EXHIBIT 49
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR UNDER ANY
STATE SECURITIES LAWS AND MAY NOT BE TRANSFERRED EXCEPT AS EXPRESSLY
PERMITTED UNDER THE STOCKHOLDERS AGREEMENT, DATED AS OF DECEMBER 16,
2002, BY AND AMONG USA NETWORKS, INC. AND THE OTHER PARTIES SET FORTH ON
THE SIGNATURE PAGES THERETO, AS THE SAME MAY BE AMENDED FROM TIME TO
TIME, AND OTHERWISE IN COMPLIANCE WITH FEDERAL AND APPLICABLE STATE
SECURITIES LAWS.
EQUITY WARRANT AGREEMENT
dated as of _____________, 2002
for
WARRANTS TO PURCHASE
UP TO 60,467,7355* SHARES OF COMMON STOCK
EXPIRING ____________, 2012
between
USA NETWORKS, INC.
and
THE BANK OF NEW YORK, as
Equity Warrant Agent
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* Subject to adjustment as described in this Agreement.
TABLE OF CONTENTS
PAGE
ARTICLE 1. Definitions................................................. 1
ARTICLE 2. Issuance of Equity Warrants and Execution and Delivery of
Equity Warrant Certificates................................. 3
2.1. Issuance of Equity Warrants................................. 3
2.2. Form and Execution of Equity Warrant Certificates........... 3
2.3. Issuance and Delivery of Equity Warrant Certificates........ 4
2.4. Temporary Equity Warrant Certificates....................... 4
2.5. Payment of Taxes............................................ 4
ARTICLE 3. Duration and Exercise of Equity Warrants.................... 5
3.1. Exercise Price.............................................. 5
3.2. Duration of Equity Warrants................................. 5
3.3. Exercise of Equity Warrants................................. 5
ARTICLE 4. Adjustments of Number of Shares............................. 6
4.1. Adjustments................................................. 6
4.2. Statement on Warrants....................................... 9
4.3. Cash Payments in Lieu of Fractional Shares.................. 9
4.4. Notices to Warrantholders................................... 9
ARTICLE 5. Other Provisions Relating to Rights of Holders of Equity
Warrants.................................................... 9
5.1. No Rights as Holder of Common Stock Conferred by Equity
Warrants or Equity Warrant Certificates..................... 9
5.2. Lost, Stolen, Destroyed or Mutilated Equity Warrant
Certificates................................................ 9
5.3. Holders of Equity Warrants May Enforce Rights............... 10
5.4. Consolidation or Merger or Sale of Assets................... 10
ARTICLE 6. Exchange and Transfer of Equity Warrants.................... 11
6.1. Equity Warrant Register; Exchange and Transfer of Equity
Warrants.................................................... 11
6.2. Treatment of Holders of Equity Warrants..................... 12
6.3. Cancellation of Equity Warrant Certificates................. 12
ARTICLE 7. Concerning the Equity Warrant Agent......................... 12
7.1. Equity Warrant Agent........................................ 12
7.2. Conditions of Equity Warrant Agent's Obligations............ 12
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7.3. Compliance with Applicable Laws............................. 14
7.4. Resignation and Appointment of Successor.................... 15
ARTICLE 8. Miscellaneous............................................... 16
8.1. Amendment................................................... 16
8.2. Notices and Demands to the Company and Equity Warrant Agent. 16
8.3. Addresses for Notices....................................... 16
8.4. Governing Law............................................... 17
8.5. Governmental Approvals...................................... 17
8.6. Reservation of Shares of Common Stock....................... 17
8.7. Covenant Regarding Shares of Common Stock................... 17
8.8. Persons Having Rights Under Agreement....................... 17
8.9 Limitation of Liability..................................... 18
8.10 Restrictions on Transfer/Registration Rights................ 18
8.11. Headings.................................................... 18
8.12. Counterparts................................................ 18
8.13. Inspection of Agreement..................................... 18
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THIS EQUITY WARRANT AGREEMENT (the "AGREEMENT"), dated as of
______________2002, between USA Networks, Inc., a Delaware corporation (the
"COMPANY"), and Bank of New York, a New York corporation, as warrant agent (the
"EQUITY WARRANT AGENT").
WHEREAS, pursuant to the Transaction Agreement, by and among the
Company, Vivendi Universal, S.A. (the "INITIAL HOLDER"), Universal Studios,
Inc., Liberty Media Corporation, Mr. Xxxxx Xxxxxx and USANi LLC, dated as of
December 16, 2001, the Company has agreed to issue to the Initial Holder an
aggregate of 60,467,735 warrants,* subject to adjustment pursuant to Section 4.1
hereof (collectively, the "EQUITY WARRANTS" or, individually, an "EQUITY
WARRANT"), each Equity Warrant representing the right to purchase one share of
common stock, par value $.01 per share, of the Company (the "COMMON STOCK") and
being evidenced by certificates herein called the "EQUITY WARRANT CERTIFICATES";
WHEREAS, the Company desires the Equity Warrant Agent to assist the
Company in connection with the issuance, exchange, cancellation, replacement and
exercise of the Equity Warrants, and in this Agreement wishes to set forth,
among other things, the terms and conditions on which the Equity Warrants may be
issued, exchanged, cancelled, replaced and exercised; and
WHEREAS, the Company has duly authorized the execution and delivery
of this Agreement to provide for the issuance of Equity Warrants to be
exercisable at such times and for such prices, and to have such other
provisions, as shall be fixed as hereinafter provided.
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained, the parties hereto agree as follows:
ARTICLE 1.
DEFINITIONS
"AGREEMENT" shall have the meaning set forth in the preamble.
"CLOSING PRICE" for each Trading Day shall be the last reported
sales price regular way, during regular trading hours, or, in case no such
reported sales takes place on such day, the average of the closing bid and asked
prices regular way, during regular trading hours, for such day, in each case on
The Nasdaq Stock Market or, if not listed or quoted on such market, on the
principal national securities exchange on which the shares of Common Stock are
listed or admitted to trading or, if not listed or admitted to trading on a
national securities exchange, the last sale price regular way for the Common
Stock as published by the National Association of Securities Dealers Automated
Quotation System ("NASDAQ"), or if such last sale price is not so published by
NASDAQ or if no such sale takes place on such day, the mean between the closing
bid and asked prices for the Common Stock as published by NASDAQ. If the Common
Stock is not publicly held or so listed or publicly traded, "Closing Price"
shall mean the Fair Market Value per share as determined in good faith by the
Board of Directors of the Company or, if such
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* Comprised of 24,187,094 warrants each at $27.50 and $32.50 and 12,093,547
warrants at $37.50.
determination cannot be made, by a nationally recognized independent investment
banking firm selected in good faith by the Board of Directors of the Company.
"COMMON STOCK" shall have the meaning set forth in the recitals.
"COMPANY" shall have the meaning set forth in the preamble.
"CURRENT MARKET PRICE" shall have the meaning set forth in Section
4.1(d).
"EQUITY WARRANT" and "EQUITY WARRANTS" shall have the meaning set
forth in the recitals.
"EQUITY WARRANT AGENT" shall have the meaning set forth in the
preamble.
"EQUITY WARRANT CERTIFICATES" shall have the meaning set forth in
the recitals.
"EQUITY WARRANT REGISTER" shall have the meaning set forth in
Section 6.1.
"EXERCISE DATE" shall have the meaning set forth in 3.3(a).
"EXERCISE PRICE" shall have the meaning set forth in the applicable
Equity Warrant Certificate.
"EXPIRATION DATE" means 5:00 p.m. New York City time on
____________, 2012.
"FAIR MARKET VALUE" means the amount that a willing buyer would pay
a willing seller in an arm's length transaction.
"FORMED, SURVIVING OR ACQUIRING CORPORATION" shall have the meaning
set forth in Section 5.4.
"GOVERNANCE AGREEMENT" shall have the meaning set forth in Section
8.10.
"HOLDER" means the person or persons in whose name such Equity
Warrant Certificate shall then be registered as set forth in the Equity Warrant
Register to be maintained by the Equity Warrant Agent pursuant to Section 6.1
for that purpose.
