=============================================================================
▇▇▇▇▇▇▇ CHAUS, INC.
WARRANT TO PURCHASE SHARES OF COMMON STOCK
=============================================================================
=============================================================================
THIS SECURITY AND THE SECURITIES ISSUABLE UPON EXERCISE HEREOF HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY
NOT BE OFFERED, SOLD, PLEDGED, HYPOTHECATED, ASSIGNED OR TRANSFERRED EXCEPT IN
COMPLIANCE WITH THIS AGREEMENT AND (I) PURSUANT TO A REGISTRATION STATEMENT
UNDER THE ACT WHICH HAS BECOME EFFECTIVE AND IS CURRENT WITH RESPECT TO THE
SECURITIES, OR (II) PURSUANT TO A SPECIFIC EXEMPTION FROM REGISTRATION UNDER
THE ACT BUT ONLY UPON THE HOLDER HEREOF FIRST HAVING OBTAINED THE WRITTEN
OPINION OF COUNSEL TO THE COMPANY, OR OTHER COUNSEL ACCEPTABLE TO THE COMPANY,
THAT THE PROPOSED DISPOSITION IS CONSISTENT WITH ALL APPLICABLE PROVISIONS OF
THE ACT AS WELL AS ANY APPLICABLE "BLUE SKY" OR SIMILAR SECURITIES LAW.
=============================================================================
February 19, 1997
▇▇▇▇▇▇▇ CHAUS, INC.
For good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged by ▇▇▇▇▇▇▇ Chaus, Inc., a New York corporation,
with its principal office at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (the
"Company"), BNY Financial Corporation (the "Holder" or "BNY"), of ▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, subject to the terms and conditions
of this Warrant, is hereby granted the right to purchase, at the initial
Purchase Price of $0.625 per share, at any one or more times from the date
hereof until 5:00 p.m. on February 19, 2002, in the aggregate, one hundred
twenty five thousand (125,000) shares of Common Stock of the Company, $.01 par
value (the "Shares").
This Warrant initially is exercisable at a price of $0. 625 (the
"Purchase Price") per Share payable in cash, by certified or official bank
check in New York Clearing House funds or other
2
form of payment satisfactory to the Company, subject to adjustment as provided
in Section 5 hereof.
1. Exercise of Warrant. The purchase rights represented by this
Warrant are exercisable at the option of the Holder hereof, in whole or in
part, at one or more times during any period in which this Warrant may be
exercised as set forth above. The Holder shall not be deemed to have exercised
its purchase rights hereunder until the Company receives written notice of the
Holder's intent to exercise its purchase rights hereunder along with payment
for the purchased Shares. The written notice shall be in the form of a duly
executed Subscription Form a form of which is attached hereto and made a part
hereof. Less than all of the Shares may be purchased under this Warrant.
2. Issuance of Certificates. Upon the exercise of this Warrant, the
issuance of certificates for Shares underlying this Warrant which are
purchased shall be made forthwith (and in any event within ten (10) business
days after the Company's receipt of written notice and payment for the
purchased Shares specified in Section 1 above) and such certificates shall be
issued in the name of the Holder hereof.
3. Restriction on Transfer and Registration Rights. Neither this
Warrant nor any Shares issuable upon exercise hereof have been registered
under the Securities Act of 1933, as amended (the "Act"), and neither may be
sold or transferred in whole or in part unless the Holder shall have first
given prior written notice to the Company describing such sale or transfer and
furnished to the Company an opinion, satisfactory to counsel for the Company
as determined by such counsel in its sole discretion, to the effect that the
proposed sale or transfer may be made without registration under the Act;
provided, however, that the foregoing shall not apply if there
3
is in effect a registration statement with respect to this Warrant or the
Shares issuable upon exercise hereof, as the case may be, at the time of the
proposed sale or transfer. Upon exercise, in part or in whole, of this
Warrant, each certificate issued representing the Shares underlying this
Warrant shall bear a legend to the foregoing effect. The Holder shall have
such rights to request the Company to register all or any of the Shares
issuable upon exercise of this Warrant as set forth in Annex B hereto (the
"Registration Rights") subject to the terms of Annex B.
