EXHIBIT 4.19
PACIFICARE HEALTH SYSTEMS, INC.
and
_________________, AS WARRANT AGENT
FORM OF DEBT SECURITIES
WARRANT AGREEMENT
DATED AS OF ____________________
TABLE OF CONTENTS
PAGE
ARTICLE 1 ISSUANCE OF WARRANTS AND EXECUTION AND DELIVERY OF WARRANT CERTIFICATES.............................. 1
1.1 Issuance of Warrants........................................................................... 1
1.2 Execution and Delivery of Warrant Certificates................................................. 2
1.3 Issuance of Warrant Certificates............................................................... 3
ARTICLE 2 WARRANT PRICE, DURATION AND EXERCISE OF WARRANTS..................................................... 3
2.1 Warrant Price.................................................................................. 3
2.2 Duration of Warrants........................................................................... 3
2.3 Exercise of Warrants........................................................................... 3
ARTICLE 3 OTHER PROVISIONS RELATING TO RIGHTS OF HOLDERS OF WARRANT CERTIFICATES............................... 5
3.1 No Rights as Holders of Warrant Debt Securities Conferred by Warrants or Warrant
Certificates................................................................................... 5
3.2 Lost, Stolen, Mutilated or Destroyed Warrant Certificates...................................... 5
3.3 Holder of Warrant Certificate May Enforce Rights............................................... 5
3.4 Merger, Sale, Conveyance or Lease.............................................................. 5
3.5 Notice to Warrantholders....................................................................... 6
ARTICLE 4 EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES........................................................ 6
4.1 Exchange and Transfer of Warrant Certificates.................................................. 6
4.2 Treatment of Holders of Warrant Certificates................................................... 7
4.3 Cancellation of Warrant Certificates........................................................... 7
ARTICLE 5 CONCERNING THE WARRANT AGENT......................................................................... 7
5.1 Warrant Agent.................................................................................. 7
5.2 Conditions of Warrant Agent's Obligations...................................................... 8
5.3 Resignation, Removal and Appointment of Successors............................................. 9
ARTICLE 6 MISCELLANEOUS........................................................................................ 11
6.1 Amendment...................................................................................... 11
6.2 Notices and Demands to the Company and Warrant Agent........................................... 11
6.3 Addresses...................................................................................... 11
6.4 Governing Law.................................................................................. 11
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TABLE OF CONTENTS
(CONTINUED)
PAGE
6.5 Delivery of Prospectus........................................................................ 11
6.6 Obtaining of Governmental Approvals........................................................... 11
6.7 Persons Having Rights Under Warrant Agreement................................................. 12
6.8 Headings...................................................................................... 12
6.9 Counterparts.................................................................................. 12
6.10 Inspection of Agreement....................................................................... 12
-ii-
PACIFICARE HEALTH SYSTEMS, INC.
Form of Debt Securities Warrant Agreement
DEBT SECURITIES WARRANT AGREEMENT, dated as of _____________ between
PACIFICARE HEALTH SYSTEMS, INC., a Delaware corporation (the "COMPANY") and
__________, a [corporation] [national banking association] organized and
existing under the laws of __________ and having a corporate trust office in
___________, as warrant agent (the "WARRANT AGENT").
WHEREAS, the Company has entered into an indenture dated as of
[_____________ (the "SENIOR INDENTURE"), with _________________, as trustee
(such trustee, and any successors to such trustee, herein called the "SENIOR
TRUSTEE"), providing for the issuance from time to time of its unsubordinated
debt securities, to be issued in one or more series as provided in the Senior
Indenture (the "DEBT SECURITIES");] [____________ (the "SUBORDINATED
INDENTURE"), with _____________, as trustee (such trustee, and any successors to
such trustee, herein called the "SUBORDINATED TRUSTEE"), providing for the
issuance from time to time of its subordinated debt securities, to be issued in
one or more series as provided in the Subordinated Indenture (the "DEBT
SECURITIES");]
WHEREAS, the Company proposes to sell [If Warrants are sold with other
securities -- title of such other Securities being offered (the "OTHER
SECURITIES") with] warrant certificates evidencing one or more warrants (the
"WARRANTS" or, individually, a "WARRANT") representing the right to purchase
[title of Debt Securities purchasable through exercise of Warrants] (the
"WARRANT DEBT SECURITIES"), such warrant certificates and other warrant
certificates issued pursuant to this Agreement being herein called the "WARRANT
CERTIFICATES"; and
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, registration, transfer, exchange, exercise and replacement of the
Warrant Certificates, and in this Agreement wishes to set forth, among other
things, the form and provisions of the Warrant Certificates and the terms and
conditions on which they may be issued, registered, transferred, exchanged,
exercised and replaced;
NOW, THEREFORE, in consideration of the premises and of the mutual
agreements herein contained, the parties hereto agree as follows:
ARTICLE 1
ISSUANCE OF WARRANTS AND EXECUTION AND
DELIVERY OF WARRANT CERTIFICATES
1.1 ISSUANCE OF WARRANTS. [If Warrants alone--Upon issuance, each
Warrant Certificate shall evidence one or more Warrants.] [If Other Securities
and Warrants--Warrant Certificates shall be [initially] issued in connection
with the issuance of the Other Securities [but shall be separately transferable
on and after ___________________________________ (the "DETACHABLE DATE")] [and
shall not be separately transferable] and each Warrant Certificate shall
1.
evidence one or more Warrants.] Each Warrant evidenced thereby shall represent
the right, subject to the provisions contained herein and therein, to purchase
one Warrant Debt Security. [If Other Securities and Warrants - Warrant
Certificates shall be initially issued in units with the Other Securities and
each Warrant Certificate included in such a unit shall evidence _____________
Warrants for each [$__________ principal amount] [________ shares] of Other
Securities included in such unit.].
