EXHIBIT 4.2
NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE
HEREOF HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAW, AND
THEY MAY NOT BE SOLD, ASSIGNED, PLEDGED, HYPOTHECATED
OR OTHERWISE DISPOSED OF EXCEPT IN COMPLIANCE WITH
APPLICABLE FEDERAL AND STATE SECURITIES LAWS
AND THE OTHER RESTRICTIONS ON TRANSFER
SET FORTH HEREIN.
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Date: _____, 1998
FORM OF
AMENDED AND RESTATED
CLASS A WARRANT
TO PURCHASE ORDINARY SHARES OF
SCOTTISH LIFE HOLDINGS, LTD.
Void after 5:00 P.M. (United States Eastern Time), on the Termination Date, as
defined and provided herein.
THIS CERTIFIES that, for value received, _____________ (the "Warrant
Holder") or registered assigns, is entitled to purchase from Scottish Life
Holdings, Ltd. (the "Company"), upon the satisfaction of the conditions stated
herein and during the period (subject to Section 2 hereof) from and after the
first anniversary of the consummation of the Company's initial public offering
(the "Offering") of its ordinary shares, par value $.01 per share (the "Ordinary
Shares"), to 5:00 p.m. (United States Eastern Time) on the tenth anniversary of
the consummation of the Offering (the "Termination Date"), ________ Ordinary
Shares subject to adjustment as provided herein, at a per share purchase price
equal to the sales price to the public of an Ordinary Share in the Offering. The
Company acknowledges receipt from the initial Warrant Holder of _________
($_________) in full payment for the issuance of this warrant.
1. DEFINITIONS. For the purpose of this Warrant:
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(a) "Capital Stock" shall mean the Company's Ordinary Shares and
any other shares of any class, or series within a class, whether now or
hereafter authorized, which has the right to participate in the distribution of
earnings or assets of the Company without limit as to amount or percentage.
(b) "Warrants" shall mean the original Class A Warrant to
purchase Ordinary Shares of the Company issued by the Company pursuant hereto
and any and all Warrants which are issued in exchange or substitution for any
outstanding Warrant pursuant to the terms of the Warrant.
(c) "Warrant Price" shall mean the price per share at which
Ordinary Shares of the Company are purchasable hereunder, as such price may be
adjusted from time to time hereunder.
(d) "Warrant Shares" shall mean the Ordinary Shares purchasable
upon exercise of Warrants.
2. EXERCISE OF WARRANTS.
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(a) This Warrant may be exercised at any time or from time to
time on or after (i) the first anniversary of the consummation of the Offering
for up to one-third of the number of Warrant Shares provided for on page 1
hereof, (ii) the second anniversary of the consummation of the Offering for up
to an additional one-third of the number of Warrant Shares provided for on page
1 hereof, and (iii) the third anniversary of the consummation of the Offering
for up to an additional one-third of the number of Warrant Shares provided for
on page 1 hereof, in each case subject to adjustment as provided in Section 6.
Subject to the foregoing, this Warrant may be exercised at any time or from time
to time in whole or in part (but not as to fractional shares) prior to 5:00 p.m.
United States Eastern Time on the Termination Date, at which time this Warrant
and all of the Warrant Holder's rights hereunder shall terminate, except as
expressly provided herein. Notwithstanding the foregoing, upon a Change in
Control of the Company (as defined below) this Warrant shall become immediately
exercisable for the full number of Warrant Shares provided for on page 1 hereof.
For purposes of this Section 2(a), a "Change in Control" of the Company shall be
deemed to have occurred if:
(i) the Company is merged or consolidated or reorganized into
or with another corporation or other legal person, and as a result of such
merger, consolidation or reorganization less than a majority of the combined
voting power of the then-outstanding securities of such corporation or person
immediately after such transaction are held in the aggregate by the holders of
securities entitled to vote generally in the election of Directors immediately
prior to such transaction;
(ii) the Company sells or otherwise transfers all or
substantially all of its assets to any other corporation or other legal person,
and less than a majority of the combined voting power of the then-outstanding
securities of such corporation or person immediately after such sale or transfer
is held in the aggregate by the holders of Ordinary Shares immediately prior to
such sale or transfer;
(iii) the Company files a report or proxy statement with the
Securities and Exchange Commission pursuant to the Act disclosing in response to
Form 8-K or Schedule 14A (or any successor schedule, form or report or item
therein) that a change in control of the Company has or may have occurred or
will or may occur in the future pursuant to any then-existing contract or
transaction; or
(iv) if during any period of two consecutive years,
individuals who at the beginning of any such period constitute the Directors
cease for any reason to
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constitute at least a majority thereof, unless the election, or the nomination
for election by the Company's shareholders, of each Director first elected
during such period was approved by a vote of at least two-thirds of the
Directors then still in office who were Directors at the beginning of any such
period.
