Agent,
until 5:00 p.m. Pacific time on the relevant Expiration Date or, if such day is
not a Business Day, then until 5:00 p.m. Pacific time on the next succeeding day
that shall be a Business Day by presenting and surrendering their Warrant
Certificates to the Bank at the office of the Warrant Agent at Los Angeles,
California, with the Exercise Subscription Form set forth on the Warrant
Certificate, duly executed and accompanied by proper payment, of the C Warrant
Exercise Price or D Warrant Exercise Price for the number of C Warrant Shares or
D Warrant Shares specified in such form, all subject to the terms and conditions
of this Agreement and the Warrant Certificate. At the option of the Registered
Holder, the Exercise Price may be paid in cash or by certified or official bank
check or bank cashier's check payable to the order of the Bank, or by any
combination of cash or such check. For purposes of this Agreement and the
Warrant Certificates, the term "BUSINESS DAY" shall mean any day except a
Saturday, Sunday or other day on which commercial banks in Los Angeles,
California are authorized by law to close.
2.3.3 Upon surrender of any Warrants in conformity with the
provisions of this Agreement and the Warrant Certificate, the Bank shall
transfer to the Registered Holder of such Warrants appropriate evidence of
ownership of any shares of Common Stock to which the Registered Holder is
entitled, registered or otherwise placed in, or payable to the order of the
Registered Holder, and shall deliver such evidence of ownership, together with
an amount in cash in lieu of any fraction of a share of Common Stock as
provided in Paragraph 3.3 below.
2.3.4 If a Registered Holder exercises fewer than all of the
Warrants evidenced by such Registered Holder's Warrant Certificate, such
Warrant Certificate shall be surrendered to the Bank and a new Warrant
Certificate of the same tenor evidencing such Registered Holder's remaining
Warrants shall be executed by the Bank. The Bank shall register such new
Warrant Certificate in the name of such Registered Holder and deliver the new
Warrant Certificate to such Registered Holder.
2.3.5 The Bank shall pay all expenses in connection with, and all
taxes and other governmental charges that may be imposed in respect of, the
issue or delivery of any shares of Common Stock issuable upon the exercise of
any Warrant. The Bank shall not be required, however, to pay any tax or other
charge imposed in connection with any transfer involved in the issue of a
certificate for shares of Common Stock in any name other than that of a
Registered Holder of a Warrant, and in such case the Bank shall not be required
to issue or deliver any such stock certificate until such tax or other charge
has been paid or it has been established to the Bank's reasonable satisfaction
that such tax or other charge is not due.
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2.3.6 Each Person in whose name any such certificate for shares of
Common Stock is issued shall for all purposes be deemed have become the holder
of record of the Common Stock represented thereby on the date on which the
Warrant was surrendered and payment of the purchase price and any applicable
taxes was made irrespective of the date of issue or delivery of such certificate
except that if the date of such surrender and payment is a date when the stock
transfer books of the Bank for the Common Stock are closed, such Person shall be
deemed to have become the holder such shares on the next succeeding date on
which such stock transfer books are open, The Bank will not close such stock
transfer books at any one time for a period longer than 20 days.
3. ADJUSTMENTS IN WARRANT SHARES; FRACTIONAL SHARES
3.1 ANTI-DILUTION PROVISIONS. The number of shares of Common Stock which
may be purchased upon the exercise hereof shall be subject to change or
adjustment as follows:
3.1.1 STOCK DIVIDENDS-SUBDIVISIONS, COMBINATIONS. In case the
Bank shall pay a dividend on the Common Stock in shares of Common Stock (or
securities convertible into, exchangeable for or otherwise entitling the
registered holder to receive Common Stock) , (ii) subdivide the outstanding
Common Stock into a greater number of shares of Common Stock or (iii) combine
the outstanding Common Stock into a smaller number of shares of Common Stock,
the number of shares of Common Stock purchasable upon exercise of any Warrant
immediately prior to the record date fixing shareholders to be affected by such
event shall be adjusted so that the Registered Holder shall thereafter be
entitled to receive that kind and number of shares of Common Stock or other
securities of the Bank that the Registered Holder would have owned or have been
entitled to receive after the happening of any of the events described above,
had the Warrant been exercised immediately prior to the happening of such event
or any record date with respect thereto. An adjustment made pursuant to this
paragraph 3.1.1 shall become effective (i) immediately after the record date in
the case of a dividend and (i) immediately after the effective date in the case
of a subdivision or combination. If the Bank shall take a record of the holders
of its Common Stock for the purpose of entitling them to receive a dividend or
other distribution, and shall thereafter and before the distribution to
stockholders thereof legally abandon its plan to pay or deliver such dividend or
distribution, then thereafter no adjustment in the number of shares of Common
Stock issuable upon exercise of a Warrant then in effect shall be required by
reason of the taking of such record. No adjustment shall be made under this
Paragraph 3.1.1 unless such adjustment would require an increase or decrease of
at least one percent in the number of shares of Common Stock or other securities
of the Bank that the Registered Holder would have owned or have been entitled to
receive had the Warrant been exercised, provided however, that any adjustments
which by reason of this sentence are not required to be made shall be carried
forward and taken into account in any subsequent adjustment, and all
calculations shall be made to the nearest one-hundredth of a share,
3.1.2 REORGANIZATION OR RECLASSIFICATION. In case of any capital
reorganization or any reclassification of the capital stock of the Bank (whether
pursuant to a merger or
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consolidation or otherwise), each Warrant shall thereafter be exercisable for
the number of shares of stock or other securities or property receivable upon
such capital reorganization or reclassification of capital stock, as the case
may be, by a holder of the number of shares of Common Stock into which the
Warrant was exercisable immediately prior to such capital reorganization or
reclassification of capital stock; and, in any case, appropriate adjustment
shall be made in the application of the provisions herein set forth with respect
to the rights and interests thereafter of the Registered Holder of any Warrant
to the end that the provisions set forth herein shall thereafter be applicable,
as nearly as reasonably may be, in relation to any shares of stock or other
securities or property thereafter deliverable upon the exercise of the Warrant.
