EXHIBIT 4.5
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BARNEYS NEW YORK, INC.
Warrants to Purchase
Shares of Common Stock
WARRANT AGREEMENT
Dated as of April 1, 2003
WILMINGTON TRUST COMPANY
Warrant Agent
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WARRANT AGREEMENT, dated as of April 1, 2003, between Barneys New
York, Inc., a Delaware corporation (the "COMPANY"), and Wilmington Trust
Company, as warrant agent (the "WARRANT AGENT").
WHEREAS, the Company proposes to issue warrants (the "WARRANTS") to
initially purchase up to an aggregate of 361,672 shares of Common Stock, par
value $.01 per share (the "COMMON STOCK"), of the Company (the Common Stock
issuable on exercise of the Warrants being referred to herein as the "WARRANT
SHARES"), in connection with the offering (the "OFFERING") by the Company and
Barney's, Inc. of 106,000 Units (the "UNITS"), each consisting of $1,000
principal amount at maturity of the 9.000% Senior Secured Notes due 2008 of
Barney's, Inc. (the "NOTES") and one Warrant, each Warrant initially
representing the right to purchase 3.412 Warrant Shares.
WHEREAS, the Company desires the Warrant Agent to act on behalf of
the Company, and the Warrant Agent is willing so to act in connection with the
issuance of Warrant Certificates (as defined) and other matters as provided
herein.
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
SECTION 1. CERTAIN DEFINITIONS
As used in this Agreement, the following terms shall have the
following respective meanings:
"144A GLOBAL WARRANT" means a global Warrant substantially in the
form of Exhibit A hereto bearing the Global Warrant Legend and the Private
Placement Legend and deposited with or on behalf of, and registered in the name
of, the Depositary or its nominee.
"AFFILIATE" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control,"
as used with respect to any Person, means the possession, directly or
indirectly, of the power to direct or cause the direction of the management or
policies of such Person, whether through the ownership of voting securities, by
agreement or otherwise; provided that beneficial ownership of 10% or more of the
Voting Stock of a Person will be deemed to be control; provided, further, that
as of the date hereof Isetan and its Affiliates will not be deemed to be
Affiliates of the Company or any of its Subsidiaries. For purposes of this
definition, the terms "controlling," "controlled by" and "under common control
with" have correlative meanings.
"APPLICABLE PROCEDURES" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Note, the rules and
procedures of the Depositary, Euroclear and Clearstream that apply to such
transfer or exchange.
"BOARD OF DIRECTORS" means:
(1) with respect to a corporation, the board of directors
of the corporation;
(2) with respect to a partnership, the Board of Directors
of the general partner of the partnership; and
(3) with respect to any other Person, the board or
committee of such Person serving a similar function.
"BUSINESS DAY" means any day other than a Legal Holiday.
"CLEARSTREAM" means Clearstream Banking, S.A.
"CLOSING DATE" means the date hereof.
"COMMISSION" means the Securities and Exchange Commission.
"DEPOSITARY" means, with respect to the Warrants issuable or issued
in whole or in part in global form, the Person specified in Section 3.3 hereof
as the Depositary with respect to the Warrants, and any and all successors
thereto appointed as Depositary hereunder and having become such pursuant to the
applicable provision of the Indenture.
"EQUITY REGISTRATION RIGHTS AGREEMENT" means the registration rights
agreement, dated as of April 1, 2003, by and between the Company and the Initial
Purchaser relating to the Warrant Shares.
"EUROCLEAR" means Euroclear Bank S.A./N.V., as operator of the
Euroclear system.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"EXERCISE PRICE" means the amount set forth in the form of Warrant
Certificate attached hereto as Exhibit A, as adjusted as herein provided.
"GLOBAL WARRANTS" means, individually and collectively, each of the
Restricted Global Warrants and the Unrestricted Global Warrants, substantially,
in the form of Exhibit A hereto issued in accordance with Section 3.1(b) and 3.5
hereof.
"GLOBAL WARRANT LEGEND" means the legend set forth in Section
3.5(g)(ii), which is required to be placed on all Global Warrants issued under
this Warrant Agreement.
"IAI GLOBAL WARRANT" means the Global Warrant substantially in the
form of Exhibit A hereto bearing the Global Warrant Legend and the Private
Placement Legend and deposited with or on behalf of and registered in the name
of the Depositary or its nominee.
"INDENTURE" means the indenture, dated as of April 1, 2003, among
Barney's, Inc., the Company, the Guarantors set forth therein and Wilmington
Trust Company, as trustee, relating to the Notes.
"INDIRECT PARTICIPANT" means a Person who holds a beneficial interest
in a Global Warrant through a Participant.
"INITIAL PURCHASER" means Xxxxxxxxx & Company, Inc.
"INSTITUTIONAL ACCREDITED INVESTOR" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, which is not also a QIB.
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"LEGAL HOLIDAY" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York, the city in which the corporate trust
office of the Warrant Agent is located or at a place of payment are authorized
by law, regulation or executive order to remain closed. If a payment date is a
Legal Holiday at a place of payment, payment may be made at that place on the
next succeeding day that is not a Legal Holiday, and no interest shall accrue on
such payment for the intervening period.
"NON-U.S. PERSON" means any Person other than a U.S. Person.
"OFFICER" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person.
"OPINION OF COUNSEL" means an opinion from legal counsel who is
reasonably acceptable to the Warrant Agent in form and substance reasonably
acceptable to the Warrant Agent. The counsel may be an employee of or counsel to
the Company, any subsidiary of the Company or the Warrant Agent.
"PARTICIPANT" means, with respect to the Depositary, Euroclear or
Clearstream, a Person who has an account with the Depositary, Euroclear or
Clearstream, respectively (and, with respect to DTC, shall include Euroclear and
Clearstream).
"PERSON" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization,
limited liability company or government or other entity.
"PRIVATE PLACEMENT LEGEND" means the legend set forth in Section
3.5(g)(i) to be placed on all Warrants issued under this Warrant Agreement
except where otherwise permitted by the provisions of this Warrant Agreement.
"QIB" means a "qualified institutional buyer" as defined in Rule
144A.
"REGULATION S" means Regulation S promulgated under the Securities
Act.
"REGULATION S GLOBAL WARRANT" means a global Warrant in the form of
Exhibit A hereto bearing the Global Warrant Legend, the Private Placement Legend
and the Regulation S Legend and deposited with or on behalf of and registered in
the name of the Depositary or its nominee.
"REGULATION S LEGEND" means the legend set forth in Section
3.5(g)(iv) to be placed on all Regulation S Global Warrants issued pursuant to
Regulation S.
"RESTRICTED DEFINITIVE WARRANT" means a Definitive Warrant bearing
the Private Placement Legend.
"RESTRICTED GLOBAL WARRANT" means a Global Warrant bearing the
Private Placement Legend.
"RULE 144" means Rule 144 promulgated under the Securities Act.
"RULE 144A" means Rule 144A promulgated under the Securities Act.
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"RULE 903" means Rule 903 promulgated under the Securities Act.
"RULE 904" means Rule 904 promulgated under the Securities Act.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SEPARATION DATE" means the earliest of (i) 180 days after the date
hereof, (ii) the date on which a registration statement with respect to a
registered exchange offer or a shelf registration statement with respect to the
Notes is declared effective under the Securities Act, (iii) the date on which a
shelf registration statement with respect to the Warrant Shares is declared
effective under the Securities Act, and (iv) such date as Xxxxxxxxx & Company,
Inc., in its sole discretion, shall determine.
"TRANSFER RESTRICTED SECURITIES" shall mean (a) each Warrant and
Warrant Share held by an Affiliate of the Company and (b) each other Warrant and
Warrant Share until the earlier to occur of (i) with respect to each such
Warrant Share only, the date on which such Warrant Share has been effectively
registered under the Securities Act and disposed of in accordance with a
Registration Statement covering it (and the purchasers thereof have been issued
a registered freely tradable security) and (ii) the date on which such Warrant
or Warrant Share is distributed to the public pursuant to Rule 144 under the
Securities Act.
"TRUSTEE" means the trustee under the Indenture.
"UNRESTRICTED GLOBAL WARRANT" means a global Warrant substantially in
the form of Exhibit A attached hereto that bears the Global Warrant Legend and
that has the "Schedule of Exchanges of Interests in the Global Warrant" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Warrants that do not bear the
Private Placement Legend.
"UNRESTRICTED DEFINITIVE WARRANT" means one or more Definitive
Warrants that do not bear and are not required to bear the Private Placement
Legend.
"U.S. PERSON" means a U.S. person as defined in Rule 902(k) under the
Securities Act.
"WARRANT PAYING AGENT" means an office or agency where Warrants may
be presented for surrender. The Company initially appoints the Warrant Agent to
act as Warrant Paying Agent.
SECTION 2. APPOINTMENT OF WARRANT AGENT.
The Company hereby appoints the Warrant Agent to act as agent for the
Company in accordance with the instructions set forth hereinafter in this
Agreement and the Warrant Agent hereby accepts such appointment.
SECTION 3. ISSUANCE OF WARRANTS; WARRANT CERTIFICATES
3.1. FORM AND DATING.
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(a) General.
The Warrants shall be substantially in the form of Exhibit A hereto
(each a "WARRANT CERTIFICATE"). The Warrants may have notations, legends or
endorsements required by law, stock exchange rule or usage. Each Warrant shall
be dated the date of the countersignature.
The terms and provisions contained in the Warrants shall constitute,
and are hereby expressly made, a part of this Warrant Agreement. The Company and
the Warrant Agent, by their execution and delivery of this Warrant Agreement,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Warrant conflicts with the express provisions
of this Warrant Agreement, the provisions of this Warrant Agreement shall govern
and be controlling.
(b) Global Warrants.
Warrants issued in global form shall be substantially in the form of
Exhibit A attached hereto (including the Global Warrant Legend thereon and the
"Schedule of Exchanges of Interests in the Global Warrant" attached thereto).
Warrants issued in definitive form shall be substantially in the form of Exhibit
A attached hereto (but without the Global Warrant Legend thereon and without the
"Schedule of Exchanges of Interests in the Global Warrant" attached thereto).
Each Global Warrant shall represent such of the outstanding Warrants as shall be
specified therein and each shall provide that it shall represent the number of
outstanding Warrants from time to time endorsed thereon and that the number of
outstanding Warrants represented thereby may from time to time be reduced or
increased, as appropriate, to reflect exchanges and redemptions. Any endorsement
of a Global Warrant to reflect the amount of any increase or decrease in the
number of outstanding Warrants represented thereby shall be made by the Warrant
Agent in accordance with instructions given by the holder thereof as required by
Section 3.5 hereof.
(c) Euroclear and Clearstream Procedures Applicable.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Clearstream Banking" and "Customer Handbook" of Clearstream shall
be applicable to transfers of beneficial interests in the Regulation S Global
Warrant that are held by Participants through Euroclear or Clearstream.
3.2. EXECUTION
An Officer shall sign the Warrants on behalf of the Company by manual
or facsimile signature.
If the Officer whose signature is on a Warrant no longer holds that
office at the time a Warrant is countersigned, the Warrant shall nevertheless be
valid.
A Warrant shall not be valid until countersigned by the manual
signature of the Warrant Agent. The signature shall be conclusive evidence that
the Warrant has been properly issued under this Warrant Agreement.
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The Warrant Agent shall, upon a written order of the Company signed
by an Officer (a "WARRANT COUNTERSIGNATURE ORDER"), countersign Warrants for
original issue up to the number stated in the preamble hereto.
The Warrant Agent may appoint an agent acceptable to the Company to
countersign Warrants. Such an agent may countersign Warrants whenever the
Warrant Agent may do so. Each reference in this Warrant Agreement to a
countersignature by the Warrant Agent includes a countersignature by such agent.
Such an agent has the same rights as the Warrant Agent to deal with the Company
or an Affiliate of the Company.
3.3. WARRANT REGISTRAR AND DEPOSITARY
The Company shall maintain an office or agency where Warrants may be
presented for registration of transfer or for exchange ("WARRANT REGISTRAR").
The Warrant Registrar shall keep a register of the Warrants and of their
transfer and exchange. The Company may appoint one or more co-Warrant
Registrars. The term "Warrant Registrar" includes any co-Warrant Registrar. The
Company may change any Warrant Registrar without notice to any holder. The
Company shall notify the Warrant Agent in writing of the name and address of any
agent not a party to this Warrant Agreement. If the Company fails to appoint or
maintain another entity as Warrant Registrar, the Warrant Agent shall act as
such. The Company or any of its subsidiaries may act as Warrant Registrar.
The Company initially appoints the Warrant Agent to act as the
Warrant Registrar with respect to the Global Warrants.
The Company initially appoints The Depository Trust Company ("DTC")
to act as Depositary with respect to the Global Warrants.
3.4. HOLDER LISTS
The Warrant Agent shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of all holders of Warrants. If the Warrant Agent is not the Warrant
Registrar, the Company shall promptly furnish to the Warrant Agent at such times
as the Warrant Agent may request in writing, a list in such form and as of such
date as the Warrant Agent may reasonably require of the names and addresses of
the holders.
3.5. TRANSFER AND EXCHANGE
(a) Transfer and Exchange of Global Warrants.