"INITIAL HOLDER" shall have the meaning set forth in the recitals.
"NON-ELECTING SHARE" shall have the meaning set forth in Section
5.4.
"OFFICER'S CERTIFICATE" shall have the meaning set forth in Section
7.2(e).
"PROSPECTUS" shall have the meaning set forth in Section 8.9.
"SALE TRANSACTION" shall have the meaning set forth in Section 5.4.
"STOCKHOLDERS AGREEMENT" shall have the meaning set forth in Section
8.10.
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"TIME OF DETERMINATION" shall have the meaning set forth in Section
4.1(d).
"TRADING DAY" shall mean a day on which the securities exchange
utilized for the purpose of calculating the Closing Price shall be open for
business or, if the shares of Common Stock shall not be listed on such exchange
for such period, a day on which The Nasdaq Stock Market is open for business.
ARTICLE 2.
ISSUANCE OF EQUITY WARRANTS AND EXECUTION AND
DELIVERY OF EQUITY WARRANT CERTIFICATES
2.1. ISSUANCE OF EQUITY WARRANTS. Equity Warrants may be issued by the
Company from time to time.
2.2. FORM AND EXECUTION OF EQUITY WARRANT CERTIFICATES.
(a) The Equity Warrants shall be evidenced by the Equity Warrant
Certificates, which shall be in registered form and substantially in the form
set forth as Exhibit A attached hereto. Each Equity Warrant Certificate shall be
dated the date it is countersigned by the Equity Warrant Agent and may have such
letters, numbers or other marks of identification and such legends or
endorsements printed, lithographed or engraved thereon as are not inconsistent
with the provisions of this Agreement, or as may be required to comply with any
law or with any rule or regulation made pursuant thereto or with any rule or
regulation of any securities exchange on which the Equity Warrants may be
listed, or to conform to usage, as the officer of the Company executing the same
may approve (his execution thereof to be conclusive evidence of such approval).
Each Equity Warrant Certificate shall evidence one or more Equity Warrants.
(b) The Equity Warrant Certificates shall be signed in the name and on
behalf of the Company by its Chairman, its Vice Chairman, its Chief Executive
Officer, President or a Vice President (any reference to a Vice President of the
Company herein shall be deemed to include any Vice President of the Company
whether or not designated by a number or a word or words added before or after
the title "Vice President") under its corporate seal, and attested by its
Secretary or an Assistant Secretary. Such signatures may be manual or facsimile
signatures of the present or any future holder of any such office and may be
imprinted or otherwise reproduced on the Equity Warrant Certificates. The seal
of the Company may be in the form of a facsimile thereof and may be impressed,
affixed, imprinted or otherwise reproduced on the Equity Warrant Certificates.
(c) No Equity Warrant Certificate shall be valid for any purpose, and no
Equity Warrant evidenced thereby shall be deemed issued or exercisable, until
such Equity Warrant Certificate has been countersigned by the manual or
facsimile signature of the Equity Warrant Agent. Such signature by the Equity
Warrant Agent upon any Equity Warrant Certificate executed by the Company shall
be conclusive evidence that the Equity Warrant Certificate so countersigned has
been duly issued hereunder.
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(d) In case any officer of the Company who shall have signed any Equity
Warrant Certificate either manually or by facsimile signature shall cease to be
such officer before the Equity Warrant Certificate so signed shall have been
countersigned and delivered by the Equity Warrant Agent, such Equity Warrant
Certificate nevertheless may be countersigned and delivered as though the person
who signed such Equity Warrant Certificate had not ceased to be such officer of
the Company; and any Equity Warrant Certificate may be signed on behalf of the
Company by such person as, at the actual date of the execution of such Equity
Warrant Certificate, shall be the proper officer of the Company, although at the
date of the execution of this Agreement such person was not such an officer.
2.3. ISSUANCE AND DELIVERY OF EQUITY WARRANT CERTIFICATES. At any time and
from time to time after the execution and delivery of this Agreement, the
Company may deliver Equity Warrant Certificates executed by the Company to the
Equity Warrant Agent for countersignature. Except as provided in the following
sentence, the Equity Warrant Agent shall thereupon countersign and deliver such
Equity Warrant Certificates to or upon the written request of the Company.
Subsequent to the original issuance of an Equity Warrant Certificate evidencing
Equity Warrants, the Equity Warrant Agent shall countersign a new Equity Warrant
Certificate evidencing such Equity Warrants only if such Equity Warrant
Certificate is issued in exchange or substitution for one or more previously
countersigned Equity Warrant Certificates evidencing such Equity Warrants or in
connection with their transfer, as hereinafter provided.
2.4. TEMPORARY EQUITY WARRANT CERTIFICATES. Pending the preparation of a
definitive Equity Warrant Certificate, the Company may execute, and upon the
order of the Company the Equity Warrant Agent shall countersign and deliver,
temporary Equity Warrant Certificates that are printed, lithographed,
typewritten, mimeographed or otherwise produced, substantially of the tenor of
the definitive Equity Warrant Certificates in lieu of which they are issued and
with such appropriate insertions, omissions, substitutions and other variations
as the officer executing such Equity Warrant Certificates may determine, as
evidenced by his execution of such Equity Warrant Certificates.
If temporary Equity Warrant Certificates are issued, the Company
will cause definitive Equity Warrant Certificates to be prepared without
unreasonable delay. After the preparation of definitive Equity Warrant
Certificates, the temporary Equity Warrant Certificates shall be exchangeable
for definitive Equity Warrant Certificates upon surrender of the temporary
Equity Warrant Certificates at the corporate trust office of the Equity Warrant
Agent. Upon surrender for cancellation of any one or more temporary Equity
Warrant Certificates, the Company shall execute and the Equity Warrant Agent
shall countersign and deliver in exchange therefor definitive Equity Warrant
Certificates representing the same aggregate number of Equity Warrants. Until so
exchanged, the temporary Equity Warrant Certificates shall in all respects be
entitled to the same benefits under this Agreement as definitive Equity Warrant
Certificates.
2.5. PAYMENT OF TAXES. The Company will pay all stamp and other duties, if
any, to which this Agreement or the original issuance, or exercise, of the
Equity Warrants or Equity Warrant Certificates may be subject under the laws of
the United States of America or any state or locality; PROVIDED, HOWEVER, that
the Holder, and not the Company, shall be required to pay any stamp or other tax
or other governmental charge that may be imposed in connection with any transfer
involved in the issuance of the Common Stock where the Holder designates the
shares to
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be issued in a name other than the name of the Holder; and in the
event that any such transfer is involved, the Company shall not be required to
issue any Common Stock (and the purchase of the shares of Common Stock issued
upon the exercise of such Holder's Equity Warrant shall not be deemed to have
been consummated) until such tax or other charge shall have been paid or it has
been established to the Company's satisfaction that no such tax or other charge
is due.
ARTICLE 3.
DURATION AND EXERCISE OF EQUITY WARRANTS
3.1. EXERCISE PRICE. Each Holder shall have the right to purchase the
number of fully paid and nonassessable shares of Common Stock which the Holder
may at the time be entitled to receive on exercise of such Equity Warrant and
payment of the Exercise Price, subject to the terms herein. The number of shares
of Common Stock which shall be purchasable upon the payment of the Exercise
Price and to the extent provided therein, the Exercise Price, shall be subject
to adjustment pursuant to Article 4 hereof.
3.2. DURATION OF EQUITY WARRANTS. Each Equity Warrant is exercisable at any
time commencing on _____________, 2002* up to the Expiration Date. Each Equity
Warrant not exercised at or before the Expiration Date shall become void, and
all rights of the Holder of such Equity Warrant thereunder and under this
Agreement shall cease.