Notwithstanding the foregoing provisions of this Section 2(a), a Change in
Control shall not be deemed to have occurred for purposes of this Agreement (i)
by reason of any action taken by the Company, including changes in beneficial
ownership of equity securities of the Company occurring in connection with the
Offering; (ii) solely because (A) the Company, (B) a Subsidiary, or (C) any
Company-sponsored employee stock ownership plan or other employee benefit plan
of the Company either files or becomes obligated to file a report or proxy
statement under or in response to Schedule 13D, Schedule 14D-1, Form 8-K or
Schedule 14A (or any successor schedule, form or report or item therein) under
the Act, disclosing beneficial ownership by it of shares, or because the Company
reports that a change of control of the Company has or may have occurred or will
or may occur in the future by reason of such beneficial ownership; or (iii)
solely because of a change in control of any Subsidiary other than Scottish Life
Assurance (Cayman) Ltd.
(b) This Warrant may be exercised at the time(s) or upon the
occurrence of the event(s) specified in Subsection 2(a) hereof by the surrender
of this Warrant, with the Purchase Agreement attached hereto as Annex A properly
completed and duly executed, at the principal office of the Company at Xxxxxx
House, South Church Street, Xxxxxx Town, Grand Cayman, Cayman Islands, British
West Indies, or such other location which shall at that time be the principal
office of the Company and of which the Company shall have notified the Warrant
Holder in writing (the "Principal Office"), or at the office of the transfer
agent for the Ordinary Shares, and upon payment to the Company of the Warrant
Price for the Warrant Shares to be purchased upon such exercise. The person
entitled to the Warrant Shares so purchased shall be treated for all purposes as
the holder of such shares as of the close of business on the date of exercise
and certificates for the shares so purchased shall be delivered to the person so
entitled within a reasonable time, not exceeding fifteen (15) days, after such
exercise. Certificates representing the Warrant Shares issued upon exercise of
this Warrant shall bear a legend referring to the restrictions on transfer set
forth herein. Unless this Warrant has expired, a new Warrant of like tenor and
for such number of Ordinary Shares as the holder of this Warrant shall direct,
representing in the aggregate the right to purchase the number of Ordinary
Shares with respect to which this Warrant shall not have been exercised, shall
also be issued to the holder of this Warrant within such time.
(c) The Warrant Price shall be payable in cash or its equivalent.
3. EXCHANGE. This Warrant is exchangeable, upon its surrender by
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the Warrant Holder to the Company at its Principal Office, or to the Company's
stock transfer agent at its office, for new Warrants of like tenor registered in
the Warrant Holder's name and representing in the aggregate the right to
purchase the same number of Common Shares purchasable hereunder, each of such
new Warrants to represent the right to subscribe for and purchase such number of
Common Shares as shall be designated by the Warrant Holder at the time of such
surrender.
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4. TRANSFER. Subject to restrictions on transfer set forth in
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Section 10, this Warrant is transferable, in whole or in part, by the holder
thereof at the Principal Office of the Company or at the office of its stock
transfer agent, in person or by duly authorized attorney, upon presentation of
this Warrant properly endorsed for transfer, the Assignment attached hereto as
Annex A duly executed, and funds sufficient to pay any transfer tax (the
"Transfer Documents"). Within a reasonable time after receiving the Transfer
Documents, not exceeding fifteen (15) days, the Company shall execute and
deliver a new Warrant in the name of the assignee named in the Assignment and
this Warrant shall be canceled. Each holder of this Warrant, by holding it,
agrees that this Warrant, when endorsed in blank, may be deemed negotiable, and
that, when this Warrant shall been so endorsed, the holder of this Warrant may
be treated by the Company and all other persons dealing with this Warrant as the
absolute owner of this Warrant for any purpose and as the person entitled to
exercise the rights represented by this Warrant, or to the transfer of this
Warrant on the books of the Company, any notice to the contrary notwithstanding.