A Global Warrant may not be transferred as a whole except by the
Depositary to a nominee of the Depositary, by a nominee of the Depositary to the
Depositary or to another nominee of the Depositary, or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor
Depositary. All Global Warrants will be exchanged by the Company for Definitive
Warrants if (i) the Company delivers to the Warrant Agent notice from the
Depositary that it is unwilling or unable to continue to act as Depositary or
that it is no longer a clearing agency registered under the Exchange Act and, in
either case, a successor Depositary is not appointed by the Company within 120
days after the date of such notice from the Depositary or (ii) the Company in
its sole discretion determines that the Global Warrants (in whole but not in
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part) should be exchanged for Definitive Warrants and delivers a written notice
to such effect to the Warrant Agent. Upon the occurrence of either of the
preceding events in (i), (ii) above, Definitive Warrants shall be issued in such
names as the Depositary shall instruct the Warrant Agent. Global Warrants also
may be exchanged or replaced, in whole or in part, as provided in Sections 3.6
and 3.7 hereof. A Global Warrant may not be exchanged for another Warrant other
than as provided in this Section 3.5(a), however, beneficial interests in a
Global Warrant may be transferred and exchanged as provided in Section 3.5(b) or
(c) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Warrants.
The transfer and exchange of beneficial interests in the Global
Warrants shall be effected through the Depositary, in accordance with the
provisions of this Warrant Agreement and the Applicable Procedures. Beneficial
interests in the Restricted Global Warrants shall be subject to restrictions on
transfer comparable to those set forth herein to the extent required by the
Securities Act. Transfers of beneficial interests in the Global Warrants also
shall require compliance with either subparagraph (i) or (ii) below, as
applicable, as well as one or more of the other following subparagraphs, as
applicable:
(i) Transfer of Beneficial Interests in the Same Global
Warrant. Beneficial interests in any Restricted Global Warrant may be
transferred to Persons who take delivery thereof in the form of a
beneficial interest in the same Restricted Global Warrant in
accordance with the transfer restrictions set forth in the Private
Placement Legend. Beneficial interests in any Unrestricted Global
Warrant may be transferred to Persons who take delivery thereof in
the form of a beneficial interest in an Unrestricted Global Warrant.
No written orders or instructions shall be required to be delivered
to the Warrant Registrar to effect the transfers described in this
Section 3.5(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial
Interests in Global Warrants. In connection with all transfers and
exchanges of beneficial interests that are not subject to Section
3.5(b)(i) above, the transferor of such beneficial interest must
deliver to the Warrant Registrar both (A) (1) a written order from a
Participant or an Indirect Participant given to the Depositary in
accordance with the Applicable Procedures directing the Depositary to
credit or cause to be credited a beneficial interest in another
Global Warrant in an amount equal to the beneficial interest to be
transferred or exchanged and (2) instructions given in accordance
with the Applicable Procedures containing information regarding the
Participant account to be credited with such increase or both (B) (1)
a written order from a Participant or an Indirect Participant given
to the Depositary in accordance with the Applicable Procedures
directing the Depositary to cause to be issued a Definitive Warrant
in an amount equal to the beneficial interest to be transferred or
exchanged and (2) instructions given by the Depositary to the Warrant
Registrar containing information regarding the Person in whose name
such Definitive Warrant shall be registered. Upon satisfaction of all
of the requirements for transfer or exchange of beneficial interests
in Global Warrants contained in this Agreement and the Warrants or
otherwise applicable under the Securities Act, the Warrant Agent
shall adjust the principal amount of the relevant Global Warrant(s)
pursuant to Section 3.5(g) hereof.
(iii) Transfer of Beneficial Interests to Another
Restricted Global Warrant. A beneficial interest in any Restricted
Global Warrant may be transferred to a Person who takes delivery
thereof in the form of a beneficial interest in another Restricted
Global Warrant if the transfer complies with the requirements of
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Section 3.5(b)(ii) above and the Warrant Registrar receives the
following:
(A) if the transferee will take delivery in the
form of a beneficial interest in the 000X Xxxxxx Xxxxxxx,
then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications in item
(1) thereof; and
(B) if the transferee will take delivery in the
form of a beneficial interest in the Regulation S Global
Warrant, then the transferor must deliver a certificate in
the form of Exhibit B hereto, including the certifications
in item (2) thereof, if
(C) if the transferee will take delivery in the
form of a beneficial interest in the IAI Global Warrant,
then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications and
certificates and Opinion of Counsel required by item (3)
thereof, if applicable.
(iv) Transfer and Exchange of Beneficial Interests in a
Restricted Global Warrant for Beneficial Interests in the
Unrestricted Global Warrant. A beneficial interest in any Restricted
Global Warrant may be exchanged by any holder thereof for a
beneficial interest in an Unrestricted Global Warrant or transferred
to a Person who takes delivery thereof in the form of a beneficial
interest in an Unrestricted Global Warrant if the exchange or
transfer complies with the requirements of Section 3.5(b)(ii) above
and the Warrant Registrar receives the following:
(A) if the holder of such beneficial interest
in a Restricted Global Warrant proposes to exchange such
beneficial interest for a beneficial interest in an
Unrestricted Global Warrant, a certificate from such
holder in the form of Exhibit C hereto, including the
certifications in item (1)(a) thereof; or
(B) if the holder of such beneficial interest
in a Restricted Global Warrant proposes to transfer such
beneficial interest to a Person who shall take delivery
thereof in the form of a beneficial interest in an
Unrestricted Global Warrant, a certificate from such
holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (iv), if the
Warrant Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to the
Warrant Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the Securities
Act.
If any such transfer is effected pursuant to subparagraph (iv) above
at a time when an Unrestricted Global Warrant has not yet been issued, the
Company shall issue and, upon receipt of an Warrant Countersignature Order in
accordance with Section 3.2 hereof, the Warrant Agent shall countersign one or
more Unrestricted Global Warrants in the number equal to the number of
beneficial interests transferred pursuant to subparagraph (iv) above.
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(c) Transfer and Exchange of Beneficial Interests for
Definitive Warrants.
(i) Beneficial Interests in Restricted Global Warrants to
Restricted Definitive Warrants. If any holder of a beneficial
interest in a Restricted Global Warrant proposes to exchange such
beneficial interest for a Restricted Definitive Warrant or to
transfer such beneficial interest to a Person who takes delivery
thereof in the form of a Restricted Definitive Warrant, then, upon
receipt by the Warrant Registrar of the following documentation:
(A) if the holder of such beneficial interest
in a Restricted Global Warrant proposes to exchange such
beneficial interest for a Restricted Definitive Warrant, a
certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (2)(a)
thereof;
(B) if such beneficial interest is being
transferred to a QIB in accordance with Rule 144A under
the Securities Act, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in item
(1) thereof;
(C) if such beneficial interest is being
transferred to a Non-U.S. Person in an offshore
transaction in accordance with Rule 903 or Rule 904 under
the Securities Act, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in item
(2) thereof;
(D) if such beneficial interest is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule
144 under the Securities Act, a certificate to the effect
set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if such beneficial interest is being
transferred to an Institutional Accredited Investor in
reliance on an exemption from the registration
requirements of the Securities Act other than those listed
in subparagraphs (B) through (D) above, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable; or
(F) if such beneficial interest is being
transferred to the Company or any of its Subsidiaries, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(b) thereof;
the Warrant Agent shall cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Warrant Agent, the number of
Warrants represented by the Global Warrant to be reduced by the number of
Warrants to be represented by the Definitive Warrant pursuant to Section 3.5(g)
hereof, and the Company shall execute and the Warrant Agent shall countersign
and deliver to the Person designated in the instructions a Definitive Warrant in
the appropriate amount. Any Definitive Warrant issued in exchange for a
beneficial interest in a Restricted Global Warrant pursuant to this Section
3.5(c) shall be registered in such name or names as the holder of such
beneficial interest shall instruct the Warrant Registrar through instructions
from the Depositary and the Participant or Indirect Participant. The Warrant
Agent shall deliver such Definitive Warrants to the Persons in whose names such
Warrants are so registered. Any Definitive Warrant issued in exchange for a
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beneficial interest in a Restricted Global Warrant pursuant to this Section
3.5(c)(i) shall bear the Private Placement Legend and shall be subject to all
restrictions on transfer contained therein.
(ii) Beneficial Interests in Restricted Global Warrants to
Unrestricted Definitive Warrants. A holder of a beneficial interest
in a Restricted Global Warrant may exchange such beneficial interest
for an Unrestricted Definitive Warrant or may transfer such
beneficial interest to a Person who takes delivery thereof in the
form of an Unrestricted Definitive Warrant only if the Warrant
Registrar receives the following:
(A) if the holder of such beneficial interest
in a Restricted Global Warrant proposes to exchange such
beneficial interest for an Unrestricted Definitive
Warrant, a certificate from such holder in the form of
Exhibit C hereto, including the certifications in item
(1)(b) thereof; or
(B) if the holder of such beneficial interest
in a Restricted Global Warrant proposes to transfer such
beneficial interest to a Person who shall take delivery
thereof in the form of an Unrestricted Definitive Warrant,
a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph
(ii), if the Warrant Registrar so requests or if the
Applicable Procedures so require, an Opinion of Counsel in
form reasonably acceptable to the Warrant Registrar to the
effect that such exchange or transfer is in compliance
with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement
Legend are no longer required in order to maintain
compliance with the Securities Act.
(iii) Beneficial Interests in Unrestricted Global Warrants
to Unrestricted Definitive Warrants. If any holder of a beneficial
interest in an Unrestricted Global Warrant proposes to exchange such
beneficial interest for a Definitive Warrant or to transfer such
beneficial interest to a Person who takes delivery thereof in the
form of a Definitive Warrant, then, upon satisfaction of the
conditions set forth in Section 3.5(b)(ii) hereof, the Warrant Agent
shall cause the amount of the applicable Global Warrant to be reduced
accordingly pursuant to Section 3.5(g) hereof, and the Company shall
execute and the Warrant Agent shall countersign and deliver to the
Person designated in the instructions a Definitive Warrant in the
appropriate principal amount. Any Definitive Warrant issued in
exchange for a beneficial interest pursuant to this Section
3.5(c)(iii) shall be registered in such name or names and in such
authorized denomination or denominations as the holder of such
beneficial interest shall instruct the Warrant Registrar through
instructions from the Depositary and the Participant or Indirect
Participant. The Warrant Agent shall deliver such Definitive Warrants
to the Persons in whose names such Warrants are so registered. Any
Definitive Warrant issued in exchange for a beneficial interest
pursuant to this Section 3.5(c)(iii) shall not bear the Private
Placement Legend.
(d) Transfer and Exchange of Definitive Warrants for
Beneficial Interests.
(i) Restricted Definitive Warrants to Beneficial Interests
in Restricted Global Warrants. If any holder of a Restricted
Definitive Warrant proposes to exchange such Warrant for a beneficial
interest in a Restricted Global Warrant or to transfer such
Restricted Definitive Warrants to a Person who takes delivery thereof
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in the form of a beneficial interest in a Restricted Global Warrant,
then, upon receipt by the Warrant Registrar of the following
documentation:
(A) if the holder of such Restricted Definitive
Warrant proposes to exchange such Warrant for a beneficial
interest in a Restricted Global Warrant, a certificate
from such holder in the form of Exhibit C hereto,
including the certifications in item (2)(b) thereof;
(B) if such Restricted Definitive Warrant is
being transferred to a QIB in accordance with Rule 144A
under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in
item (1) thereof;
(C) if such Restricted Definitive Warrant is
being transferred to a Non-U.S. Person in an offshore
transaction in accordance with Rule 903 or Rule 904 under
the Securities Act, a certificate to the effect set forth
in Exhibit B hereto, including the certifications in item
(2) thereof;
(D) if such Restricted Definitive Warrant is
being transferred pursuant to an exemption from the
registration requirements of the Securities Act in
accordance with Rule 144 under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Warrant is
being transferred to an Institutional Accredited Investor
in reliance on an exemption from the registration
requirements of the Securities Act other than those listed
in subparagraphs (B) through (D) above, a certificate to
the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable; or
(F) if such Restricted Definitive Warrant is
being transferred to the Company or any of its
Subsidiaries, a certificate to the effect set forth in
Exhibit B hereto, including the certifications in item
(3)(b) thereof;
the Warrant Agent shall cancel the Restricted Definitive Warrant,
increase or cause to be increased the amount of, in the case of
clause (A) above, the appropriate Restricted Global Warrant, in the
case of clause (B) above, the 000X Xxxxxx Xxxxxxx, in the case of
clause (C) above, the Regulation S Global Warrant, and in all other
cases, the IAI Global Warrant.
(ii) Restricted Definitive Warrants to Beneficial
Interests in Unrestricted Global Warrants. A holder of a Restricted
Definitive Warrant may exchange such Warrant for a beneficial
interest in an Unrestricted Global Warrant or transfer such
Restricted Definitive Warrant to a Person who takes delivery thereof
in the form of a beneficial interest in an Unrestricted Global
Warrant only if the Warrant Registrar receives the following:
(A) if the holder of such Definitive Warrants
proposes to exchange such Warrants for a beneficial
interest in the Unrestricted Global Warrant, a certificate
from such holder in the form of Exhibit C hereto,
including the certifications in item (1)(c) thereof; or
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(B) if the holder of such Definitive Warrants
proposes to transfer such Warrants to a Person who shall
take delivery thereof in the form of a beneficial interest
in the Unrestricted Global Warrant, a certificate from
such holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (ii), if the
Warrant Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to the
Warrant Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the Securities
Act.
Upon satisfaction of the conditions of any of the subparagraphs in
this Section 3.5(d)(ii), the Warrant Agent shall cancel the
Definitive Warrants and increase or cause to be increased the
aggregate principal amount of the Unrestricted Global Warrant.