3.1.3 NOTICE. In the event that the Bank shall propose at any
time to effect any transaction of the type described in Subsections 3.1.1 and
3.1.2 above or take any similar extraordinary corporate action affecting the
Bank's capital stock (including but not limited to the transfer of substantially
all of the Bank's assets), then, in connection with each such event, the Bank
shall send notice thereof to all Registered Holders at least 20 days prior to
the earlier of (i) the date on which such event is to become effective, (ii) the
record date for the shareholders affected by such event, or (iii) the first date
on which the Bank intends to effect any such transaction, in each case
specifying in reasonable detail what the transaction or event consists of and,
if applicable, the aggregate amount or value of any cash or property proposed to
be distributed, paid, purchased or received by the Bank in connection therewith.
3.1.4 ADJUSTMENT OF EXERCISE PRICE. The C Warrant Exercise Price
per share of Common Stock purchasable upon exercise of any C Warrant shall be
subject to adjustment from time to time as follows: upon each adjustment of the
number of shares of Common Stock purchasable pursuant to this Section 3.1, the C
Warrant Exercise Price shall be reduced or increased, as the case may be, to a
price determined by dividing the aggregate C Warrant Exercise Price of all C
Warrant Shares in effect prior to such adjustment by the total minimum number of
C Warrant Shares purchasable upon the exercise of all C Warrants immediately
after such adjustment. The D Warrant Exercise Price per share of Common Stock
purchasable upon exercise of any D Warrant shall be subject to adjustment from
time to time as follows: upon each adjustment of the number of shares of Common
Stock purchasable pursuant to this Section 3.1, the D Warrant Exercise Price
shall be reduced or increased, as the case may be, to a price determined by
dividing the aggregate D Warrant Exercise Price of all D Warrant Shares in
effect prior to such adjustment by the total maximum number of D Warrant Shares
purchasable upon the exercise of all D Warrants immediately after such
adjustment.
3.2 CONSOLIDATION, MERGER, OR SALE OF ASSETS. In addition to any other
rights of Registered Holders set forth herein, in case of any consolidation
of the Bank with, or merger of the Bank into, any other Person, any merger of
another Person into the Bank (other than a merger which does not result in
any reclassification, conversion, exchange or cancellation of outstanding
shares of Common Stock) or any sale or transfer of all or substantially all
of the assets of the Bank to the Person formed by such consolidation or
resulting from such merger or which acquires such assets, as the case may be,
all Registered Holders shall have the right thereafter to exercise their
Warrants for the kind and amount of securities, cash and other property
receivable upon such consolidation, merger, sale or transfer by a holder of
the number of shares of Common Stock
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for which their Warrants may have been exercised immediately prior to such
consolidation, merger, sale or transfer. Adjustments for events subsequent to
the effective date of such a consolidation, merger and sale of assets shall be
as nearly equivalent as may be practicable to the adjustments provided for in
this Agreement. In any such event, effective provisions shall be made in the
certificate or articles of incorporation of the resulting or surviving
corporation, in any contact of sale, conveyance, lease or transfer, or otherwise
so that the provisions set forth herein for the protection of the rights of the
Registered Holders shall thereafter continue to be applicable, and any such
resulting or surviving corporation shall expressly assume the obligation to
deliver, upon exercise, such shares of stock, other securities, cash and
property. The provisions of this Paragraph 3.2 shall similarly apply to
successive consolidations, mergers, sales, leases or transfers.
3.3 FRACTIONAL SHARES. No fractional shares of Common Stock shall be
issued upon the exercise of any Warrant. If any fraction of a shut of Common
Stock would be issuable upon the exercise of a Warrant, the Bank shall round
down the number of shares of Common Stock to be issued upon exercise of such
Warrant to the nearest lower whole number of shares of Common Stock.
4. OTHER PROVISIONS RELATING TO THE RIGHTS OF REGISTERED HOLDERS OF WARRANTS
4.1 RIGHTS OF REGISTERED HOLDERS. Prior to the exercise of any Warrant, a
Registered Holder shall not, by virtue hereof, be entitled to any rights of a
shareholder of the Bank including, without limitation, the right to vote, to
receive dividends or other distributions or to receive any notice of meetings of
shareholders or any notice of any proceedings of the Bank, except as may be
specifically provided for herein.