3.3. EXERCISE OF EQUITY WARRANTS.
(a) The Holder of an Equity Warrant shall have the right, at its option, to
exercise such Equity Warrant and purchase one share of Common Stock during the
period referred to in Section 3.2, subject to adjustment pursuant to Article 4
hereof. Except as may be provided in an Equity Warrant Certificate, an Equity
Warrant may be exercised by completing the form of election to purchase set
forth on the reverse side of the Equity Warrant Certificate, by duly executing
the same, and by delivering the same, together with payment in full of the
Exercise Price, in lawful money of the United States of America, in cash or by
certified or official bank check or by bank wire transfer, to the Equity Warrant
Agent. Except as may be provided in an Equity Warrant Certificate, the date on
which such Equity Warrant Certificate and payment are received by the Equity
Warrant Agent as aforesaid shall be deemed to be the date on which the Equity
Warrant is exercised and the relevant shares of Common Stock are issued (the
"EXERCISE DATE").
(b) Upon the exercise of an Equity Warrant, the Company shall, as soon as
practicable, issue, to or upon the order of the Holder of such Equity Warrant,
the shares of Common Stock to which such Holder is entitled, registered in such
name or names as may be directed by such Holder.
(c) Unless the Equity Warrant Agent and the Company agree otherwise, the
Equity Warrant Agent shall deposit all funds received by it in payment of the
Equity Warrant Price for Equity Warrants in the account of the Company
maintained with it for such purpose and
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* Date following the six-month anniversary of the Closing.
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shall advise the Company by telephone by 5:00 P.M., New York City time, of each
day on which a payment of the Exercise Price for Equity Warrants is received of
the amount so deposited in its account. The Equity Warrant Agent shall promptly
confirm such telephone advice in writing to the Company.
(d) The Equity Warrant Agent shall, from time to time, as promptly as
practicable, advise the Company of (i) the number of Equity Warrants exercised
as provided herein, (ii) the instructions of each Holder of such Equity Warrants
with respect to delivery of the Common Stock issued upon exercise of such Equity
Warrants to which such Holder is entitled upon such exercise, and (iii) such
other information as the Company shall reasonably require. Such advice may be
given by telephone to be confirmed in writing.
ARTICLE 4.
ADJUSTMENTS OF NUMBER OF SHARES
4.1. ADJUSTMENTS. The number of shares of Common Stock purchasable upon the
exercise of the Equity Warrants shall be subject to adjustment as follows:
(a) In case the Company shall (A) pay a dividend or make a distribution on
its Common Stock in shares of Common Stock, (B) subdivide its outstanding shares
of Common Stock into a greater number of shares, (C) combine its outstanding
shares of Common Stock into a smaller number of shares, or (D) issue by
reclassification, recapitalization or reorganization of its Common Stock any
shares of capital stock of the Company, then in each such case the number of
shares of Common Stock issuable upon exercise of an Equity Warrant shall be
equitably adjusted so that the Holder of any Equity Warrant thereafter
surrendered for conversion shall be entitled to receive the number of shares of
Common Stock or other capital stock of the Company which such Holder would have
owned or been entitled to receive immediately following such action had such
Equity Warrant been exercised immediately prior to the occurrence of such event.
An adjustment made pursuant to this subsection 4.1(a) shall become effective
immediately after the record date, in the case of a dividend or distribution, or
immediately after the effective date, in the case of a subdivision, combination
or reclassification. If, as a result of an adjustment made pursuant to this
subsection 4.1(a), the Holder of any Equity Warrant thereafter exercised shall
become entitled to receive shares of two or more classes of capital stock or
shares of Common Stock and other capital stock of the Company, the Board of
Directors (whose determination shall be in its good faith judgment and shall be
described in a statement filed by the Company with the Equity Warrant Agent)
shall determine the allocation of the Exercise Price between or among shares of
such classes of capital stock or shares of Common Stock and other capital stock.
Such adjustment shall be made successively whenever any event listed above shall
occur.
(b) In case the Company shall issue options, rights or warrants to holders
of its outstanding shares of Common Stock entitling them (for a period expiring
within 45 days after the record date mentioned below) to subscribe for or
purchase shares of Common Stock or other securities convertible or exchangeable
for shares of Common Stock at a price per share of Common Stock less than the
Current Market Price (as determined pursuant to subsection (d) of this Section
4.1) (other than pursuant to any stock option, restricted stock or other
incentive or
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benefit plan or stock ownership or purchase plan for the benefit of
employees, directors or officers or any dividend reinvestment plan of the
Company in effect at the time hereof or any other similar plan adopted or
implemented hereafter, it being agreed that none of the adjustments set forth in
this Section 4.1 shall apply to the issuance of stock, rights, warrants or other
property pursuant to such benefit plans), then the number of shares of Common
Stock issuable upon exercise of an Equity Warrant shall be adjusted so that it
shall equal the product obtained by multiplying the number of shares of Common
Stock issuable upon exercise of an Equity Warrant immediately prior to the date
of issuance of such rights or warrants by a fraction of which the numerator
shall be the number of shares of Common Stock outstanding on the date of
issuance of such rights or warrants (immediately prior to such issuance) plus
the number of additional shares of Common Stock offered for subscription or
purchase and of which the denominator shall be the number of shares of Common
Stock outstanding on the date of issuance of such rights or warrants
(immediately prior to such issuance) plus the number of shares which the
aggregate offering price of the total number of shares so offered would purchase
at such Current Market Price. Such adjustment shall be made successively
whenever any rights or warrants are issued, and shall become effective
immediately after the record date for the determination of stockholders entitled
to receive such rights or warrants; PROVIDED, HOWEVER, in the event that all the
shares of Common Stock offered for subscription or purchase are not delivered
upon the exercise of such rights or warrants, upon the expiration of such rights
or warrants the number of shares of Common Stock issuable upon exercise of an
Equity Warrant shall be readjusted to the number of shares of Common Stock
issuable upon exercise of an Equity Warrant which would have been in effect had
the numerator and the denominator of the foregoing fraction and the resulting
adjustment been made based upon the number of shares of Common Stock actually
delivered upon the exercise of such rights or warrants rather than upon the
number of shares of Common Stock offered for subscription or purchase. In
determining whether any security covered by this Section 4.1(b) entitles the
holders to subscribe for or purchase shares of Common Stock at less than such
Current Market Price, and in determining the aggregate offering price of such
shares of Common Stock, there shall be taken into account any consideration
received by the Company for the issuance of such options, rights, warrants or
convertible or exchangeable securities, plus the aggregate amount of additional
consideration (as set forth in the instruments relating thereto) to be received
by the Company upon the exercise, conversion or exchange of such securities, the
value of such consideration, if other than cash, to be determined by the Board
of Directors in its good faith judgment (whose determination shall be described
in a statement filed by the Company with the Equity Warrant Agent).
(c) In case the Company shall, by dividend or otherwise, distribute to all
holders of its outstanding Common Stock, evidences of its indebtedness or assets
(including securities and cash, but excluding any regular periodic cash dividend
of the Company and dividends or distributions payable in stock for which
adjustment is made pursuant to subsection (a) of this Section 4.1) or rights or
warrants to subscribe for or purchase securities of the Company (excluding those
referred to in subsection (b) of this Section 4.1), then in each such case the
number of shares of Common Stock issuable upon exercise of an Equity Warrant
shall be adjusted so that the same shall equal the product determined by
multiplying the number of shares of Common Stock issuable upon exercise of an
Equity Warrant immediately prior to the record date of such distribution by a
fraction of which the numerator shall be the Current Market Price as of the Time
of Determination, and of which the denominator shall be such Current Market
Price less the Fair Market Value on such record date (as determined by the Board
of
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Directors in its good faith judgment, whose determination shall be described
in a statement filed by the Company with the stock transfer or conversion agent,
as appropriate) of the portion of the capital stock or assets or the evidences
of indebtedness or assets so distributed to the holder of one share of Common
Stock or of such subscription rights or warrants applicable to one share of
Common Stock. Such adjustment shall be made successively whenever any such
distributions referred to in the first sentence of this Section 4.01(c) are made
and shall become effective immediately after the record date for the
determination of stockholders entitled to receive such distribution.