1.2 EXECUTION AND DELIVERY OF WARRANT CERTIFICATES. Each Warrant
Certificate, whenever issued, shall be in registered form substantially in the
form set forth in Exhibit A hereto, shall be dated the date of its
countersignature by the Warrant Agent and may have such letters, numbers, or
other marks of identification or designation and such legends or endorsements
printed, lithographed or engraved thereon as the officers of the Company
executing the same may approve (execution thereof to be conclusive evidence of
such approval) and as are not inconsistent with the provisions of this
Agreement, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any
securities exchange on which the Warrants may be listed, or to conform to usage.
The Warrant Certificates shall be signed on behalf of the Company by any of its
present or future chief executive officers, presidents, senior vice presidents,
vice presidents, chief financial officers, chief legal officers, treasurers,
assistant treasurers, controllers, assistant controllers, secretaries or
assistant secretaries under its corporate seal reproduced thereon. Such
signatures may be manual or facsimile signatures of such authorized officers and
may be imprinted or otherwise reproduced on the Warrant Certificates. The seal
of the Company may be in the form of a facsimile thereof and may be impressed,
affixed, imprinted or otherwise reproduced on the Warrant Certificates.
No Warrant Certificate shall be valid for any purpose, and no Warrant
evidenced thereby shall be exercisable, until such Warrant Certificate has been
countersigned by the manual signature of the Warrant Agent. Such signature by
the Warrant Agent upon any Warrant Certificate executed by the Company shall be
conclusive evidence that the Warrant Certificate so countersigned has been duly
issued hereunder.
In case any officer of the Company who shall have signed any of the
Warrant Certificates either manually or by facsimile signature shall cease to be
such officer before the Warrant Certificates so signed shall have been
countersigned and delivered by the Warrant Agent, such Warrant Certificates may
be countersigned and delivered notwithstanding that the person who signed
Warrant Certificates ceased to be such officer of the Company; and any Warrant
Certificate may be signed on behalf of the Company by such persons as, at the
actual date of the execution of such Warrant Certificate, shall be the proper
officers of the Company, although at the date of the execution of this Agreement
any such person was not such officer.
The term "holder" or "holder of a Warrant Certificate" as used herein
shall mean any person in whose name at the time any Warrant Certificate shall be
registered upon the books to be maintained by the Warrant Agent for that purpose
[If Other Securities and Warrants are not immediately detachable - or upon the
registration of the Other Securities prior to the Detachable Date. Prior to the
Detachable Date, the Company will, or will cause the registrar of the Other
Securities to, make available at all times to the Warrant Agent such information
as to holders of the Other Securities as may be necessary to keep the Warrant
Agent's records up to date].
2.
1.3 ISSUANCE OF WARRANT CERTIFICATES. Warrant Certificates
evidencing the right to purchase Warrant Debt Securities may be executed by the
Company and delivered to the Warrant Agent upon the execution of this Warrant
Agreement or from time to time thereafter. The Warrant Agent shall, upon receipt
of Warrant Certificates duly executed on behalf of the Company, countersign such
Warrant Certificates and shall deliver such Warrant Certificates to or upon the
order of the Company.
ARTICLE 2
WARRANT PRICE, DURATION AND
EXERCISE OF WARRANTS
2.1 WARRANT PRICE. During the period specified in Section 2.2,
each Warrant shall, subject to the terms of this Warrant Agreement and the
applicable Warrant Certificate, entitle the holder thereof, to purchase the
principal amount of Warrant Debt Securities specified in the applicable Warrant
Certificate at an exercise price of ________% of the principal amount thereof
[plus accrued amortization, if any, of the original issue discount of the
Warrant Debt Securities] [plus accrued interest, if any, from the most recent
date from which interest shall have been paid on the Warrant Debt Securities or,
if no interest shall have been paid on the Warrant Debt Securities, from the
date of their initial issuance.] [The original issue discount ($________ for
each $1,000 principal amount of Warrant Debt Securities) will be amortized at a
________% annual rate, computed on a[n] [semi-] annual basis [using a 360-day
year consisting of twelve 30-day months].] Such purchase price for the Warrant
Debt Securities is referred to in this Agreement as the "WARRANT PRICE."
2.2 DURATION OF WARRANTS. Each Warrant may be exercised in whole
or in part at any time, as specified herein, on or after [the date thereof]
[________] and at or before [________] p.m., [City] time, on ________ or such
later date as the Company may designate by notice to the Warrant Agent and the
holders of Warrant Certificates mailed to their addresses as set forth in the
record books of the Warrant Agent (the "EXPIRATION DATE"). Each Warrant not
exercised at or before [________] p.m., [City] time, on the Expiration Date
shall become void, and all rights of the holder of the Warrant Certificate
evidencing such Warrant under this Agreement shall cease.
2.3 EXERCISE OF WARRANTS.
(a) During the period specified in Section 2.2, the
Warrants may be exercised to purchase a whole number of Warrant Debt Securities
in registered form by providing certain information as set forth on the reverse
side of the Warrant Certificate and by paying in full, in lawful money of the
United States of America, [in cash or by certified check or official bank check
in New York Clearing House funds] [by bank wire transfer in immediately
available funds] the Warrant Price for each Warrant Debt Security with respect
to which a Warrant is being exercised to the Warrant Agent at its corporate
trust office, provided that such exercise is subject to receipt within five
business days of such payment by the Warrant Agent of the Warrant Certificate
with the form of election to purchase Warrant Debt Securities set forth on the
reverse side of the Warrant Certificate properly completed and duly executed.