5. CERTAIN COVENANTS OF THE COMPANY. The Company covenants and
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agrees that all Ordinary Shares that may be issued upon the exercise of this
Warrant, will, upon issuance, be duly and validly issued, fully paid and
nonassessable and free from all taxes, liens and charges with respect to the
issue thereof. The Company further covenants and agrees that during the period
within which the rights represented by this Warrant may be exercised, the
Company will at all times have authorized, and reserved for the purpose of issue
upon exercise of the purchase rights evidenced by this Warrant, a sufficient
number of Ordinary Shares to provide for the exercise of the rights represented
by this Warrant.
6. ADJUSTMENT OF PURCHASE PRICE AND NUMBER OF SHARES. The number
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and kind of securities purchasable upon the exercise of this Warrant and the
Warrant Price shall be subject to adjustment from time to time upon the
happening of certain events as follows:
(a) Reclassification, Consolidation or Merger. At any time while
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this Warrant remains outstanding and unexpired, in case of any reclassification
or change of outstanding securities of the class issuable upon exercise of this
Warrant (other than a change in par value, or from par value to no par value, or
from no par value to par value, or as a result of a subdivision or combination
of outstanding securities issuable upon the exercise of this Warrant) or in case
of any consolidation or merger of the Company with or into another corporation
(other than a merger with another corporation in which the Company is a
continuing corporation and which does not result in any reclassification or
change, other than a change in par value, or from par value to no par value, or
from no par value to par value, or as a result of a subdivision or combination
of outstanding securities issuable upon the exercise of this Warrant), the
Company, or such successor corporation, as the case may be, shall, without
payment of any additional consideration therefor, execute a new Warrant
providing that the Warrant Holder shall have the right to exercise such new
Warrant (upon terms not less favorable to the Warrant Holder than those then
applicable to this Warrant) and to receive upon such exercise, in lieu of each
Ordinary Share theretofore issuable upon exercise of this Warrant, the kind and
amount of shares of stock, other securities, money or property receivable upon
such reclassification, change, consolidation or merger, by the holder of one
Ordinary Share issuable upon exercise of this Warrant had it been
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exercised immediately prior to such reclassification, change, consolidation or
merger. Such new Warrant shall provide for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this Section
6. The provisions of this Subsection 6(a) shall similarly apply to successive
reclassifications, changes, consolidations, mergers, sales and transfers.
(b) Subdivision or Combination of Shares. If the Company at any
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time while this Warrant remains outstanding and unexpired shall subdivide or
combine its Capital Stock, the Warrant Price shall be proportionately reduced,
in case of subdivision of such shares, as of the effective date of such
subdivision, or, if the Company shall take a record of holders of its Capital
Stock for the purpose of so subdividing, as of such record date, whichever is
earlier, or shall be proportionately increased, in the case of combination of
such shares, as of the effective date of such combination, or, if the Company
shall take a record of holders of its Capital Stock for the purpose of so
combining, as of such record date, whichever is earlier.
(c) Certain Dividends and Distributions. If the Company at any
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time while this Warrant remains outstanding and unexpired shall:
(i) Stock Dividends. Pay a dividend in shares of, or make
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other distribution of shares of, its Capital Stock, then the Warrant Price shall
be adjusted, as of the date the Company shall take a record of the holders of
its Capital Stock for the purpose of receiving such dividend or other
distribution (or if no such record is taken, as of the date of such payment or
other distribution), to that price determined by multiplying the Warrant Price
in effect immediately prior to such payment or other distribution by a fraction
(A) the numerator of which shall be the total number of shares of Capital Stock
outstanding immediately prior to such dividend or distribution, and (B) the
denominator of which shall be the total number of shares of Capital Stock
outstanding immediately after such dividend or distribution; or
(ii) Liquidating Dividends, Etc. Make a distribution of
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its assets to the holders of its Capital Stock as a dividend in liquidation or
by way of return of capital or other than as a dividend payable out of earnings
or surplus legally available for dividends under applicable law, the Warrant
Holder shall be entitled to receive upon the exercise hereof, in addition to the
number of Ordinary Shares receivable thereupon, and without payment of any
additional consideration therefor, a sum equal to the amount of such assets as
would have been payable to him as owner of that number of Ordinary Shares
receivable by exercise of the Warrant had he been the holder of record of such
Ordinary Shares on the record date for such distribution, or if no such record
is taken, as of the date of such distribution, and an appropriate provision
therefor shall be made a part of any such distribution.