(iii) Unrestricted Definitive Warrants to Beneficial
Interests in Unrestricted Global Warrants. A holder of an
Unrestricted Definitive Warrant may exchange such Warrant for a
beneficial interest in an Unrestricted Global Warrant or transfer
such Definitive Warrants to a Person who takes delivery thereof in
the form of a beneficial interest in an Unrestricted Global Warrant
at any time. Upon receipt of a request for such an exchange or
transfer, the Warrant Agent shall cancel the applicable Unrestricted
Definitive Warrant and increase or cause to be increased the amount
of one of the Unrestricted Global Warrants.
If any such exchange or transfer from a Definitive Warrant to a
beneficial interest is effected pursuant to subparagraphs (ii)(B) or
(iii) above at a time when an Unrestricted Global Warrant has not yet
been issued, the Company shall issue and, upon receipt of an Warrant
Countersignature Order in accordance with Section 3.2 hereof, the
Warrant Agent shall countersign one or more Unrestricted Global
Warrants in the number equal to the number of beneficial interests of
Definitive Warrants so transferred.
(e) Transfer and Exchange of Definitive Warrants for
Definitive Warrants.
Upon request by a holder of Definitive Warrants and such holder's
compliance with the provisions of this Section 3.5(e), the Warrant Registrar
shall register the transfer or exchange of Definitive Warrants. Prior to such
registration of transfer or exchange, the requesting holder shall present or
surrender to the Warrant Registrar the Definitive Warrants duly endorsed or
accompanied by a written instruction of transfer in form satisfactory to the
Warrant Registrar duly executed by such holder or by its attorney, duly
authorized in writing. In addition, the requesting holder shall provide any
additional certifications, documents and information, as applicable, required
pursuant to the following provisions of this Section 3.5(e).
(i) Restricted Definitive Warrants to Restricted
Definitive Warrants. Any Restricted Definitive Warrant may be
transferred to and registered in the name of Persons who take
delivery thereof in the form of a Restricted Definitive Warrant if
the Warrant Registrar receives the following:
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(A) if the transfer will be made pursuant to
Rule 144A, then the transferor must deliver a certificate
in the form of Exhibit B hereto, including the
certifications in item (1) thereof;
(B) if the transfer will be made pursuant to
Rule 903 or Rule 904, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications in item (2) thereof; or
(C) if the transfer will be made pursuant to
any other exemption from the registration requirements of
the Securities Act, then the transferor must deliver a
certificate in the form of Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel
required by item (3) thereof, if applicable.
(ii) Restricted Definitive Warrants to Unrestricted
Definitive Warrants. Any Restricted Definitive Warrant may be
exchanged by the holder thereof for an Unrestricted Definitive
Warrant or transferred to a Person or Persons who take delivery
thereof in the form of an Unrestricted Definitive Warrant if the
Warrant Registrar receives the following:
(A) if the holder of such Restricted Definitive
Warrants proposes to exchange such Warrants for an
Unrestricted Definitive Warrant, a certificate from such
holder in the form of Exhibit C hereto, including the
certifications in item (1)(d) thereof; or
(B) if the holder of such Restricted Definitive
Warrants proposes to transfer such Warrants to a Person
who shall take delivery thereof in the form of an
Unrestricted Definitive Warrant, a certificate from such
holder in the form of Exhibit B hereto, including the
certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (ii),
if the Warrant Registrar so requests, an Opinion of Counsel
in form reasonably acceptable to the Warrant Registrar to
the effect that such exchange or transfer is in compliance
with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement
Legend are no longer required in order to maintain
compliance with the Securities Act.
(iii) Unrestricted Definitive Warrants to Unrestricted
Definitive Warrants. A holder of Unrestricted Definitive Warrants may
transfer such Warrants to a Person who takes delivery thereof in the
form of an Unrestricted Definitive Warrant. Upon receipt of a request
to register such a transfer, the Warrant Registrar shall register the
Unrestricted Definitive Warrants pursuant to the instructions from
the holder thereof.
(f) Legends.
The following legends shall appear on the face of all Global Warrants
and Definitive Warrants issued under this Warrant Agreement unless specifically
stated otherwise in the applicable provisions of this Warrant Agreement.
(i) Private Placement Legend.
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(A) Except as permitted by subparagraph (B)
below, each Global Warrant and each Definitive Warrant
(and all Warrants issued in exchange therefor or
substitution thereof) shall bear the legend in
substantially the following form:
"THIS SECURITY AND THE WARRANT SHARES TO BE ISSUED UPON ITS EXERCISE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
SECURITY, THE WARRANT SHARES TO BE ISSUED UPON ITS EXERCISE NOR ANY
INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF
IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY AND THE WARRANT SHARES TO BE ISSUED UPON
ITS EXERCISE, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH SECURITY AND THE WARRANT SHARES TO BE ISSUED
UPON ITS EXERCISE, PRIOR TO THE DATE (THE "RESALE RESTRICTION
TERMINATION DATE"), WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH BARNEYS NEW
YORK, INC., INC. ("HOLDINGS") OR ANY AFFILIATE OF HOLDINGS WAS THE
OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY) ONLY (A)
TO BARNEY'S, INC., HOLDINGS OR ANY SUBSIDIARY THEREOF, (B) FOR SO
LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A,
TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
BUYER"' AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHICH NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (C) PURSUANT TO OFFERS AND SALES
TO NON-U.S. PURCHASERS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN
THE MEANING OF REGULATION S UNDER THE SECURITIES ACT, (D) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF
SUBPARAGRAPH (A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES
ACT THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE
ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED INVESTOR, FOR INVESTMENT
PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN CONNECTION
WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT, (E)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT, OR (F) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT TO HOLDINGS RIGHT PRIOR TO ANY SUCH OFFER,
SALE OR TRANSFER PURSUANT TO CLAUSE (D) OR (F) TO REQUIRE THE
DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO IT, AND IN EACH OF THE FOREGOING CASES, A
CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF
THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER
AFTER THE RESALE RESTRICTION TERMINATION DATE.
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THE HOLDER OF THIS SECURITY AND THE WARRANT SHARES TO BE ISSUED UPON
ITS EXERCISE, BY ITS ACCEPTANCE HEREOF, AGREES NOT TO ENGAGE IN ANY
HEDGING TRANSACTION UNLESS IN COMPLIANCE WITH THE SECURITIES ACT.
THE HOLDER OF THIS SECURITY AND THE WARRANT SHARES TO BE ISSUED UPON
ITS EXERCISE, BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL DELIVER
TO EACH PERSON TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THESE LEGENDS AND
AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR
AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND."
(B) Notwithstanding the foregoing, any Global
Warrant or Definitive Warrant issued pursuant to
subparagraphs (b)(iv), (c)(ii), (c)(iii), (d)(ii),
(d)(iii), (e)(ii), (e)(iii) or (f) to this Section 3.5
(and all Warrants issued in exchange therefor or
substitution thereof) shall not bear the Private Placement
Legend.
(ii) Global Warrant Legend. Each Global Warrant shall bear
a legend in substantially the following form:
"THIS GLOBAL WARRANT IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
WARRANT AGREEMENT GOVERNING THIS WARRANT) OR ITS NOMINEE IN CUSTODY
FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT
TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I)
THE WARRANT AGENT MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 3.5 OF THE WARRANT AGREEMENT, (II) THIS GLOBAL
WARRANT MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION
3.5(a) OF THE WARRANT AGREEMENT, (III) THIS GLOBAL WARRANT MAY BE
DELIVERED TO THE WARRANT AGENT FOR CANCELLATION PURSUANT TO SECTION
3.8 OF THE WARRANT AGREEMENT AND (IV) THIS GLOBAL WARRANT MAY BE
TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT
OF THE COMPANY."
(iii) Unit Legend. Each Warrant issued prior to the
Separation Date shall bear a legend in substantially the following
form:
"THE SECURITY EVIDENCED BY THIS CERTIFICATE IS INITIALLY ISSUED AS
PART OF AN ISSUANCE OF UNITS (THE "UNITS"), EACH OF WHICH CONSISTS OF
$1,000 PRINCIPAL AMOUNT AT MATURITY OF THE 9.000% SENIOR SECURED
NOTES DUE 2008 (THE "NOTES") OF BARNEY'S, INC. AND ONE WARRANT TO
PURCHASE SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE, OF
BARNEYS NEW YORK, INC.
PRIOR TO THE EARLIEST TO OCCUR OF (I) 180 DAYS AFTER THE CLOSING OF
THE OFFERING OF THE UNITS, (II) THE DATE ON WHICH A REGISTRATION
STATEMENT WITH RESPECT TO A REGISTERED EXCHANGE OFFER FOR THE NOTES
IS DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (III) THE DATE A
SHELF REGISTRATION STATEMENT WITH RESPECT TO THE WARRANT SHARES IS
15
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, AND (IV) SUCH DATE AS
XXXXXXXXX & COMPANY, INC. IN ITS SOLE DISCRETION SHALL DETERMINE, THE
DATE WE MAIL THE REQUISITE NOTICE TO THE HOLDERS, THE SECURITY
EVIDENCED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED OR EXCHANGED
SEPARATELY FROM, BUT MAY BE TRANSFERRED OR EXCHANGED ONLY AS A UNIT."
(iv) Regulation S. Legend. Each Warrant that is a
Registrable Security and issued pursuant to Regulation S shall bear
the following legend on the face thereof:
"THIS WARRANT AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT AND THE WARRANT MAY NOT
BE EXERCISED BY OR ON BEHALF OF ANY U.S. PERSON UNLESS REGISTERED
UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT") OR AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. IN ORDER
TO EXERCISE THIS WARRANT, THE HOLDER MUST FURNISH TO THE COMPANY AND
THE WARRANT AGENT EITHER (A) A WRITTEN CERTIFICATION THAT IT IS NOT A
U.S. PERSON AND THE WARRANT IS NOT BEING EXERCISED ON BEHALF OF A
U.S. PERSON OR (B) A WRITTEN OPINION OF COUNSEL TO THE EFFECT THAT
THE SECURITIES DELIVERED UPON EXERCISE OF THE WARRANT HAVE BEEN
REGISTERED UNDER THE SECURITIES ACT OR THAT THE DELIVERY OF SUCH
SECURITIES IS EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. TERMS IN THIS LEGEND HAVE THE MEANINGS GIVEN TO THEM
BY REGULATION S UNDER THE SECURITIES ACT."
(g) Cancellation and/or Adjustment of Global Warrants.
At such time as all beneficial interests in a particular Global
Warrant have been exercised or exchanged for Definitive Warrants or a particular
Global Warrant has been exercised, redeemed, repurchased or canceled in whole
and not in part, each such Global Warrant shall be returned to or retained and
canceled by the Warrant Agent in accordance with Section 3.8 hereof. At any time
prior to such cancellation, if any beneficial interest in a Global Warrant is
exercised or exchanged for or transferred to a Person who will take delivery
thereof in the form of a beneficial interest in another Global Warrant or for
Definitive Warrants, the amount of Warrants represented by such Global Warrant
shall be reduced accordingly and an endorsement shall be made on such Global
Warrant by the Warrant Agent or by the Depositary at the direction of the
Warrant Agent to reflect such reduction; and if the beneficial interest is being
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Warrant, such other Global
Warrant shall be increased accordingly and an endorsement shall be made on such
Global Warrant by the Warrant Agent or by the Depositary at the direction of the
Warrant Agent to reflect such increase.
(h) General Provisions Relating to Transfers and
Exchanges.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Warrant Agent shall countersign Global
Warrants and Definitive Warrants upon the Company's order or at the
Warrant Registrar's request.
16
(ii) No service charge shall be made to a holder of a
beneficial interest in a Global Warrant or to a holder of a
Definitive Warrant for any registration of transfer or exchange, but
the Company may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection
therewith.
(iii) All Global Warrants and Definitive Warrants issued
upon any registration of transfer or exchange of Global Warrants or
Definitive Warrants shall be the duly authorized, executed and issued
warrants for Common Stock of the Company, not subject to any
preemptive rights, and entitled to the same benefits under this
Warrant Agreement, as the Global Warrants or Definitive Warrants
surrendered upon such registration of transfer or exchange.
(iv) Prior to due presentment for the registration of a
transfer of any Warrant, the Warrant Agent, and the Company may deem
and treat the Person in whose name any Warrant is registered as the
absolute owner of such Warrant for all purposes and none of the
Warrant Agent, or the Company shall be affected by notice to the
contrary.
(v) The Warrant Agent shall countersign Global Warrants and
Definitive Warrants in accordance with the provisions of Section 3.2
hereof.
(i) Facsimile Submissions to Warrant Agent.
All certifications, certificates and Opinions of Counsel required to
be submitted to the Warrant Registrar pursuant to this Section 3.5 to effect a
registration of transfer or exchange may be submitted by facsimile.
Notwithstanding anything herein to the contrary, as to any
certificates and/or certifications delivered to the Warrant Registrar pursuant
to this Section 3.5, the Warrant Registrar's duties shall be limited to
confirming that any such certifications and certificates delivered to it are in
the form of Exhibits B and C attached hereto. The Warrant Registrar shall not be
responsible for confirming the truth or accuracy of representations made in any
such certifications or certificates. As to any Opinions of Counsel delivered
pursuant to this Section 3.5, the Warrant Registrar may rely upon, and be fully
protected in relying upon, such opinions.