4.2 ASSIGNMENT OR TRANSFER. A Warrant is transferable by the Registered
Holder thereof by surrendering for transfer at the office of the Warrant Agent
in Los Angeles, California, maintained for that purpose, the Warrant Certificate
evidencing the Warrant and the Assignment Form, Duly Endorsed, set forth on the
Warrant Certificate. Thereupon, one or more new Warrant Certificates evidencing
the transferred Warrants of authorized denominations will be issued to the
designated transferee or transferees, and, if necessary, a new Warrant
Certificate evidencing warrants not transferred will be issued to the original
Registered Holder. In any event, Warrants may not be sold, assigned, pledged or
otherwise transferred except in compliance with the Securities Act of 1933, as
amended, if applicable.
4.3 LOSS OF WARRANT CERTIFICATES. Upon receipt by the Bank of evidence
satisfactory to it (in the exercise of its reasonable discretion) of the loss,
theft, destruction or mutilation of any Warrant Certificate, and (in the case of
loss, theft or destruction) of reasonably satisfactory indemnification, and upon
surrender and cancellation of any Warrant Certificate, if mutilated, the Bank
shall execute and deliver a new Warrant Certificate of like tenor and date. The
provisions of this Paragraph 4.3 are exclusive and shall preclude (to the extent
lawful) all other rights or remedies with respect to the replacement of
mutilated, lost, stolen, or destroyed Warrant Certificates.
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4.4 RESERVATION OF SHARES. The Bank hereby agrees that at all times there
shall be reserved for issuance and delivery upon exercise of any Warrant such
number of its authorized but unissued shares of Common Stock or other securities
of the Bank from time to time issuable upon exercise of the Warrants as will be
sufficient to permit the exercise in full of the Warrants. All such shares
shall be duly authorized and, when issued upon such exercise, shall be validly
issued, fully paid, free and clear of all liens, security interests and charges.
5. CONCERNING THE WARRANT AGENT AND OTHER MATTERS
5.1 PAYMENT OF TAXES. The Bank will from time to time promptly pay to the
Warrant Agent, or make provision satisfactory to the Warrant Agent for the
payment of, all taxes and charges that may be imposed by the United States or
any State upon the Bank or the Warrant Agent upon the issuance or delivery of
shares of Common Stock upon the exercise of any Warrant, but the Bank shall not
be obligated to pay any transfer taxes in respect of the Warrant or such shares.
5.2 RESIGNATION, CONSOLIDATION OR MERGER OF WARRANT AGENT, AND SUCCESSOR
WARRANT AGENT.
5.2.1 The Warrant Agent may resign its duties and be discharged
from all further duties and liabilities hereunder after giving one month's
notice in writing to the Bank, except that such shorter notice may be given as
the Bank shall in writing, accept as sufficient. If the office of Warrant Agent
becomes vacant by resignation or incapacity to act or otherwise, the Bank shall
appoint in writing a new Warrant Agent. If the Bank shall fail to make such
appointment within a period of 30 days after it has been notified in writing of
such resignation or incapacity by the resigning or incapacitated Warrant Agent
or by the Registered Holder of a Warrant, then the Registered Holder of any
Warrant may apply to any court of competent jurisdiction in the State of
California, County of San Diego, for the appointment of a new Warrant Agent.
Any new Warrant Agent, whether appointed by the Bank or by such a court, shall
be a financial institution of nationally recognized standing in the United
States, which is authorized, under any applicable law to exercise corporate
trust powers and is subject to supervision or examination by United States
federal or state authority and which has a combined capital and surplus of not
less than $50,000,000. Any new Warrant Agent appointed hereunder shall execute,
acknowledge and deliver to the former Warrant Agent last in office and to the
Bank an instrument accepting such appointment hereunder and thereupon such new
Warrant Agent without any further act or deed shall become vested with all the
rights, powers, duties and responsibilities of the Warrant Agent hereunder with
like effect as if it had been named as the Warrant Agent; but if for any reason
it becomes necessary or expedient to have the former Warrant Agent execute and
deliver any further assurance, conveyance, act or deed, the same shall be done
at the expense of the Bank and shall be legally and validly executed and
delivered by the former Warrant Agent. Not later than the effective date of any
such appointment the Bank shall file notice thereof with the former Warrant
Agent and each transfer agent for the Common Stock, and shall forthwith mail
notice thereof to the Registered Holders of the Warrants at their addresses as
they appear on the registry books. Failure to file or mail such notice, or any
defect therein, shall not affect the legality or validity of the appointment of
the successor Warrant Agent.
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5.2.2 Any Person into which the Warrant Agent or any new Warrant
Agent may be merged or converted or with which it may be consolidated or any
Person resulting from any merger, conversion or consolidation to which the
Warrant Agent or any new Warrant Agent shall be a party, shall be the successor
Warrant Agent under this Agreement without any further act, provided that such
company would be eligible for appointment as a successor Warrant Agent under the
provisions of Paragraph 5.2.1.
5.3 FEES AND EXPENSES OF WARRANT AGENTS. The Bank agrees (i) that it will
pay the Warrant Agent reasonable remuneration for its services as Warrant Agent
hereunder and will reimburse the Warrant Agent upon demand for all expenditures
that the Warrant Agent may reasonably incur in the execution of its duties
hereunder; and (ii) that it will perform, execute, acknowledge and deliver or
cause to be performed, executed, acknowledged and delivered all such further and
other acts, instruments and assurances as may reasonably be required by the
Warrant Agent for the carrying out or performing by the Warrant Agent of the
provisions of this Agreement.
