EXHIBIT 1.1
SUBREGISTRAR AGREEMENT
Related to the registration of
certain securities issued by Frontline Ltd.
in the Norwegian Registry of Securities
("Verdipapirsentralen")
BETWEEN
FRONTLINE LTD.
(a company incorporated under the laws of Bermuda)
and
CHRISTIANIA BANK OG KREDITKASSE ASA
Registrar Department
("Verdipapirservice")
This subregistration agreement (the "Agreement") is entered into
on this 18th day of June, 1999 by and between:
(1) FRONTLINE LTD., Mercury House, 101 Front Street, Xxxxxxxx XX
GX, Bermuda (the "Company")
and
(2) CHRISTIANIA BANK OG KREDITKASSE ASA, acting through its
registrar department ("Verdipapirservice") at X.X.Xxx 0000 -
Xxxxxxx, 0000 Xxxx, Xxxxxx (the "Registrar")
(the Company and the Registrar hereinafter jointly referred
to as the "Parties" or, individually, a "Party")
WHEREAS:
(A) The Registrar was, on June (1), the nominee owner of
44.612.536 ordinary, fully paid shares in the Company.
(B) The number of ordinary shares in the Company nominally owned
by the Registrar may change in the future as a consequence
of:
(i) further shares being issued to the shareholders on
whose behalf the Registrar acts as nominee;
(ii) existing share evidenced by physical share
certificates being transferred to the nominal
ownership of the Registrar by the owner(s) thereof;
and
(iii) the beneficial owner(s) of shares nominally held by
the Registrar withdrawing such shares from the
Registrar's ownership in exchange for physical share
certificates;
(the ordinary shares in the Company from time to time
nominally owned by the Registrar hereinafter referred to as
the "Shares").
(C) The beneficial owners of the Shares (the "VPS Shareholders")
are recorded in a subregister (the "Share Subregister") in
the Norwegian paperless securities recordation system
("Verdipapirsentralen") ("VPS").
(D) The Registrar has, pursuant to the terms of a certain
registration agreement dated 1 July 1997 with the Company
(the "Existing Agreement"), acted as registrar for the
Company in matters relating to the Shares, the VPS
Shareholders, the Share Subregister and the VPS.
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(E) The Parties have agreed that the Registrar shall continue to
act as registrar for the Company as aforesaid.
(F) The Registrar is, at the date hereof, the nominee owner of
26.000.000 warrants to subscribe for ordinary shares in the
Company.
(G) The number of warrants nominally owned by the Registrar may
be reduced in the future as a consequence of the exercise by
the warrant holders on whose behalf the Registrar acts as
nominee exercising their rights thereunder (the warrants
issued by the Company from time to time nominally owned by
the Registrar hereinafter referred to as the "Warrants").
(H) The beneficial owners of the Warrants (the "Warrant
Holders") are recorded in a subregister (the "Warrant
Subregister") in the VPS.
(I) The Registrar has agreed to act as registrar for the Company
in matters relating to the Warrants, the Warrant Holders,
the Warrant Subregister and the VPS.
(J) The Parties have agreed to document the terms upon and
subject to which the Registrar shall perform its duties as
registrar as aforesaid in one agreement, thus substituting
the Existing Agreement.
NOW THEREFORE, the Parties have agreed as follows:
1. APPOINTMENT
1.1 The Company hereby confirms the appointment of the Registrar
as registrar in respect of the Shares, the Warrants, the VPS
Shareholders, the Warrant Holders, the Share Subregister,
the Warrant Subregister and the VPS on the terms set forth
in this Agreement. The terms set forth herein shall be
effective from the date hereof.
This Agreement shall substitute and render invalid all other
agreements, whether written or oral, between the Parties
(including, but not limited to the Existing Agreement) in
respect of the matters regulated herein.
1.2 The Registrar agrees to provide the services set forth
herein and all such other things and steps as may be
required or requested by the Company in order to enable:
(i) the VPS Shareholders to benefit from and enjoy all
such rights and privileges as members of the Company
have; and
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(ii) the Warrant Holders to benefit from and enjoy all such
rights and privileges as a holder of the Warrants
has;
(iii) the Company to enforce the provisions of its bye-laws
as if the VPS Shareholders and the Warrant Holders
were registered in the Company's register of members
and register of holders of warrants;
(iv) shares in the Company evidenced by physical share
certificates being converted to Shares if so requested
by the registered owner thereof and Shares being
converted to shares in the Company evidenced by
physical share certificate if so requested by the
relevant VPS Shareholder.
1.3 The Registrar further agrees to act as nominee owner of the
Shares and the Warrants and will be registered as such in
the Company's register of members and register of holders
of the Company's warrants.