(d) Adjustment of Number of Shares. Upon each adjustment in the
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Warrant Price pursuant to any provision of this Section 6, the number of
Ordinary Shares purchasable hereunder at the Warrant Price shall be adjusted, to
the nearest one hundredth of a whole share, to the product obtained by
multiplying such number of Ordinary Shares purchasable immediately prior to such
adjustment in the Warrant Price by a fraction, the numerator of which shall be
the Warrant Price immediately prior to such adjustment and the denominator of
which shall be the Warrant Price immediately thereafter.
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(e) Limitation or Adjustment of Warrant Price. Notwithstanding any
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other provision of this Warrant, no adjustment of the Warrant Price shall be
made which would reduce such Warrant Price below the par value of the Warrant
Shares.
7. PAYMENT OF TAXES. All Ordinary Shares issued upon the exercise of
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this Warrant shall be validly issued, fully paid and nonassessable, and the
Company shall pay all taxes and other governmental charges that may be imposed
in respect of the issue or delivery thereof. The Company shall not be required,
however, to pay any tax or other charge imposed in connection with any transfer
involved in the issue of any certificate for Ordinary Shares in any name other
than that of the registered holder of the Warrant surrendered in connection with
the purchase of such shares, and in such case the Company shall not be required
to issue or deliver any share certificate until such tax or other charge has
been paid or it has been established to the Company's satisfaction that no tax
or other charge is due.
8. FRACTIONAL SHARES. No fractional Ordinary Shares will be issued
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in connection with any purchase hereunder but in lieu of such fractional shares,
the Company shall make a cash refund therefor equal in amount to the product of
the applicable fraction multiplied by the Warrant Price paid by the holder for
its Warrant Shares upon such exercise.
9. LOSS, THEFT, DESTRUCTION OR MUTILATION. Upon receipt by the
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Company of evidence reasonably satisfactory to it that this Warrant has been
mutilated, destroyed, lost or stolen, and in the case of a destroyed, lost or
stolen Warrant, a bond of indemnity reasonably satisfactory to the Company, or
in the case of a mutilated Warrant, upon surrender and cancellation of this
Warrant, the Company will execute and deliver in the Warrant Holder's name, in
exchange and substitution for the Warrant so mutilated, destroyed, lost or
stolen, a new Warrant of like tenor substantially in the form hereof with
appropriate insertions and variations.
10. SECURITIES LAWS REPRESENTATIONS AND WARRANTIES; TRANSFER TO
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COMPLY WITH SECURITIES LAWS.
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(a) The Warrant Holder, by acceptance of this Warrant, represents and
warrants to the Company that this Warrant is being, and any Warrant Shares
acquired on exercise of this Warrant will be, acquired by the Warrant Holder for
his own account and not with a view to resale or distribution within the meaning
of the Securities Act of 1933, as amended (the "Securities Act"), and the
Warrant Holder will not distribute this Warrant or any Warrant Shares in
violation of the Securities Act or any applicable state or foreign law;
provided, however, that the disposition of this Warrant and the Warrant Shares
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shall at all times remain in the Warrant Holder's control.
(b) The Warrant Holder, by acceptance of this Warrant, (i)
acknowledges that this Warrant and the Warrant Shares are not registered under
the Securities Act or any state securities laws and that this Warrant and any
Warrant Shares to be issued to it upon the exercise of this Warrant must be held
indefinitely by it unless they are subsequently registered under the Securities
Act and all applicable state securities laws or an exemption from
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registration is available, (ii) is aware that any routine sales under Rule 144,
promulgated under the Securities Act, of this Warrant and the Warrant Shares may
be made only in limited amounts and in accordance with the terms and conditions
of that Rule and that in such cases where the Rule is not applicable, compliance
with some other registration exemption will be required, (iii) is aware that
Rule 144 is not as of the date hereof available for use by the Warrant Holder
for resale of such Warrant and Warrant Shares, and (iv) is aware that the
Company is not obligated to register under the Securities Act any sale, transfer
or other disposition of this Warrant or the Warrant Shares.