4. Price.
4.1 Initial and Adjusted Purchase Price. The initial Purchase Price
shall be $0.625 per Share. The adjusted Purchase Price shall be the price
which shall result from time to time from any and all adjustments of the
initial Purchase Price in accordance with the provisions of Section 5 hereof.
4.2 Purchase Price. The term "Purchase Price" herein shall mean the
initial Purchase Price or the adjusted Purchase Price, as the case may be.
5. Adjustments of Purchase Price and Number of Shares. The Shares
subject to this Warrant and the Purchase Price thereof shall be appropriately
adjusted by the Company in accordance with the Statement of Rights to Warrants
included in Annex A hereto.
6. Replacement of Warrant. Upon receipt by the Company of (i)
evidence reasonably satisfactory to it of the loss, theft, destruction or
mutilation of this Warrant, and, in case of such loss, theft, destruction or
mutilation, and (ii) an indemnity or other security reasonably satisfactory to
it in its sole discretion, and upon reimbursement to the Company of all
expenses incidental or relating thereto, and in the event of mutilation upon
surrender and cancellation of
4
this Warrant, the Company will make and deliver a new Warrant of like tenor,
in lieu of this Warrant.
7. Notices to Warrant Holder. Nothing contained in this Warrant shall
be construed as conferring upon the Holder hereof the right to vote or to
consent or to receive notice as a shareholder in respect of any meetings of
shareholders for the election of directors or any other matter, or as having
any rights whatsoever as a shareholder of the Company.
8. Notices. All notices, requests, consents and other communications
hereunder shall be in writing and shall be deemed to have been duly made when
delivered, or mailed by registered or certified mail, return receipt
requested:
(a) If to the registered Holder of this Warrant, to the
address of such Holder as shown on the books of the Company, or
(b) If to the Company, to the address set forth on the first
page of this Warrant or to such other address as the Company may
designate by notice to the Holder.
9. Successors. All the agreements contained in this Warrant shall
bind the parties hereto and their respective heirs, executors, administrators,
distributees, permitted successors and assigns. The Holder may assign this
Warrant without the Company's prior written consent provided that the Holder
complies with the provisions of this agreement and applicable securities laws.
Any attempted assignment in violation of the preceding sentence shall be void
and of no effect.
10. Headings. The headings in this Warrant are inserted for purposes
of convenience only and shall have no substantive effect.
5
11. Law Governing. This Warrant is delivered in the State of New York
and shall be construed and enforced in accordance with, and governed by, the
laws of the State of New York, without giving effect to conflicts of law
principles.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
in its corporate name by, and such signature to be attested to by, a duly
authorized officer as of the date first above written.
▇▇▇▇▇▇▇ CHAUS, INC.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------------
Its: Chief Financial Officer
Attest:
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------
6
ANNEX A
STATEMENT OF RIGHTS TO WARRANTS
AND
FORMS OF SUBSCRIPTION AND ASSIGNMENT
(a) Adjustment to Purchase Price and Number of Shares. In case, prior
to the expiration of this Warrant by exercise or by its terms, the Company
shall issue any shares of its Common Stock as a stock dividend or subdivide
the number of outstanding shares of its Common Stock into a greater number of
shares, then in either of such cases, the then applicable Purchase Price per
share of the Shares of Common Stock purchasable pursuant to this Warrant in
effect at the time of such action shall be proportionately reduced and the
number of shares at that time purchasable pursuant to this Warrant shall be
proportionately increased; and conversely, in the event the Company shall
contract the number of outstanding shares of Common Stock by combining such
shares into a smaller number of shares, then, in such case, the then
applicable Purchase Price per share of the shares of Common Stock purchasable
pursuant to this Warrant in effect at the time of such action shall be
proportionately increased and the number or shares of Common Stock purchasable
pursuant to this Warrant shall be proportionately decreased. If the Company
shall, at any time during the term of this Warrant, declare a dividend payable
in cash on its Common Stock and shall, at substantially the same time, offer
to its stockholders a right to purchase new Common Stock from the proceeds of
such dividend or for an amount substantially equal to the dividend, all Common
Stock so issued shall, for the purpose of this Warrant, be deemed to have been
issued as a stock dividend.