5.4 ADDITIONAL PROVISIONS.
5.4.1 The Warrant Agent may consult with legal counsel (who may be
legal counsel for the Bank), and the opinion of such counsel shall be full and
complete authorization and protection to the Warrant Agent as to any action
taken or omitted by it in good faith and in accordance with such opinion.
5.4.2 Whenever in the performance of its duties under this
Agreement the Warrant Agent shall deem it necessary or desirable that any matter
be proved or established by the Bank prior to taking or suffering any action
hereunder, such matter (unless other evidence in respect thereof be herein
specifically prescribed) may be deemed to be conclusively proved and established
by a certificate or instrument signed by the Chief Executive Officer, President
or an Executive Vice President or Senior Vice President of the Bank and
delivered to the Warrant Agent; and such certificate or instrument shall be full
warrant to the Warrant Agent for any action taken or suffered in good faith by
it under the provisions of this Agreement in reliance upon such certificate or
instrument; but in its discretion the Warrant Agent may in lieu thereof accept
other evidence of such matter or may require such further or additional evidence
as it may deem reasonable.
5.4.3 The Warrant Agent shall be liable hereunder only for its own
negligence or willful misconduct.
5.4.4 The Warrant Agent shall not be liable for or by reason of
any of the statements of fact or recitals contained in this Agreement or in the
Warrant Certificates (except its countersignature thereof) or be required to
verify the same, but all such statements and recitals are and shall be deemed to
have been made by the Bank only.
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5.4.5 The Warrant Agent shall not be under any responsibility in
respect of the validity of this Agreement or the execution and delivery hereof
or in respect of the validity or execution of any Warrant or Warrant Certificate
(except its countersignature thereof); nor shall it be responsible for any
breach by the Bank of any covenant or condition contained in this Agreement or
in a Warrant Certificate; nor shall it be responsible for the making of any
adjustment in the Warrant Shares required under the provision of Paragraph 3
hereof or responsible for the manner, method or amount of any such adjustment or
the facts that would require any such adjustment; nor shall it by any act
hereunder be deemed to make any representation or warranty as to the
authorization or reservation of any shares of Common Stock to be issued pursuant
to this Agreement or any Warrant or Warrant Certificate or as to whether any
shares of Common Stock will when issued be validly authorized and issued and
fully paid.
5.4.6 Anything in this Agreement to the contrary notwithstanding,
in no event shall the Warrant Agent be liable for special, indirect or
consequential loss or damage of any kind whatsoever (including but not limited
to lost profits), even if the Warrant Agent has been advised of the likelihood
of such loss or damage and regardless of the form of action.
5.5 ACCEPTANCE OF AGENCY. The Warrant Agent hereby accepts the agency
established by this Agreement and agrees to perform the same upon the terms and
conditions herein set forth.
5.6 MODIFICATION OF AGREEMENT. Notwithstanding anything in Paragraph 5.11
herein to the contrary, the Warrant Agent may, without the consent or
concurrence of the Registered Holder by supplemental agreement or otherwise,
concur with the Bank making any changes or corrections in this Agreement that
they shall have been advised by counsel are required to cure any ambiguity or to
correct any defective or inconsistent provision or clerical omission or mistake
or manifest error herein contained.
5.7 SUCCESSORS. All the covenants and provisions of this Agreement by or
for the benefit of the Bank shall bind and inure to the benefit of its
successors and assigns.
5.8 MERGER OR CONSOLIDATION OR SALE OF ASSETS OF THE BANK. The Bank will
not merge or consolidate with any other corporation, unless the corporation
resulting from such merger or consolidation (if not the Bank), shall expressly
assume, by supplemental agreement satisfactory in form to the Warrant Agent and
executed and delivered to the Warrant Agent, the due and punctual performance
and observance of each and every covenant and condition of this Agreement to be
performed and observed by the Bank.
5.9 PERSONS HAVING RIGHTS UNDER THIS AGREEMENT.
5.9.1 Nothing this Agreement expressed and nothing that may be
implied from any of the provisions hereof is intended, or shall be construed, to
confer upon, or give to, any Person other than the Bank, the Warrant Agent and
the Registered Holders 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 in
this
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Agreement contained shall be for the sale and exclusive benefit of the Bank and
the Warrant Agent and their successors and of the Registered Holders.
5.9.2 The Bank, the Warrant Agent and any transfer agent and
registrar for the Common Stock may deem and treat the Person in whose name any
Warrant Certificate shall be registered upon the books of the Bank as the
absolute owner of such Warrant Certificate (notwithstanding any notation of
ownership or other writing thereon made by anyone other than the Bank or the
Warrant Agent) for all purposes; and neither the Bank nor the Warrant Agent or
any transfer agent or registrar of the Common Stock shall be affected by an
notice to the contrary.
