Exhibit 10
[Five-Year Terminable Warrant Agreement]
TiVo Inc.
and
The Bank of New York
as Warrant Agent
WARRANT AGREEMENT
DATED as of August 28, 2001
TABLE OF CONTENTS
Page Number
SECTION 1. Definitions.........................................................................................1
SECTION 2. Appointment of Warrant Agent........................................................................4
SECTION 3. Form of Warrant Certificates........................................................................4
SECTION 4. Execution of Warrant Certificates...................................................................4
SECTION 5. Registration, Countersignature and Issuance of Temporary Warrant Certificates.......................5
SECTION 6. Registration of Transfers and Exchanges.............................................................6
SECTION 7. Lost, Stolen, Destroyed, Defaced or Mutilated Warrant Certificates.................................13
SECTION 8. Offices for Exercise, Etc..........................................................................14
SECTION 9. Duration of Warrants; Early Termination of Warrants................................................14
SECTION 10. Exercise, Exercise Price, Settlement and Delivery; Separation of Warrants..........................15
SECTION 11. Cancellation of Warrant Certificates...............................................................18
SECTION 12. Adjustment of Exercise Price and Number of Shares Issuable.........................................18
SECTION 13. Effect of Reclassification, Consolidation, Merger or Sale..........................................27
SECTION 14. Taxes on Shares Issued.............................................................................28
SECTION 15. Reservation of Shares; Shares to Be Fully Paid; Listing of Common Stock............................28
SECTION 16. Fractional Warrants and Fractional Shares..........................................................28
SECTION 17. Notice to Warrantholders Prior to Certain Actions..................................................29
SECTION 18. Merger, Consolidation or Change of Name of Warrant Agent...........................................30
SECTION 19. Warrant Agent......................................................................................30
SECTION 20. Disposition of Proceeds of Exercise of Warrants....................................................32
SECTION 21. Change of Warrant Agent............................................................................32
SECTION 22. Notices to Company and Warrant Agent...............................................................32
SECTION 23. Supplements and Amendments.........................................................................33
SECTION 24. Successors.........................................................................................34
SECTION 25. Termination........................................................................................34
SECTION 26. Governing Law......................................................................................34
SECTION 27. Benefits of This Agreement.........................................................................34
SECTION 28. Counterparts.......................................................................................34
Exhibit A Form of Warrant.........................................................................................A-1
Exhibit B Form of Transfer Letter of Representations..............................................................B-1
WARRANT AGREEMENT ("Agreement") dated as of August 28, 2001,
between TiVo Inc., a Delaware corporation (together with any successor
thereto, the "Company"), and The Bank of New York, a New York banking
corporation, not in its individual capacity but solely as warrant agent
(together with any successor warrant agent, the "Warrant Agent").
WHEREAS, the Company has entered into purchase or acquisition
agreements with certain purchasers or acquirors (the "Purchasers"), in
which the Company has agreed to issue and/or sell to the Purchasers (i) an
aggregate principal amount of $51,750,000 of its 7% Convertible Senior
Notes due 2006 (the "Notes") to be issued under an Indenture dated as of
August 28, 2001 between the Company and The Bank of New York, a New York
banking corporation, as trustee (in such capacity, the "Trustee"), (ii)
warrants to purchase 2,682,600 shares of the Company's common stock, par
value $.001 per share (the "Common Stock"), (iii) and 4,064,542 units (each
a "Unit," and collectively, the "Units"), each consisting of (a) one
warrant (a "One-Year Warrant") to purchase one share of Common Stock and
(b) one warrant (a "Warrant," and collectively the "Warrants", and the
certificates evidencing the Warrants hereinafter referred to as the
"Warrant Certificates") to purchase 0.33 of one share of Common Stock.
WHEREAS, the Company desires the Warrant Agent to act on behalf of
the Company to assist the Company in connection with the issuance,
exchange, cancellation, replacement and exercise of the Warrants, and this
Agreement sets forth, among other things, the terms and conditions on which
the Warrants may be issued, exchanged, cancelled, replaced and exercised;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
SECTION 1. Definitions. The terms defined in this Section 1
(except as herein otherwise expressly provided or unless the context
otherwise requires) for all purposes of this Agreement shall have the
respective meanings specified in this Section 1. The words "herein,"
"hereof," "hereunder," and words of similar import refer to this Agreement
as a whole and not to any particular Section or other subdivision. The
terms defined in this Section include the plural as well as the singular.