(b) Recapitalization. In case, prior to the expiration of this
Warrant by exercise or by its terms, the Company shall be recapitalized by
reclassifying its outstanding Common Stock, (other than a change in par value
to no par value), or the Company or a successor corporation shall consolidate
or merge with or convey all or substantially all of its or of any successor
corporation's property and assets to any other corporation or corporations
(any such other corporations being included within the meaning of the term
"successor corporation" hereinbefore used in the event of any consolidation or
merger of any such other corporation with, or the sale of all or substantially
all of the property of any such other corporation to, another corporation or
corporations), then, as a condition of such recapitalization, consolidation,
merger or conveyance, lawful and adequate provision shall be made whereby the
Holder of this Warrant shall thereafter have the right to purchase, upon the
basis and on the terms and conditions specified in this Warrant, in lieu of
the Shares of Common Stock of the Company theretofore purchasable upon the
exercise of this Warrant, such shares of stock, securities, property or assets
of the other corporation (including, without limitation, cash) as to which the
Holder of this Warrant would have been entitled had this Warrant been
exercised immediately prior to such recapitalization, consolidation, merger or
conveyance; and in any such event, the rights of the Warrant Holder to any
adjustment in the number of Shares of Common Stock purchasable upon the
exercise of this Warrant, as hereinbefore provided, shall continue and be
preserved in respect of any stock which the Warrant Holder becomes entitled to
purchase.
7
(c) Dissolution. In case the Company at any time, while this Warrant
shall remain both unexpired and unexercised, shall sell all or substantially
all of its property, other than as provided in subsection (b) above or
dissolve, liquidate or wind up its affairs, lawful provision shall be made as
part of the terms of any such sale, dissolution, liquidation or winding up, so
that the Holder of this Warrant may thereafter receive upon exercise hereof in
lieu of each Share of Common Stock of the Company which it would have been
entitled to receive, the same kind and amount of any securities or assets as
may be issuable, distributable or payable upon any such sale, dissolution,
liquidation or winding up with respect to each share of Common Stock of the
Company; provided, however, that in any case of any such sale or of
dissolution, liquidation or winding up, the right to exercise this Warrant
shall terminate on a date fixed by the Company. Such date so fixed shall be no
earlier than 3 P.M. New York City Time, on the forty-fifth (45th) day next
succeeding the date on which notice of such termination of the right to
exercise this Warrant has been given by mail to the registered Holder of this
Warrant at its address as it appears on the books of the Company.
(d) No Fractional Shares. Upon any exercise of this Warrant by the
Warrant Holder, the Company shall not be required to deliver- fractions of one
Share, but adjustment in the Purchase Price payable by the Warrant Holder
shall be made in respect of any such fraction of one Share on the basis of the
Purchase Price per Share then applicable upon exercise of this Warrant.
(e) Notices. In the event that, prior to the expiration of this
Warrant by exercise or by its terms, the Company shall determine to take a
record of its stockholders for the purpose of determining stockholders
entitled to receive any dividend, stock dividend, distribution or other right
that may cause any change or adjustment in the number, amount, price or nature
of the securities or assets deliverable upon the exercise of this Warrant
pursuant to the foregoing provisions, the Company shall give at least ten (10)
days' prior written notice to the effect that it intends to take such record
to the registered Holder of this Warrant at its address as it appears on the
books of the Company, said notice to specify the date as of which such record
is to be taken, the purpose for which such record is to be taken, and the
effect which the action which may be taken will have upon this Warrant.
(f) Registered Owner. The Company may deem and treat the registered
Holder of the Warrant at any time as the absolute owner hereof for all
purposes, and shall not be affected by any notice to the contrary.
(g) Status. This Warrant shall not entitle any Holder hereof to any
of the rights of a stockholder, and shall not entitle any Holder hereof to any
dividend declared upon the Common Stock unless the Holder shall have exercised
the within Warrant and purchased the Shares of Common Stock prior to the
record date fixed by the Board of Directors for the determination of holders
of Common Stock entitled to exercise any such rights or receive said dividend.