6. GENERAL PROVISIONS.
6.1. NOTICES. Unless otherwise specifically permitted by this Agreement,
all notices or other communications required or permitted under this Agreement
between the Warrant Agent and the Bank shall be in writing, and shall be
personally delivered or sent by registered or certified mail, postage prepaid,
return receipt requested, or sent by telecopy, provided that the telecopy cover
sheet contain a notation of the date and time of transmission, and shall be
deemed received: (i) if personally delivered, upon the date of delivery to the
address of the person to receive such notice, (ii) if mailed in accordance with
the provisions of this paragraph, two (2) business days after the date placed in
the United States mail, (iii) if mailed other than in accordance with the
provisions of this paragraph or mailed from outside the United States, upon the
date of delivery to the address of the person to receive such notice, or (iv) if
given by telecopy, when sent. Notices shall be given at the following
addresses:
If to the Bank:
Bank of Commerce
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Corporate Secretary
Telecopier: (000) 000-0000
With a copy to:
Xxxxx, Xxxxxxxx & Xxxx
000 Xxxx "X" Xxxxxx, Xxxxx 0000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxxxxxxxx, Esq.
Telecopier: (000) 000-0000
If to the Warrant Agent:
Chemical Mellon Shareholder Services
000 Xxxxx Xxxxx Xxx, 0xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Telecopier: (000) 000-0000
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Attention: Xxx X. Xxxx
Telecopier: (000) 000-0000
With a copy to:
--------------------------------
--------------------------------
--------------------------------
Attention:
---------------------
Telecopier:
--------------------
6.2. COMPLETE AGREEMENT: MODIFICATIONS. This Agreement and written
agreements, if any, entered into concurrently herewith (i) constitute the
parties' entire agreement, including all terms, conditions, definitions,
warranties, representations, and covenants, with respect to the subject
matter hereof, (ii) merge all prior discussions and negotiations between or
among any or all of them as to the subject matter hereof, and (iii) supersede
and replace all terms, conditions, definitions, warranties, representations,
covenants, agreements, promises and understandings, whether oral or written,
with respect to the subject matter hereof. Any provision of this Agreement
may be amended or waived if, and only if, such amendment or waiver is in
writing and signed, in the case of an amendment, by a majority of all
Registered Holders and the Bank, or in the case of a waiver, by the party
against whom the waiver is to be effective. No failure or delay by either
party in exercising any right, power or privilege hereunder shall operate as
a waiver thereof nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right,
power or privilege. The rights and remedies herein provide shall be
cumulative and not exclusive of any rights or remedies by law. Any
amendment, alteration, or modification requiring the signature of more than
one party may be signed in counterparts.
6.3. FURTHER ACTIONS. Each party agrees to perform any further acts and
execute and deliver any further documents reasonably necessary to carry out the
provisions of this Agreement.
6.4. ASSIGNMENT. No party may assign its rights under this Agreement
without the prior written consent of the other parties hereto.
6.5. SUCCESSORS AND ASSIGNS. Except as explicitly provided herein to the
contrary, this Agreement shall be binding upon and inure to the benefit of the
parties, their respective successors and permitted assigns.
6.6. SEVERABILITY. If any portion of this Agreement shall be held by a
court of competent jurisdiction to be invalid, void, or otherwise unenforceable,
the remaining provisions shall remain enforceable to the fullest extent
permitted by law if enforcement would not frustrate the overall intent of the
parties (as such intent is manifested by all provisions of the Agreement,
including such invalid, void, or otherwise unenforceable portion).
6.7. EXTENSION NOT A WAVIER. No delay or omission in the exercise of any
power, remedy, or right herein provided or otherwise available to any party
shall impair or affect the right
11
of such party thereafter to exercise the same. Any extension of time or other
indulgence granted to a party hereunder shall not otherwise alter or affect any
power, remedy or right of any other party, or the obligations of the party to
whom such extension or indulgence is granted except as specifically waived.
6.8. TIME OF ESSENCE. Time is of the essence of each and every term,
condition, obligation and provision hereof.
6.9. NO THIRD PARTY BENEFICIARIES. Subject to Paragraph 5.9, this
Agreement and each and every provision hereof is for the exclusive benefit of
the parties hereto and not for the benefit of any third party.
6.10. ATTORNEYS' FEES. Should any litigation (including any proceedings
in a bankruptcy court) or arbitration be commenced between the parties hereto or
their representatives concerning any provision of this Agreement or the rights
and duties of any person or entity hereunder, the party or parties prevailing in
such litigation or arbitration shall be entitled, in addition to such other
relief as may be granted, to the attorneys' fees and court or arbitration costs
incurred by reason of such litigation or arbitration, including attorneys' and
experts' fees incurred in preparation for or investigation of any matter
relating to such litigation or arbitration.
6.11. HEADINGS. The headings in this Agreement are inserted only as a
matter of convenience, and in no way define, limit, or extend or interpret the
scope of this Agreement or of any particular provision hereof.
6.12. REFERENCES. A reference to a particular paragraph of this Agreement
shall be deemed to include references to all subordinate paragraphs, if any.
6.13. GENDER, NUMBER, AND TENSE. Throughout this Agreement, unless the
context otherwise requires,
(i) the masculine, feminine, and neuter genders each includes
the other;
(ii) the singular includes the plural, and the plural includes
the singular; and
(iii) the past tense includes the present, and the present tense
includes the past.