2. UNDERTAKINGS BY THE REGISTRAR
2.1 The Registrar undertakes:
a) to have copies of the Memorandum of Association and
Bye-laws of the Company and the conditions for the
Warrants available for inspection by the VPS
Shareholders and the Warrant Holders in its office.
b) that, if any share, debenture, security or other
right, asset or benefit other than a cash dividend
(hereinafter a "Security") shall accrue to the
Registrar as a consequence of its nominee ownership of
the Shares or the Warrants, it shall ensure that the
legal or registered title to such Security is held for
the benefit of the VPS Shareholders or, as the case
may be, the Warrant Holders until such time as
transfers of such Security are executed in favour of
the VPS Shareholders or, as the case may be, the
Warrant Holders pro rata to their entitlement to such
Security.
c) to ensure that, at all times, there is registered in
the Share Subregister and the Warrant Subregister
accurate and complete information with respect to each
person or entity who is or becomes a VPS Shareholder
or, as the case may be, a Warrant Holder including:
(i) the name and address of such person or entity;
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(ii) the number of the Shares and/or the Warrants
held by such person or entity;
(iii) the date each such person or entity was entered
into the Share Subregister as a VPS Shareholder
or, as the case may be, in the Warrant
Subregister as a Warrant Holder; and
(iv) the date such person or entity ceased to be a
VPS Shareholder or, as the case may be, a
Warrant Holder.
(Information concerning (iii) and (iv) to be safely
retained for 10 years following the date referred to
in (iv)).
and all such other information as may be required in
order to comply with any applicable Norwegian
legislation and the terms of the Company's listing
agreement with the Oslo Stock Exchange ("OSE") from
time to time.
d) to promptly distribute all dividends declared by the
Company to the VPS Shareholders based upon the number
of the Shares which were registered in each of their
names in the Share Subregister on the date of
declaration in accordance with the terms of Clause 4
below.
e) to assist the Company in despatching each and every
notice of a meeting of the Company's shareholders or a
meeting of the Company's holders of the Warrants to
each VPS Shareholder and/or Warrant Holder at the
address recorded in the VPS at such time.
f) not to attend any shareholders and/or meeting of the
holders of the Warrants, nor to vote any of the Shares
or the Warrants in such meeting other than in
accordance with proxies received for this purpose from
VPS Shareholders or, as the case may be, Warrant
Holders.
g) to assist the Company in despatching all reports,
accounts, financial statements, circulars or other
similar documents (each a "Document") relating to the
affairs of the Company to the VPS Shareholders and/or
the Warrant Holders at such person or entity's
registered address in the VPS.
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h) upon:
(i) any change in or alteration of the Company's
issued share capital or the par value of the
Shares, to make or cause to be made, without
delay, all necessary amendments reflecting such
change or alteration in the Share Subregister;
(ii) the occurrence of an event which leads to the
adjustment of the subscription rights of the
Warrant Holders as per the terms of the
Warrants, promptly, upon receipt of such
information from the Company, make or cause to
be made (a) such adjustment known to the Warrant
Holders and (b) all necessary amendments
reflecting such adjustment in the Warrant
Subregister;
provided, however, that any instructions from the
Company as per the above shall be accompanied by a
certificate of either a firm of independent public
accountants of recognised standing (who may be the
regular auditors of the Company) or an internationally
recognised investment bank to be selected by the
Company's board of directors in respect of such change
or alteration in the issued share capital or such
adjustment in the subscription price for the Warrants
setting out the effect the same shall have for the VPS
Shareholders and/or the Warrant Holders.
i) to do all such acts and things as are within its
powers to (a) enforce the provisions of the Memorandum
of Association and Bye-laws of the Company in order to
confer upon the VPS Shareholders all such rights and
obligations as are attributable to the Company's
members and (b) the provisions of the Memorandum of
Association and Bye-laws of the Company and the
conditions for the Warrants in order to confer upon
the Warrant Holders all such rights and obligations as
are attributable to the holders of the Warrants from
time to time.
j) to assist the Company in discharging all such
obligations as it will be obliged to do vis-a-vis the
VPS Shareholders and, if the Warrants are listed
thereon, the Warrant Holders under the listing
agreement between the Company and the OSE.
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3. UNDERTAKINGS OF THE COMPANY
3.1 The Company undertakes to inform the Registrar of any
decision made by the Company's governing bodies relevant to
the continued subregistration of the Shares and the Warrants
in the VPS and of such other information which is relevant
to the Registrar in order for the Registrar to comply with
the terms of this Agreement and its obligations to the VPS.
3.2 The Company specifically undertakes to comply with the terms
of its listing agreement with OSE in respect of the Shares
and, if the Warrants are listed thereon, the Warrants, and
such laws and regulations of Norway as may be applicable
thereto.
3.3 The Company shall provide the Registrar with a copy of its
Memorandum of Association and Bye-laws in force at the date
of this Agreement and undertakes to immediately inform the
Registrar of any subsequent change in or amendment to the
same.
3.4 The Company shall provide the Registrar with the original
certificates evidencing the Shares and the Warrants
nominally issued to the Registrar on the date of this
Agreement at the latest.
4. DIVIDEND PAYMENTS
4.1 The Company shall provide the Registrar with details of any
dividend declared by the Company to its members before any
payment thereof is made to the Registrar (in its capacity as
nominee owner of the Shares).
4.2 The Company shall transfer such amount as shall represent
the aggregate dividends due to the VPS Shareholders on the
record date for such payment to an account of the Registrar
nominated for this purpose.
The Registrar shall, upon receipt of such dividend payment,
forward, to each VPS Shareholder recorded as such on the
date of declaration of such dividend (the "Record Date"),
such VPS Shareholder's proportionate part thereof without
undue delay.
4.3 VPS Shareholders who maintain a Norwegian address in the VPS
or have supplied the VPS with details of a NOK account in
their name shall receive their dividend payment in NOK in
accordance with and through the VPS computer system for
dividend payments.