The date on which payment in full of the Warrant Price is received by the
Warrant Agent shall, subject to
3.
receipt of the Warrant Certificate as aforesaid, be deemed to be the date on
which the Warrant is exercised; provided, however, that if, at the date of
receipt of such Warrant Certificates and payment in full of the Warrant Price,
the transfer books for the Warrant Debt Securities purchasable upon the exercise
of such Warrants shall be closed, no such receipt of such Warrant Certificates
and no such payment of such Warrant Price shall be effective to constitute the
person so designated to be named as the holder of record of such Warrant Debt
Securities on such date, but shall be effective to constitute such person as the
holder of record of such Warrant Debt Securities for all purposes at the opening
of business on the next succeeding day on which the transfer books for the
Warrant Debt Securities purchasable upon the exercise of such Warrants shall be
opened, and the certificates for the Warrant Debt Securities in respect of which
such Warrants are then exercised shall be issuable as of the date on such next
succeeding day on which the transfer books shall next be opened, and until such
date the Company shall be under no duty to deliver any certificate for such
Warrant Debt Securities. The Warrant Agent shall deposit all funds received by
it in payment of the Warrant Price in an account of the Company maintained with
it and shall advise the Company by telephone at the end of each day on which a
payment for the exercise of Warrants is received of the amount so deposited to
its account. The Warrant Agent shall promptly confirm such telephone advice to
the Company in writing.
(b) The Warrant Agent shall, from time to time, as
promptly as practicable, advise the Company of (i) the number of Warrant Debt
Securities with respect to which Warrants were exercised, (ii) the instructions
of each holder of the Warrant Certificates evidencing such Warrants with respect
to delivery of the Warrant Debt Securities to which such holder is entitled upon
such exercise, (iii) delivery of Warrant Certificates evidencing the balance, if
any, of the Warrants for the remaining Warrant Debt Securities after such
exercise, and (iv) such other information as the Company or the [Senior]
[Subordinated] Trustee shall reasonably require.
(c) As soon as practicable after the exercise of any
Warrant, the Company shall issue, pursuant to the Indenture, in authorized
denominations, to or upon the order of the holder of the Warrant Certificate
evidencing such Warrant, the Warrant Debt Securities to which such holder is
entitled, in fully registered form, registered in such name or names as may be
directed by such holder. If fewer than all of the Warrants evidenced by such
Warrant Certificate were exercised, the Company shall execute, and an authorized
officer of the Warrant Agent shall manually countersign and deliver, a new
Warrant Certificate evidencing Warrants for the number of Warrant Debt
Securities remaining unexercised.
(d) The Company shall not be required to pay any stamp or
other tax or other governmental charge required to be paid in connection with
any transfer involved in the issue of the Warrant Debt Securities, and in the
event that any such transfer is involved, the Company shall not be required to
issue or deliver any Warrant Debt Securities until such tax or other charge
shall have been paid or it has been established to the Company's satisfaction
that no such tax or other charge is due.
4.
ARTICLE 3
OTHER PROVISIONS RELATING TO RIGHTS OF
HOLDERS OF WARRANT CERTIFICATES
3.1 NO RIGHTS AS HOLDERS OF WARRANT DEBT SECURITIES CONFERRED BY
WARRANTS OR WARRANT CERTIFICATES. No Warrant Certificate or Warrant evidenced
thereby shall entitle the holder thereof to any of the rights of a holder of
Warrant Debt Securities, including, without limitation, the right to receive the
payment of principal of (or premium, if any) or interest, if any, on the Warrant
Debt Securities or to enforce any of the covenants in the Indenture.
3.2 LOST, STOLEN, MUTILATED OR DESTROYED WARRANT CERTIFICATES.
Upon receipt by the Warrant Agent of evidence reasonably satisfactory to it and
the Company of the ownership of and the loss, theft, destruction or mutilation
of any Warrant Certificate and/or indemnity reasonably satisfactory to the
Warrant Agent and the Company and, in the case of mutilation, upon surrender of
the mutilated Warrant Certificate to the Warrant Agent for cancellation, then,
in the absence of notice to the Company or the Warrant Agent that such Warrant
Certificate has been acquired by a bona fide purchaser, the Company shall
execute, and an authorized officer of the Warrant Agent shall manually
countersign and deliver, in exchange for or in lieu of the lost, stolen,
destroyed or mutilated Warrant Certificate, a new Warrant Certificate of the
same tenor and evidencing Warrants for a like principal amount of Warrant Debt
Securities. Upon the issuance of any new Warrant Certificate under this Section
3.2, the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Warrant Agent) in connection
therewith. Every substitute Warrant Certificate executed and delivered pursuant
to this Section 3.2 in lieu of any lost, stolen or destroyed Warrant Certificate
shall represent an additional contractual obligation of the Company, whether or
not the lost, stolen or destroyed Warrant Certificate shall be at any time
enforceable by anyone, and shall be entitled to the benefits of this Agreement
equally and proportionately with any and all other Warrant Certificates duly
executed and delivered hereunder. The provisions of this Section 3.2 are
exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement of mutilated, lost, stolen or destroyed
Warrant Certificates.
3.3 HOLDER OF WARRANT CERTIFICATE MAY ENFORCE RIGHTS.
Notwithstanding any of the provisions of this Agreement, any holder of any
Warrant Certificate, without the consent of the Warrant Agent, the [Senior]
[Subordinated] Trustee, the holder of any Warrant Debt Securities or the holder
of any other Warrant Certificate, may, in such holder's own behalf and for such
holder's own benefit, enforce, and may institute and maintain any suit, action
or proceeding against the Company suitable to enforce, or otherwise in respect
of, such holder's right to exercise the Warrants evidenced by such holder's
Warrant Certificate in the manner provided in such holder's Warrant Certificates
and in this Agreement.
3.4 MERGER, SALE, CONVEYANCE OR LEASE. In case of (a) any share
exchange, merger or similar transaction of the Company with or into another
person or entity (other than a share exchange, merger or similar transaction in
which the Company is the acquiring or surviving corporation) or (b) the sale,
exchange, lease, transfer or other disposition of all or substantially all of
the properties and assets of the Company as an entirety (in any such case, a
5.