(d) For the purpose of any computation under subsections (b) and (c) of
this Section 4.1, the "CURRENT MARKET PRICE" per share of Common Stock on any
date shall be deemed to be the average of the daily Closing Prices for the
shorter of (A) 10 consecutive Trading Days ending on the day immediately
preceding the applicable Time of Determination or (B) the period commencing on
the date next succeeding the first public announcement of the issuance of such
rights or warrants or such distribution through such last day prior to the
applicable Time of Determination. For purposes of the foregoing, the term "TIME
OF DETERMINATION" shall mean the time and date of the record date for
determining stockholders entitled to receive the rights, warrants or
distributions referred to in Section 4.1(b) and (c).
(e) In any case in which this Section 4.1 shall require that an adjustment
in the amount of Common Stock or other property to be received by a Holder upon
exercise of an Equity Warrant be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event the issuance to the Holder of any Equity Warrant exercised after such
record date the Common Stock or other property issuable upon such exercise over
and above the shares of Common Stock issuable upon such exercise prior to such
adjustment, PROVIDED, HOWEVER, that the Company shall deliver to such Holder a
due xxxx or other appropriate instrument evidencing such Holder's right to
receive such additional shares of Common Stock or other property, if any, upon
the occurrence of the event requiring such adjustment.
(f) In the event that the Amended and Restated Merger Agreement, dated as
of July 15, 2001, among the Company, Expedia, Inc. and Microsoft Corporation, is
terminated following the date hereof without consummation of the merger
contemplated thereby, the aggregate number of Equity Warrants shall be reduced
by 3,348,2104 (subject to adjustment pursuant to Sections 4.1(a), (b) or (c)),
which reduction shall be allocated proportionately to any Equity Warrant
Certificates issued hereunder.
(g) No adjustment in the number of shares of Common Stock issuable upon
exercise of an Equity Warrant shall be required to be made pursuant to this
Section 4.1 unless such adjustment would require an increase or decrease of at
least 1% of such number; PROVIDED, HOWEVER, that any adjustments which by reason
of this subsection (g) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All calculations under this
subsection 4.1(g) shall be made to the nearest cent or to the nearest 1/1000th
of a share, as the case may be. Except as set forth in subsections 4.1(a), (b),
and (c) above, the
______________
* In the event of adjustment, there would be an aggregate of 57,119,525
warrants, comprised of 22,847,810 warrants each at $27.50 and $32.50 and
11,423,905 warrants at $37.50.
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number of shares of Common Stock issuable upon exercise of an Equity Warrant
shall not be adjusted as a result of the issuance of Common Stock, or any
securities convertible into or exchangeable for Common Stock or carrying the
right to purchase any of the foregoing, in exchange for cash, property or
services.
4.2. STATEMENT ON WARRANTS. Irrespective of any adjustment in the amount of
Common Stock issued upon exercise of an Equity Warrant, Equity Warrants
theretofore or thereafter issued may continue to express the same number and
kind of shares as are stated in the Equity Warrants initially issuable pursuant
to this Agreement.
4.3. CASH PAYMENTS IN LIEU OF FRACTIONAL SHARES No fractional shares or
scrip representing fractions of shares of Common Stock shall be issued upon
exercise of the Equity Warrants. If more than one share of Equity Warrants shall
be exercised at one time by the same Holder, the number of full shares of Common
Stock issuable upon exercise thereof shall be computed on the basis of the
aggregate number of shares of Common Stock purchasable on exercise of the Equity
Warrants so requested to be exercised. In lieu of any fractional interest in a
share of Common Stock which would otherwise be deliverable upon the exercise of
such Equity Warrants, the Company shall pay to the Holder of such Equity
Warrants an amount in cash (computed to the nearest cent) equal to the Closing
Price on the Exercise Date (or the next Trading Day if such date is not a
Trading Day) multiplied by the fractional interest that otherwise would have
been deliverable upon exercise of such Equity Warrants.
4.4. NOTICES TO WARRANTHOLDERS. Upon any adjustment of the amount of Common
Stock issuable upon exercise of an Equity Warrant pursuant to Section 4.1 (but
not for any fractional cumulation as described in Section 4.1(f)), the Company
within 30 days thereafter shall (i) cause to be filed with the Equity Warrant
Agent an Officer's Certificate (as defined hereinafter) setting forth the amount
of Common Stock issuable upon exercise of an Equity Warrant after such
adjustment and setting forth in reasonable detail the method of calculation and
the facts upon which such calculations are based, which certificate, absent
manifest error and any failure to comply with Section 4.1 (other than failures
that are de minimus in nature), shall be conclusive evidence of the correctness
of the matters set forth therein, and (ii) cause to be given to each of the
registered Holders at his address appearing on the Equity Warrant Register (as
defined hereinafter) written notice of such adjustments by first-class mail,
postage prepaid.
ARTICLE 5.
OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS
OF EQUITY WARRANTS
5.1. NO RIGHTS AS HOLDER OF COMMON STOCK CONFERRED BY EQUITY WARRANTS OR
EQUITY WARRANT CERTIFICATES. No Equity Warrant or Equity Warrant Certificate
shall entitle the Holder to any of the rights of a holder of Common Stock,
including, without limitation, voting, dividend or liquidation rights.
5.2. LOST, STOLEN, DESTROYED OR MUTILATED EQUITY WARRANT CERTIFICATES. Upon
receipt by the Company and the Equity Warrant Agent of evidence reasonably
satisfactory to them of the ownership of and the loss, theft, destruction or
mutilation of any Equity Warrant Certificate
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and of indemnity (other than in connection with any mutilated Equity Warrant
certificates surrendered to the Equity Warrant Agent for cancellation)
reasonably satisfactory to them, the Company shall execute, and the Equity
Warrant Agent shall countersign and deliver, in exchange for or in lieu of each
lost, stolen, destroyed or mutilated Equity Warrant Certificate, a new Equity
Warrant Certificate evidencing a like number of Equity Warrants of the same
title. Upon the issuance of a new Equity Warrant Certificate under this Section,
the Company may require the payment of a sum sufficient to cover any stamp or
other tax or other governmental charge that may be imposed in connection
therewith and any other expenses (including the fees and expenses of the Equity
Warrant Agent) in connection therewith. Every substitute Equity Warrant
Certificate executed and delivered pursuant to this Section in lieu of any lost,
stolen or destroyed Equity Warrant Certificate shall represent a contractual
obligation of the Company, whether or not such lost, stolen or destroyed Equity
Warrant Certificate shall be at any time enforceable by anyone, and shall be
entitled to the benefits of this Agreement equally and proportionately with any
and all other Equity Warrant Certificates, duly executed and delivered
hereunder, evidencing Equity Warrants of the same title. The provisions of this
Section are exclusive and shall preclude (to the extent lawful) all other rights
and remedies with respect to the replacement of lost, stolen, destroyed or
mutilated Equity Warrant Certificates.
5.3. HOLDERS OF EQUITY WARRANTS MAY ENFORCE RIGHTS. Notwithstanding any of
the provisions of this Agreement, any Holder may, without the consent of the
Equity Warrant Agent, enforce and may institute and maintain any suit, action or
proceeding against the Company suitable to enforce, or otherwise in respect of
his right to exercise his Equity Warrants as provided in the Equity Warrants and
in this Agreement.