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VPS Shareholders without a Norwegian address or NOK account
recorded in the VPS shall receive dividend payments in a
manner agreed between the Company and the Registrar prior to
such payment being effectuated.
4.4 Any dividend payment shall be effectuated by the Registrar
in a manner which ensures that the VPS Shareholders have
such payment available in their respective accounts no later
than 12 Business Days from the Record Date subject to the
Registrar having received such amount no later than 6
Business Days before the payment date in USD or, if the
Company takes responsibility for the exchange of any amounts
payable in currencies other than USD, on the date payment is
to be effected.
Payments to be made to VPS Shareholders without a Norwegian
address or NOK account recorded in the VPS shall be made as
soon as possible with a view to reducing the costs involved
with such transfer.
5. STATISTICS
5.1 The Registrar shall, at the request of the Company, produce
and send to the Company statistical material relevant to the
Share Subregister and/or the Warrant Subregister.
The following statistical material will be made available
immediately upon receipt of such request:
(i) up to date list of the VPS Shareholders and/or the
Warrant Holders together with the number of Shares
and/or Warrants owned by each person/entity among them
at such date;
(ii) the percentage of the total shares outstanding in the
Company which the Shares represent at the date of such
request;
(iii) a transcript listing the 20 VPS Shareholders with the
largest ownership of the Shares and/or the 20 Warrant
Holders with the largest ownership of the Warrants;
(iv) a report identifying the VPS Shareholders and/or
Warrant Holders who, according to the VPS, are
resident in Norway or such other jurisdiction as may
be identified by the Company in such request; and
(v) the Share Subregister and/or the Warrant Subregister
in a label format, ready for postage.
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Other reports and statistical material may furthermore be
prepared by the Registrar subject to agreement with the
Company.
5.2 All reports and statistical material provided by the
Registrar will be made available on paper, computer disc
and/or by E-mail.
5.3 If a stockbroker, newspaper or any other person requests a
transcript of the 20 largest VPS Shareholders or Warrant
Holders, the Register is authorised by the Company to
release the same.
The Company shall, however, be notified of such request
without undue delay.
If any other person or entity than the Company requests a
full transcript (whether as a list or in label format) of
the Share Subregister and/or the Warrant Subregister) the
Registrar shall obtain the Company's explicit permission
before releasing the same.
5.4 An updated version of the Share Subregister and the Warrant
Subregister shall be available at the Registrar's office for
public inspection in accordance with Norwegian law during
the Registrar's normal office hours.
6. CONVERSIONS
6.1 Each VPS Shareholder has the right to demand that the
recordation of those of the Shares that are beneficially
owned by him is transferred from the Share Subregister (and
thus the nominal ownership of the Registrar) to the
Company's official register of members (and thus to his
beneficial ownership).
6.2 A demand as referred to in 6.1 shall be effectuated as
follows:
(i) Such demand shall always be directed to the Registrar,
who shall note the same and inform the relevant VPS
Shareholder that the recordation of his ownership of
those of the Shares as he is the beneficial owner of
will be transferred to the main register of members of
the Company no later than 3 months from the date his
demand was received by the Registrar and that he
cannot, unless his demand is formally withdrawn,
transport or encumber those of the Shares as he is
recorded as being the beneficial owner of in the Share
Subregister in the said period. The Registrar shall
furthermore record a lien against those of the Shares
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which are registered on his VPS account for this
purpose.
(ii) Every second month, the Registrar shall, if demands
for transfers of the recordation of shareholdings in
the Company from the Share Subregister to the main
register of members have been received in the
preceding two months, send a request to the Company to
split the share certificate evidencing the Shares into
a number of new certificates, all in the Registrar's
name, consistent with such demands. The original
certificate evidencing the Shares shall always
accompany such request.
(iii) Upon the return of such new certificates to the
Registrar, the Registrar shall endorse the
certificate(s) to be delivered to the relevant VPS
Shareholder(s) for transport and send it/them to the
same by registered mail. Simultaneously, the
shareholding of such VPS Shareholder shall be deleted
from the Share Subregister and notice of the transfer
sent to the Company.
All costs relevant to the transfer of the shareholdings of a
VPS Shareholder from the Share Subregister to the main
register shall be for the account of the relevant VPS
Shareholder.
6.3 The Company may, following a request from a shareholder
whose ownership of shares in the Company is documented by
way of physical share certificates, demand that such shares
are included in the VPS Subregister.
6.4 A demand as referred to in 6.1 shall be effectuated as
follows:
(i) Such demand shall be accomplished by confirmation from
the Company that the Company has the relevant share
certificate(s) in hand duly endorsed for transfer to
the Registrar and such information as will be
necessary to establish a VPS account in the name of
the relevant shareholder or, if such shareholder
already has a VPS account, the account number;
(ii) The Registrar shall, thereafter, establish a VPS
account in the name of such shareholder or confirm
that the VPS account nominated exists in the name of
such shareholder and confirm the same to the Company.
At the same time, the Registrar shall arrange for the
share certificate evidencing the Shares to be
delivered to the Company;
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(iii) Upon receipt of such confirmation as aforesaid and the
share certificate evidencing the Shares from the
Registrar, the Company will cancel the share
certificate representing the shares to be included in
the VPS Subregister and the certificate evidencing the
Shares and issue a new share certificate in the name
of the Registrar representing all such shares;
(iv) The Company shall notify the Registrar of the issuing
of the new share certificate in the Registrar's name
immediately after the issue thereof, whereafter the
Registrar shall record the shares transferred to the
VPS Subregister pursuant to the original demand on
such shareholder's VPS account;
(v) The new certificate representing the Shares shall,
thereafter, be returned to the Registrar.