Affiliate: The term "Affiliate" of any specified person shall mean
any other person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified person. For the
purposes of this definition, "control," when used with respect to any
specified person means the power to direct or cause the direction of the
management and policies of such person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise; and
the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
Board of Directors: The term "Board of Directors" shall mean the
Board of Directors of the Company or a committee of such Board duly
authorized to act for it hereunder.
Board Resolution: The term "Board Resolution" means a copy of a
resolution certified by the Secretary or any Assistant Secretary of the
Company to have been duly adopted by the Board of Directors, or duly
authorized committee thereof (to the extent permitted by applicable law),
and to be in full force and effect on the date of such certification, and
delivered to the Warrant Agent.
Business Day: The term "Business Day" means each Monday, Tuesday,
Wednesday, Thursday and Friday which is not a day on which the banking
institutions in The City of New York or the city in which the Corporate
Office is located are authorized or obligated by law or executive order to
close or be closed.
Cashless Exercise. The term "Cashless Exercise" shall have the
meaning specified in Section 10(b).
Cashless Exercise Ratio: The term "Cashless Exercise Ratio" shall
have the meaning specified in Section 10(b).
Close of business: The term "close of business" means 5 p.m. (New
York City time).
Corporate Office: The term "Corporate Office," or other similar
term, shall mean the office of the Warrant Agent maintained for the purpose
of exchanging, transferring or exercising the Warrants, which office is, at
the date as of which this Agreement is dated, located at 000 Xxxxxxx
Xxxxxx, Xxxxx 00X, Xxx Xxxx, N.Y. 10286, Attention: Corporate Trust
Administration.
Exchange Act: The term "Exchange Act" means the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated
thereunder.
Exercise Date: The term "Exercise Date" shall have the meaning
specified in Section 10(c).
Exercise Form: The term "Exercise Form" shall have the meaning
specified in Section 10(a).
Exercise Price: The term "Exercise Price" shall mean the exercise
price as specified in the form of the Warrant Certificate (herein called
the "Exercise Price"), attached as Exhibit A hereto, subject to adjustment
from time to time upon the occurrence of the events enumerated in Section
12.
Exercise Price Per Share: The term "Exercise Price Per Share"
shall have the meaning specified in Section 10(b).
Expiration Time: The term "Expiration Time" shall have the meaning
specified in Section 12(f).
Individual Accredited Investor: The term "Individual Accredited
Investor" shall mean an individual "accredited investor" as defined in Rule
501(a)(5) or (6) of Regulation D under the Securities Act.
Institutional Accredited Investor: The term "Institutional
Accredited Investor" shall mean an institutional "accredited investor" as
such term is defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D
under the Securities Act.
Officer's Certificate: The term "Officer's Certificate", when used
with respect to the Company, shall mean a certificate signed by one of the
President, the Chief Executive Officer, Chief Financial Officer, Executive
or Senior Vice President or any Vice President (whether or not designated
by a number or numbers or word added before or after the title "Vice
President"), that is delivered to the Warrant Agent.
One-Year Warrant Agreement: The term "One-Year Warrant Agreement"
shall mean the Warrant Agreement, dated August 28, 2001, by and between the
Company and The Bank of New York, as warrant agent, relating to the
One-Year Warrants.
Opinion of Counsel: The term "Opinion of Counsel" shall mean an
opinion in writing signed by legal counsel, who may be an employee of or
counsel to the Company, which is delivered to the Warrant Agent.
Person: The term "person" shall mean an individual, a corporation,
a limited liability company, an association, a partnership, an individual,
a joint venture, a joint stock company, a trust, an unincorporated
organization or a government or an agency or a political subdivision
thereof.
Registration Rights Agreement: The term "Registration Rights
Agreement" means that certain Registration Rights Agreement, dated as of
August 28, 2001, between the Company and the Purchasers, as such agreement
may be amended from time to time.