8
(h) No Adjustment for Small Amounts. Anything in the Statement of
Rights to Warrants to the contrary notwithstanding, the Company shall not be
required to give effect to any adjustment in the Purchase Price unless and
until the net effect of one or more adjustments, determined as above provided,
shall have required a change of the Purchase Price by at least ten cents, but
when the cumulative net effect of more than one adjustment so determined shall
be to change the actual Purchase Price by at least ten cents, such change in
the Purchase Price shall thereupon be given effect.
9
ASSIGNMENT
(To Be Executed By the Registered Holder
to Effect a Transfer of the Within Warrant)
FOR VALUE RECEIVED
hereby sells, assigns and transfers unto
-------------------------------------
------------------------------------------------------------------------------
(Name)
------------------------------------------------------------------------------
(Address)
------------------------------------------------------------------------------
the right to purchase Common Stock evidenced by the within Warrant, to the
extent ___________ of shares of Common Stock, and does hereby irrevocably
constitute and appoint _________________
-------------------------------------------------------------------
to transfer the said right on the books of the Company, with full power of
substitution.
Dated: __________________, 19 .
---------------------------------
(Signature)
NOTICE: The signature to this assignment must correspond with the
name as written upon the case of the within Warrant in every
particular, without alteration or enlargement, or any change
whatsoever and must be guaranteed by a bank, other than a
savings bank or trust company, having an office or
correspondent in New York, or by a firm having membership on
a registered national securities exchange and an office in
New York, New York.
10
FORM OF SUBSCRIPTION
(To be signed only upon exercise of Warrant)
To ▇▇▇▇▇▇▇ Chaus, Inc.
The undersigned, the Holder of the within Warrant, hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, _________1 shares of Common Stock of ▇▇▇▇▇▇▇ Chaus, Inc.
and herewith makes payment of $ therefor, and requests that the certificate or
certificates for such shares be issued in the name of and delivered to the
undersigned.
Dated
---------------------------------------
(Signature must conform in all
respects to name of Holder as
specified on the face of the Warrants)
---------------------------------------
(Address)
-----------------
1 Insert here the maximum number of shares or, in the case of a partial
exercise, the portion thereof as to which the Warrant is being
exercised.
11
ANNEX B
REGISTRATION RIGHTS
(a) If, at any time prior to February , 2002 the Company
proposes to register any of its securities for its own account under the
Securities Act of 1933, as amended, (the "Securities Act") (other than
securities to be issued pursuant to a stock option or other employee benefit
or similar plan and other than in connection with a business combination
transaction), the Company shall, promptly give written notice (the
"Registration Notice") to BNY of the Company's intention to effect such
registration. If, within 15 days after receipt of such notice, BNY submits a
written request to the Company specifying the number of shares of Common Stock
which it will receive upon exercise of the Warrant and which it proposes to
sell or otherwise dispose of, (the "Subject Stock") the Company shall include
the Subject Stock in such registration statement. Notwithstanding anything
herein to the contrary BNY shall not be entitled to require the Company to
include the Subject Stock in a registration statement more frequently than
twice during the term hereof. BNY when requesting inclusion of the Subject
Stock in any such registration statement, may in its discretion delay exercise
of the Warrant and notify the Company that it will exercise its Warrant as to
the Subject Stock immediately upon the registration statement becoming
effective or for delivery upon closing of a related offering. The Company will
use its reasonable best efforts in good faith to effect promptly (but in no
event later than one hundred and twenty (120) days after the receipt from BNY
of the request to register the Subject Stock, provided, however, that such
period shall be extended for up to sixty (60) additional days in the event of
a material development that shall hinder the Company from effecting such
registration) the registration of the Subject Stock. The Company shall keep
each registration statement covering any Subject Stock in effect for a period
of not less than 90 days following the effectiveness of such registration
statement (except for an underwritten offering which is closed sooner) and
maintain compliance with each applicable federal and state law and regulation.
Notwithstanding the foregoing, if the offering of the Company's securities
pursuant to such registration statement is to be made by or through
underwriters, the Company shall not be required to include Subject Stock
therein if and to the extent that the underwriter managing the offering
advises the Company in writing that such inclusion would materially adversely
affect such offering.