3.6. REPLACEMENT WARRANTS
If any mutilated Warrant is surrendered to the Warrant Agent or the
Company and the Warrant Agent receives evidence to its satisfaction of the
destruction, loss or theft of any Warrant, the Company shall issue and the
Warrant Agent, upon receipt of a Warrant Countersignature Order, shall
countersign a replacement Warrant if the Warrant Agent's requirements are met.
If required by the Warrant Agent or the Company, an indemnity bond must be
supplied by the holder that is sufficient in the judgment of the Warrant Agent
and the Company to protect the Company, the Warrant Agent, any Agent and any
agent for purposes of the countersignature from any loss that any of them may
suffer if a Warrant is replaced. The Company may charge for its expenses in
replacing a Warrant.
Every replacement Warrant is an additional warrant of the Company and
shall be entitled to all of the benefits of this Warrant Agreement equally and
proportionately with all other Warrants duly issued hereunder.
17
3.7. TEMPORARY WARRANTS
Until certificates representing Warrants are ready for delivery, the
Company may prepare and the Warrant Agent, upon receipt of a Warrant
Countersignature Order, shall issue temporary Warrants. Temporary Warrants shall
be substantially in the form of certificated Warrants but may have variations
that the Company considers appropriate for temporary Warrants and as shall be
reasonably acceptable to the Warrant Agent. Without unreasonable delay, the
Company shall prepare and the Warrant Agent shall countersign definitive
Warrants in exchange for temporary Warrants.
Holders of temporary Warrants shall be entitled to all of the
benefits of this Warrant Agreement.
3.8. CANCELLATION
Subject to Section 3.5(g) hereof, the Company at any time may deliver
Warrants to the Warrant Agent for cancellation. The Warrant Registrar and
Warrant Paying Agent shall forward to the Warrant Agent any Warrants surrendered
to them for registration of transfer, exchange or exercise. The Warrant Agent
and no one else shall cancel all Warrants surrendered for registration of
transfer, exchange, exercise, replacement or cancellation and shall destroy
canceled Warrants (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all canceled Warrants shall be
delivered to the Company. The Company may not issue new Warrants to replace
Warrants that have been exercised or that have been delivered to the Warrant
Agent for cancellation.
SECTION 4. SEPARATION OF WARRANTS; EXERCISE OF WARRANTS; TERMS OF
WARRANTS
(a) The Notes and Warrants will not be separately transferable until
the Separation Date. Subject to the terms of this Agreement, each Warrant holder
shall have the right, which may be exercised during the period commencing at the
opening of business on the Separation Date and until 5:00 p.m., New York City
time on April 1, 2008 (the "EXERCISE PERIOD"), to receive from the Company the
number of fully paid and nonassessable Warrant Shares which the holder may at
the time be entitled to receive on exercise of such Warrants and payment of the
Exercise Price (i) in cash, by wire transfer or by certified or official bank
check payable to the order of the Company, (ii) by tendering Notes having an
Accreted Value (as defined in the Indenture) at the time of tender equal to the
Exercise Price then in effect, (iii) by tendering Warrants as set forth below or
(iv) any combination of cash, Notes or Warrants. Each holder may elect, upon
exercise of its Warrants during the Exercise Period, to receive Warrant Shares
on a net basis, such that, without the exchange of any funds, the holder will
receive such number of Warrant Shares as shall equal the product of (A) the
number of Warrant Shares for which such Warrant is exercisable as of the date of
exercise (if the Exercise Price were being paid in cash) and (B) the Cashless
Exercise Ratio. The "CASHLESS EXERCISE RATIO" shall equal a fraction the
numerator of which is the Market Value (as defined below) per share of Common
Stock minus the Exercise Price per share as of the date of exercise and the
denominator of which is the Market Value per share on the date of exercise. Each
Warrant not exercised prior to 5:00 p.m., New York City time, on April 1, 2008
(the "EXPIRATION DATE") shall become void and all rights thereunder and all
rights in respect thereof under this agreement shall cease as of such time. The
Warrant Agent shall have no obligation to calculate the Cashless Exercise Ratio.
No adjustments as to dividends will be made upon exercise of the Warrants.
18
The "MARKET VALUE" per share of Common Stock as of any date shall
equal (i) if Common Stock is primarily traded on a securities exchange, the last
sale price on such securities exchange on the trading day immediately prior to
the date of determination, or if no sale occurred on such day, the mean between
the closing "bid" and "asked" prices on such day, (ii) if the principal market
for Common Stock is in the over-the-counter market, the closing sale price on
the trading day immediately prior to the date of the determination, as published
by the National Association of Securities Dealers Automated Quotation System or
similar organization, or if such price is not so published on such day, the mean
between the closing "bid" and "asked" prices, if available, on such day, which
prices may be obtained from any reputable pricing service, broker or dealer, and
(iii) if neither clause (i) nor clause (ii) is applicable, the fair market value
on the date of determination of Common Stock as determined in good faith by the
Board of Directors of the Company.
(b) In order to exercise all or any of the Warrants represented by a
Warrant Certificate, (i) in the case of a Definitive Warrant, the holder thereof
must surrender upon exercise the Warrant Certificate to the Company at the
corporate trust office of the Warrant Agent set forth in Section 15 hereof, (ii)
in the case of a book-entry interest in a Global Warrant, the exercising
Participant whose name appears on a securities position listing of the
Depositary as the holder of such book-entry interest must comply with the
Depositary's procedures relating to the exercise of such book-entry interest in
such Global Warrant and (iii) in the case of interests in both Global Warrants
and Definitive Warrants, the holder thereof or the Participant, as applicable,
shall deliver to the Company at the corporate trust office of the Warrant Agent
the form of election to purchase on the reverse thereof duly completed and
signed, which signature shall be medallion guaranteed by an institution which is
a member of a Securities Transfer Association recognized signature guarantee
program, and upon payment to the Warrant Agent for the account of the Company of
the Exercise Price, for the number of Warrant Shares in respect of which such
Warrants are then exercised. Payment of the aggregate Exercise Price shall be
made in accordance with Section 4(a) hereof.
(c) Subject to the provisions of Section 5 hereof, upon compliance
with clause (b) above, the Company shall deliver or cause to be delivered with
all reasonable dispatch, to or to the written order of the holder and in such
name or names as the holder may designate, a certificate or certificates for the
number of whole Warrant Shares issuable upon the exercise of such Warrants or
other securities or property to which such holder is entitled hereunder,
together with cash as provided in Section 9 hereof; provided that if any
consolidation, merger or lease or sale of assets is proposed to be effected by
the Company or its subsidiaries as described in Section 8(m) hereof, or a tender
offer or an exchange offer for shares of Common Stock shall be made, upon such
surrender of Warrants and payment of the Exercise Price in accordance with
clause (b) above, the Company shall, as soon as possible, but in any event not
later than two business days thereafter, deliver or cause to be delivered the
full number of Warrant Shares issuable upon the exercise of such Warrants in the
manner described in this sentence or other securities or property to which such
holder is entitled hereunder, together with cash as provided in Section 9
hereof. Such certificate or certificates shall be deemed to have been issued and
any Person so designated to be named therein shall be deemed to have become a
holder of record of such Warrant Shares as of the date of the surrender of such
Warrants and payment of the Exercise Price.
(d) The Warrants shall be exercisable, at the election of the holders
thereof, either in full. If less than all the Warrants represented by a Warrant
Certificate are exercised, such Warrant Certificate shall be surrendered and a
new Warrant Certificate of the same tenor and for the number of Warrants which
were not exercised shall be executed by the Company and delivered to the Warrant
Agent and the Warrant Agent shall countersign the new Warrant Certificate,
19
registered in such name or names as may be directed in writing by the holder,
and shall deliver or cause to be delivered the new Warrant Certificate to the
Person or Persons entitled to receive the same.
(e) All Warrant Certificates surrendered upon exercise of Warrants
shall be cancelled by the Warrant Agent. Such cancelled Warrant Certificates
shall then be disposed of by the Warrant Agent in a manner satisfactory to the
Company. The Warrant Agent shall report promptly to the Company with respect to
Warrants exercised and concurrently pay to the Company all monies received by
the Warrant Agent for the purchase of the Warrant Shares through the exercise of
such Warrants.
(f) The Warrant Agent shall keep copies of this Agreement and any
notices given or received hereunder available for inspection by the holders
during normal business hours at its office. The Company shall supply the Warrant
Agent from time to time with such numbers of copies of this Agreement as the
Warrant Agent may request.
SECTION 5. PAYMENT OF TAXES
The Company shall pay all documentary stamp taxes attributable to the
initial issuance of Warrant Shares upon the exercise of Warrants; provided that
the Company shall not be required to pay any tax or taxes which may be payable
in respect of any transfer involved in the issue of any Warrant Certificates or
any certificates for Warrant Shares in a name other than that of the registered
holder of a Warrant Certificate surrendered upon the exercise of a Warrant, and
the Company shall not be required to issue or deliver such Warrant Certificates
unless or until the Person or Persons requesting the issuance thereof shall have
paid to the Company the amount of such tax or shall have established to the
satisfaction of the Company that such tax has been paid.
SECTION 6. RESERVATION OF WARRANT SHARES
(a) The Company shall at all times reserve and keep available, free
from preemptive rights, out of the aggregate of its authorized but unissued
Common Stock or the authorized and issued Common Stock held in its treasury, for
the purpose of enabling it to satisfy any obligation to issue Warrant Shares
upon exercise of Warrants, the maximum number of shares of Common Stock which
may then be deliverable upon the exercise of all outstanding Warrants.
(b) The Company or, if appointed, the transfer agent for the Common
Stock (the "TRANSFER AGENT") and every subsequent transfer agent for any shares
of the Company's capital stock issuable upon the exercise of any of the rights
of purchase aforesaid will be irrevocably authorized and directed at all times
to reserve such number of authorized shares as shall be required for such
purpose. The Company shall keep a copy of this Agreement on file with the
Transfer Agent and with every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the exercise of the rights of purchase
represented by the Warrants. The Warrant Agent is hereby irrevocably authorized
to requisition from time to time from such Transfer Agent the stock certificates
required to honor outstanding Warrants upon exercise thereof in accordance with
the terms of this Agreement. The Company shall supply such Transfer Agent with
duly executed certificates for such purposes and shall provide or otherwise make
available any cash which may be payable as provided in Section 9 hereof. The
Company shall furnish such Transfer Agent a copy of all notices of adjustments,
and certificates related thereto, transmitted to each holder pursuant to Section
11 hereof.
20
(c) Before taking any action which would cause an adjustment pursuant
to Section 8 hereof to reduce the Exercise Price below the then par value (if
any) of the Warrant Shares, the Company shall take any corporate action which
may, in the opinion of its counsel (which may be counsel employed by the
Company), be necessary in order that the Company may validly and legally issue
fully paid and nonassessable Warrant Shares at the Exercise Price as so
adjusted.
(d) The Company covenants that all Warrant Shares which may be issued
upon exercise of Warrants shall, upon issue, be fully paid, nonassessable, free
of preemptive rights and free from all taxes, liens, charges and security
interests with respect to the issuance thereof.
SECTION 7. OBTAINING STOCK EXCHANGE LISTINGS.
The Company shall from time to time take all action which may be
necessary so that the Warrant Shares, immediately upon their issuance upon the
exercise of Warrants, will be listed on a principal securities exchange,
automated quotation system or other market within the United States of America,
if any, on which other shares of Common Stock are then listed, if any.
SECTION 8. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES
ISSUABLE
The Exercise Price and the number of Warrant Shares issuable upon the
exercise of each Warrant shall be subject to adjustment from time to time upon
the occurrence of the events enumerated in this Section 8; provided that in no
event shall the Exercise Price be less than $0.01 per share of Common Stock. For
purposes of this Section 8, "COMMON STOCK" means shares now or hereafter
authorized of any class of common stock of the Company and any other stock of
the Company, however designated, that has the right (subject to any prior rights
of any class or series of preferred stock) to participate in any distribution of
the assets or earnings of the Company without limit as to per share amount.
In addition to the adjustments required under this Section 8, the
Company may, at any time reduce the Exercise Price to any amount greater than or
equal to $0.01 per share for any period of time (but not less than 20 Business
Days) deemed appropriate by the Board of Directors of the Company.
(a) Adjustment for Change in Capital Stock.
If the Company (i) pays a dividend or makes a distribution on its
Common Stock payable in shares of its Common Stock, (ii) subdivides its
outstanding shares of Common Stock into a greater number of shares, (iii)
combines its outstanding shares of Common Stock into a smaller number of shares,
(iv) makes a distribution on its Common Stock in shares of its capital stock
other than Common Stock or (v) issues by reclassification of its Common Stock
any shares of its capital stock, then the Exercise Price in effect immediately
prior to such action shall, subject to the proviso to the first sentence of the
first paragraph of this Section 8, be proportionately adjusted so that the
holder of any Warrant thereafter exercised may receive the aggregate number and
kind of shares of capital stock of the Company which such holder would have
owned immediately following such action assuming the exercise of such Warrant
immediately prior to such action.
The adjustment shall become effective immediately after the record
date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
21
If, after an adjustment, a holder of a Warrant upon exercise of it may receive
shares of two or more classes of capital stock of the Company, the Company shall
determine, in good faith, the allocation of the adjusted Exercise Price between
the classes of capital stock. After such allocation, the exercise privilege and
the Exercise Price of each class of capital stock shall thereafter be subject to
adjustment on terms comparable to those applicable to Common Stock in this
Section 8. Such adjustment shall be made successively whenever any event listed
above shall occur.