Restricted Securities: The term "Restricted Securities" has the
meaning specified in Section 6(c).
Rule 144A: The term "Rule 144A" shall mean Rule 144A as
promulgated under the Securities Act.
Securities Act: The term "Securities Act" means the Securities Act
of 1933, as amended, and the rules and regulations promulgated thereunder.
Separation Date: The term "Separation Date" shall have the meaning
specified in Section 10(f).
Subsidiary: The term "Subsidiary" means a corporation more than
50% of the outstanding voting stock of which is owned, directly or
indirectly, by the Company or by one or more other Subsidiaries, or by the
Company and one or more other Subsidiaries. For the purposes of this
definition, "voting stock" means stock which ordinarily has voting power
for the election of directors, whether at all times or only so long as no
senior class of stock has such voting power by reason of any contingency.
Trading Day: The term "Trading Day" has the meaning specified in
Section 12(h)(v).
Warrant Exercise Office. The term "Warrant Exercise Office" shall
have the meaning specified in Section 10(a).
Warrantholder or holder: The terms "Warrantholder" or "holder" as
applied to any Warrant, or other similar terms (but excluding the term
"beneficial holder"), shall mean any person in whose name at the time a
particular Warrant is registered on the Warrant register.
Warrant register: The term "Warrant register" shall mean the
register maintained in the Corporate Office and in any other office or
agency of the Company as designated herein, in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for
the registration of the Warrants and transfers of Warrants.
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. Form of Warrant Certificates. The Warrant Certificates
may have such letters, numbers or other marks of identification and such
notations, legends and endorsements as the officers 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
or automated quotation system on which the Warrants may be listed or
designated for issuance, or to conform to usage.
The Warrants shall be substantially in the form set forth in
Exhibit A, which exhibit is hereby incorporated in and expressly made a
part of this Agreement. Each Warrant Certificate shall represent such of
the outstanding Warrants as shall be specified thereon.
Warrants will be issued in registered form as definitive Warrant
Certificates.
Each Warrant shall evidence the right, subject to the provisions
of this Agreement and of the applicable Warrant Certificate, to purchase
0.33 of one share of Common Stock, subject to adjustment pursuant to the
provisions of Section 12 hereof.
Until the Separation Date (as defined in Section 10(f) hereof),
each Warrant shall only be transferable or exchangeable as a Unit with a
corresponding One-Year Warrant.
SECTION 4. Execution of Warrant Certificates. Each Warrant
Certificate, whenever issued, shall be dated as of the date of
countersignature thereof by the Warrant Agent pursuant to Section 5 either
upon initial issuance or upon exchange, substitution or transfer, shall be
signed manually by, or bear the facsimile signature of, the Chairman of the
Board or the Chief Executive Officer or the President or Executive or
Senior Vice President or any Vice President (whether or not designated by a
number or number of words added before or after the title "Vice President")
of the Company, and shall be attested by the manual or facsimile signature
of the Chief Financial Officer or Treasurer or Assistant Treasurer or
Secretary or any Assistant Secretary of the Company.
In case any officer of the Company who shall have signed any of
the Warrant Certificates shall cease to be such officer before the Warrant
Certificates so signed shall have been countersigned by the Warrant Agent
pursuant to Section 5, or disposed of by the Company, such Warrant
Certificates nevertheless may be countersigned and delivered or disposed of
as though such person had not ceased to be such officer of the Company; and
any Warrant Certificate may be signed on behalf of the Company by any
person who, at the actual date of the execution of such Warrant
Certificate, shall be a proper officer of the Company to sign such Warrant
Certificate, although at the date of the execution of this Warrant
Agreement any such person was not such an officer.
SECTION 5. Registration, Countersignature and Issuance of
Temporary Warrant Certificates.
(a) Registration and Countersignature. Warrant Certificates
distributed as provided for herein shall be registered in the names of the
record holders of the Warrant Certificates to whom they are to be
distributed.
The Company and the Warrant Agent may deem and treat the
registered holder of a Warrant Certificate as the absolute owner thereof
(notwithstanding any notation of ownership or other writing thereon made by
anyone), for the purpose of any exercise or conversion thereof and any
distribution to the holder thereof and for all other purposes, and neither
the Company nor the Warrant Agent shall be affected by any notice to the
contrary.