(c) The Warrant Holder, by acceptance of this Warrant, confirms
that the Company has made available to him the opportunity to ask questions of
and receive answers from the Company's officers and directors concerning the
terms and conditions of the offering and the business and financial condition of
the Company, and to acquire, and the Warrant Holder has received to his
satisfaction, such additional information about the business and financial
condition of the Company and the terms and conditions of the offering as it has
requested.
(d) The Warrant Holder, by acceptance of this Warrant, represents
that (i) he is an "accredited investor" as such term is defined in Rule 501
promulgated under the Securities Act, (ii) his financial situation is such that
he can afford to bear the economic risk of holding this Warrant and the Warrant
Shares for an indefinite period of time and suffer complete loss of his
investment in this Warrant and the Warrant Shares, and (iii) his knowledge and
experience in financial and business matters are such that he is capable of
evaluating the merits and risks of his purchase of this Warrant and the Warrant
Shares as contemplated by this Agreement.
(e) The certificate representing any Warrant Shares acquired upon
exercise of this Warrant, and any Ordinary Shares or other securities issued in
respect of such Warrant Shares upon any stock split, stock dividend,
recapitalization, merger, consolidation or similar event, shall be stamped or
otherwise imprinted with the following legend (unless such a legend is no longer
required under the Securities Act):
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAW
AND MAY NOT BE SOLD EXCEPT IN A TRANSACTION WHICH IS (A) EXEMPT UNDER SUCH ACT
OR (B) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT. IN
ADDITION, THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS
ON TRANSFER AS SET FORTH IN A CLASS A WARRANT OF THE COMPANY DATED _____,
1998."
(f) The Company shall not be required to register the transfer of
this Warrant or any Warrant Shares on the books of the Company unless the
Company shall have been provided with an opinion of counsel satisfactory to it
or no-action letters from the Securities and Exchange Commission and the
appropriate state regulatory agencies prior to such transfer to the effect that
registration under the Securities Act and any applicable state securities law is
not required in connection with the transaction resulting in such transfer;
provided, however, that no
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such opinion of counsel or no-action letter shall be necessary in order to
effectuate a transfer in accordance with the provisions of Rule 144(k)
promulgated under the Securities Act or pursuant to an effective registration
statement under the Securities Act. Each Warrant or certificate for Warrant
Shares issued upon any transfer as above provided shall bear the restrictive
legend set forth in Subsection 10(e) above, except that such restrictive legend
shall not be required if the opinion of counsel satisfactory to the Company or
no-action letters referred to above are to the further effect that such legend
is not required in order to establish compliance with the provisions of the
Securities Act and any applicable state securities law, or if the transfer is
made in accordance with the provisions of Rule 144(k) promulgated under the
Securities Act or pursuant to an effective registration statement under the
Securities Act. The cost of obtaining any legal opinion or no-action letter
required under this Section shall be borne by the Warrant Holder.
11. SURVIVAL. The provisions of Section 10 shall survive any
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expiration, cancellation or exercise of this Warrant.
12. HEADINGS. The descriptive headings of the several sections of
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this Warrant are inserted for convenience only and do not constitute a part of
this Warrant.
IN WITNESS WHEREOF, the Company has caused this Warrant to be signed
by its duly authorized officer under its corporate seal, attested by its duly
authorized officer, on the date of this Warrant.
SCOTTISH LIFE HOLDINGS, LTD.
By: _________________________________
Name:____________________________
Title:___________________________
ACCEPTED, ACKNOWLEDGED
AND AGREED
By: _______________________________
Name:__________________________
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Annex A
PURCHASE AGREEMENT
Date: __________________________
TO:
The undersigned, pursuant to the provisions set forth in the attached
Class A Warrant, hereby agrees to purchase _________________ Ordinary Shares
covered by such Class A Warrant, and makes payment herewith in full therefor at
the price per share provided by this Class A Warrant.
Signature: _______________________
Address: _______________________
* * * *
ASSIGNMENT
For Value Received, ________________________________ hereby sells,
assigns and transfers all of the rights of the undersigned under the Class A
Warrant with respect to _________ of the number of Ordinary Shares covered by
such Class A Warrant, to:
NAME OF ASSIGNEE ADDRESS NO. OF SHARES
Dated: Signature: _______________________
Address: _______________________