5.4. CONSOLIDATION OR MERGER OR SALE OF ASSETS. For purposes of this
Section 5.4, a "SALE TRANSACTION" means any transaction or event, including any
merger, consolidation, sale of assets, tender or exchange offer,
reclassification, compulsory share exchange or liquidation, in which all or
substantially all outstanding shares of the Company's Common Stock are converted
into or exchanged for stock, other securities, cash or assets or following which
any remaining outstanding shares of Common Stock fail to meet the listing
standards imposed by each of the New York Stock Exchange, the American Stock
Exchange and the Nasdaq National Market at the time of such transaction, but
shall not include any transaction the primary purpose of which is the
reincorporation of the Company in another U.S. jurisdiction so long as in such
transaction each Equity Warrant shall convert into an equity security of the
successor to the Company having identical rights as the Equity Warrant. If a
Sale Transaction occurs, then lawful provision shall be made by the corporation
formed by such Sale Transaction or the corporation whose securities, cash or
other property will immediately after the Sale Transaction be owned, by virtue
of such Sale Transaction, by the holders of Common Stock immediately prior to
the Sale Transaction, or the corporation which shall have acquired such
securities of the Company (collectively the "FORMED, SURVIVING OR ACQUIRING
CORPORATION"), as the case may be, providing that each Equity Warrant then
outstanding shall thereafter be exercisable for the kind and amount of
securities, cash or other property receivable upon such Sale Transaction by a
holder of the number of shares of Common Stock that would have been received
upon exercise of such Equity Warrant immediately prior to such Sale Transaction
assuming such holder of Common Stock did not exercise his rights of election, if
any, as to the kind or amount of securities, cash or other property receivable
upon such Sale Transaction (PROVIDED that, if the kind or amount of securities,
cash or other property receivable upon such Sale Transaction is not the same for
each
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share of Common Stock in respect of which such rights of election shall not
have been exercised ("NON-ELECTING SHARE"), then for the purposes of this
Section 5.4 the kind and amount of securities, cash or other property receivable
upon such Sale Transaction for each Non-Electing Share shall be deemed to be the
kind and amount so receivable per share by a plurality of the Non-Electing
Shares). At the option of the Company, in lieu of the foregoing, the Company may
require that in a Sale Transaction each Holder of an Equity Warrant shall
receive in exchange for each such Equity Warrant a security of the Formed,
Surviving or Acquiring Corporation having substantially equivalent rights, other
than as set forth in this Section 5.4, as the Equity Warrant. Concurrently with
the consummation of such transaction, the Formed, Surviving or Acquiring
Corporation shall enter into a supplemental Equity Warrant Agreement so
providing and further providing for adjustments which shall be as nearly
equivalent as may be practical to the adjustments provided for in Section 4.1.
The Formed, Surviving or Acquiring Corporation shall mail to Holders a notice
describing the supplemental Equity Warrant Agreement. If the issuer of
securities deliverable upon exercise of Equity Warrants under the supplemental
Equity Warrant Agreement is an affiliate of the formed or surviving corporation,
that issuer shall join in the supplemental Equity Warrant Agreement.
Notwithstanding anything to the contrary herein, there will be no adjustments
pursuant to Article 4 hereof in case of the issuance of any shares of the
Company's stock in a Sale Transaction except as provided in this Section 5.4.
The provisions of this Section 5.4 shall similarly apply to successive Sale
Transactions; PROVIDED, HOWEVER, that in no event shall a Holder of an Equity
Warrant be entitled to more than one adjustment pursuant to this Section 5.4 in
respect of a series of related transactions.
ARTICLE 6.
EXCHANGE AND TRANSFER OF EQUITY WARRANTS
6.1. EQUITY WARRANT REGISTER; EXCHANGE AND TRANSFER OF EQUITY WARRANT. The
Equity Warrant Agent shall maintain, at its corporate trust office or at 000
Xxxxx Xxxx Xxxx, Xxxxxxxxxxxxxx Services Department, 0xx Xxxxx, Xxxx Xxxxxxxx,
Xxx Xxxxxx 00000, a register (the "EQUITY WARRANT REGISTER") in which, upon the
issuance of Equity Warrants, and, subject to such reasonable regulations as the
Equity Warrant Agent may prescribe, it shall register Equity Warrant
Certificates and exchanges and transfers thereof. The Equity Warrant Register
shall be in written form or in any other form capable of being converted into
written form within a reasonable time.
Except as provided in the following sentence, upon surrender at the
corporate trust office of the Equity Warrant Agent or at 000 Xxxxx Xxxx Xxxx,
Xxxxxxxxxxxxxx Services Department, 0xx Xxxxx, Xxxx Xxxxxxxx, Xxx Xxxxxx 00000,
Equity Warrant Certificates may be exchanged for one or more other Equity
Warrant Certificates evidencing the same aggregate number of Equity Warrants of
the same title, or may be transferred in whole or in part. A transfer shall be
registered and an appropriate entry made in the Equity Warrant Register upon
surrender of an Equity Warrant Certificate to the Equity Warrant Agent at its
corporate trust office or at 000 Xxxxx Xxxx Xxxx, Xxxxxxxxxxxxxx Services
Department, 0xx Xxxxx, Xxxx Xxxxxxxx, Xxx Xxxxxx 00000 for transfer, properly
endorsed or accompanied by appropriate instruments of transfer and written
instructions for transfer, all in form satisfactory to the Company and the
Equity Warrant Agent. Whenever an Equity Warrant Certificate is surrendered for
exchange or transfer, the Equity Warrant Agent shall countersign and deliver to
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the person or person entitled thereto one or more Equity Warrant Certificates
duly executed by the Company, as so requested. The Equity Warrant Agent shall
not be required to effect any exchange or transfer which will result in the
issuance of an Equity Warrant Certificate evidencing a fraction of an Equity
Warrant. All Equity Warrant Certificates issued upon any exchange or transfer of
an Equity Warrant Certificate shall be the valid obligations of the Company,
evidencing the same obligations, and entitled to the same benefits under this
Agreement, as the Equity Warrant Certificate surrendered for such exchange or
transfer.
No service charge shall be made for any exchange or transfer of
Equity Warrants, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any such exchange or transfer, in accordance with Section 2.5 hereof.
6.2. TREATMENT OF HOLDERS OF EQUITY WARRANTS. Every Holder of an Equity
Warrant, by accepting the Equity Warrant Certificate evidencing the same,
consents and agrees with the Company, the Equity Warrant Agent and with every
other Holder of Equity Warrants that the Company and the Equity Warrant Agent
may treat the record holder of an Equity Warrant Certificate as the absolute
owner of such Equity Warrant for all purposes and as the person entitled to
exercise the rights represented by such Equity Warrant.
6.3. CANCELLATION OF EQUITY WARRANT CERTIFICATES. In the event that the
Company shall purchase, redeem or otherwise acquire any Equity Warrants after
the issuance thereof, the Equity Warrant Certificate shall thereupon be
delivered to the Equity Warrant Agent and be canceled by it. The Equity Warrant
Agent shall also cancel any Equity Warrant Certificate (including any mutilated
Equity Warrant Certificate) delivered to it for exercise, in whole or in part,
or for exchange or transfer. Equity Warrant Certificates so canceled shall be
delivered by the Equity Warrant Agent to the Company from time to time, or
disposed of in accordance with the instructions of the Company.
ARTICLE 7.
CONCERNING THE EQUITY WARRANT AGENT
7.1. EQUITY WARRANT AGENT. The Company hereby appoints The Bank of New York
as Equity Warrant Agent of the Company in respect of the Equity Warrants upon
the terms and subject to the conditions set forth herein; and The Bank of New
York hereby accepts such appointment. The Equity Warrant Agent shall have the
powers and authority granted to and conferred upon it in the Equity Warrant
Certificates and hereby and such further powers and authority acceptable to it
to act on behalf of the Company as the Company may hereafter grant to or confer
upon it. All of the terms and provisions with respect to such powers and
authority contained in the Equity Warrant Certificates are subject to and
governed by the terms and provisions hereof.
7.2. CONDITIONS OF EQUITY WARRANT AGENT'S OBLIGATIONS. The Equity Warrant
Agent accepts its obligations set forth herein upon the terms and conditions
hereof, including the following, to all of which the Company agrees and to all
of which the rights hereunder of the Holders shall be subject:
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(a) COMPENSATION AND INDEMNIFICATION. The Company agrees to pay the
Equity Warrant Agent from time to time such compensation for its
services as the Company and the Equity Warrant shall agree in writing
and to reimburse the Equity Warrant Agent for reasonable out-of-pocket
expenses (including reasonable counsel fees) incurred by the Equity
Warrant Agent in connection with the services rendered hereunder by the
Equity Warrant Agent. The Company also agrees to indemnify the Equity
Warrant Agent for, and to hold it harmless against, any loss, liability
or expenses (including the reasonable costs and expense of defending
against any claim of liability) incurred without negligence or bad
faith on the part of the Equity Warrant Agent arising out of or in
connection with its appointment as Equity Warrant Agent hereunder.