All costs relevant to the transfer of the shareholdings of a
shareholder outside the VPS Subregister to the VPS
Subregister shall be for the account of the relevant
shareholder.
7. TRANSFER AND EXERCISE OF WARRANTS
7.1 Evidence of the ownership of the Warrants cannot be
transferred from the Warrant Subregister to the Company's
general register of holders of warrants.
7.2 If a Warrant Holder wishes to exercise the right of his
Warrants, notice thereof shall be given to the Registrar in
writing.
The Registrar shall, upon receipt of such notice, inform the
Warrant Holder that:
(i) shares corresponding to the number of Warrants
exercised will be allotted by the Company no later
than 30 banking days in Oslo (a "Banking Day")
following receipt of such notice subject to the
subscription price for such shares being paid and the
terms of the Warrants otherwise being complied with.
(ii) the subscription price for such shares must be paid to
the Company (to an account with the Registrar
identified to the Warrant Holder) correspondingly with
the submittal of such notice.
(iii) the Warrants so exercised no longer can be traded and
that a lien will be placed on those of the Warrants
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that are beneficially owned by such Warrant Holder on
his VPS account in order to ensure this.
The Registrar shall then complete a notice as required in
the terms for the Warrants and, within 3 days, submit this
to the Company together with (a) the certificate evidencing
the Warrants, (b) the share certificate evidencing the
Shares and (c) confirmation that the subscription price has
been paid by the Warrant Holder.
The Company shall, not later than 20 Banking Days from
receipt of such notice, reissue the certificates evidencing
the Shares and the Warrants in numbers corresponding to the
exercise of the Warrants having taken place.
The Registrar shall be informed immediately after the
allotment of the shares as per (i) above and shall, upon
receipt of such information, delete the relevant number of
Warrants from the VPS account of the relevant Warrant Holder
and record the number of Shares corresponding to the said
exercise of Warrants on such person/company's VPS account.
The Warrant Holder shall furthermore be informed thereof
without delay.
8. PAYMENTS
8.1 The Company shall pay for the services of the Registrar
pursuant hereto in accordance with the standard charges of
the Registrar for such services. The standard charges
effective as of the date hereof are set out in Schedule 1
hereto.
The Registrar shall be entitled to change such charges
subject to 2 weeks written notice to the Company having been
given.
8.2 In addition to the charges referred to in Clause 8.1, the
Company shall reimburse the Registrar for all out-of-pocket
costs (including, but not limited to reasonable external
legal fees) incurred by the Registrar in performing its
duties hereunder, provided, however that all the Registrar's
costs in respect of the entering into of this Agreement
shall be for the Registrar's own account.
8.3 The Registrar shall render monthly invoices to the Company
detailing the charges, fees and costs payable by the Company
to the Registrar hereunder.
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9. CONFIDENTIALITY
Any information regarding the Company or otherwise relating
to its affairs which may be obtained by the Registrar or its
employees in connection with the performance of the duties
of the Registrar hereunder shall be treated by the Registrar
and its employees as private and confidential and shall not
be disclosed to any third person unless required by
applicable law.
10. LIABILITY
The Registrar is not responsible for any loss or losses
incurred by the Company as a result of insufficient,
misleading or wrongful information or instruction(s) given
to the Registrar by the Company, a person or entity
representing or acting on behalf of the Company, or the VPS.
11. TERMINATION
11.1 This Agreement may be terminated by either Party upon a
minimum of two months prior written notice.
11.2 Each of the Parties may terminate this Agreement upon 10
days prior written notice in the event of any material
breach by the other Party of its duties hereunder.
11.3 Upon receipt or submittal of notice of termination of this
Agreement for any reason whatsoever, the Company shall,
without delay, appoint a new registrar in place of the
Registrar.
The Company shall thereafter, forthwith and in writing,
notify the VPS, each VPS Shareholder and Warrant Holder of
the name and address of the new registrar and the date on
which the new registrar has been or will be entered in the
Company's register of members and register of holders of
warrants as nominee owner of the Shares and the Warrants in
place of the Registrar. The Registrar shall, immediately
following the appointment of a new registrar, transfer all
information concerning the VPS Shareholders and the Warrant
Holders and the primary insiders of the Company to the new
registrar. Such transfer shall be free of charge if the
termination is a result of the Registrar's material breach
of its duties hereunder. Otherwise only administrative costs
shall be charged.
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12. GOVERNING LAW - JURISDICTION
12.1 This Agreement shall be governed by and construed in
accordance with the laws of the Kingdom of Norway.
12.2 Any dispute between the Parties relating to this Agreement
which cannot be amicably settled, shall be submitted to
arbitration before a panel of three arbitrators in Oslo
according to the provisions of the Norwegian Civil Procedure
Act, Chapter 32.
The Party demanding the initiation of arbitration
proceedings shall, correspondingly with such demand, appoint
one of the arbitrators. The other Party shall, within 21
days from receipt of such demand appoint another of the
arbitrators. No later than 21 days from the appointment of
the second arbitrator, the two arbitrators so appointed
shall jointly appoint the third arbitrator who shall be the
chairman of the panel.