"REORGANIZATION EVENT"), then, as a condition of such Reorganization Event,
lawful provisions shall be made, and duly executed documents evidencing the same
from the Company's successor shall be delivered to the holders of the Warrants,
so that such successor shall succeed to and be substituted for the Company, and
assume all the Company's obligations under, this Agreement and the Warrants. The
Company shall thereupon be relieved of any further obligation hereunder or under
the Warrants, and the Company as the predecessor corporation may thereupon or at
any time thereafter be dissolved, wound up or liquidated. Such successor or
assuming entity thereupon may cause to be signed, and may issue either in its
own name or in the name of the Company, any or all of the Warrants issuable
hereunder which heretofore shall not have been signed by the Company, and may
execute and deliver securities in its own name, in fulfillment of its
obligations to deliver Warrant Debt Securities upon exercise of the Warrants.
All the Warrants so issued shall in all respects have the same legal rank and
benefit under this Agreement as the Warrants theretofore or thereafter issued in
accordance with the terms of this Agreement as though all of such Warrants had
been issued at the date of the execution hereof. In any case of any such
Reorganization Event, such changes in phraseology and form (but not in
substance) may be made in the Warrants thereafter to be issued as may be
appropriate.
The Warrant Agent may receive a written opinion of legal counsel as
conclusive evidence that any such Reorganization Event complies with the
provisions of this Section 3.4.
3.5 NOTICE TO WARRANTHOLDERS. In case the Company shall (a) effect
any Reorganization Event or (b) make any distribution on or in respect of the
[title of Warrant Debt Securities] in connection with the dissolution,
liquidation or winding up of the Company, then the Company shall mail to each
holder of Warrants at such holder's address as it shall appear on the books of
the Warrant Agent, at least ten days prior to the applicable date hereinafter
specified, a notice stating the date on which such Reorganization Event,
dissolution, liquidation or winding up is expected to become effective, and the
date as of which it is expected that holders of [title of Warrant Debt
Securities] of record shall be entitled to exchange their shares of [title of
Warrant Debt Securities] for securities or other property deliverable upon such
Reorganization Event, dissolution, liquidation or winding up. No failure to mail
such notice nor any defect therein or in the mailing thereof shall affect any
such transaction.
ARTICLE 4
EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES
4.1 EXCHANGE AND TRANSFER OF WARRANT CERTIFICATES. [If Other
Securities with Warrants which are immediately detachable - Upon] [If Other
Securities with Warrants which are not immediately detachable - Prior to the
Detachable Date, a Warrant Certificate may be exchanged or transferred only
together with the Other Security to which the Warrant Certificate was initially
attached, and only for the purpose of effecting or in conjunction with an
exchange or transfer of such Other Security. Prior to any Detachable Date, each
transfer of the Other Security shall operate also to transfer the related
Warrant Certificates. After the Detachable Date, upon] surrender at the
corporate trust office of the Warrant Agent, Warrant Certificates evidencing
Warrants may be exchanged for Warrant Certificates in other denominations
evidencing such Warrants or the transfer thereof may be registered in whole or
in part; provided that such other Warrant Certificates evidence Warrants for the
same aggregate principal amount
6.
of Warrant Debt Securities as the Warrant Certificates so surrendered. The
Warrant Agent shall keep, at its corporate trust office, books in which, subject
to such reasonable regulations as it may prescribe, it shall register Warrant
Certificates and exchanges and transfers of outstanding Warrant Certificates,
upon surrender of the Warrant Certificates to the Warrant Agent at its corporate
trust office for exchange or registration of transfer, properly endorsed or
accompanied by appropriate instruments of registration of transfer and written
instructions for transfer, all in form satisfactory to the Company and the
Warrant Agent. No service charge shall be made for any exchange or registration
of transfer of Warrant Certificates, but the Company may require payment of a
sum sufficient to cover any stamp or other tax or other governmental charge that
may be imposed in connection with any such exchange or registration of transfer.
Whenever any Warrant Certificates are so surrendered for exchange or
registration of transfer, an authorized officer of the Warrant Agent shall
manually countersign and deliver to the person or persons entitled thereto a
Warrant Certificate or Warrant Certificates duly authorized and executed by the
Company, as so requested. The Warrant Agent shall not be required to effect any
exchange or registration of transfer which will result in the issuance of a
Warrant Certificate evidencing a Warrant for a fraction of a Warrant Debt
Security or a number of Warrants for a whole number of Warrant Debt Securities
and a fraction of a Warrant Debt Security. All Warrant Certificates issued upon
any exchange or registration of transfer of Warrant Certificates shall be the
valid obligations of the Company, evidencing the same obligations and entitled
to the same benefits under this Agreement as the Warrant Certificate surrendered
for such exchange or registration of transfer.
4.2 TREATMENT OF HOLDERS OF WARRANT CERTIFICATES. [If Other
Securities and Warrants are not immediately detachable--Prior to the Detachable
Date, the Company, the Warrant Agent and all other persons may treat the owner
of the Other Security as the owner of the Warrant Certificates initially
attached thereto for any purpose and as the person entitled to exercise the
rights represented by the Warrants evidenced by such Warrant Certificates, any
notice to the contrary notwithstanding. After the Detachable Date and prior to
due presentment of a Warrant Certificate for registration of transfer, the]
[The] Company, the Warrant Agent and all other persons may treat the registered
holder of a Warrant Certificate as the absolute owner thereof for any purpose
and as the person entitled to exercise the rights represented by the Warrants
evidenced thereby, any notice to the contrary notwithstanding.
4.3 CANCELLATION OF WARRANT CERTIFICATES. Any Warrant Certificate
surrendered for exchange, registration of transfer or exercise of the Warrants
evidenced thereby shall, if surrendered to the Company, be delivered to the
Warrant Agent and all Warrant Certificates surrendered or so delivered to the
Warrant Agent shall be promptly canceled by the Warrant Agent and shall not be
reissued and, except as expressly permitted by this Agreement, no Warrant
Certificate shall be issued hereunder in exchange therefor or in lieu thereof.
The Warrant Agent shall deliver to the Company from time to time or otherwise
dispose of canceled Warrant Certificates in a manner satisfactory to the
Company.