(b) Countersignature and Delivery. Subject to the second paragraph
of Section 4, Warrant Certificates shall be countersigned by manual
signature and dated the date of countersignature by the Warrant Agent and
shall not be valid for any purpose unless so countersigned and dated. The
Warrant Certificates shall be numbered and shall be registered.
Upon the receipt by the Warrant Agent of a written order of the
Company, which order shall be signed manually by, or bear the facsimile
signature of, the Chairman of the Board, the Chief Executive Officer, the
President , any Executive or Senior Vice President , or any Vice President
(whether or not designated by a number or number of words added before or
after the title "Vice President") and attested by the manual or facsimile
signature of the Chief Financial Officer, Treasurer, Assistant Treasurer,
Secretary or any Assistant Secretary of the Company, and shall specify the
number of Warrants to be countersigned, the date of such Warrants and such
other information as is necessary or as the Warrant Agent may reasonably
request. Without any further action by the Company, the Warrant Agent is
authorized, upon receipt from the Company at any time and from time to time
of the Warrant Certificates, duly executed as provided in Section 4 hereof,
to countersign the Warrant Certificates and make them available for
delivery. Such countersignature shall be by a duly authorized signatory of
the Warrant Agent (although it shall not be necessary for the same
signatory to sign all Warrant Certificates).
In case any authorized signatory of the Warrant Agent who shall
have countersigned any of the Warrant Certificates shall cease to be such
authorized signatory before the Warrant Certificate shall be disposed of by
the Company, such Warrant Certificate nevertheless may be delivered or
disposed of as though the person who countersigned such Warrant Certificate
had not ceased to be such authorized signatory of the Warrant Agent; and
any Warrant Certificate may be countersigned on behalf of the Warrant Agent
by such persons as, at the actual time of countersignature of such Warrant
Certificates, shall be the duly authorized signatories of the Warrant
Agent, although at the time of the execution and delivery of this Agreement
any such person is not such an authorized signatory.
(c) Temporary Warrant Certificates. Pending the preparation of
definitive Warrant Certificates, the Company may execute, and the Warrant
Agent shall, upon written request of the Company, countersign and make
available for delivery, temporary Warrant Certificates, which are printed,
lithographed, typewritten or otherwise produced, substantially of the tenor
of the definitive Warrant Certificates in lieu of which they are issued and
with such appropriate insertions, omissions, substitutions and other
variations as the officers executing such Warrant Certificates may
determine, as evidenced by their execution of such Warrant Certificates.
The Company will promptly execute and deliver to the Warrant Agent
definitive Warrant Certificates. After the preparation of definitive
Warrant Certificates, the temporary Warrant Certificates shall be
exchangeable for definitive Warrant Certificates upon surrender of the
temporary Warrant Certificates at any office or agency maintained by the
Company for that purpose pursuant to Section 8 hereof. Subject to the
provisions of Section 6(h) hereof, such exchange shall be without charge to
the holder. Upon surrender for cancellation of any one or more temporary
Warrant Certificates, the Company shall execute, and the Warrant Agent
shall countersign and deliver in exchange therefor, one or more definitive
Warrant Certificates representing in the aggregate a like number of
Warrants. Until so exchanged, the holder of a temporary Warrant Certificate
shall in all respects be entitled to the same benefits under this Agreement
as a holder of a definitive Warrant Certificate.
SECTION 6. Registration of Transfers and Exchanges.
(a) The Warrant Agent shall from time to time register in the
Warrant register the transfer of any outstanding Warrant Certificates, upon
surrender thereof accompanied by a written instrument of transfer in the
form of the assignment appearing at the end of the form of the Warrant
Certificate attached as Exhibit A hereto, duly executed by the registered
holder or holders thereof or by the duly appointed legal representative
thereof or by a duly authorized attorney. Such Warrant register shall be in
written form or in any form capable of being converted into written form
within a reasonable period of time. The Warrant Agent is hereby appointed
"Warrant registrar" for the purpose of registering Warrants and transfers
of Warrants as herein provided. Upon any such registration of transfer, a
new Warrant Certificate of like tenor and representing in the aggregate a
like number of Warrants shall be issued to the transferee and the
surrendered Warrant Certificate shall be cancelled by the Warrant Agent.