6.14. COUNTERPARTS. This Agreement may be signed in multiple
counterparts with the same force and effect as if all original signatures
appeared on one copy; and in the event this Agreement is signed in
counterparts, each counterpart shall be deemed an original and all of the
counterparts shall be deemed to be one agreement.
12
6.15. APPLICABLE LAW. This Agreement shall be construed in accordance
with, and governed by, the laws of the State of California.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first set forth above.
BANK OF COMMERCE
By: /s/ [ILLEGIBLE]
------------------------------
Its: SVP
------------------------------
CHEMICAL MELLON SHAREHOLDER
SERVICES, L.L.C.
By: /s/ [ILLEGIBLE]
------------------------------
Its: VICE - PRESIDENT
------------------------------
[GRAPHIC]
EXERCISABLE ONLY ON AND AFTER SEPTEMBER 21, 1995 AND ON OR BEFORE JULY 25,
1999 DEFINITIVE WARRANT CERTIFICATE TO PURCHASE WARRANT SHARES AS HEREIN
DESCRIBED.
[LOGO]
BANK OF COMMERCE
"D" COMMON STOCK PURCHASE WARRANT
VOID AFTER JULY 25, 1999
CAPITALIZED TERMS USED BUT NOT DEFINED HEREIN SHALL HAVE THE MEANING ASSIGNED
TO THEM IN THE
WARRANT AGREEMENT HEREINAFTER REFERRED TO.
------------------------
WARRANT SHARES
------------------------
CUSIP 061589 14 9
-------------------------------------------------------------------------------
THIS CERTIFIES THAT
SPECIMEN
-------------------------------------------------------------------------------
(being herein called the "Registered Holder"), will be entitled to purchase,
at any time on or after September 21, 1995, and on or before July 25, 1999,
Warrant Shares, each Warrant Share consisting of one share of fully paid
Common Stock, no par value, of BANK OF COMMERCE (the "Bank"), as such stock
is constituted at the date of this Warrant Certificate (but the number of
Warrant Shares may be adjusted from time to time as stated below), at the
price ("Exercise Price") of $49.00 per Warrant Share, by surrendering this
Warrant Certificate, with the purchase form on the back hereof duly executed,
at the office of CHEMICAL MELLON SHAREHOLDER SERVICES, L.L.C, or its
successor as warrant agent, in Los Angeles, California (such Warrant agent
being herein called the "Warrant Agent"), and by paying in full, as provided
in the Warrant Agreement, the Exercise Price for the warrant Shares as to
which this Warrant Certificate is exercised, and upon compliance with and
subject to the conditions set forth herein and in the Warrant Agreement
hereinafter referred to. No such purchase may be of a number of Warrant
Shares less upon the lessor of the number of Warrant Shares set forth on this
Warrant Certificate and [ILLEGIBLE].
The warrants evidenced by this Warrant Certificate (the "Warrants") may not be
exercised unless the Warrant Certificate is countersigned below by the
Warrant Agent.
Upon any exercise of fewer than all of the Warrants evidenced by this Warrant
Certificate, there shall be issued to the Registered Holder thereof a new
Warrant Certificate evidencing the Warrant and exercised.
In certain events provided for in the Warrant Agreement which provisions are
set forth on the back hereof the shares of Common Stock included in a Warrant
Share may be adjusted as herein provided. The term "Warrant Share" refers to
such shares as so adjusted from time to time.
No fractional shares will be issued upon the exercise of rights in purchase
hereunder. If any fraction of a share of Common Stock would be Issuable upon
the exercise of any of the Warrants evidenced hereby, the Bank shall round
the number of shares of Common Stock to be issued on such exercise to the
nearest lower whole number of shares of Common Stock.
This Warrant Certificate is issued under and in accordance with the Warrant
Agreement dated as of July 25, 1995 between the Bank and the Warrant Agent
and is subject to the terms and provisions contained in said Warrant
Agreement, to all of which terms and provisions the Registered Holder of this
Warrant Certificate consents by acceptance hereof. Copies of said Warrant
Agreement are on file at the above-mentioned office of the Warrant Agent.
This Warrant Certificate is transferable by the Registered Holder hereof,
upon (i) surrender of this Warrant Certificate for transfer at the office of
the Warrant Agent maintained for that purpose in Los Angeles, California,
duty endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Bank and the Warrant Agent, duly executed by the
Registered Holder hereon or his attorney duly authorized in writing, and
thereupon one or more new Warrant Certificates of authorized denominations
will be issued to the designed transfers or transferees and (ii) compliance
with the Securities Act of 1933, as amended, if applicable.
The Bank and the Warrant Agent and all transfer agents and registered for the
Common Stock may deem and treat the Registered Holder hereof as the absolute
owner of this Warrant Certificate for all purposes, and neither the Bank, the
Warrant Agent nor any such transfer agents or registrars shall be affected by
any notice to the contrary.
This Warrant Certificate shall not entitle the Registered Holder hereof to
any of the rights of a shareholder of the Bank including, without limitation,
the right to vote, to receive dividends and other distributions, to exercise
any pre-emptive right, or to receive any notice of, or to attend, meetings of
shareholders of any other proceedings of the Bank.
This Warrant Certificate shall be void and all rights represented hereby
shall cease unless exercised on or before July 25, 1999.