7.
ARTICLE 5
CONCERNING THE WARRANT AGENT
5.1 WARRANT AGENT. The Company hereby appoints _______________ as
Warrant Agent of the Company in respect of the Warrants and the Warrant
Certificates upon the terms and subject to the conditions herein set forth, and
______________ hereby accepts such appointment. The Warrant Agent shall have the
powers and authority granted to and conferred upon it in the Warrant
Certificates and hereby and such further power and authority to act on behalf of
the Company as the Company may hereafter grant to or confer upon it. All of the
terms and provisions with respect to such power and authority contained in the
Warrant Certificates are subject to and governed by the terms and provisions
hereof.
5.2 CONDITIONS OF WARRANT AGENT'S OBLIGATIONS. The Warrant Agent
accepts its obligations herein set forth upon the terms and conditions hereof,
including the following to all of which the Company agrees and to all of which
the rights hereunder of the holders from time to time of the Warrant
Certificates shall be subject:
(a) COMPENSATION AND INDEMNIFICATION. The Company agrees
promptly to pay the Warrant Agent the compensation to be agreed upon with the
Company for all services rendered by the Warrant Agent and to reimburse the
Warrant Agent for reasonable out-of-pocket expenses (including reasonable
counsel fees) incurred without negligence, bad faith or willful misconduct by
the Warrant Agent in connection with the services rendered hereunder by the
Warrant Agent. The Company also agrees to indemnify the Warrant Agent for, and
to hold it harmless against, any loss, liability or expense incurred without
negligence, bad faith or willful misconduct on the part of the Warrant Agent,
arising out of or in connection with its acting as Warrant Agent hereunder,
including the reasonable costs and expenses of defending against any claim of
such liability.
(b) AGENT FOR THE COMPANY. In acting under this Warrant
Agreement and in connection with the Warrant Certificates, the Warrant Agent is
acting solely as agent of the Company and does not assume any obligations or
relationship of agency or trust for or with any of the holders of Warrant
Certificates or beneficial owners of Warrants.
(c) COUNSEL. The Warrant Agent may consult with counsel
satisfactory to it, which may include counsel for the Company, and the written
advice of such counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in accordance with the advice of such counsel.
(d) DOCUMENTS. The Warrant Agent shall be protected and
shall incur no liability for or in respect of any action taken or omitted by it
in reliance upon any Warrant Certificate, notice, direction, consent,
certificate, affidavit, statement or other paper or document reasonably believed
by it to be genuine and to have been presented or signed by the proper parties.
(e) CERTAIN TRANSACTIONS. The Warrant Agent, and its
officers, directors and employees, may become the owner of, or acquire any
interest in, Warrants, with the same rights
8.
that it or they would have if it were not the Warrant Agent hereunder, and, to
the extent permitted by applicable law, it or they may engage or be interested
in any financial or other transaction with the Company and may act on, or as
depositary, trustee or agent for, any committee or body of holders of Warrant
Securities or other obligations of the Company as freely as if it were not the
Warrant Agent hereunder. Nothing in this Warrant Agreement shall be deemed to
prevent the Warrant Agent from acting as [Senior] [Subordinated] Trustee under
the [Senior] [Subordinated] Indenture.
(f) NO LIABILITY FOR INTEREST. Unless otherwise agreed
with the Company, the Warrant Agent shall have no liability for interest on any
monies at any time received by it pursuant to any of the provisions of this
Agreement or of the Warrant Certificates.
(g) NO LIABILITY FOR INVALIDITY. The Warrant Agent shall
have no liability with respect to any invalidity of this Agreement or any of the
Warrant Certificates (except as to the Warrant Agent's countersignature
thereon).
(h) NO RESPONSIBILITY FOR REPRESENTATIONS. The Warrant
Agent shall not be responsible for any of the recitals or representations herein
or in the Warrant Certificates (except as to the Warrant Agent's
countersignature thereon), all of which are made solely by the Company.
(i) NO IMPLIED OBLIGATIONS. The Warrant Agent shall be
obligated to perform only such duties as are herein and in the Warrant
Certificates specifically set forth and no implied duties or obligations shall
be read into this Agreement or the Warrant Certificates against the Warrant
Agent. The Warrant Agent shall not be under any obligation to take any action
hereunder which may tend to involve it in any expense or liability, the payment
of which within a reasonable time is not, in its reasonable opinion, assured to
it. The Warrant Agent shall not be accountable or under any duty or
responsibility for the use by the Company of any of the Warrant Certificates
authenticated by the Warrant Agent and delivered by it to the Company pursuant
to this Agreement or for the application by the Company of the proceeds of the
Warrant Certificates. The Warrant Agent shall have no duty or responsibility in
case of any default by the Company in the performance of its covenants or
agreements contained herein or in the Warrant Certificates or in the case of the
receipt of any written demand from a holder of a Warrant Certificate with
respect to such default, including, without limiting the generality of the
foregoing, any duty or responsibility to initiate or attempt to initiate any
proceedings at law or otherwise or, except as provided in Section 6.2 hereof, to
make any demand upon the Company.
5.3 RESIGNATION, REMOVAL AND APPOINTMENT OF SUCCESSORS.
(a) The Company agrees, for the benefit of the holders
from time to time of the Warrant Certificates, that there shall at all times be
a Warrant Agent hereunder until all the Warrants have been exercised or are no
longer exercisable.
(b) The Warrant Agent may at any time resign as agent by
giving written notice to the Company of such intention on its part, specifying
the date on which its desired resignation shall become effective; provided that
such date shall not be less than three months after the date on which such
notice is given unless the Company otherwise agrees. The Warrant
9.