(b) AGENT FOR THE COMPANY. In acting under this Agreement and in
connection with any Equity Warrant Certificate, the Equity Warrant Agent is
acting solely as agent of the Company and does not assume any obligation or
relationship of agency or trust for or with any Holder.
(c) COUNSEL. The Equity Warrant Agent may consult with counsel
reasonably satisfactory to it, and the advice of such counsel shall be full
and complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in accordance with
the advice of such counsel.
(d) DOCUMENTS. The Equity Warrant Agent shall be protected and shall
incur no liability for or in respect of any action taken, suffered or
omitted by it in reliance upon any notice, direction, consent,
certification, affidavit, statement or other paper or document reasonably
believed by it to be genuine and to have been presented or signed by the
proper parties.
(e) OFFICER'S CERTIFICATE. Whenever in the performance of its duties
hereunder the Equity Warrant Agent shall reasonably deem it necessary that
any fact or matter be proved or established by the Company prior to taking,
suffering or omitting any action hereunder, the Equity Warrant Agent may
(unless other evidence in respect thereof be herein specifically
prescribed), in the absence of bad faith on its part, rely upon a
certificate signed by the Chairman, the Vice Chairman, the Chief Executive
Officer, the President, a Vice President, the Treasurer, and Assistant
Treasurer, the Secretary or an Assistant Secretary of the Company (an
"OFFICER'S CERTIFICATE") delivered by the Company to the Equity Warrant
Agent.
(f) ACTIONS THROUGH AGENTS. The Equity Warrant Agent may execute and
exercise any of the rights or powers hereby vested in it or perform any
duty hereunder either itself or by or through its attorneys or agents,
provided, however, that reasonable care shall be exercised in the selection
and continued employment of such attorneys and agents.
(g) CERTAIN TRANSACTIONS. The Equity Warrant Agent, and any officer,
director or employee thereof, may become the owner of, or acquire
interest in, any Equity Warrant, with the same rights that he, she or
it would have if it were not the Equity Warrant Agent, and, to the
extent permitted by applicable law, he, she or it may engage
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or be interested in any financial or other transaction with the Company and
may serve on, or as depositary, trustee or agent for, any committee or body
of holders of any obligations of the Company as if it were not the Equity
Warrant Agent.
(h) NO LIABILITY FOR INTEREST. The Equity Warrant Agent shall not be
liable for interest on any monies at any time received by it pursuant to
any of the provisions of this Agreement or of the Equity Warrant
Certificates, except as otherwise agreed with the Company.
(i) NO LIABILITY FOR INVALIDITY. The Equity Warrant Agent shall incur
no liability with respect to the validity of this Agreement (except as to
the due execution hereof by the Equity Warrant Agent) or any Equity Warrant
Certificate (except as to the countersignature thereof by the Equity
Warrant Agent).
(j) NO RESPONSIBILITY FOR COMPANY REPRESENTATIONS. The Equity
Warrant Agent shall not be responsible for any of the recitals or
representations contained herein (except as to such statements or
recitals as describe the Equity Warrant Agent or action taken or to be
taken by it) or in any Equity Warrant Certificate (except as to the
Equity Warrant Agent's countersignature on such Equity Warrant
Certificate), all of which recitals and representations are made solely
by the Company.
(k) NO IMPLIED OBLIGATIONS. The Equity Warrant Agent shall be
obligated to perform only such duties as are specifically set forth
herein, and no other duties or obligations shall be implied. The
Equity Warrant Agent shall not be under any obligation to take any
action hereunder that may subject it to any expense or liability, the
payment of which within a reasonable time is not, in its reasonable
opinion, assured to it. The Equity Warrant Agent shall not be
accountable or under any duty or responsibility for the use by the
Company of any Equity Warrant Certificate countersigned by the Equity
Warrant Agent and delivered by it to the Company pursuant to this
Agreement or for the application by the Company of the proceeds of the
issuance or exercise of Equity Warrants. The Equity Warrant Agent
shall have no duty or responsibility in case of any default by the
Company in the performance of its covenants or agreements contained
herein or in any Equity Warrant Certificate or in case of the receipt
of any written demand from a Holder with respect to such default,
including, without limiting the generality of the foregoing, any duty
or responsibility to initiate or attempt to initiate any proceedings at
law or otherwise or, except as provided in Section 8.2 hereof, to make
any demand upon the Company.
7.3. COMPLIANCE WITH APPLICABLE LAWS. The Equity Warrant Agent agrees to
comply with all applicable federal and state laws imposing obligations on it in
respect of the services rendered by it under this Agreement and in connection
with the Equity Warrants, including (but not limited to) the provisions of
United States federal income tax laws regarding information reporting and backup
withholding. The Equity Warrant Agent expressly assumes all liability for its
failure to comply with any such laws imposing obligations on it, including (but
not limited to) any liability for failure to comply with any applicable
provisions of United States federal income tax laws regarding information
reporting and backup withholding.
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7.4. RESIGNATION AND APPOINTMENT OF SUCCESSOR.
(a) The Company agrees, for the benefit of the Holders of the Equity
Warrants, that there shall at all times be an Equity Warrant Agent hereunder
until all the Equity Warrants are no longer exercisable.
(b) The Equity Warrant Agent may at any time resign as such agent by giving
written notice to the Company of such intention on its part, specifying the date
on which its desired resignation shall become effective, subject to the
appointment of a successor Equity Warrant Agent and acceptance of such
appointment by such successor Equity Warrant Agent, as hereinafter provided. The
Equity Warrant Agent hereunder may be removed at any time by the filing with it
of an instrument in writing signed by or on behalf of the Company and specifying
such removal and the date when it shall become effective. Such resignation or
removal shall take effect upon the appointment by the Company, as hereinafter
provided, of a successor Equity Warrant Agent (which shall be a banking
institution organized under the laws of the United States of America, or one of
the states thereof and having an office or an agent's office in the Borough of
Manhattan, the City of New York) and the acceptance of such appointment by such
successor Equity Warrant Agent. In the event a successor Equity Warrant Agent
has not been appointed and has not accepted its duties within 90 days of the
Equity Warrant Agent's notice of resignation, the Equity Warrant Agent may apply
to any court of competent jurisdiction for the designation of a successor Equity
Warrant Agent.
(c) In case at any time the Equity Warrant Agent shall resign, or shall be
removed, or shall become incapable of acting, or shall be adjudged bankrupt or
insolvent, or make an assignment for the benefit of its creditors or consent to
the appointment of a receiver or custodian of all or any substantial part of its
property, or shall admit in writing its inability to pay or meet its debts as
they mature, or if a receiver or custodian of it or all or any substantial part
of its property shall be appointed, or if any public officer shall have taken
charge or control of the Equity Warrant Agent or of its property or affairs, for
the purpose of rehabilitation, conservation or liquidation, a successor Equity
Warrant Agent, qualified as aforesaid, shall be appointed by the Company by an
instrument in writing, filed with the successor Equity Warrant Agent. Upon the
appointment as aforesaid of a successor Equity Warrant Agent and acceptance by
the latter of such appointment, the Equity Warrant Agent so superseded shall
cease to be the Equity Warrant Agent hereunder.
(d) Any successor Equity Warrant Agent appointed hereunder shall execute,
acknowledge and deliver to its predecessor and to the Company an instrument
accepting such appointment hereunder, and thereupon such successor Equity
Warrant Agent, without any further act, deed or conveyance, shall become vested
with all the authority, rights, powers, trusts, immunities, duties and
obligations of such predecessor with like effect as if originally named as
Equity Warrant Agent hereunder, and such predecessor, upon payment of its
charges and disbursements then unpaid, shall thereupon become obligated to
transfer, deliver and pay over, and such successor Equity Warrant Agent shall be
entitled to receive all moneys, securities and other property on deposit with or
held by such predecessor, as Equity Warrant Agent hereunder.