If either of the Parties fails to appoint an arbitrator or
the two arbitrators appointed by the Parties fail to agree
on the appointment of the third arbitrator within 2 weeks
from the date on which such appointment should have been
made at the latest, such appointment shall be referred to
the chairman of the Oslo division of the Norwegian Bar
Association.
The arbitration shall be conducted in the English language
or accompanied by qualified English translation.
This Agreement has been executed in two copies, one for each of
the parties.
For and on behalf of
FRONTLINE LTD.
/s/ Tor Olav Troim
___________________________________________
Tor Olav Troim
Director
For and on behalf of
CHRISTIANIA BANK OG KREDITKASSE
Verdipapirservice
/s/ Xxxxxx Xxxxxxx
___________________________________________
/s/ Xxx Xxxxxxxxx
___________________________________________
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WARRANTS
Certificate No. [ ] Warrants to subscribe
for
[ ] Ordinary Shares
FRONTLINE LTD.
(Incorporated in Bermuda with limited liability)
Subscription Warrant entitling the Holder to subscribe
for [ ] Ordinary Shares of US$ 2.50 par value
each with associated rights in Frontline Ltd. at a
subscription price of US$ [ ] per share
This is to certify that [ ] is the registered holder of the
right to subscribe for [ ] Ordinary Shares of US$ 2.50 par
value each with associated rights in Frontline Ltd. subject to
the conditions of the Memorandum of Association and Bye-Laws of
Frontline Ltd. and to the conditions attached hereto.
Given under the Seal of Frontline Ltd.
On [ ] (date)
___________________________
Name:
Title: Director
___________________________
Name:
Title: Secretary/Director (delete as appropriate)
Note: This certificate is non-transferable other than as set
forth in Clause 5 in the attached conditions.
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CONDITIONS ATTACHING TO THE WARRANTS TO SUBSCRIBE
FOR ORDINARY SHARES IN FRONTLINE LTD.
On May 11, 1998 Frontline Ltd. issued 26,000,000 warrants (a
"Warrant" or the "Warrants") to subscribe for 26,000,000 ordinary
shares with associated rights in Frontline Ltd. of US$ 0.25 par
value each at a subscription price of US$ 1.591 per share.
On October 19, 1998, the Annual General Meeting of Frontline Ltd.
resolved to effectuate a consolidation of its shares whereby one
new ordinary share of US$ 2.50 par value (an "Ordinary Share" or
the "Ordinary Shares") replaced 10 previous ordinary shares of
US$ 0.25 par value. The share consolidation became effective as
from October 26, 1998.
As a consequence thereof, the number of Ordinary Shares the
Warrants gave its holders the right to subscribe for was adjusted
to 2,600,000 (two million six hundred thousand) and the
subscription price for each Ordinary Share was adjusted to US$
15.91, as per the terms of Clause 2.a.1 and 2.c below.
The following conditions apply to the Warrants:
1. SUBSCRIPTION RIGHTS
a. The registered holder for the time being of a warrant (the
"Warrant Holder") shall have the right (a "Subscription
Right") to purchase, from Frontline Ltd., at any time until
the 11th of May 2001 (the "Final Subscription Date"), one
tenth of an Ordinary Share for each Warrant of which he is
the holder as specified on the face of the warrant
certificate evidencing the Subscription Right (the "Warrant
Certificate") at a price of US$ 15.91 per Ordinary Share of
US$ 2.50 par value (the "Exercise Price"), payable in full
in immediate available funds on subscription.
The number and/or nominal value of Ordinary Shares to be
subscribed and the Exercise Price are subject to adjustments
as provided in Clause 2 below.
b. In order to exercise his Subscription Right, the Warrant
Holder must lodge, at the office of Frontline Ltd., at any
time prior to the Final Subscription Date, (i) the Warrant
Certificate evidencing his Warrants, (ii) a duly completed
notice of exercise of Subscription Rights in the form
attached thereto (the "Notice") and (iii) a remittance for
the Exercise Price of the Ordinary Shares in respect of
which his Subscription Rights are being exercised.
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Once lodged, a Notice shall be irrevocable save for
revocation with the consent of Frontline Ltd. Compliance
must also be made with any statutory requirements for the
time being applicable.
c. Ordinary Shares issued pursuant to the exercise by a Warrant
Holder of his Subscription Rights, whether in full or in
part, will be allotted no later than three banking days in
Oslo, Norway (a "Banking Day") after, and with effect from,
the date of receipt by Frontline Ltd. of a duly completed
Notice accompanied by confirmation that the Exercise Price
in respect of which the Subscription Rights are being
exercised has been received by Frontline Ltd. (the
"Subscription Date").
Certificates in respect of such Ordinary Shares will be
issued free of charge not later than three Banking Days
after the Subscription Date to the Warrant Holder. In the
event of partial exercise by the Warrant Holder of his
Subscription Rights, Frontline Ltd. shall, at the same time,
issue, free of charge, a fresh Warrant Certificate in the
name of the Warrant Holder for any balance of his Warrants.
d. All Ordinary Shares issued upon the exercise of any Warrants
shall be validly authorized and issued, fully paid and non-
assessable, and free from all taxes, liens and charges
created by Frontline Ltd. in respect of the issue thereof.