Agent hereunder may be removed at any time by the filing with it of an
instrument in writing signed by or on behalf of the Company and specifying such
removal and the intended date when it shall become effective. Such resignation
or removal shall take effect upon the appointment by the Company, as hereinafter
provided, of a successor Warrant Agent (which shall be a bank or trust company
authorized under the laws of the jurisdiction of its organization to exercise
corporate trust powers) and the acceptance of such appointment by such successor
Warrant Agent. The obligation of the Company under Section 5.2(a) shall continue
to the extent set forth therein notwithstanding the resignation or removal of
the Warrant Agent.
(c) In case at any time the Warrant Agent shall resign,
or shall be removed, or shall become incapable of acting, or shall be adjudged a
bankrupt or insolvent, or shall commence a voluntary case under the Federal
bankruptcy laws, as now or hereafter constituted, or under any other applicable
Federal or state bankruptcy, insolvency or similar law or shall consent to the
appointment of or taking possession by a receiver, custodian, liquidator,
assignee, trustee, sequestrator (or other similar official) of the Warrant Agent
or its property or affairs, or shall make an assignment for the benefit of
creditors, or shall admit in writing its inability to pay its debts generally as
they become due, or shall take corporate action in furtherance of any such
action, or a decree or order for relief by a court having jurisdiction in the
premises shall have been entered in respect of the Warrant Agent in an
involuntary case under the Federal bankruptcy laws, as now or hereafter
constituted, or any other applicable Federal or state bankruptcy, insolvency or
similar law, or a decree or order by a court having jurisdiction in the premises
shall have been entered for the appointment of a receiver, custodian,
liquidator, assignee, trustee, sequestrator (or similar official) of the Warrant
Agent or of its property or affairs, or any public officer shall take charge or
control of the Warrant Agent or of its property or affairs for the purpose of
rehabilitation, conservation, winding up or liquidation, a successor Warrant
Agent, qualified as aforesaid, shall be appointed by the Company by an
instrument in writing, filed with the successor Warrant Agent. Upon the
appointment as aforesaid of a successor Warrant Agent and acceptance by the
successor Warrant Agent of such appointment, the Warrant Agent shall cease to be
Warrant Agent hereunder.
(d) Any successor Warrant Agent appointed hereunder shall
execute, acknowledge and deliver to its predecessor and to the Company an
instrument accepting such appointment hereunder, and thereupon such successor
Warrant Agent, without any further act, deed or conveyance, shall become vested
with all the authority, rights, powers, trusts, immunities, duties and
obligations of such predecessor with like effect as if originally named as
Warrant Agent hereunder, and such predecessor, upon payment of its charges and
disbursements then unpaid, shall thereupon become obligated to transfer, deliver
and pay over, and such successor Warrant Agent shall be entitled to receive, all
monies, securities and other property on deposit with or held by such
predecessor, as Warrant Agent hereunder.
(e) Any corporation into which the Warrant Agent
hereunder may be merged or converted or any corporation with which the Warrant
Agent may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Warrant Agent shall be a party, or any
corporation to which the Warrant Agent shall sell or otherwise transfer all or
substantially all the assets and business of the Warrant Agent, provided that it
shall be qualified as aforesaid, shall be the successor Warrant Agent under this
Agreement without the execution or filing of any paper or any further act on the
part of any of the parties hereto.
10.
ARTICLE 6
MISCELLANEOUS
6.1 AMENDMENT. This Agreement may be amended by the parties
hereto, without the consent of the holder of any Warrant Certificate, for the
purpose of curing any ambiguity, or of curing, correcting or supplementing any
defective provision contained herein, or making any other provisions with
respect to matters or questions arising under this Agreement as the Company and
the Warrant Agent may deem necessary or desirable; provided that such action
shall not materially adversely affect the interests of the holders of the
Warrant Certificates.
6.2 NOTICES AND DEMANDS TO THE COMPANY AND WARRANT AGENT. If the
Warrant Agent shall receive any notice or demand addressed to the Company by the
holder of a Warrant Certificate pursuant to the provisions of the Warrant
Certificates, the Warrant Agent shall promptly forward such notice or demand to
the Company.
6.3 ADDRESSES. Any communication from the Company to the Warrant
Agent with respect to this Agreement shall be addressed to ______________,
Attention: ____________ and any communication from the Warrant Agent to the
Company with respect to this Agreement shall be addressed to PacifiCare Health
Systems, Inc., 0000 Xxxxx Xxxxx, Xxxxxxx, Xxxxxxxxxx 00000, Attention: General
Counsel (or such other address as shall be specified in writing by the Warrant
Agent or by the Company).
6.4 GOVERNING LAW. This Agreement and each Warrant Certificate
issued hereunder shall be governed by and construed in accordance with the laws
of the State of [____________].
6.5 DELIVERY OF PROSPECTUS. The Company shall furnish to the
Warrant Agent sufficient copies of a prospectus meeting the requirements of the
Securities Act of 1933, as amended, relating to the Warrant Debt Securities
deliverable upon exercise of the Warrants (the "PROSPECTUS"), and the Warrant
Agent agrees that upon the exercise of any Warrant, the Warrant Agent will
deliver to the holder of the Warrant Certificate evidencing such Warrant, prior
to or concurrently with the delivery of the Warrant Debt Securities issued upon
such exercise, a Prospectus.
The Warrant Agent shall not, by reason of any such delivery, assume any
responsibility for the accuracy or adequacy of such Prospectus.
6.6 OBTAINING OF GOVERNMENTAL APPROVALS. The Company will from
time to time take all action which may be necessary to obtain and keep effective
any and all permits, consents and approvals of governmental agencies and
authorities and securities act filings under United States Federal and state
laws (including without limitation a registration statement in respect of the
Warrants and Warrant Debt Securities under the Securities Act of 1933, as
amended), which may be or become requisite in connection with the issuance,
sale, transfer, and delivery of the Warrant Debt Securities issued upon exercise
of the Warrants, the issuance, sale, transfer and delivery of the Warrants or
upon the expiration of the period during which the Warrants are exercisable.
11.