(e) Any corporation into which the Equity Warrant Agent hereunder may be
merged or converted or any corporation with which the Equity Warrant Agent may
be
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consolidated, or any corporation resulting from any merger, conversion or
consolidation to which the Equity Warrant Agent shall be a party, or any
corporation to which the Equity Warrant Agent shall sell or otherwise transfer
all or substantially all of the assets and business of the Equity Warrant Agent,
provided that it shall be qualified as aforesaid, shall be the successor Equity
Warrant Agent under this Agreement without the execution or filing of any paper
or any further act on the part of any of the parties hereto.
ARTICLE 8.
MISCELLANEOUS
8.1. AMENDMENT.
(a) This Agreement and the Equity Warrants may be amended by the Company
and the Equity Warrant Agent, without the consent of the Holders of Equity
Warrants, for the purpose of curing any ambiguity, or of curing, correcting or
supplementing any defective or inconsistent provision contained herein or
therein or in any other manner which the Company may deem to be necessary or
desirable and which will not (i) materially and adversely affect the rights of
the Equity Warrants and (ii) adversely affect the rights of the Initial Holder
under this Agreement to the extent the Initial Holder is a Holder at the time of
such amendment.
(b) The Company and the Equity Warrant Agent may modify or amend this
Agreement and the Equity Warrant Certificates with the consent of the Holders of
not fewer than a majority in number of the then outstanding unexercised Equity
Warrants affected by such modification or amendment, for any purpose; PROVIDED,
HOWEVER, (i) that no such modification or amendment that shortens the period of
time during which the Equity Warrants may be exercised, or increases the
Exercise Price, or otherwise materially and adversely affects the exercise
rights of the holders or reduces the percentage of holders of outstanding Equity
Warrants the consent of which is required for modification or amendment of this
Agreement or the Equity Warrants, may be made without the consent of each Holder
affected thereby, and (ii) that no such modification or amendment that adversely
affects the exercise rights of the holders may be made without the consent of
the Initial Holder of the Equity Warrants to the extent the Initial Holder is a
Holder at the time of such modification and/or amendment.
8.2. NOTICES AND DEMANDS TO THE COMPANY AND EQUITY WARRANT AGENT. If the
Equity Warrant Agent shall receive any notice or demand addressed to the Company
by any Holder pursuant to the provisions of the Equity Warrant Certificate, the
Equity Warrant Agent shall promptly forward such notice or demand to the
Company.
8.3. ADDRESSES FOR NOTICES. Any communications from the Company to the
Equity Warrant Agent with respect to this Agreement shall be addressed to The
Bank of New York, 385 Rifle Camp Road, Reorganization Services Department, 0xx
Xxxxx, Xxxx Xxxxxxxx, Xxx Xxxxxx 00000; any communications from the Equity
Warrant Agent to the Company with respect to this Agreement shall be addressed
to USA Networks, Inc., 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000, Attention:
General Counsel; or such other addresses as shall be specified in writing by the
Equity Warrant Agent or by the Company.
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8.4. GOVERNING LAW. This Agreement and the Equity Warrants shall be
governed by the laws of the State of New York applicable to contracts made and
to be performed entirely within such state.
8.5. GOVERNMENTAL APPROVALS. The Company will from time to time use all
reasonable efforts to obtain and keep effective any and all permits, consents
and approvals of governmental agencies and authorities and the national
securities exchange on which the Equity Warrants may be listed or authorized for
trading from time to time and filings under the United States federal and state
laws, which may be or become requisite in connection with the issuance, sale,
trading, transfer or delivery of the Equity Warrants, and the exercise of the
Equity Warrants.
8.6. RESERVATION OF SHARES OF COMMON STOCK. The Company covenants that it
will at all times reserve and keep available, free from preemptive rights (other
than such rights as do not affect the ownership of shares issued to a Holder),
out of the aggregate of its authorized but unissued shares of Common Stock or
its issued shares of Common Stock held in its treasury, or both, for the purpose
of effecting exercises of Equity Warrants, the full number of shares of Common
Stock deliverable upon the exercise of all outstanding Equity Warrants not
theretofore exercised and on or before taking any action that would cause an
adjustment resulting in an increase in the number of shares of Common Stock
deliverable upon exercise above the number thereof previously reserved and
available therefor, the Company shall take all such action so required. For
purposes of this Section 8.6, the number of shares of Common Stock which shall
be deliverable upon the exercise of all outstanding Equity Warrants shall be
computed as if at the time of computation all outstanding Equity Warrants were
held by a single holder. Before taking any action which would cause an
adjustment reducing the price per share of Common Stock issued upon exercise of
the Equity Warrants below the then par value (if any) of such shares of Common
Stock, the Company shall take any corporate action which may, in the opinion of
its counsel, be necessary in order that the Company may validly and legally
issue fully paid and non-assessable shares of Common Stock at such Exercise
Price.
8.7. COVENANT REGARDING SHARES OF COMMON STOCK. All shares of Common Stock
which may be delivered upon exercise of the Equity Warrants will upon delivery
be duly and validly issued and fully paid and non-assessable, free of all liens
and charges and not subject to any preemptive rights (other than rights which do
not affect the Holder's right to own the shares of Common Stock to be issued),
and prior to the Exercise Date the Company shall take any corporate action
necessary therefor. The issuance of all such shares of Common Stock shall, to
the extent permitted by law, be registered under the Securities Act of 1933, as
amended.
8.8. PERSONS HAVING RIGHTS UNDER AGREEMENT. Nothing in this Agreement
expressed or implied and nothing that may be inferred from any of the provisions
hereof is intended, or shall be construed, to confer upon, or give to, any
person or corporation other than the Company, the Equity Warrant Agent and the
Holders any right, remedy or claim under or by reason of this Agreement or of
any covenant, condition, stipulation, promise or agreement hereof; and all
covenants, conditions, stipulations, promises and agreements in this Agreement
contained shall be for the sole and exclusive benefit of the Company and the
Equity Warrant Agent and their successors and of the Holders of Equity Warrant
Certificates.
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8.9. LIMITATION OF LIABILITY. No provision hereof, in the absence of
affirmative action by the Holder to purchase shares of Common Stock, and no
enumeration herein of the rights or privileges of the Holder hereof, shall give
rise to any liability of such Holder to pay the Exercise Price for any shares of
Common Stock other than pursuant to an exercise of the Equity Warrant or any
liability as a stockholder of the Company, whether such liability is asserted by
the Company or by creditors of the Company.
8.10. RESTRICTIONS ON TRANSFER/REGISTRATION RIGHTS. For any transfer of
Equity Warrants and/or the Common Stock purchasable upon exercise of the Equity
Warrants to be effective, the Holders of the Equity Warrants must comply with
the transfer restrictions set forth in the Amended and Restated Stockholders
Agreement, dated as of December 16, 2001, among the Company and the other
parties on the signature pages thereto, as the same may be amended from time to
time (the "STOCKHOLDERS AGREEMENT"). On delivery of the Equity Warrants by the
Company to the Initial Holder, such Initial Holder (and to the extent provided
for in the Amended and Restated Governance Agreement, dated as of December 16,
2001, among the Company and the other parties set forth on the signature pages
thereto, as the same may be amended from time to time (the "GOVERNANCE
AGREEMENT"), certain transferees of the Initial Holder) shall have registration
rights with respect to the Equity Warrants to the extent provided in the
Governance Agreement.
8.11. HEADINGS. The descriptive headings of the several Articles and
Sections and the Table of Contents of this Agreement are for convenience only
and shall not control or affect the meaning or construction of any of the
provisions hereof.
8.12. COUNTERPARTS. This Agreement may be executed by the parties hereto in
any number of counterparts, each of which when so executed and delivered shall
be deemed to be an original; but all such counterparts shall together constitute
but one and the same instrument.
8.13. INSPECTION OF AGREEMENT. A copy of this Agreement shall be available
at all reasonable times at the principal corporate trust office of the Equity
Warrant Agent, for inspection by the Holders of Equity Warrants.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, all as of the day and year first above written.
USA NETWORKS, INC.