(b) Adjustment for Rights Issue.
If the Company distributes any rights, options or warrants to all
holders of its Common Stock entitling them for a period expiring within 45 days
after the record date set forth below to subscribe for shares of Common Stock or
securities convertible into, or exchangeable or exercisable for, shares of
Common Stock, in either case, at a price per share less than the Fair Value (as
defined in subsection (g) of this Section 8) per share on that record date, the
Exercise Price shall be adjusted in accordance with the formula:
O + N x P
-----
E' = E x M
------------------
O + N
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
O = the number of shares of Common Stock
outstanding on the record date.
N = the number of additional shares of Common Stock
issued pursuant to such rights, options or
warrants.
P = the aggregate price per share of the additional
shares.
M = the Fair Value per share of Common Stock on the
record date.
The adjustment shall be made successively whenever any such rights,
options or warrants are issued and shall become effective immediately after the
record date for the determination of stockholders entitled to receive the
rights, options or warrants. If at the end of the period during which such
rights, options or warrants are exercisable, not all rights, options or warrants
shall have been exercised, the Exercise Price shall be immediately readjusted to
what it would have been if "N" in the above formula had been the number of
shares actually issued.
(c) Adjustment for Other Distributions.
If the Company distributes to all holders of its Common Stock any of
its assets (including cash), debt securities, preferred stock or any rights or
warrants to purchase assets (including cash), debt securities, preferred stock
22
or other securities of the Company, the Exercise Price shall be adjusted in
accordance with the formula:
M - F
E' = E x ----------------
M
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
M = the Fair Value per share of Common Stock on the
record date mentioned below.
F = the fair market value on the record date of the
debt securities, preferred stock, assets,
securities, rights or warrants to be
distributed in respect of one share of Common
Stock as determined in good faith by the Board
of Directors of the Company.
The adjustment shall be made successively whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the distribution.
This Section 8(c) shall not apply to cash dividends or other cash
distributions paid out of consolidated current or retained earnings as shown on
the books of the Company prepared in accordance with generally accepted
accounting principles. In addition, this Section 8(c) shall not apply to rights,
options or warrants referred to in Section 8(b) hereof.
(d) Adjustment for Common Stock Issue.
If the Company issues shares of Common Stock for a consideration per
share less than the Fair Value per share on the date the Company fixes the
offering price of such additional shares, the Exercise Price shall be adjusted
in accordance with the formula:
P
---
E' = E x O + M
-----------
A
where:
E' = the adjusted Exercise Price.
E = the then current Exercise Price.
23
O = the number of shares outstanding immediately
prior to the issuance of such additional
shares.
P = the aggregate consideration received for the
issuance of such additional shares.
M = the Fair Value per share on the date of
issuance of such additional shares.
A = the number of shares outstanding immediately
after the issuance of such additional shares.
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
This subsection (d) shall not apply to:
(1) any of the transactions described in subsections (a),
(b) and (c) of this Section 8,
(2) the exercise of Warrants, or the conversion, exchange
or exercise of other securities convertible into or exchangeable or
exercisable for Common Stock the issuance of which requires an
adjustment to be made under Section 8(e),
(3) the issuance of Common Stock (and options exercisable
therefore) to employees, officers or directors of the Company or its
subsidiaries under bona fide employee benefit plans adopted by the
Board of Directors and approved by the holders of Common Stock when
required by law, if such Common Stock would otherwise be covered by
this subsection (d) (but only to the extent that the aggregate number
of shares excluded hereby and issued after the date of this Warrant
Agreement shall not exceed 5% of the Common Stock outstanding at the
time of the adoption of each such plan, exclusive of anti-dilution
adjustments thereunder),
(4) the issuance of Common Stock to shareholders of any
Person which merges into the Company, or with a subsidiary of the
Company, in proportion to their stock holdings of such person
immediately prior to such merger, upon such merger, provided that if
such Person is an Affiliate of the Company, the Board of Directors
shall have obtained a fairness opinion from a nationally recognized
investment banking, appraisal or valuation firm, which is not an
Affiliate of the Company, stating that the consideration received in
such merger is fair to the Company from a financial point of view,
(5) the issuance of securities upon the conversion,
exchange or exercise of other securities, warrants, options or
similar rights if the conversion, exchange or exercise price is not
less than the Fair Value per share of Common Stock at the time the
security, warrant, option or right so converted, exchanged or
exercised was issued or granted, or
(6) the issuance of shares of Common Stock pursuant to
rights, options or warrants which were originally issued in a
Non-Affiliate Sale (as defined below) together with one or more other
securities as part of a unit at a price per unit.
24
(e) Adjustment for Convertible Securities Issue.
If the Company issues any securities convertible into or exchangeable
or exercisable for Common Stock (other than securities issued in transactions
described in subsections (a), (b) and (c) of this Section 8) for a consideration
per share of Common Stock initially deliverable upon conversion, exchange or
exercise of such securities less than the Fair Value per share on the date of
issuance of such securities, the Exercise Price shall be adjusted in accordance
with the formula:
P
---
O + M
E' = E x ---------------
O + D
where:
E' = the adjusted Exercise Price.
E = the then current Exercise Price.
O = the number of shares outstanding immediately
prior to the issuance of such securities.
P = the aggregate consideration received for the
issuance of such securities.
M = the Fair Value per share on the date of
issuance of such securities.
D = the maximum number of shares deliverable upon
conversion or in exchange for such securities
at the initial conversion, exchange or exercise
rate.
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
If all of the Common Stock deliverable upon conversion, exchange or
exercise of such securities have not been issued when such securities are no
longer outstanding, then the Exercise Price shall promptly be readjusted to the
Exercise Price which would then be in effect had the adjustment upon the
issuance of such securities been made on the basis of the actual number of
shares of Common Stock issued upon conversion, exchange or exercise of such
securities.
This subsection (e) shall not apply to convertible securities issued
to shareholders of any Person which merges into the Company, or with a
subsidiary of the Company, in proportion to their stock holdings of such person
immediately prior to such merger, upon such merger, provided that if such Person
is an Affiliate of the Company, the Board of Directors shall have obtained a
fairness opinion from a nationally recognized investment banking, appraisal or
valuation firm, which is not an Affiliate of the Company, stating that the
consideration received in such merger is fair to the Company from a financial
point of view.
25
(f) Consideration Received.
For purposes of any computation respecting consideration received
pursuant to subsections (d) and (e) of this Section 8, the following shall
apply:
(1) in the case of the issuance of shares of Common Stock
for cash, the consideration shall be the amount of such cash,
provided that in no case shall any deduction be made for any
commissions, discounts or other expenses incurred by the Company for
any underwriting of the issue or otherwise in connection therewith;
(2) in the case of the issuance of shares of Common Stock
for a consideration in whole or in part other than cash, the
consideration other than cash shall be deemed to be the fair market
value thereof as determined in good faith by the Board of Directors
(irrespective of the accounting treatment thereof), whose
determination shall be conclusive, and described in a Board
resolution which shall be filed with the Warrant Agent;
(3) in the case of the issuance of securities convertible
into or exchangeable or exercisable for shares, the aggregate
consideration received therefor shall be deemed to be the
consideration received by the Company for the issuance of such
securities plus the additional minimum consideration, if any, to be
received by the Company upon the conversion, exchange or exercise
thereof (the consideration in each case to be determined in the same
manner as provided in clauses (1) and (2) of this subsection (f));
and
(4) in the case of the issuance of shares of Common Stock
pursuant to rights, options or warrants which rights, options or
warrants were originally issued together with one or more other
securities as part of a unit at a price per unit, the consideration
shall be deemed to be the fair value of such rights, options or
warrants at the time of issuance thereof as determined in good faith
by the Board of Directors whose determination shall be conclusive and
described in a Board resolution which shall be filed with the Warrant
Agent plus the additional minimum consideration, if any, to be
received by the Company upon the exercise, conversion or exchange
thereof (as determined in the same manner as provided in clauses (1)
and (2) of this subsection (f)).
(g) Fair Value.
For purposes of Sections 8 (b), (c), (d) and (e) hereof, the "FAIR
VALUE" per share of Common Stock at any date of determination shall be (1) in
connection with a sale by the Company to a party that is not an Affiliate of the
Company in an arm's-length transaction (a "NON-AFFILIATE SALE"), the price per
security at which such security is sold and (2) in connection with any sale by
the Company to an Affiliate of the Company, (a) the last price per security at
which such security was sold in a Non-Affiliate Sale within the three-month
period preceding such date of determination and (b), if clause (a) is not
applicable, the fair market value of such security determined in good faith by
(i) a majority of the Board of Directors of the Company, including a majority of
the Disinterested Directors, and approved in a Board resolution delivered to the
Warrant Agent or (ii) a nationally recognized investment banking, appraisal or
26
valuation firm, which is not an Affiliate of the Company, in each case, taking
into account, among all other factors deemed relevant by the Board of Directors
or such investment banking, appraisal or valuation firm, the trading price and
volume of such security on any national securities exchange or automated
quotation system on which such security is traded.
For purposes of this Section 8(g), "DISINTERESTED DIRECTOR" means, in
connection with any issuance of securities that gives rise to a determination of
the Fair Value thereof, each member of the Board of Directors who is not an
officer, employee, director or other Affiliate of the party to whom the Company
is proposing to issue the securities giving rise to such determination.
For purposes of this Section 8(g), "AFFILIATE" of any specified
Person means (A) any other Person directly or indirectly controlling or
controlled by or under direct or indirect common control with such specified
Person and (B) any director, officer or employee of such specified Person. For
purposes of this definition "CONTROL" (including, with correlative meanings, the
terms "CONTROLLING," "CONTROLLED BY" and "UNDER COMMON CONTROL WITH") as used
with respect to any Person, shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of
such Person, whether through the ownership of voting securities, by agreement or
otherwise.
(h) When De Minimis Adjustment May Be Deferred.
No adjustment in the Exercise Price need be made unless the
adjustment would require an increase or decrease of at least 1% in the Exercise
Price. Any adjustments that are not made shall be carried forward and taken into
account in any subsequent adjustment. All calculations under this Section 8
shall be made to the nearest cent or to the nearest 1/100th of a share, as the
case may be, it being understood that no such rounding shall be made under
subsection (p).
(i) When No Adjustment Required.
With respect to Warrants of any holder, no adjustment need be made
for a transaction referred to Section 8(a), (b), (c), (d), (e) or (f) hereof, if
such holder is to participate (without being required to exercise its Warrants)
in the transaction on a basis and with notice that the Board of Directors
determines to be fair and appropriate in light of the basis and notice on which
holders of Common Stock participate in the transaction. No adjustment need be
made for (i) rights to purchase Common Stock pursuant to a Company plan for
reinvestment of dividends or interest or (ii) a change in the par value or no
par value of the Common Stock. To the extent the Warrants become convertible
into cash, no adjustment need be made thereafter as to the cash. Interest will
not accrue on the cash.
(j) Notice of Adjustment.
Whenever the Exercise Price is adjusted, the Company shall provide
the notices required by Section 10 hereof.
(k) Reorganization of Company.
Immediately after the date hereof, if the Company consolidates or
merges with or into, or transfers or leases all or substantially all its assets
to, any Person, upon consummation of such transaction the Warrants shall
automatically become exercisable for the kind and amount of securities, cash or
other assets which the holder of a Warrant would have owned immediately after
the consolidation, merger, transfer or lease if the holder had exercised the
Warrant immediately before the effective date of the transaction. Concurrently
27
with the consummation of such transaction, the corporation formed by or
surviving any such consolidation or merger if other than the Company, or the
Person to which such sale or conveyance shall have been made, shall enter into
(i) a supplemental 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 this Section 8(l) and (ii) a supplement to the
Equity Registration Rights Agreement providing for the assumption of the
Company's obligations thereunder. The successor Company shall mail to Warrant
holders a notice describing the supplemental Warrant Agreement and Equity
Registration Rights Agreement. If the issuer of securities deliverable upon
exercise of Warrants under the supplemental Warrant Agreement is an Affiliate of
the formed, surviving, transferee or lessee corporation, such issuer shall join
in the supplemental Warrant Agreement and Equity Registration Rights Agreement.
If this Section 8(l) shall be applicable, Sections 8(a), (b), (c), (d), (e) and
(f) hereof shall not be applicable.
(l) Company Determination Final.
Any determination that the Company or the Board of Directors must
make pursuant to Section 8(a), (c), (d), (e), (f), (g), (h) or (i) hereof is
conclusive.
(m) Warrant Agent's Disclaimer.
The Warrant Agent shall have no duty to determine when an adjustment
under this Section 8 should be made, how it should be made or what it should be.
The Warrant Agent shall have no duty to determine whether a supplement warrant
agreement under Section 8(k) need be entered into or whether any provisions of a
supplemental Warrant Agreement under Section 8(l) hereof are correct. The
Warrant Agent makes no representation as to the validity or value of any
securities or assets issued upon exercise of Warrants. The Warrant Agent shall
not be responsible for the Company's failure to comply with this Section 8.
(n) When Issuance or Payment May Be Deferred.