6.7 PERSONS HAVING RIGHTS UNDER WARRANT AGREEMENT. Nothing in this
Agreement shall give to any person other than the Company, the Warrant Agent and
the holders of the Warrant Certificates any right, remedy or claim under or by
reason of this Agreement.
6.8 HEADINGS. The descriptive headings of the several Articles and
Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
6.9 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which as so executed shall be deemed to be an original,
but such counterparts shall together constitute but one and the same instrument.
6.10 INSPECTION OF AGREEMENT. A copy of this Agreement shall be
available at all reasonable times at the principal corporate trust office of the
Warrant Agent for inspection by the holder of any Warrant Certificate. The
Warrant Agent may require such holder to submit his Warrant Certificate for
inspection by it.
12.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, all as of the day and year first above written.
PACIFICARE HEALTH SYSTEMS, INC.
By_________________________________________
Its_________________________________________
Attest:_______________________
_________________________________, as
Warrant Agent
By_________________________________________
Its_________________________________________
Attest:_______________________
[SIGNATURE PAGE TO DEBT SECURITIES WARRANT AGREEMENT]
EXHIBIT A
FORM OF WARRANT CERTIFICATE
[FACE OF WARRANT CERTIFICATE]
[Form if Warrants are attached to Prior to _____________, this Warrant
Other Securities and are not Certificate cannot be transferred or
immediately detachable. exchanged unless attached to a [Title of
Other Security].]
[Form of Legend if Warrants are not Prior to _____________, Warrants
immediately exercisable. evidenced by this Warrant Certificate
cannot be exercised.]
EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT
AGENT AS PROVIDED HEREIN
VOID AFTER [_______] P.M., [CITY] TIME, ON ______________,
PACIFICARE HEALTH SYSTEMS, INC.
WARRANT CERTIFICATE REPRESENTING
WARRANTS TO PURCHASE
[TITLE OF WARRANT DEBT SECURITIES]
No. ____________ __________ Warrants
This certifies that _________________ or registered assigns is the
registered owner of the above indicated number of Warrants, each Warrant
entitling such owner [If Warrants are attached to Other Securities and are not
immediately detachable --, subject to the registered owner qualifying as a
"Holder" of this Warrant Certificate, as hereinafter defined)] to purchase, at
any time [after [________] p.m., [City] time, on ________ and] on or before
[____] p.m., [City] time, on __________, $________ principal amount of [Title of
Warrant Debt Securities] (the "WARRANT DEBT SECURITIES"), of PacifiCare Health
Systems, Inc. (the "COMPANY"), issued or to be issued under the Indenture (as
hereinafter defined), on the following basis: during the period from _________,
through and including _______, each Warrant shall entitle the Holder thereof,
subject to the provisions of this Agreement, to purchase the principal amount of
Warrant Debt Securities stated in the Warrant Certificate at the warrant price
(the "WARRANT PRICE") of ____% of the principal amount thereof [plus accrued
amortization, if any, of the original issue discount of the Warrant Debt
Securities] [plus accrued interest, if any, from the most recent date from which
interest shall have been paid on the Warrant Debt Securities or, if no interest
shall have been paid on the Warrant Debt Securities, from the date of their
original issuance]. [The original issue discount ($_____ for each $1,000
principal amount of Warrant Debt Securities) will be amortized at a ____% annual
rate, computed on a[n] [semi-]annual basis [using a 360-day year consisting of
twelve 30-day months]. The Holder may exercise the Warrants evidenced hereby by
providing certain information set forth on the back hereof and by paying in
full, in
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lawful money of the United States of America, [in cash or by certified check or
official bank check in New York Clearing House funds] [by bank wire transfer in
immediately available funds], the Warrant Price for each Warrant Debt Security
with respect to which this Warrant is exercised to the Warrant Agent (as
hereinafter defined) and by surrendering this Warrant Certificate, with the
purchase form on the back hereof duly executed, at the corporate trust office of
[name of Warrant Agent], or its successor as warrant agent (the "WARRANT
AGENT"), which is, on the date hereof, at the address specified on the reverse
hereof, and upon compliance with and subject to the conditions set forth herein
and in the Warrant Agreement (as hereinafter defined).
The term "HOLDER" as used herein shall mean [If Warrants are attached
to Other Securities and are not immediately detachable--, prior to ___________,
_____ (the "DETACHABLE DATE"), the registered owner of the Company's [title of
Other Securities] to which this Warrant Certificate was initially attached, and
after such Detachable Date,] the person in whose name at the time this Warrant
Certificate shall be registered upon the books to be maintained by the Warrant
Agent for that purpose pursuant to Section 4 of the Warrant Agreement.
The Warrants evidenced by this Warrant Certificate may be exercised to
purchase Warrant Debt Securities in the principal amount of $1,000 or any
integral multiple thereof in registered form. Upon any exercise of fewer than
all of the Warrants evidenced by this Warrant Certificate, there shall be issued
to the Holder hereof a new Warrant Certificate evidencing Warrants for the
aggregate principal amount of Warrant Debt Securities remaining unexercised.
This Warrant Certificate is issued under and in accordance with the
Warrant Agreement dated as of _____________, ____ (the "WARRANT AGREEMENT"),
between the Company and the Warrant Agent and is subject to the terms and
provisions contained in the Warrant Agreement, to all of which terms and
provisions the Holder of this Warrant Certificate consents by acceptance hereof.
Copies of the Warrant Agreement are on file at the above-mentioned office of the
Warrant Agent.
The Warrant Debt Securities to be issued and delivered upon the
exercise of Warrants evidenced by this Warrant Certificate will be issued under
and in accordance with an Indenture, [dated as of _________, ______ (the "SENIOR
INDENTURE"), between the Company and _____________, as trustee (such trustee,
and any successors to such trustee, the "SENIOR TRUSTEE")] [dated as of
__________, ______, (the "SUBORDINATED INDENTURE"), between the Company and
_____________, as trustee (such trustee, and any successors to such trustee, the
"SUBORDINATED TRUSTEE")] and will be subject to the terms and provisions
contained in the Warrant Debt Securities and in the Indenture. Copies of the
[Senior] [Subordinated] Indenture, including the form of the Warrant Debt
Securities, are on file at the corporate trust office of the Trustee.