(b) In connection with any offering of shares of Subject
Stock registered pursuant to this Annex B the Company (i) shall furnish to BNY
such number of copies of each registration statement, each prospectus and each
preliminary prospectus, and of each amendment and supplement to any thereof as
BNY may reasonably request in order to effect the offering and sale of the
Subject Stock to be offered and sold, but only while the Company shall be
required under the provisions hereof to cause the registration statement to
remain current and (ii) take such action as shall be necessary to qualify the
shares covered by such registration statement under such blue sky or other
state securities laws for offer and sale as BNY shall request; provided,
however, that the Company shall not be obligated to qualify as a foreign
corporation to do business under the laws of any jurisdiction in which it
shall not then be qualified or to file any
12
general consent to service of process in any jurisdiction in which such a
consent has not been previously filed or subject itself to taxation in any
jurisdiction in which the Company is not already subject to taxation. The
Company shall enter into an underwriting agreement (the "Agreement") with a
managing underwriter or underwriters selected by it containing
representations, warranties, indemnities and agreements then customarily
included by an issuer in underwriting agreements with respect to secondary
distributions and BNY agrees as a condition to participation in such offering
to make such representations and warranties with respect to information as to
it as selling stockholder, and as to its holdings, which is furnished in
writing to the underwriter for use in the registration statement as are
customary and appropriate and to otherwise reasonably cooperate with the
Company in connection with any registration statement with respect to the
Subject Stock. In connection with any offering of Subject Stock registered
pursuant to this Annex B, the Company shall furnish to the underwriter, at the
Company's expense, unlegended certificates representing ownership of the
Subject Stock being sold in such denominations as requested and instruct any
transfer agent and registrar of the Subject Stock to release any stop transfer
orders with respect to such Subject Stock.
(c) Upon receipt of notice from the Company to suspend sales
to permit the Company to correct or update a registration statement or
prospectus, BNY will not (until a receipt of a notice to the contrary) effect
sales of Subject Stock included in any registration statement. The obligations
of the Company with respect to maintaining any registration statements current
and effective shall be extended by a period of days equal to the period that
such suspension is in effect.
(d) In connection with any registration pursuant to this
Annex B all expenses of registration shall be borne by the Company (unless
contrary to the federal securities laws or the laws of any state where the
Subject Stock is to be offered), provided, however, in connection with any
such registration, BNY shall be obligated to pay any and all underwriter's
commissions and filing fees incurred by the Company, to the extent that such
fees and commissions would not have been so incurred in the absence of the
registration of such Subject Stock. Under no circumstances shall the Company
have any liability for any fees and expenses of underwriters, counsel,
accountants or other agents of BNY with respect to any registration statement
filed pursuant hereto, including but not limited to the costs of any
investigations by or on behalf of BNY of the accuracy and completeness of such
registration statement or related to the furnishing of information by BNY in
connection with such registration statement.
(e) For a period of ninety (90) days from and after the
effective date of any registration statement filed pursuant hereto in which
any of the Subject Stock is included, the Company shall from time to time
amend or supplement the registration statement and the prospectus used in
connection therewith as may be necessary to permit such sale and disposition
and to the extent necessary in order to keep such registration statement
effective and such prospectus current under the Securities Act so that neither
the registration statement nor the prospectus contains any untrue statement as
to any material fact, omits any statements necessary to make the statements
contained therein not misleading.