Each person in whose name any such certificate for Ordinary
Shares is issued shall, for all purposes, be deemed to have
become the holder of record of the Ordinary Shares
represented thereby on the Subscription Date resulting in
the issuance of such Ordinary Shares (so long as the
Exercise Price then in effect has been paid as required
hereby), irrespective of the date of issuance or delivery of
such certificate for Ordinary Shares.
2. ADJUSTMENTS AND NOTICE PROVISIONS
a. Adjustment of the Exercise Price
1. In case Frontline Ltd. shall (i) declare a dividend or make
a distribution on its outstanding Ordinary Shares in
additional shares, (ii) subdivide or reclassify its
outstanding Ordinary Shares into a greater number of shares,
or (iii) combine or reclassify its outstanding Ordinary
Shares into a smaller number of shares, the Exercise Price
in effect immediately after the record date for such
dividend or distribution or the effective date of such
subdivision, combination or reclassification shall be
adjusted so that it shall equal the price determined by
multiplying the Exercise Price in effect immediately prior
17
thereto by a fraction, the numerator of which shall be the
number of Ordinary Shares outstanding immediately before
such dividend, distribution, subdivision, combination or
reclassification, and the denominator of which shall be the
number of Ordinary Shares outstanding immediately after such
dividend, distribution, subdivision, combination or
reclassification. Such adjustment shall be made successively
whenever any event specified above shall occur.
2. If Frontline Ltd. or any other person or entity shall issue
to holders of its outstanding Ordinary Shares generally any
rights, options or warrants (or modify any of their existing
rights, options or warrants) entitling them to subscribe for
or purchase (i) Ordinary Shares, (ii) any assets of
Frontline Ltd., (iii) any securities of Frontline Ltd.
(other than its Ordinary Shares) or of any entity other than
Frontline Ltd. or (iv) any rights, options or warrants
entitling them to subscribe for or to purchase any of the
foregoing securities, whether or not such rights, options or
warrants are immediately exercisable (hereinafter
collectively called "Distribution on Ordinary Shares"),
Frontline Ltd. shall issue to the Warrant Holders the
Distribution on Ordinary Shares to which they would have
been entitled if they had exercised their Warrants
immediately prior to the record date for the purpose of
determining the shareholders entitled to receive such
Distribution on Ordinary Shares.
3. No adjustment of the Exercise Price shall be made as a
result of or in connection with:
(i) the issuance of Ordinary Shares pursuant to options,
warrants or stock purchase agreements entered into
prior to the date hereof, or pursuant to options for
Ordinary Shares issued pursuant to Frontline Ltd.'s
Bermuda Share Option Plan or Frontline Ltd.'s United
Kingdom Share Option Plan or otherwise subsequent to
the date hereof to officers, directors, employees or
consultants of Frontline Ltd. or of a subsidiary in
connection with their services to Frontline Ltd.;
(ii) the issuance of Ordinary Shares in connection with
Distributions on Ordinary Shares pursuant to
Subsection 2. a. 2.; or
(iii) the issuance or exercise of the Warrants.
4. All calculations under this Section 2. a. shall be made to
the nearest one-tenth of a cent.
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b. No Adjustments to Exercise Price
No adjustment in the Exercise Price in accordance with the
provisions of Section 2.a. hereof need be made if such
adjustment would (i) lower the Exercise Price below the par
value of an Ordinary Share or (ii) amount to a change in
such Exercise Price of less than USD 0.05; provided,
however, that the amount by which any adjustment is not made
by reason of the provision of this section 2.b. (ii) shall
be carried forward and taken into account at the time of any
subsequent adjustment in the Exercise Price.
c. Adjustment to Number of Shares
Upon each adjustment of the Exercise Price pursuant to
Section 2.a., each Warrant shall thereupon be deemed to
evidence the right to purchase that number of Ordinary
Shares (calculated to the nearest hundredth of a share)
obtained by multiplying the number of Ordinary Shares
purchasable immediately prior to such adjustment by the
Exercise Price in effect immediately prior to such
adjustment and dividing the product so obtained by the
Exercise Price in effect immediately after such adjustment.
d. Reorganisations
In case of any capital reorganisation (other than in the
cases referred to in Section 2.a. hereof) or the
amalgamation, consolidation or merger of Frontline Ltd. with
or into any other entity (other than an amalgamation, merger
or consolidation in which Frontline Ltd. is the continuing
parent and which does not result in any reclassification of
the outstanding Ordinary Shares or the conversion of such
outstanding Ordinary Shares into other shares, securities or
property), or the sale of the property of Frontline Ltd. as
an entirety or substantially as an entirety (collectively
each such action being hereinafter referred to as a
"Reorganisation"), there shall thereafter be deliverable
upon the exercise of any Subscription Right (in lieu of the
number of Ordinary Shares theretofore deliverable) the
number of Ordinary Shares or other securities or property to
which a holder of Ordinary Shares would have been entitled
upon such Reorganisation if such Subscription Right had been
exercised in full immediately prior to such Reorganisation.
In case of any Reorganisation, appropriate adjustment, as
determined in good faith by the Board of Directors of
Frontline Ltd., shall be made in the application of the
provisions herein set forth with respect to the rights and
interests of the Warrant Holders so that the provisions set
forth herein shall thereafter be applicable, as nearly as
19
possible, in relation to any shares or other property
thereafter deliverable upon the exercise of any Subscription
Right.