[If Warrants are attached to Other Securities and are not immediately
detachable--Prior to the Detachable Date, this Warrant Certificate may be
exchanged or transferred only together with the [Title of Other Securities] (the
"OTHER SECURITIES") to which this Warrant Certificate was initially attached,
and only for the purpose of effecting or in conjunction with, an exchange or
transfer of such Other Security. Additionally, on or prior to the Detachable
Date, each transfer of such Other Security on the register of the Other
Securities shall operate also to transfer this Warrant Certificate. After such
date, transfer of this] [If Warrants are attached to Other
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Securities and are immediately detachable -- Transfer of this] Warrant
Certificate may be registered when this Warrant Certificate is surrendered at
the corporate trust office of the Warrant Agent by the registered owner or such
owner's assigns, in the manner and subject to the limitations provided in the
Warrant Agreement.
[If Other Securities with Warrants which are not immediately
detachable-Except as provided in the immediately preceding paragraph, after] [If
Other Securities with Warrants which are immediately detachable or Warrants
alone--After] countersignature by the Warrant Agent and prior to the expiration
of this Warrant Certificate, this Warrant Certificate may be exchanged at the
corporate trust office of the Warrant Agent for Warrant Certificates
representing Warrants for the same aggregate principal amount of Warrant Debt
Securities.
This Warrant Certificate shall not entitle the Holder hereof to any of
the rights of a holder of the Warrant Debt Securities, including, without
limitation, the right to receive payments of principal of (and premium, if any)
or interest, if any, on the Warrant Debt Securities or to enforce any of the
covenants of the Indenture.
Reference is hereby made to the further provisions of this Warrant
Certificate set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
This Warrant Certificate shall not be valid or obligatory for any
purpose until countersigned by the Warrant Agent.
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IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
in its name and on its behalf by the facsimile signatures of its duly authorized
officers.
Dated:_______________________ PACIFICARE HEALTH SYSTEMS, INC.
By__________________________________
Its_________________________________
Attest:
__________________________________
Countersigned:
__________________________________
As Warrant Agent
By________________________________
Authorized Signature
A-4
[REVERSE OF WARRANT CERTIFICATE]
(Instructions for Exercise of Warrants)
To exercise any Warrants evidenced hereby for Warrant Debt Securities
(as hereinafter defined), the Holder must pay, in lawful money of the United
States of America, [in cash or by certified check or official bank check in New
York Clearing House funds] [by bank wire transfer in immediately available
funds], the Warrant Price in full for Warrants exercised, to [Warrant Agent]
[address of Warrant Agent], Attn: _____________, which payment must specify the
name of the Holder and the number of Warrants exercised by such Holder. In
addition, the Holder must complete the information required below and present
this Warrant Certificate in person or by mail (certified or registered mail is
recommended) to the Warrant Agent at the appropriate address set forth above.
This Warrant Certificate, completed and duly executed, must be received by the
Warrant Agent within five business days of the payment.
(To be executed upon exercise of Warrants)
The undersigned hereby irrevocably elects to exercise __________
Warrants, represented by this Warrant Certificate, to purchase $______ principal
amount of the [Title of Warrant Debt Securities] (the "WARRANT DEBT SECURITIES")
of PacifiCare Health Systems, Inc. and represents that he has tendered payment
for such Warrant Debt Securities, in lawful money of the United States of
America, [in cash or by certified check or official bank check in New York
Clearing House funds] [by bank wire transfer in immediately available funds], to
the order of PacifiCare Health Systems, Inc., c/o [insert name and address of
Warrant Agent], in the amount of $__________ in accordance with the terms
hereof. The undersigned requests that said principal amount of Warrant Debt
Securities be in fully registered form in the authorized denominations,
registered in such names and delivered all as specified in accordance with the
instructions set forth below.
If the number of Warrants exercised is less than all the Warrants
evidenced hereby, the undersigned requests that a new Warrant Certificate
evidencing the Warrants for the aggregate principal amount of Warrant Debt
Securities remaining unexercised be issued and delivered to the undersigned
unless otherwise specified in the instructions below.
Dated _______________________ Name__________________________________
(Please Print)
Address__________________________________
_________________________________________
_________________________________________
(Insert Social Security or Other
Identifying Number of Holder)
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Signature Guaranteed __________________________________
Signature
(Signature must conform in all respects to
name of holder as specified on the face of
this Warrant Certificate and must bear a
signature guarantee by a bank, trust company
or member broker of the New York, Midwest or
Pacific Stock Exchange)
This Warrant may be exercised at the following addresses:
By hand at _________________________________________________________
_________________________________________________________
_________________________________________________________
By mail at _________________________________________________________
_________________________________________________________
_________________________________________________________
[Instructions as to form and delivery of Warrant Debt Securities and, if
applicable, Warrant Certificates evidencing Warrants for the number of Warrant
Debt Securities remaining unexercised -- complete as appropriate.]
A-6
ASSIGNMENT
[Form of assignment to be executed if
Warrant Holder desires to transfer Warrant)
FOR VALUE RECEIVED, ___________________ hereby sells, assigns and
transfers unto:
_____________________________________
_____________________________________
_____________________________________ ____________________________________
(Please print name and address including Please insert Social Security or
zip code) other identifying number
the right represented by the within Warrant to purchase $_______ aggregate
principal amount of [Title of Warrant Debt Securities] of PacifiCare Health
Systems, Inc. to which the within Warrant relates and appoints ____________
attorney to transfer such right on the books of the Warrant Agent with full
power of substitution in the premises.
Dated _____________________ _______________________________________
Signature
(Signature must conform in all respects to
name of holder as specified on the face of
the Warrant)
Signature Guaranteed
__________________________
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