13
(f) In the case of any offering registered pursuant to this
Annex B, the Company agrees to indemnify and hold harmless BNY and each
controlling person of BNY within the meaning of Section 15 of the Securities
Act, and the directors and officers of BNY, against any and all losses,
claims, damages or liabilities to which they or any of them may become subject
under the Securities Act or any other statute or common law or otherwise, and
to reimburse them, from time to time upon request, for any legal or other
expenses reasonably incurred by them in connection with investigating any
claims and defending any actions, insofar as any such losses, claims, damages,
liabilities or actions shall arise out of or shall be based upon (i) any
untrue statement or alleged untrue statement contained in the registration
statement relating to the sale of such Subject Stock in any preliminary
prospectus or in any prospectus or in any supplement or amendment to any of
the foregoing of a material fact, or the omission or alleged omission to state
therein a material fact required to be stated or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading or (ii) any failure or omission on the part of the Company to
comply with any provision of the Act and the rules and regulations of the
Securities and Exchange Commission (or other Federal agency at the time
charged with administration of the Securities Act) applicable to such
offering; provided, however, that the indemnification agreement contained in
this paragraph (f) shall not apply to such losses, claims, damages,
liabilities or actions which shall arise from the sale of Subject Stock if
such losses, claims, damages, liabilities or actions shall arise out of or
shall be based upon any such untrue statement or alleged untrue statement, or
any such omission or alleged omission, if such statement or omission shall
have been made in reliance upon and in conformity with information furnished
in writing to the Company by BNY specifically for use in connection with the
preparation of the registration statement or any preliminary prospectus or
prospectus contained in the registration statement or any amendment thereof or
supplement thereto provided further, however, that the indemnification
agreement contained in this paragraph (f) shall not apply to such losses,
claims, damages, liabilities or actions to the extent that they arise out of
or are based upon any untrue statement or omission made in any preliminary
prospectus if (i) BNY failed to send or deliver a copy of the final prospectus
with or prior to the delivery of written confirmation of the sale by BNY to
the person asserting the claim from which such damages arise, and (ii) the
final prospectus would have corrected such untrue statement or such omission;
provided further, that the Company shall not be liable to BNY in any such case
to the extent that any such damages arise out of or are based upon any untrue
statement or omission in any prospectus if (x) such untrue statement or
omission is corrected in an amendment or supplement to such prospectus, and
(y) having previously been furnished by or on behalf of the Company with
copies of such prospectus as so amended or supplemented, BNY thereafter fails
to deliver such prospectus as so amended or supplemented prior to or
concurrently with the sale of a Subject Stock to the person asserting the
claim from which such damages arise.
(g) In connection with any registration statement in which
BNY is participating, BNY will indemnify, to the extent permitted by law, the
underwriters, the Company and its directors and officers against any losses,
claims, damages, liabilities and expenses resulting solely by reason of any
untrue statement of a material fact or any omission of a material fact
necessary to make the statements therein not misleading, in the registration
14
statement or any prospectus or preliminary prospectus or any amendment or
supplement thereto, but only to the extent that such untrue statement is
contained in, or such omission is omitted from, information so furnished to
the Company by BNY in writing; provided, however, that BNY shall not be liable
in the aggregate for any amounts exceeding the product of the sale price minus
the Purchase Price per share of Subject Stock of BNY sold in such registered
offering and the number of shares of Subject Stock sold pursuant to such
registration statement or prospectus by BNY.
(h) Each party indemnified under paragraph (f) or (g) of
this Annex B shall, promptly after receipt of notice of the commencement of
any action against such indemnified party in respect of which indemnity may be
sought hereunder, notify the indemnifying party in writing of the commencement
thereof. The omission of any indemnified party to so notify an indemnifying
party of any such action shall not relieve the indemnifying party from any
liability in respect of such action which it may have to such indemnified
party on account of the indemnity agreement contained in paragraph (f) or (g)
of this Annex B, unless the indemnifying party was prejudiced by such
omission, and in no event shall relieve the indemnifying party from any other
liability which it may have to such indemnified party. In case any such action
shall be brought against any indemnified party and it shall notify an
indemnifying party of the commencement thereof, the indemnifying party shall
be entitled to participate therein and, to the extent that it may desire to
assume the defense thereof through counsel satisfactory to the indemnified
party, and after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under paragraph (f) or (g) of this
Annex B for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof, other than
reasonable costs of investigation (unless such indemnified party reasonably
objects to such assumption on the grounds that there may be defenses available
to it which are different from or in addition to such indemnifying party in
which event the indemnified party shall be reimbursed by the indemnifying
party for the expenses incurred in connection with retaining separate legal
counsel).
(i) Nothing in paragraph (f) or (g) of this Annex B shall
prevent the indemnified party from retaining counsel of its own choosing, at
its own expense, to defend or cooperate in the defense or investigation of any
claim in respect of which indemnification is available hereunder. No
indemnifying party will consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving
by the claimant or plaintiff to such indemnified party of a release from all
liability in respect to such claim or litigation.
15