In any case in which this Section 8 shall require that an adjustment
in the Exercise Price be made effective as of a record date for a specified
event, the Company may elect to defer until the occurrence of such event (i)
issuing to the holder of any Warrant exercised after such record date the
Warrant Shares and other capital stock of the Company, if any, issuable upon
such exercise over and above the Warrant Shares and other capital stock of the
Company, if any, issuable upon such exercise on the basis of the Exercise Price
and (ii) paying to such holder any amount in cash in lieu of a fractional share
pursuant to Section 10 hereof; provided that the Company shall deliver to such
holder a due xxxx or other appropriate instrument evidencing such holder's right
to receive such additional Warrant Shares, other capital stock and cash upon the
occurrence of the event requiring such adjustment.
(o) Adjustment in Number of Shares.
Upon each adjustment of the Exercise Price pursuant to this Section
8, each Warrant outstanding prior to the making of the adjustment in the
Exercise Price shall thereafter evidence the right to receive upon payment of
the adjusted Exercise Price that number of shares of Common Stock (calculated to
the nearest hundredth) obtained from the following formula:
28
N' = N x E
---
E'
where:
N' = the adjusted number of Warrant Shares issuable
upon exercise of a Warrant by payment of the
adjusted Exercise Price.
N = the number or Warrant Shares previously
issuable upon exercise of a Warrant by payment
of the Exercise Price prior to adjustment.
E' = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
(p) Form of Warrants.
Irrespective of any adjustments in the Exercise Price or the number
or kind of shares purchasable upon the exercise of the Warrants, Warrants
theretofore or thereafter issued may continue to express the same price and
number and kind of shares as are stated in the Warrants initially issuable
pursuant to this Agreement.
SECTION 9. FRACTIONAL INTERESTS
The Company shall not be required to issue fractional Warrant Shares
on the exercise of Warrants. If more than one Warrant shall be presented for
exercise in full at the same time by the same holder, the number of full Warrant
Shares which shall be issuable upon the exercise thereof shall be computed on
the basis of the aggregate number of Warrant Shares purchasable on exercise of
the Warrants so presented. If any fraction of a Warrant Share would, except for
the provisions of this Section 9, be issuable on the exercise of any Warrants
(or specified portion thereof), the Company shall pay an amount in cash equal to
the Fair Value per Warrant Share, as determined on the day immediately preceding
the date the Warrant is presented for exercise, multiplied by such fraction,
computed to the nearest whole U.S. cent.
SECTION 10. NOTICES TO WARRANT HOLDERS
(a) Upon any adjustment of the Exercise Price pursuant to Section 8
hereof, the Company shall promptly thereafter (i) cause to be filed with the
Warrant Agent a certificate of a firm of independent public accountants of
recognized standing selected by the Board of Directors of the Company (who may
be the regular auditors of the Company) setting forth the Exercise Price after
such adjustment and setting forth in reasonable detail the method of calculation
and the facts upon which such calculations are based and setting forth the
number of Warrant Shares (or portion thereof) issuable after such adjustment in
the Exercise Price, upon exercise of a Warrant and payment of the adjusted
Exercise Price, which certificate 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 of Warrants at the address appearing on the Warrant
29
register for each such registered holder written notice of such adjustments by
first-class mail, postage prepaid. Where appropriate, such notice may be given
in advance and included as a part of the notice required to be mailed under the
other provisions of this Section 10.
(b) In the event:
(i) that the Company shall authorize the issuance to all
holders of shares of Common Stock of rights, options or warrants to
subscribe for or purchase shares of Common Stock or of any other
subscription rights or warrants;
(ii) that the Company shall authorize the distribution to
all holders of shares of Common Stock of evidences of its
indebtedness or assets (other than dividends or cash distributions
paid out of consolidated current or retained earnings as shown on the
books of the Company prepared in accordance with generally accepted
accounting principles or dividends payable in shares of Common Stock
or distributions referred to in Section 10(a) hereof);
(iii) of any consolidation or merger to which the Company
is a party and for which approval of any stockholders of the Company
is required, or of the conveyance or transfer of the properties and
assets of the Company substantially as an entirety, or of any
reclassification or change of Common Stock issuable upon exercise of
the Warrants (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), or a tender offer or exchange offer for
shares of Common Stock;
(iv) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company; or
(v) that the Company proposes to take any action (other
than actions of the character described in Section 8(a) hereof) which
would require an adjustment of the Exercise Price pursuant to Section
8 hereof;
then the Company shall cause to be filed with the Warrant Agent and shall cause
to be given to each of the registered holders of Warrants at his address
appearing on the Warrant register, at least 20 days (or 10 days in any case
specified in clauses (i) or (ii) above) prior to the applicable record date
hereinafter specified, or promptly in the case of events for which there is no
record date, by first-class mail, postage prepaid, a written notice stating (x)
the date as of which the holders of record of shares of Common Stock to be
entitled to receive any such rights, options, warrants or distribution are to be
determined, (y) the initial expiration date set forth in any tender offer or
exchange offer for shares of Common Stock, or (z) the date on which any such
consolidation, merger, conveyance, transfer, dissolution, liquidation or winding
up is expected to become effective or consummated, and the date as of which it
is expected that holders of record of shares of Common Stock shall be entitled
to exchange such shares for securities or other property, if any, deliverable
upon such reclassification, consolidation, merger, conveyance, transfer,
dissolution, liquidation or winding up. The failure to give the notice required
by this Section 10 or any defect therein shall not affect the legality or
validity of any distribution, right, option, warrant, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up, or the vote upon
any action.
30
(c) Nothing contained in this Agreement or in any of the Warrant
Certificates shall be construed as conferring upon the holders of Warrants the
right to vote or to consent or to receive notice as stockholders in respect of
the meetings of stockholders or the election of directors of the Company or any
other matter, or any rights whatsoever as stockholders of the Company.
SECTION 11. MERGER, CONSOLIDATION OR CHANGE OF NAME OF WARRANT AGENT
(a) Any corporation into which the Warrant Agent may be merged or
with which it may be consolidated, or any corporation resulting from any merger
or consolidation to which the Warrant Agent shall be a party, or any corporation
succeeding to the business of the Warrant Agent, shall be the successor to the
Warrant Agent hereunder without the execution or filing of any paper or any
further act on the part of any of the parties hereto, provided that such
corporation would be eligible for appointment as a successor warrant agent under
the provisions of Section 13 hereof. In case at the time such successor to the
Warrant Agent shall succeed to the agency created by this Agreement, and in case
at that time any of the Warrant Certificates shall have been countersigned but
not delivered, any such successor to the Warrant Agent may adopt the
countersignature of the original Warrant Agent; and in case at that time any of
the Warrant Certificates shall not have been countersigned, any successor to the
Warrant Agent may countersign such Warrant Certificates either in the name of
the predecessor Warrant Agent or in the name of the successor to the Warrant
Agent; and in all such cases such Warrant Certificates shall have the full force
and effect provided in the Warrant Certificates and in this Agreement.
(b) In case at any time the name of the Warrant Agent shall be
changed and at such time any of the Warrant Certificates shall have been
countersigned but not delivered, the Warrant Agent whose name has been changed
may adopt the countersignature under its prior name, and in case at that time
any of the Warrant Certificates shall not have been countersigned, the Warrant
Agent may countersign such Warrant Certificates either in its prior name or in
its changed name, and in all such cases such Warrant Certificates shall have the
full force and effect provided in the Warrant Certificates and in this
Agreement.
SECTION 12. WARRANT AGENT
The Warrant Agent undertakes the duties and obligations imposed by
this Agreement upon the following terms and conditions, by all of which the
Company and the holders of Warrants, by their acceptance thereof, shall be
bound:
(a) The statements contained herein and in the Warrant Certificates
shall be taken as statements of the Company and the Warrant Agent assumes no
responsibility for the correctness of any of the same except such as describe
the Warrant Agent or action taken or to be taken by it. The Warrant Agent
assumes no responsibility with respect to the distribution of the Warrant
Certificates except as herein otherwise provided.
(b) The Warrant Agent shall not be responsible for any failure of the
Company to comply with any of the covenants contained in this Agreement or in
the Warrant Certificates to be complied with by the Company.
(c) The Warrant Agent may consult at any time with counsel
satisfactory to it (who may be counsel for the Company) and the Warrant Agent
shall incur no liability or responsibility to the Company or to any holder of
31
any Warrant Certificate in respect of any action taken, suffered or omitted by
it hereunder in good faith and in accordance with the opinion or the advice of
such counsel.
(d) The Warrant Agent shall incur no liability or responsibility to
the Company or to any holder of any Warrant Certificate for any action taken in
reliance on any Warrant Certificate, certificate of shares, notice, resolution,
waiver, consent, order, certificate, or other paper, document or instrument
believed by it to be genuine and to have been signed, sent or presented by the
proper party or parties.
(e) The Company agrees to pay to the Warrant Agent reasonable
compensation for all services rendered by the Warrant Agent in the execution of
this Agreement, to reimburse the Warrant Agent for all expenses, taxes and
governmental charges and other charges of any kind and nature incurred by the
Warrant Agent in the execution of this Agreement. The Company shall indemnify
the Warrant Agent against any and all losses, liabilities or expenses incurred
by it arising out of or in connection with the acceptance or administration of
its duties under this Warrant Agreement, including the costs and expenses of
enforcing this Agreement against the Company and defending itself against any
claim (whether asserted by the Company or any holder or any other person) or
liability in connection with the exercise or performance of any of its powers or
duties hereunder, except to the extent any such loss, liability or expense may
be attributable to its gross negligence or bad faith. The Warrant Agent shall
notify the Company promptly of any claim for which it may seek indemnity.
Failure by the Warrant Agent to so notify the Company shall not relieve the
Company of its obligations hereunder. The Company shall defend the claim and the
Warrant Agent shall cooperate in the defense. The Warrant Agent may have
separate counsel and the Company shall pay the reasonable fees and expenses of
such counsel. The Company need not pay for any settlement made without its
consent, which consent shall not be unreasonably withheld, conditioned or
delayed.
(f) The Warrant Agent shall be under no obligation to institute any
action, suit or legal proceeding or to take any other action likely to involve
expense unless the Company or one or more registered holders of Warrants shall
furnish the Warrant Agent with reasonable security and indemnity for any costs
and expenses which may be incurred, but this provision shall not affect the
power of the Warrant Agent to take such action as it may consider proper,
whether with or without any such security or indemnity. All rights of action
under this Agreement or under any of the Warrants may be enforced by the Warrant
Agent without the possession of any of the Warrant Certificates or the
production thereof at any trial or other proceeding relative thereto, and any
such action, suit or proceeding instituted by the Warrant Agent shall be brought
in its name as Warrant Agent and any recovery of judgment shall be for the
ratable benefit of the registered holders of the Warrants, as their respective
rights or interests may appear.
(g) The Warrant Agent, and any stockholder, director, officer or
employee of it, may buy, sell or deal in any of the Warrants or other securities
of the Company or become pecuniarily interested in any transaction in which the
Company may be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Warrant Agent under this
Agreement. Nothing herein shall preclude the Warrant Agent from acting in any
other capacity for the Company or for any other legal entity.
(h) The Warrant Agent shall act hereunder solely as agent for the
Company, and its duties shall be determined solely by the provisions hereof. The
Warrant Agent shall not be liable for anything which it may do or refrain from
32
doing in connection with this Agreement except for its own gross negligence or
bad faith.
(i) The Warrant Agent shall not at any time be under any duty or
responsibility to any holder of any Warrant Certificate to make or cause to be
made any adjustment of the Exercise Price or number of the Warrant Shares or
other securities or property deliverable as provided in this Agreement, or to
determine whether any facts exist which may require any of such adjustments, or
with respect to the nature or extent of any such adjustments, when made, or with
respect to the method employed in making the same. The Warrant Agent shall not
be accountable with respect to the validity or value or the kind or amount of
any Warrant Shares or of any securities or property which may at any time be
issued or delivered upon the exercise of any Warrant or with respect to whether
any such Warrant Shares or other securities will when issued be validly issued
and fully paid and nonassessable, and makes no representation with respect
thereto.
(j) The Warrant Agent shall not be required to risk or expend its own
funds on the performance of it obligations and duties hereunder.
SECTION 13. CHANGE OF WARRANT AGENT
If the Warrant Agent shall become incapable of acting as Warrant
Agent, the Company shall appoint a successor to such Warrant Agent. If the
Company shall fail to make such appointment within a period of 30 days after it
has been notified in writing of such incapacity by the Warrant Agent or by the
registered holder of a Warrant Certificate, then the registered holder of any
Warrant may apply to any court of competent jurisdiction for the appointment of
a successor to the Warrant Agent. Pending appointment of a successor to such
Warrant Agent, either by the Company or by such a court, the duties of the
Warrant Agent shall be carried out by the Company. The holders of a majority of
the unexercised Warrants shall be entitled at any time to remove the Warrant
Agent and appoint a successor to such Warrant Agent. Such successor to the
Warrant Agent need not be approved by the Company or the former Warrant Agent.
After appointment the successor to the Warrant Agent shall be vested with the
same powers, rights, duties and responsibilities as if it had been originally
named as Warrant Agent without further act or deed; provided that the former
Warrant Agent shall deliver and transfer to the successor to the Warrant Agent
any property at the time held by it hereunder and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Failure to
give any notice provided for in this Section 13, however, or any defect therein,
shall not affect the legality or validity of the appointment of a successor to
the Warrant Agent.