Any such adjustment shall be made by and set forth in an
addendum hereto and shall, for all purposes hereof,
conclusively be deemed to be an appropriate adjustment.
Frontline Ltd. shall not effect any Reorganisation unless
upon or prior to the consummation thereof, the successor
parent, or, if Frontline Ltd. shall be the surviving parent
and is not the issuer of the shares or other securities or
property to be delivered to holders of Ordinary Shares
outstanding at the effective time thereof, Frontline Ltd.,
shall assume, by written instrument, the obligation to
deliver to each Warrant Holder such shares of stock,
securities, cash or other property as such Warrant Holder
shall be entitled to purchase in accordance with the
foregoing provisions. In the event of the sale or conveyance
or other transfer of all or substantially all of the assets
of Frontline Ltd. as a part of a plan for liquidation of
Frontline Ltd., the Subscription Rights shall terminate
thirty (30) days after Frontline Ltd. gives written notice
to each Warrant Holder that such sale or conveyance or other
transfer has been consummated.
e. Ordinary Share Buy Backs
If at any time Frontline Ltd. offers to purchase any
Ordinary Shares from the holders of Ordinary Shares,
Frontline Ltd. shall, simultaneously, give notice thereof to
the Warrant Holders and each Warrant Holder shall be
entitled to exercise his Subscription Right effective
immediately prior to the date of Frontline Ltd.'s offer.
f. Verification of Computations
Whenever the Exercise Price is adjusted as provided in
Section 2, Frontline Ltd. will promptly obtain a certificate
of either a firm of independent public accountants of
recognised standing who may be the regular auditors of
Frontline Ltd. or an internationally recognised investment
bank to be selected by the Board of Directors setting forth
the Exercise Price as so adjusted and a brief statement of
the facts accounting for such adjustment, and will make
available a brief summary thereof to the Warrant Holders at
their addresses listed on the register maintained for that
purpose by Frontline Ltd.
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g. Notice of Adjustments
Whenever an adjustment is made pursuant to this Section 2,
Frontline Ltd. shall cause notice of such adjustment to be
mailed to the Warrant Holders within fifteen (15) days
thereafter, such notice to include in reasonable detail (i)
the events precipitating the adjustment, (ii) the
computation of any adjustments, and (iii) the Exercise Price
and the number of Ordinary Shares or securities or other
property purchasable upon exercise of the Subscription
Rights after giving effect to such adjustment.
h. Warrant Certificate Amendments
Irrespective of any adjustments pursuant to this Section 2,
Warrant Certificates theretofore issued need not be amended
or replaced, but Warrant Certificates thereafter issued
shall bear an appropriate legend or other notice of any
adjustments.
i. Fractional Shares
Frontline Ltd. shall not, upon the exercise of any
Subscription Right, issue fractional Ordinary Shares which
may result pursuant to Section 1, or from adjustments in
accordance with this Section 2 to the number of Ordinary
Shares purchasable under the Warrants. If a number of
Warrants are exercised at one time by the same Warrant
Holder which is not dividable by 10, the number of whole
Ordinary Shares which shall be deliverable shall be computed
based on the number of Ordinary Shares deliverable in
exchange for the aggregate number of Warrants exercised.
With respect to any final fraction of an Ordinary Share
called for upon the exercise of any Warrants, Frontline Ltd.
shall round up such fraction to the nearest whole number in
cases of fractions greater than or equal to one-half and
round down (and cancel) such fraction in cases of fractions
less than one-half. The Warrant Holder for such a fractional
Ordinary Share shall receive no consideration for such
fractional Ordinary Share upon its rounding down and
cancellation.
3. OTHER PROVISIONS
Frontline Ltd. shall keep available for issue sufficient
authorised but un-issued share capital to satisfy in full
all Subscription Rights remaining exercisable.
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4. PURCHASE
Frontline Ltd. shall have the right to purchase Warrants at
such price and for such consideration as its Board of
Directors shall deem appropriate in the circumstances.
5. SUB-REGISTRATION - LISTING - TRANSFERS
a. Frontline Ltd. has entered into an agreement with
Christiania Bank og Kreditkasse of Oslo, Norway (the
"Registrar") pursuant to which the Registrar has established
a sub-register for the Warrants in the Norwegian paperless
securities recordation system ("VPS").
The Registrar will, as a consequence thereof, act as nominee
owner of the Warrants (and one Warrant Certificate will be
issued in the name of the Registrar representing all of the
Warrants as a consequence thereof) on behalf of the
beneficial Warrant Holders. Each beneficial Warrant Holder's
interest will be documented in an account in his name in the
VPS.
b. A beneficial Warrant Holder cannot demand that his interest
in the Warrants are evidenced in any other way (such as a
physical Warrant Certificate issued in his own name) than
through the sub-register in the VPS.
c. These conditions are subject to the agreement between the
Registrar and Frontline Ltd.
d. Frontline Ltd. will endeavour to arrange for a listing of
the Warrants on the Oslo Stock Exchange.
e. Any transfers of beneficial ownership to the Warrants shall
be evidenced by appropriate transfers in the sub-register in
the VPS in accordance with market practice and applicable
laws in Norway.
f. If, for any reason, the agreement with the Registrar is
terminated, Frontline Ltd. shall, without delay, appoint a
new registrar in place of the Registrar.