Warrant Certificates may be exchanged at the option of the holders
thereof, when surrendered to the Warrant Agent at its Corporate Office, for
another Warrant Certificate or other Warrant Certificates of like tenor and
representing in the aggregate a like number of Warrants. Warrant
Certificates surrendered for exchange, transfer, exercise or conversion
shall be cancelled by the Warrant Agent. Warrant Certificates cancelled as
provided in this Section 6 shall then be disposed of by the Warrant Agent
in accordance with its customary procedures.
Neither the Company nor the Warrant Agent shall be required to
exchange or register a transfer of any of the Warrants surrendered for
exercise or, if a portion of any Warrant is surrendered for exercise, such
portion thereof surrendered for exercise.
The Warrant Agent is hereby authorized to countersign, in
accordance with the provisions of Section 5 and this Section 6, the new
Warrant Certificates required pursuant to the provisions of this Section,
and for the purpose of any distribution of Warrant Certificates
contemplated herein.
Notwithstanding the foregoing, until the Separation Date with
respect to any Warrant, such Warrant shall not be transferable without
concurrent transfer of the One-Year Warrant with which such Warrant
comprises a Unit. The Warrant Agent shall not accept for transfer or
exchange any such Warrant that is submitted for transfer or exchange
without the concurrent submission of such One-Year Warrant with which such
Warrant comprises a Unit.
(b) Prior and as a condition to any sale or transfer of a Warrant
or the Common Stock issued upon exercise thereof that bears the restrictive
legend set forth in Section 6(c) or Section 6(d), respectively (other than
pursuant to a registration statement that has been declared effective under
the Securities Act), such transferee shall, unless the Company otherwise
agrees in writing and so notifies the Warrant Agent, furnish to the Company
and the Warrant Agent a signed letter containing representations and
agreements relating to restrictions on transfer substantially in the form
set forth in Exhibit B to this Agreement and an opinion of counsel if the
Company so requests (other than with respect to a transfer pursuant to an
effective registration statement under the Securities Act) and such
certificates and other information as the Company and/or the Warrant Agent
reasonably may require to confirm that any such transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Securities Act.
(c) Every Warrant that bears or is required under this Section
6(c) to bear the legend set forth in this Section 6(c) (together with any
Common Stock issued upon exercise of the Warrants and required to bear the
legend set forth in Section 6(d), collectively, the "Restricted
Securities") shall be subject to the restrictions on transfer set forth in
this Section 6(c) (including the legend set forth below), unless such
restrictions on transfer shall be waived by written consent of the Company,
and the holder of each such Restricted Security, by such holder's
acceptance thereof, agrees to be bound by all such restrictions on
transfer. As used in Sections 6(c) and 6(d), the term "transfer"
encompasses any sale, pledge, transfer or other disposition whatsoever of
any Restricted Security.