By
--------------------------------
--------------------------------
[Printed Name and Title]
Attest:
Name:
------------------------------
Title:
------------------------------
--------------------------------------
The Bank of New York
By
------------------------------------
------------------------------------
[Printed Name and Title]
Attest:
Name:
------------------------------
Title:
------------------------------
-19-
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR UNDER
ANY STATE SECURITIES LAWS AND MAY NOT BE TRANSFERRED EXCEPT AS EXPRESSLY
PERMITTED UNDER THE STOCKHOLDERS AGREEMENT, DATED AS OF DECEMBER [ ],
2002, BY AND AMONG USA NETWORKS, INC. AND THE OTHER PARTIES SET FORTH ON
THE SIGNATURE PAGES THERETO, AS THE SAME MAY BE AMENDED FROM TIME TO
TIME, AND OTHERWISE IN COMPLIANCE WITH FEDERAL AND APPLICABLE STATE
SECURITIES LAWS.
EXHIBIT A
SPECIMEN
FACE
No. W __ _____ Equity Warrants
(SUBJECT TO ADJUSTMENT PURSUANT
TO SECTION 4.1(F) TO THE EQUITY
WARRANT AGREEMENT)
EQUITY WARRANT CERTIFICATE
USA NETWORKS, INC.
This Warrant Certificate certifies that
----------------------------------------------------------------------------
-----------------------------------------------------------------------------,
or registered assigns, is the registered Holder of Equity Warrants (the "Equity
Warrants") to purchase Common Stock, par value $0.01 per share, of USA Networks,
Inc., a Delaware corporation (the "Company"). Each Equity Warrant entitles the
Holder to purchase from the Company one fully paid and non-assessable share of
Common Stock, par value $0.01 per share, of the Company ("Common Stock") at any
time commencing on ___________, 2002* and on or before 5:00 p.m. New York City
time ___________, 2012, at the exercise price per Equity Warrant (the "Exercise
Price") of $_____ payable in lawful money of the United States of America upon
surrender of this Equity Warrant Certificate and payment of the Exercise Price
at the office or agency of the Warrant Agent in the City of New York, the State
of New York, upon such conditions set forth herein and in the Equity Warrant
Agreement (as hereinafter defined). Payment of the Exercise Price must be made
in lawful money of the United States of America, in cash or by certified check
or bank draft or bank wire transfer payable to the order of the Company. The
number of shares of Common Stock which are issuable upon exercise of the
--------------
* Date following the six-month anniversary of the Closing.
Equity Warrants evidenced hereby and to the extent provided therein, the
Exercise Prices, is subject to adjustment upon the occurrence of certain events
set forth in the Equity Warrant Agreement.
By acceptance of this Equity Warrant Certificate, each Holder
agrees to be bound by the terms of the Equity Warrant Agreement.
Reference is hereby made to the further provisions of this Equity
Warrant Certificate set forth on the reverse hereof and such further provisions
shall for all purposes have the same effect as though fully set forth at this
place. Capitalized defined terms used herein have the same meaning as in the
Equity Warrant Agreement.
This Equity Warrant Certificate shall not be valid unless
countersigned by the Equity Warrant Agent, as such term is used in the Equity
Warrant Agreement.
-2-
IN WITNESS WHEREOF, USA Networks, Inc. has caused this Equity
Warrant Certificate to be duly executed under its corporate seal.
USA NETWORKS, INC.
By:
--------------------------
Attest:
----------------
Countersigned:
The Bank of New York, as Equity Warrant Agent
By _______________________________
Authorized Signature
-3-
REVERSE
EQUITY WARRANT CERTIFICATE
USA NETWORKS, INC.
The Equity Warrants evidenced by this Equity Warrant Certificate are
part of a duly authorized issue of Equity Warrants issued pursuant to an Equity
Warrant Agreement dated as of ___________, 2002 (the "Equity Warrant
Agreement"), duly executed and delivered by the Company to The Bank of New York
(the "Equity Warrant Agent"), which Equity Warrant Agreement is hereby
incorporated by reference in and made a part of this instrument and is hereby
referred to for a description of the rights, limitation of rights, obligations,
duties and immunities thereunder of the Equity Warrant Agent, the Company and
the Holders (the words "Holders" or "Holder" meaning the registered Holders or
registered Holder) of the Equity Warrants.
Equity Warrants may be exercised to purchase shares of Common Stock
of the Company, par value $.01 per share ("Common Stock") upon such terms and
conditions as are set forth in the Equity Warrant Agreement at any time on or
before 5:00 p.m. New York City time on __________, 2012, at the Exercise Price
set forth on the face hereof. The Holder of Equity Warrants evidenced by this
Equity Warrant Certificate may exercise them by surrendering the Equity Warrant
Certificate, with the form of election to purchase set forth hereon properly
completed and executed, together with payment of the Exercise Price at the
office of the Equity Warrant Agent in the City of New York in the State of New
York. In the event that upon any exercise of Equity Warrants evidenced hereby
the number of Equity Warrants exercised shall be less than the total number of
Equity Warrants evidenced hereby, there shall be issued to the Holder hereof or
his assignee a new Equity Warrant Certificate evidencing the number of Equity
Warrants not exercised. Nothing contained in the Equity Warrant Agreement or in
this Equity Warrant Certificate shall be construed as conferring upon the
Holders thereof the right to vote, to receive dividends or other distributions,
to exercise any preemptive right or to consent or to receive notice as
shareholders in respect of meetings of shareholders for the election of
Directors of the Company or any other matter, or any other rights whatsoever as
shareholders of the Company.
The Equity Warrant Agreement provides that upon the occurrence of
certain events, the number of shares of Common Stock issuable upon exercise of
an Equity Warrant may, subject to certain conditions, be adjusted.
Equity Warrant Certificates, when surrendered at the office of the
Equity Warrant Agent in the City of New York in the State of New York by the
registered Holder thereof in person or by a legal representative duly authorized
in writing or by registered mail, return receipt requested, may be exchanged, in
the manner and subject to the limitations provided in the Equity Warrant
Agreement, but without payment of any service charge, for another Equity Warrant
Certificate or Equity Warrant Certificates of like tenor evidencing in the
aggregate a like number of Equity Warrants and registered in the name of such
registered Holder.
Upon due presentment for registration of transfer of this Equity
Warrant Certificate at the office of the Equity Warrant Agent in the City of New
York in the State of New York or by registered mail, return receipt requested, a
new Equity Warrant Certificate or Equity Warrant Certificates of like tenor and
evidencing in the aggregate a like number of Equity Warrants shall be issued to
the transferee(s) in exchange for this Equity Warrant Certificate, subject to
the limitations provided in the Equity Warrant Agreement, without charge except
for any tax or other governmental charge imposed in connection therewith.
The Company and the Equity Warrant Agent may deem and treat the
registered Holder(s) hereof as the absolute owner(s) of this Equity Warrant
Certificate (notwithstanding any notation of ownership or other writing hereon
made by anyone), for the purpose of any exercise hereof, and of any distribution
to the Holder(s) hereof, and for all other purposes, and neither the Company nor
the Equity Warrant Agent shall be affected by any notice (other than a duly
presented registration of transfer in accordance with the previous paragraph) to
the contrary and shall not be bound to recognize any equitable or other claim to
or interest in such Equity Warrant on the part of any other person.
-2-
USA NETWORKS, INC.
ELECTION TO PURCHASE
USA NETWORKS, INC.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by this Equity Warrant Certificate for ________ Equity
Warrants, and to purchase thereunder the shares of Common Stock (the "Shares")
provided for therein, and requests that certificates for the Shares be issued in
the name of:
(Please Print Name, Address and Social Security Number)
If said number of Equity Warrants to be exercised shall not be all of the Equity
Warrants evidenced by this Equity Warrant Certificate, the undersigned requests
that a new Equity Warrant Certificate for the balance of the Equity Warrants be
registered in the name of the undersigned or his Assignee as below indicated and
delivered to the address stated below:
Dated:________________, 200_
Name of Equity Warrant Holder or
Assignee (Please Print):
-----------------------------------------------
Address:
----------------------------------------------------------------
Signature:
---------------------------------------------------------------
(Signature must conform to name of Holder as specified on the
face of the Equity Warrant Certificate)
Signature Guaranteed:
------------------------------------------------
Signature of Guarantor