SECTION 14. REPORTS
(a) The Company agrees with each holder, for so long as any Warrants
or Warrant Shares remain outstanding and during any period in which the Company
(i) is not subject to Section 13 or 15(d) of the Exchange Act, to make
available, upon request of any holder, to such holder or beneficial owner of
Warrants or Warrant Shares in connection with any sale thereof and any
prospective purchaser of such Warrants or Warrant Shares designated by such
holder or beneficial owner, the information required by Rule 144(A)(d)(4) under
the Act in order to permit resales of such Warrants or Warrant Shares pursuant
to Rule 144A, and (ii) is subject to Section 13 or 15(d) of the Exchange Act, to
make all filings required thereby in a timely manner in order to permit resales
of such Warrants or Warrant Shares pursuant to Rule 144A.
33
(k) The Company shall provide the Warrant Agent with a sufficient
number of copies of all such reports that the Warrant Agent may be required to
deliver to the holders of the Warrants and the Warrant Shares under this Section
14.
SECTION 15. NOTICES TO COMPANY AND WARRANT AGENT
Any notice or demand authorized by this Agreement to be given or made
by the Warrant Agent or by the registered holder of any Warrant to or on the
Company shall be sufficiently given or made when received if deposited in the
mail, first class or registered, postage prepaid, addressed (until another
address is filed in writing by the Company with the Warrant Agent) as follows:
Barneys New York, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: General Counsel
With a copy to:
Weil, Gotshal & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopier No.: (000) 000-0000
Attention: Xxx X. Xxxxxxx, Esq.
In case the Company shall fail to maintain such office or agency or
shall fail to give such notice of the location or of any change in the location
thereof, presentations may be made and notices and demands may be served at the
corporate trust office of the Warrant Agent.
Any notice pursuant to this Agreement to be given by the Company or
by the registered holder(s) of any Warrant to the Warrant Agent shall be
sufficiently given when and if deposited in the mail, first-class or registered,
postage prepaid, addressed (until another address is filed in writing by the
Warrant Agent with the Company) to and received by the Warrant Agent at its
corporate trust office as follows:
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Telecopier No.: (000) 000-0000
Attention: Xxxxx Xxxxxx
34
With a copy to:
Winston & Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxx, Esq.
SECTION 16. SUPPLEMENTS AND AMENDMENTS
The Company and the Warrant Agent may from time to time supplement or
amend this Agreement without the approval of any holders of Warrants in order to
cure any ambiguity or to correct or supplement any provision contained herein
which may be defective or inconsistent with any other provision herein, or to
make any other provisions in regard to matters or questions arising hereunder
which the Company and the Warrant Agent may deem necessary or desirable and
which shall not in any way materially adversely affect the interests of the
holders of Warrants. Any amendment or supplement to this Agreement that has a
materially adverse effect on the interests of the holders of Warrants shall
require the written consent of the holders of a majority of the then outstanding
Warrants (excluding Warrants held by the Company or any of its Affiliates). The
consent of each holder of Warrants affected shall be required for any amendment
pursuant to which the Exercise Price would be increased or the number of Warrant
Shares purchasable upon exercise of Warrants would be decreased (other than
pursuant to adjustments provided in this Agreement).
SECTION 17. SUCCESSORS
All the covenants and provisions of this Agreement by or for the
benefit of the Company or the Warrant Agent shall bind and inure to the benefit
of their respective successors and assigns hereunder.
SECTION 18. TERMINATION
This Agreement shall terminate at 5:00 p.m., New York City time on
April 1, 2008. Notwithstanding the foregoing, this Agreement will terminate on
any earlier date if all Warrants have been exercised. The provisions of Section
12 shall survive such termination.
SECTION 19. GOVERNING LAW
This Agreement and each Warrant Certificate issued hereunder shall be
deemed to be a contract made under the laws of the State of New York and for all
purposes shall be construed in accordance with the internal laws of said State.
35
SECTION 20. BENEFITS OF THIS AGREEMENT
Nothing in this Agreement shall be construed to give to any person or
corporation other than the Company, the Warrant Agent and the registered holders
of Warrants any legal or equitable right, remedy or claim under this Agreement;
but this Agreement shall be for the sole and exclusive benefit of the Company,
the Warrant Agent and the registered holders of Warrants.
SECTION 21. COUNTERPARTS
This Agreement may be executed in any number of counterparts and each
of such counterparts shall for all purposes be deemed to be an original, and all
such counterparts shall together constitute but one and the same instrument.
[Signature Page Follows]
36
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
BARNEYS NEW YORK, INC.
By: /s/ XXXXXX X. XXXXXXX
-------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Executive Vice President and
Chief Financial Officer
WILMINGTON TRUST COMPANY, as Warrant Agent
By: /s/ XXXXX X. XXXXX
-------------------------------------
Name: Xxxxx X. Xxxxx
Title: Authorized Signer
37
EXHIBIT A
[Form of Warrant Certificate]
[Face]
[Insert the Unit Legend, if applicable pursuant to the terms of the Warrant
Agreement]
[Insert the Private Placement Legend, if applicable pursuant to the terms of the
Warrant Agreement]
[Insert the Global Warrant Legend, if applicable pursuant to the terms of the
Warrant Agreement]
[Insert the Regulation S Legend, if applicable pursuant to the terms of the
Warrant Agreement]
No. ___________ ___Warrants
CUSIP No. ________
Warrant Certificate
BARNEYS NEW YORK, INC.
This Warrant Certificate certifies that Cede & Co., or its registered
assigns, is the registered holder of the number set forth above of Warrants
expiring April 1, 2008 (the "Warrants") to purchase Common Stock, par value
$0.01 (the "Common Stock"), of Barneys New York, Inc., a Delaware corporation
(the "Company"). Each Warrant entitles the registered holder upon exercise at
any time from 9:00 a.m. on the Separation Date referred to below until 5:00 p.m.
New York City Time on April 1, 2008 to receive from the Company 3.412 fully paid
and nonassessable shares of Common Stock (the "Warrant Shares") at the initial
exercise price (the "Exercise Price") of $0.01 per share payable upon surrender
of this Warrant Certificate and payment of the Exercise Price at the office or
agency of the Warrant Agent, but only subject to the conditions set forth herein
and in the Warrant Agreement referred to on the reverse hereof. The Exercise
Price and number of Warrant Shares issuable upon exercise of the Warrants are
subject to adjustment upon the occurrence of certain events set forth in the
Warrant Agreement.
No Warrant may be exercised after 5:00 p.m., New York City Time on
April 1, 2008. To the extent not exercised by such time any such Warrant shall
become void.
Reference is hereby made to the further provisions of this 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.
This Warrant Certificate shall not be valid unless countersigned by
the Warrant Agent, as such term is used in the Warrant Agreement.
This Warrant Certificate shall be governed by and construed in
accordance with the internal laws of the State of New York.
A-1
IN WITNESS WHEREOF, Barneys New York, Inc. has caused this Warrant
Certificate to be signed below.
DATED: April 1, 2003
BARNEYS NEW YORK, INC.
By:
---------------------------------
Name:
Title:
Countersigned:
WILMINGTON TRUST COMPANY ,
as Warrant Agent
By:_____________________________________
Authorized Signature
A-2
[Reverse of Warrant Certificate]
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants expiring at 5:00 p.m. New York City time on April
1, 2008 entitling the holder on exercise to receive shares of Common Stock, and
are issued or to be issued pursuant to a Warrant Agreement dated as of April 1,
2003 (the "Warrant Agreement"), duly executed and delivered by the Company to
Wilmington Trust Company, as warrant agent (the "Warrant Agent"), which 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 Warrant Agent,
the Company and the holders (the words "holders" or "holder" meaning the
registered holders or registered holder) of the Warrants. Capitalized terms used
but not defined herein have the meaning ascribed to such terms in the Warrant
Agreement. A copy of the Warrant Agreement may be obtained by the holder hereof
upon written request to the Company.
Warrants may be exercised at any time on or after the Separation Date
and on or before 5:00 p.m. New York City time on April 1, 2008. In order to
exercise all or any of the Warrants represented by this Warrant Certificate, the
holder must deliver to the Warrant Agent at its corporate trust office set forth
in Section 15 of the Warrant Agreement this Warrant Certificate and the form of
election to purchase on the reverse hereof duly completed and signed, which
signature shall be medallion guaranteed by an institution which is a member of a
Securities Transfer Association recognized signature guarantee program, and upon
payment to the Warrant Agent for the account of the Company of the Exercise
Price, for the number of Warrant Shares in respect of which such Warrants are
then exercised. No adjustment shall be made for any dividends on any Common
Stock issuable upon exercise of this Warrant.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price set forth on the face hereof may, subject to certain
conditions, be adjusted. If the Exercise Price is adjusted, the Warrant
Agreement provides that the number of shares of Common Stock issuable upon the
exercise of each Warrant shall be adjusted. No fractions of a share of Common
Stock will be issued upon the exercise of any Warrant, but the Company will pay
the cash value thereof determined as provided in the Warrant Agreement.
The Company has agreed pursuant to a Equity Registration Rights
Agreement dated as of April 1, 2003 (the "Equity Registration Rights Agreement")
upon receipt of written request by holders of at least 5% of the Registrable
Securities to, as promptly as practicable, file a registration statement on an
appropriate form under the Securities Act covering the resale of the Warrant
Shares. In addition, the Company may, at any time at its option, file a
registration statement covering the resale of the Warrant Shares. The Company
will use its reasonable best efforts to cause any such registration statement to
be declared effective and to keep such registration statement continuously
effective under the Securities Act in order to permit the resale of the Warrant
Shares by the holders thereof for two years.
Warrant Certificates, when surrendered at the corporate trust office
of the Warrant Agent by the registered holder thereof in person or by legal
representative or attorney duly authorized in writing, may be exchanged, in the
manner and subject to the limitations provided in the Warrant Agreement, but
without payment of any service charge, for another Warrant Certificate or
Warrant Certificates of like tenor evidencing in the aggregate a like number of
Warrants.
Upon due presentation for registration of transfer of this Warrant
Certificate at the corporate trust office of the Warrant Agent a new Warrant
Certificate or Warrant Certificates of like tenor and evidencing in the
aggregate a like number of Warrants shall be issued to the transferee(s) in
exchange for this Warrant Certificate, subject to the limitations provided in
A-3
the Warrant Agreement, without charge except for any tax or other governmental
charge imposed in connection therewith.
The Company and the Warrant Agent may deem and treat the registered
holder(s) thereof as the absolute owner(s) of this Warrant Certificate
(notwithstanding any notation of ownership or other writing hereon made by
anyone), for the purpose of any exercise hereof, of any distribution to the
holder(s) hereof, and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary. Neither the
Warrants nor this Warrant Certificate entitles any holder hereof to any rights
of a stockholder of the Company.
A-4
[Form of Election to Purchase]
(To Be Executed Upon Exercise Of Warrant)
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to receive _____________ shares of
Common Stock and herewith tenders payment for such shares to the order of
BARNEYS NEW YORK, INC., in the amount of [Warrants] [Notes] equal in [principal
amount] [fair market value] to $__________ in accordance with the terms hereof.
The undersigned requests that a certificate for such shares be registered in the
name of _______________, whose address is __________________ and that such
shares be delivered to ___________, whose address is
____________________________. If said number of shares is less than all of the
shares of Common Stock purchasable hereunder, the undersigned requests that a
new Warrant Certificate representing the remaining balance of such shares be
registered in the name of ______________________, whose address is
____________________, and that such Warrant Certificate be delivered to whose
address is ____________________.
----------------------------------------
Signature
Date:
----------------------------------------
Signature Guaranteed
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Warrant Agent, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Warrant Agent in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
A-5
SCHEDULE OF EXCHANGES OF INTERESTS OF GLOBAL WARRANTS
The following exchanges of a part of this Global Warrant have been made:
Number of Warrants in
Amount of decrease in Amount of increase in this Global Warrant
Number of warrants in Number of Warrants in following such decrease Signature of authorized
Date of Exchange this Global Warrant this Global Warrant or increase officer of Warrant Agent
--------------------- -------------------------- --------------------------- -------------------------- --------------------------
A-6
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
Barneys New York, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx Xxxxxx
Re: Warrants
Reference is hereby made to the Warrant Agreement, dated as of April
1, 2003 (the "WARRANT AGREEMENT"), between Barneys New York, Inc., as issuer
(the "COMPANY"), and Wilmington Trust Company, as warrant agent. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Warrant Agreement.
___________________, (the "TRANSFEROR") owns and proposes to transfer
the Warrant[s] or interest in such Warrant[s] specified in Annex A hereto, in
the principal amount at maturity of $___________ in such Warrant[s] or interests
(the "TRANSFEr"), to ___________________________ (the "TRANSFEREE"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
[CHECK ALL THAT APPLY]
1. |_| CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE 144A GLOBAL WARRANT OR A DEFINITIVE WARRANT PURSUANT TO RULE
144A. The Transfer is being effected pursuant to and in accordance with Rule
144A under the United States Securities Act of 1933, as amended (the "Securities
Act"), and, accordingly, the Transferor hereby further certifies that the
beneficial interest or Definitive Warrant is being transferred to a Person that
the Transferor reasonably believed and believes is purchasing the beneficial
interest or Definitive Warrant for its own account, or for one or more accounts
with respect to which such Person exercises sole investment discretion, and such
Person and each such account is a "qualified institutional buyer" within the
meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and
such Transfer is in compliance with any applicable blue sky securities laws of
any state of the United States. Upon consummation of the proposed Transfer in
accordance with the terms of the Warrant Agreement, the transferred beneficial
interest or Definitive Warrant will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the 144A Global Warrant
and/or the Definitive Warrant and in the Warrant Agreement and the Securities
Act.