Dated:
COUNTERSIGNED:
CHEMICAL MELLON SHAREHOLDER SERVICES, L.L.C
AS WARRANT AGENT
BY:
----------------------------------------
AUTHORIZED OFFICER
[SEAL]
BANK OF COMMERCE
BY: BY:
-------------------------------- ---------------------------------
SPECIMEN SPECIMEN
SECRETARY PRESIDENT
BANK OF COMMERCE
The text of Paragraph 3 of the Warrant Agreement is set forth below.
3. Adjustments in Warrant Shares; Fractional Shares
3.1 ANTI-DILUTION PROVISIONS. The number of shares of Common Stock
which may be purchased upon the exercise hereof shall be subject to change or
adjustment as follows:
3.1.1 STOCK DIVIDENDS - SUBDIVISIONS. COMBINATIONS, In case the Bank
shall (i) pay a dividend on the Common Stock in shares of Common Stock (or
securities convertible into, exchangeable for or otherwise confirming the
registered holder to receive Common Stock), (ii) subdivide the outstanding
Common Stock into a greater number of shares of Common Stock or (iii) combine
the outstanding Common Stock into a smaller number of shares of Common Stock,
the number of shares of Common Stock purchasable upon exercise of any Warrant
immediately prior to the record data fixing shareholders to be affected by
such event shall be adjusted so that the Registered Holder shall thereafter
be entitled to receive that kind and number of shares of Common Stock or
other securities of the Bank that the Registered Holder would have owned or
have been entitled to receive after the happening of any of the events
described above, had the Warrant been exercised immediately prior to the
happening of such event or any record sale with respect thereto. An
adjustment made pursuant to this paragraph 2.1.1 shall become effective (i)
immediately after the record date in the case of a dividend and (ii)
immediately after the effective date in the case of a subdivision or
combination. If the Bank shall take a record of the holders of its Common
Stock for the purpose of outfitting them to receive a dividend or other
distribution, and shall thereafter and before the distribution to
stockholders thereof legally abandon its plan to pay or deliver such dividend
or distribution, then thereafter no adjustment in the number of shares of
Common Stock issuable upon exercise of a Warrant then in effect shall be
required by reason of the taking of such record. No adjustment shall be made
under this Paragraph 3.1.1 unless such adjustment would require an increase
or decrease of at least one percent in the number of shares of Common Stock
or other securities of the Bank that the Registered Holder would have owned
or have been entitled to receive had the Warrant been exercised, provided
however, that any adjustments which by reason of this sentence are not
required to be made shall be carried forward and taken into account in any
subsequent adjustments and all calculations shall be made to the nearest
one-hundredth of a share.
3.1.2 REORGANIZATION OR RECLASSIFICATION. In case of any capital
reorganization or any reclassification of the capital stock of the Bank
(whether pursuant to a merger or condition or otherwise), each Warrant shall
thereafter be exercisable for the number of shares of stock or other
securities or property receivable upon such capital reorganization or
reclassification of capital stock as the case may be by a holder of the
number of shares of Common Stock into which the Warrant was exercisable
immediately prior to such capital reorganization or reclassification of
capital stock; and, in any case, appropriate adjustment shall be made in the
application of the provisions herein set forth with respect to the rights and
interests thereafter of the Registered Holder or any Warrant to the end that
the provisions set forth herein shall thereafter be applicable, as nearly as
reasonably may be, in relation to any shares of stock or other securities or
property thereafter deliverable upon the exercise of the Warrant.
3.1.3 NOTICE. In the event that the Bank shall propose at any time to
effect any transaction of the type described in Subsections 3.1.1 and 3.1.2
above or take any similar extraordinary corporate action affecting the Bank's
capital stock (including but not limited to the transfer of substantially all
of the Bank's assets), then, in connection with each such event, the Bank
shall demand notice thereof to all Registered Holders at least 20 days prior
to the earlier of (i) the date on which such event is to become effective,
(ii) the record date for the shareholders affected by such event, or (iii)
the first date on which the Bank intends to affect any such transaction, in
each case specifying in reasonable detail what the transaction or event
consists of and, if applicable, the aggregate amount or value of any cash or
property proposed to be distributed, paid, purchased or received by the Bank
in connection therewith.
3.1.4 ADJUSTMENT OF EXERCISE PRICE. The C Warrant Exercise Price per
share of Common Stock purchasable upon exercise of any C Warrant shall be
subject to adjustment from time to time as follows: upon each adjustment of
the number of shares of Common Stock purchasable pursuant to this Section
3.1. the C Warrant Exercise Price shall be reduced or increased, as the case
may be, to a price determined by dividing the aggregate C Warrant Exercise
Price of all C Warrant Shares in effect prior to such adjustment by the legal
maximum number of C Warrant Shares purchasable upon the exercise of all C
Warrants immediately after such adjustment. The D Warrant Exercise Price per
share of Common Stock purchasable upon exercise of any D Warrant shall be
subject to adjustment from time to time as follows: upon each adjustment of
the number of shares of Common Stock purchasable pursuant to this Section
2.1. the D Warrant Exercise Price shall be reduced or increased, as the case
may be, to a price determined by dividing the aggregate D Warrant Exercise
Price of all D Warrant Shares in effect prior to such adjustment by the total
maximum number of D Warrant Shares purchasable upon the exercise of all D
Warrants immediately after such adjustment.