Following such appointment (which shall be on comparable
terms and with comparable duties and obligations vis-a-vis
the beneficial Warrant Holders as the agreement with the
Registrar), the Warrant Certificate shall be delivered by
the Registrar to Frontline Ltd. Frontline Ltd. shall then
cancel such Warrant Certificate and issue a new Warrant
Certificate on identical terms to the new registrar.
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6. DOCUMENTS AND MEETINGS
a. No Warrant Certificate shall entitle the registered holder
thereof to any of the rights of a shareholder of Frontline
Ltd., including, without limitation, the right to vote, to
receive dividends and other distributions, to receive any
notice of, or to attend, meetings of shareholders or any
other proceedings of Frontline Ltd.
b. Frontline Ltd. will, concurrently, with the issue of the
same to its equity shareholders and registered Warrant
Holders, send copies of its Annual Report and Accounts
together with all documents required by law to be annexed
thereto and copies of every statement, notice or circular
otherwise issued to its shareholders to the beneficial
Warrant Holders recorded in the VPS at such time.
c. If, at any time, an offer is made to all holders of Ordinary
Shares (or all such holders except the offeror, any entity
controlled by the offeror and/or any person acting in
concert with the offeror) to acquire any or all of the
outstanding Ordinary Shares and Frontline Ltd. becomes aware
that, as a result of such offer, the right to cast a
majority of the votes which may ordinarily be cast at a
general meeting of the holders of Ordinary Shares has or may
become vested in the offeror and/or such entities or
persons, Frontline Ltd. shall give notice of such offer to
each registered Warrant Holder within seven (7) days of its
becoming so aware. For the purpose of this condition, the
publication of a scheme or arrangement under The Companies
Act of 1981 of Bermuda providing for the acquisition by any
person or persons of the whole or any part of the share
capital of Frontline Ltd. shall be deemed to be the making
of an offer.
d. If any Warrant Certificate shall be mutilated, lost, stolen
or destroyed, Frontline Ltd., in its discretion, may execute
and deliver, in exchange and substitution for and upon
cancellation of such mutilated Warrant Certificate, or, in
lieu of or in substitution for a lost, stolen or destroyed
Warrant Certificate, a new Warrant Certificate for the
number of Warrants represented by the Warrant Certificate so
mutilated, lost, stolen or destroyed but only upon receipt
of evidence of such loss, theft or destruction of such
Warrant Certificate and of the ownership thereof, and an
indemnity, if requested, all satisfactory to Frontline Ltd.
Applicants for such substitute Warrant Certificate shall
also comply with such other reasonable requirements and pay
such other reasonable charges incidental thereto as
Frontline Ltd. may prescribe. Any such new Warrant
Certificate shall constitute an original contractual
23
obligation of Frontline Ltd., whether or not the allegedly
lost, stolen, mutilated or destroyed Warrant Certificate
shall be at any time enforceable by anyone.
e. For the purpose of these conditions, "extraordinary
resolution" means a resolution proposed at a meeting of the
beneficial Warrant Holders duly convened and held and passed
by a majority consisting of not less than three-fourths of
the votes cast whether on a show of hands or on a poll.
f. All the provisions of the Bye-laws for the time being of
Frontline Ltd. as to instruments of transfer, transfer book,
the share register and general meeting shall, mutatis
mutandis, apply as though the Warrants were a class of
shares forming part of the capital of Frontline Ltd., but so
that in any meeting of the beneficial Warrant Holders:
(i) the necessary quorum shall be the beneficial Warrant
Holders (present in person or by proxy) entitled to
acquire one-third in nominal amount of the Ordinary
Shares in respect of which Subscription Rights remain
exercisable;
(ii) every beneficial Warrant Holder present in person or
by proxy at any such meeting shall be entitled, on a
show of hands to one vote and every such beneficial
Warrant Holder present in person or by proxy shall be
entitled, on a poll, to one vote for every Ordinary
Share for which he is entitled to subscribe;
(iii) any beneficial Warrant Holder present in person or by
proxy may demand or join in demanding a poll; and
(iv) if, at any time, at any adjourned meeting a quorum as
above defined is not present, those beneficial Warrant
Holders who are then present in person or by proxy
shall be a quorum.
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NOTICE OF EXERCISE OF SUBSCRIPTION RIGHTS
To: Frontline Ltd.
We, Christiania Bank og Kreditkasse, being the registered holder
of the Warrants evidenced by the Warrant Certificate overleaf,
hereby exercise our subscription rights in respect of *..........
of the Ordinary Shares referred to in such Warrant Certificate in
accordance with the conditions applicable thereto.
We send herewith a remittance for the subscription monies
payable/documentation for our payment of the Exercise Price for
the Ordinary Shares for which we hereby subscribe in accordance
with the above conditions.
We agree to accept the Ordinary Share(s) to be allotted pursuant
to this notice subject to the Memorandum of Association and Bye-
laws of the Company and the conditions applicable to our Warrants
and request you to despatch the certificate for such Ordinary
Share(s) by registered mail at our risk to ourselves at the
following address:
Address .........................................................
.................................................................
..............................................
*Note: Complete as appropriate, Subscription Right(s) may only
be exercised in respect of a whole number of Ordinary
Share(s)
25
02089006.AB2