2. |_| CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN THE REGULATION S GLOBAL WARRANT OR A DEFINITIVE WARRANT PURSUANT TO
REGULATION S. The Transfer is being effected pursuant to and in accordance with
Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor
hereby further certifies that (i) the Transfer is not being made to a person in
the United States and (x) at the time the buy order was originated, the
Transferee was outside the United States or such Transferor and any Person
acting on its behalf reasonably believed and believes that the Transferee was
outside the United States or (y) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither such
B-1
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S under the Securities Act, (iii) the transaction is not
part of a plan or scheme to evade the registration requirements of the
Securities Act and (iv) if the proposed transfer is being made prior to the
expiration of the Restricted Period, the transfer is not being made to a U.S.
Person or for the account or benefit of a U.S. Person (other than an Initial
Purchaser). Upon consummation of the proposed transfer in accordance with the
terms of the Warrant Agreement, the transferred beneficial interest or
Definitive Warrant will be subject to the restrictions on Transfer enumerated in
the Private Placement Legend printed on the Regulation S Global Warrant and/or
the Definitive Warrant and in the Warrant Agreement and the Securities Act.
3. |_| CHECK AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A
BENEFICIAL INTEREST IN THE IAI GLOBAL WARRANT OR A DEFINITIVE WARRANT PURSUANT
TO ANY PROVISION OF THE SECURITIES ACT OTHER THAN RULE 144A OR REGULATION S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Warrants and Restricted
Definitive Warrants and pursuant to and in accordance with the Securities Act
and any applicable blue sky securities laws of any state of the United States,
and accordingly the Transferor hereby further certifies that (check one):
(a) |_| such Transfer is being effected pursuant to and in
accordance with Rule 144 under the Securities Act;
or
(b) |_| such Transfer is being effected to the Company or
a subsidiary thereof.
or
(c) |_| such Transfer is being effected to an
Institutional Accredited Investor and pursuant to an exemption from
the registration requirements of the Securities Act other than Rule
144A, Rule 144 or Rule 904, and the Transferor hereby further
certifies that it has not engaged in any general solicitation within
the meaning of Regulation D under the Securities Act and the Transfer
complies with the transfer restrictions applicable to beneficial
interests in a Restricted Global Warrant or Restricted Definitive
Warrants and the requirements of the exemption claimed, which
certification is supported by (1) a certificate executed by the
Transferee in the form of Exhibit D to the Warrant Agreement and (2)
if the Company requests, an Opinion of Counsel provided by the
Transferor or the Transferee (a copy of which the Transferor has
attached to this certification), to the effect that such Transfer is
in compliance with the Securities Act. Upon consummation of the
proposed transfer in accordance with the terms of the Warrant
Agreement, the transferred beneficial interest or Definitive Warrant
will be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the IAI Global Warrant and/or the
Definitive Warrants and in the Warrant Agreement and the Securities
Act.
4. |_| CHECK IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL
INTEREST IN AN UNRESTRICTED GLOBAL WARRANT OR OF AN UNRESTRICTED DEFINITIVE
WARRANT.
(a) |_| CHECK IF TRANSFER IS PURSUANT TO RULE 144. (i) The
Transfer is being effected pursuant to and in accordance with Rule
144 under the Securities Act and in compliance with the transfer
restrictions contained in the Warrant Agreement and any applicable
blue sky securities laws of any state of the United States and (ii)
B-2
the restrictions on transfer contained in the Warrant Agreement and
the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Warrant Agreement, the
transferred beneficial interest or Definitive Warrant will no longer
be subject to the restrictions on transfer enumerated in the Private
Placement Legend printed on the Restricted Global Warrants, on
Restricted Definitive Warrants and in the Warrant Agreement.
(b) |_| CHECK IF TRANSFER IS PURSUANT TO REGULATION S. (i)
The Transfer is being effected pursuant to and in accordance with
Rule 903 or Rule 904 under the Securities Act and in compliance with
the transfer restrictions contained in the Warrant Agreement and any
applicable blue sky securities laws of any state of the United States
and (ii) the restrictions on transfer contained in the Warrant
Agreement and the Private Placement Legend are not required in order
to maintain compliance with the Securities Act. Upon consummation of
the proposed Transfer in accordance with the terms of the Warrant
Agreement, the transferred beneficial interest or Definitive Warrant
will no longer be subject to the restrictions on transfer enumerated
in the Private Placement Legend printed on the Restricted Global
Warrants, on Restricted Definitive Warrants and in the Warrant
Agreement.
(c) |_| CHECK IF TRANSFER IS PURSUANT TO OTHER EXEMPTION.
(i) The Transfer is being effected pursuant to and in compliance with
an exemption from the registration requirements of the Securities Act
other than Rule 144, Rule 903 or Rule 904 and in compliance with the
transfer restrictions contained in the Warrant Agreement and any
applicable blue sky securities laws of any State of the United States
and (ii) the restrictions on transfer contained in the Warrant
Agreement and the Private Placement Legend are not required in order
to maintain compliance with the Securities Act. Upon consummation of
the proposed Transfer in accordance with the terms of the Warrant
Agreement, the transferred beneficial interest or Definitive Warrant
will not be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Warrants or
Restricted Definitive Warrants and in the Warrant Agreement.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
[Insert Name of Transferor]
By:
------------------------------------
Name:
Title:
Dated:
------------------------
B-3
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) |_| a beneficial interest in the:
(i) |_| 000X Xxxxxx Xxxxxxx, or
(ii) |_| Regulation S Global Warrant, or
(ii) |_| IAI Global Warrant, or
(b) |_| a Restricted Definitive Warrant.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) |_| a beneficial interest in the:
(i) |_| 000X Xxxxxx Xxxxxxx, or
(ii) |_| Regulation S Global Warrant, or
(iii) |_| Unrestricted Global Warrant; or
(iv) |_| Regulation S Global Warrant; or
(b) |_| a Restricted Definitive Warrant; or
(c) |_| an Unrestricted Definitive Warrant,
in accordance with the terms of the Warrant Agreement.
B-4
EXHIBIT C
FORM OF CERTIFICATE OF EXCHANGE
Barneys New York, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx Xxxxxx
Re: Warrants
(CUSIP ____________)
Reference is hereby made to the Warrant Agreement, dated as of April
1, 2003 (the "WARRANT AGREEMENT"), between Barneys New York, Inc., as issuer
(the "COMPANY"), and Wilmington Trust Company, as warrant agent. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Warrant Agreement.
__________________________, (the "OWNER") owns and proposes to
exchange the Warrant[s] or interest in such Warrant[s] specified herein, in the
amount of $____________ in such Warrant[s] or interests (the "EXCHANGE"). In
connection with the Exchange, the Owner hereby certifies that:
1. EXCHANGE OF RESTRICTED DEFINITIVE WARRANTS OR BENEFICIAL INTERESTS
IN A RESTRICTED GLOBAL WARRANT FOR UNRESTRICTED DEFINITIVE WARRANTS OR
BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL WARRANT
(a) |_| Check if Exchange is from beneficial interest in a Restricted
Global Warrant to beneficial interest in an Unrestricted Global Warrant.
In connection with the Exchange of the Owner's beneficial interest in a
Restricted Global Warrant for a beneficial interest in an Unrestricted
Global Warrant in an equal principal amount, the Owner hereby certifies
(i) the beneficial interest is being acquired for the Owner's own
account without transfer, (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to the Global
Warrants and pursuant to and in accordance with the United States
Securities Act of 1933, as amended (the "Securities Act"), (iii) the
restrictions on transfer contained in the Warrant Agreement and the
Private Placement Legend are not required in order to maintain
compliance with the Securities Act and (iv) the beneficial interest in
an Unrestricted Global Warrant is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.
(b) |_| CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL WARRANT TO UNRESTRICTED DEFINITIVE Warrant. In connection with
the Exchange of the Owner's beneficial interest in a Restricted Global
Warrant for an Unrestricted Definitive Warrant, the Owner hereby
certifies (i) the Definitive Warrant is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to the Restricted
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Global Warrants and pursuant to and in accordance with the Securities
Act, (iii) the restrictions on transfer contained in the Warrant
Agreement and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the Definitive
Warrant is being acquired in compliance with any applicable blue sky
securities laws of any state of the United States.
(c) |_| CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE WARRANT TO
BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL Warrant. In connection
with the Owner's Exchange of a Restricted Definitive Warrant for a
beneficial interest in an Unrestricted Global Warrant, the Owner hereby
certifies (i) the beneficial interest is being acquired for the Owner's
own account without transfer, (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to Restricted
Definitive Warrants and pursuant to and in accordance with the
Securities Act, (iii) the restrictions on transfer contained in the
Warrant Agreement and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the
beneficial interest is being acquired in compliance with any applicable
blue sky securities laws of any state of the United States.
(d) |_| CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE WARRANT TO
UNRESTRICTED DEFINITIVE WARRANT. In connection with the Owner's Exchange
of a Restricted Definitive Warrant for an Unrestricted Definitive
Warrant, the Owner hereby certifies (i) the Unrestricted Definitive
Warrant is being acquired for the Owner's own account without transfer,
(ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to Restricted Definitive Warrants and pursuant
to and in accordance with the Securities Act, (iii) the restrictions on
transfer contained in the Warrant Agreement and the Private Placement
Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Unrestricted Definitive Warrant is being
acquired in compliance with any applicable blue sky securities laws of
any state of the United States.
2. EXCHANGE OF RESTRICTED DEFINITIVE WARRANTS OR BENEFICIAL INTERESTS
IN RESTRICTED GLOBAL WARRANTS FOR RESTRICTED DEFINITIVE WARRANTS OR BENEFICIAL
INTERESTS IN RESTRICTED GLOBAL WARRANTS
(a) |_| CHECK IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED
GLOBAL WARRANT TO RESTRICTED DEFINITIVE WARRANT. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global
Warrant for a Restricted Definitive Warrant in a number equal to the
number of beneficial interests exchanged, the Owner hereby certifies
that the Restricted Definitive Warrant is being acquired for the Owner's
own account without transfer. Upon consummation of the proposed Exchange
in accordance with the terms of the Warrant Agreement, the Restricted
Definitive Warrant issued will continue to be subject to the
restrictions on transfer enumerated in the Private Placement Legend
printed on the Restricted Definitive Warrant and in the Warrant
Agreement and the Securities Act.
(b) CHECK IF EXCHANGE IS FROM RESTRICTED DEFINITIVE WARRANT TO
BENEFICIAL INTEREST IN A RESTRICTED GLOBAL WARRANT. In connection with
the Exchange of the Owner's Restricted Definitive Warrant for a
beneficial interest in the [CHECK ONE] |_| 000X Xxxxxx Xxxxxxx, |_|
Regulation S Global Warrant, |_| IAI Global Warrant in a number equal to
the number of beneficial interests exchanged, the Owner hereby certifies
(i) the beneficial interest is being acquired for the Owner's own
account without transfer and (ii) such Exchange has been effected in
compliance with the transfer restrictions applicable to the Restricted
Global Warrants and pursuant to and in accordance with the Securities
Act, and in compliance with any applicable blue sky securities laws of
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any state of the United States. Upon consummation of the proposed
Exchange in accordance with the terms of the Warrant Agreement, the
beneficial interest issued will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the
relevant Restricted Global Warrant and in the Warrant Agreement and the
Securities Act.
This certificate and the statements contained herein are made for
your benefit and the benefit of the Company.
[Insert Name of Transferor]
By:
------------------------------------
Name:
Title:
Dated:
------------------------
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EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
Barneys New York, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxx Xxxxxx
Re: Warrants
Reference is hereby made to the Warrant Agreement, dated as of April
1, 2003 (the "WARRANT AGREEMENT"), between Barneys New York, Inc., as issuer
(the "COMPANY"), and Wilmington Trust Company, as warrant agent. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Warrant Agreement.
In connection with our proposed purchase of $____________ amount of:
(a) |_| a beneficial interest in a Global Warrant, or
(b) |_| a Definitive Warrant,
we confirm that:
1. We understand that any subsequent transfer of the Warrants or any
interest therein is subject to certain restrictions and conditions set forth in
the Warrant Agreement and the undersigned agrees to be bound by, and not to
resell, pledge or otherwise transfer the Warrants or any interest therein except
in compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "SECURITIES ACT").
2. We understand that the offer and sale of the Warrants have not
been registered under the Securities Act, and that the Warrants and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which we
are acting as hereinafter stated, that if we should sell the Warrants or any
interest therein, we will do so only (A) to the Company or any subsidiary
thereof, (B) in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined therein), (C) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Company a signed letter substantially in the form of this letter and, if
requested by the Company, an Opinion of Counsel in form reasonably acceptable to
the Company to the effect that such transfer is in compliance with the
Securities Act, (D) outside the United States in accordance with Rule 904 of
Regulation S under the Securities Act, (E) pursuant to the provisions of Rule
144(k) under the Securities Act or (F) pursuant to an effective registration
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statement under the Securities Act, and we further agree to provide to any
person purchasing the Definitive Warrant or beneficial interest in a Global
Warrant from us in a transaction meeting the requirements of clauses (A) through
(E) of this paragraph a notice advising such purchaser that resales thereof are
restricted as stated herein.
3. We understand that, on any proposed resale of the Warrants or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Warrants purchased by
us will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Warrants, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Warrants or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
We agree not to engage in any hedging transactions with regard to the
Warrants unless such hedging transactions are in compliance with the Securities
Act.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
[Insert Name of Transferor]
By:
------------------------------------
Name:
Title:
Dated:
------------------------
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