3.2. CONSOLIDATION, MERGER, OR SALE OF ASSETS. In addition to any other
rights of Registered Holders set forth herein. In case of any consolidation
of the Bank with, or merger of the Bank into, any other Person, any merger of
another Person into the Bank (other than a merger which does not result in
any reclassification, conversion, exchange or cancellation of outstanding
shares of Common Stock) or any sale or transfer of all or substantially all
of the assets of the Bank to the Person formed by such consolidation or
resulting from such merger or which acquires such assets, as the case may be,
all Registered Holders shall have the right thereafter to exercise their
Warrants for the kind and amount of securities, cash and other property
receivable upon such consolidation, merger, sale or transfer by a holder of
the number of shares of Common Stock for which their Warrants may have been
exercised immediately prior to such consolidation, merger, sale or transfer.
Adjustment for events subsequent to the effective date of such a
consolidation, merger and sale of assets shall be as nearly equivalent on may
be practicable to the adjustments provided for in this Agreement. In any such
event, effective provisions shall be made in the certificate or exercises of
Incorporation of the resulting or surviving corporation. In any contract of
sale, conveyance, lease or transfer, or otherwise so that the provisions set
forth herein for the protection of the rights of the Registered Holders shall
thereafter continue to be applicable; and any such resulting or surviving
corporation shall separately assume the obligation to deliver, upon exercise,
such shares of stock, other securities, cash and property. The provisions of
this Paragraph 3.2. shall similarily apply to successive consolidations,
mergers, sales, leases or transfers.
3.3. FRACTIONAL SHARES. No fractional shares of Common Stock shall be
issued upon the exercise of any Warrant. If any fraction of a share of Common
Stock would be issuable upon the exercise of a Warrant, the Bank shall round
down the number of shares of Common Stock to be issued upon exercise of such
Warrant to the nearest lower whole number of shares of Common Stock.
EXERCISE SUBSCRIPTION FORM
TO BE EXECUTED BY THE REGISTERED HOLDER DESIRING TO EXERCISE THE WITHIN
WARRANTS OF
BANK OF COMMERCE
Capitalized terms used but not defined herein shall have the meaning
assigned to them in the within Warrant Certificate and in the Warrant
Agreement between Bank of Commerce and Chemical Trust Company of California
dated as of July 25, 1995.
The undersigned Registered Holder hereby exercises _________________
Warrants evidencing the right to purchase shares of the Common Stock covered
by the within Warrant Certificate, according to the conditions thereof.
The undersigned Registered Holder herewith makes payment in full of the
Excercise Price on such shares of $ _____________________ in cash or by
certified or official bank check or bank cashier's check payable to the order
of the Bank, or by any combination of such cash or check.
[The undersigned Registered Holder has hereby exercised fewer than all the
Warrants evidenced by the within Warrant Certificate and, therefore,
requests that a new Warrant Certificate evidencing the remaining Warrants
evidenced by the within Warrant Certificate be issued in the name of and
delivered to the Registered Holder](1)
NOTE: EXERCISE MAY BE MADE FOR A MINIMUM OF THE LESSER OF 100 SHARES OR
THE FULL NUMBER OF SHARES AS TO WHICH EXERCISE MAY BE MADE UNDER THIS WARRANT
CERTIFICATE.
By: [ ]
---------------------------------------
Name:
Title:
Address:
-----------------------------------
-----------------------------------
Dated:
------------------
--------------
(1) To be included only if the Registered Holder is exercising fewer than as
of the Warrants evidenced by the within Warrant Certificate.
ASSIGNMENT FORM
TO BE EXECUTED BY THE REGISTERED HOLDER DESIRING TO EFFECT A TRANSFER OF THE
WITHIN WARRANTS OF
BANK OF COMMERCE
The following abbreviations, when used in the inscription on the face of this
certificate, shall be construed as though they were written out in full
according to applicable laws or regulations.
TEN COM -as tenants in common UNIF GIFT MIN ACT - Custodian
TEN ENT - as tenants by the entireties ---------- --------
JT TEN - as joint tenants with right of (Cust) (Minor)
survivorship and not as tenants
in common under Uniform Gifts to Minors
Act
----------------------------------------
(State)
Additional abbreviations may also be used, though not in the above list.
FOR VALUE RECEIVED, in accordance with the Warrant Agreement between BANK OF
COMMERCE and Chemical Mellon Shareholder Services, dated as of July 25,
1995, and the Securities Act of 1933, as amended, if applicable, the
undersigned hereby sells, assigns and transfers unto
-----------------------------------------------------------------------------------------------------
(Name)
-----------------------------------------------------------------------------------------------------
(Address)
the right to purchase ________ Warrant Shares evidenced by the within Warrant
Certificate, and does hereby irrevocably constitute and appoint
-----------------------------------------------------------------------------------------------------
attorney to transfer the said right on the books of the Bank with full power of
substitution.
By:
-----------------------------------------
Name:
Title:
Address
--------------------------------
--------------------------------
Dated:
--------------------
--------------------------------------------------------------------------------
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE WITHIN WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT, OR A CHANGE WHATSOEVER AND MUST BE
GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS,
SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED
SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO SEC RULE 17Ad15.