Until two (2) years after the original issuance date of any
Warrant, any certificate evidencing such Warrant (and all securities issued
in exchange therefor or substitution thereof, other than Common Stock, if
any, issued upon exercise thereof which shall bear the legend set forth in
Section 6(d), if applicable) shall bear a legend in substantially the
following form (unless such Warrants have been transferred pursuant to a
registration statement that has been declared effective under the
Securities Act (and which continues to be effective at the time of such
transfer), pursuant to the exemption from registration provided by Rule 144
under the Securities Act, or unless otherwise agreed by the Company in
writing, with notice thereof to the Warrant Agent):
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE ISSUER THAT THIS SECURITY
MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED OTHER THAN (1)
TO THE ISSUER, (2) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH
REGULATION S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER APPEARING
ON THIS SECURITY), (3) TO A PERSON THAT IS AN ACCREDITED INVESTOR
AS DEFINED IN RULE 501(A)(1), (2), (3), (5), (6) OR (7) OF
REGULATION D UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER APPEARING
ON THIS SECURITY) AND THAT IS ACQUIRING THIS SECURITY FOR
INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND A SIGNED LETTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE
FORM OF WHICH LETTER IS AN EXHIBIT TO THE AGREEMENT GOVERNING THIS
SECURITY AND MAY BE OBTAINED FROM THE WARRANT AGENT) IS DELIVERED
PRIOR TO SUCH TRANSFER BY THE TRANSFEREE TO THE ISSUER AND THE
WARRANT AGENT, (4) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT, (5)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OR (6) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE
IN ACCORDANCE WITH ANY OTHER APPLICABLE SECURITIES LAWS. THE
HOLDER HEREOF AGREES, THAT PRIOR TO SUCH TRANSFER, IT WILL FURNISH
TO THE ISSUER AND THE WARRANT AGENT AN OPINION OF COUNSEL IF THE
ISSUER SO REQUESTS (OTHER THAN WITH RESPECT TO A TRANSFER PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT)
AND SUCH CERTIFICATES AND OTHER INFORMATION AS THEY MAY REASONABLY
REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY
COMPLIES WITH THE FOREGOING RESTRICTIONS AND IS BEING MADE
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER
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 SUCH LEGEND. THE HOLDER HEREOF, BY
PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF
THE ISSUER THAT IT IS AN ACCREDITED INVESTOR AS DEFINED IN RULE
501(A)(1), (2), (3), (5), (6) OR (7) OF REGULATION D UNDER THE
SECURITIES ACT AND THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT
PURPOSES AND NOT FOR DISTRIBUTION OR (3) NON-U.S. PERSON OUTSIDE
THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING
THE REQUIREMENTS OF RULE 902 UNDER) REGULATION S UNDER THE
SECURITIES ACT.
The Company may, but is not obligated to instruct the Warrant
Agent to place the following legend on any Warrant held by or transferred
to an "affiliate" (as defined in Rule 501(b) of Regulation D under the
Securities Act) of the Company:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A PERSON
WHO MAY BE DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR PURPOSES OF
RULE 144 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "1933 ACT"), AND MAY BE SOLD ONLY IN COMPLIANCE WITH RULE
144, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
1933 ACT OR PURSUANT TO A VALID EXEMPTION FROM REGISTRATION UNDER
THE 1933 ACT.
Any Warrant (or security issued in exchange or substitution
therefor) as to which such restrictions on transfer shall have expired in
accordance with their terms may, upon surrender of the Warrant Certificate
representing such Warrant for exchange to the Warrant registrar in
accordance with the provisions of this Section 6, be exchanged for a new
Warrant Certificate, of like tenor and representing the same aggregate
number of Warrants, which shall not bear the restrictive legend required by
this Section 6(c).
(d) Until the end of the holding period under Rule 144(k) of the
Securities Act (or any successor provision) applicable to the Common Stock
issued upon exercise of a Warrant, the stock certificate representing such
Common Stock shall bear a legend in substantially the following form
(unless such Common Stock has been sold pursuant to the exemption from
registration provided by Rule 144 under the Securities Act or pursuant to a
registration statement that has been declared effective under the
Securities Act, and which continues to be effective at the time of such
transfer, or such Common Stock has been issued upon the exercise of
Warrants that have been transferred pursuant to a registration statement
that has been declared effective under the Securities Act and which was
effective at the time of such transfer, or unless otherwise agreed by the
Company in writing with written notice thereof to the Warrant Agent and any
transfer agent for the Common Stock):
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE ISSUER THAT THIS SECURITY
MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED OTHER THAN (1)
TO THE ISSUER, (2) IN THE EVENT THIS SECURITY BECOMES ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A
(AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER APPEARING ON THIS SECURITY), (3) IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE
SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR
ON THE CERTIFICATE OF TRANSFER APPEARING ON THIS SECURITY), (4) TO
A PERSON THAT IS AN ACCREDITED INVESTOR AS DEFINED IN RULE
501(A)(1), (2), (3), (5), (6) OR (7) OF REGULATION D UNDER THE
SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR
ON THE CERTIFICATE OF TRANSFER APPEARING ON THIS SECURITY) THAT IS
ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION, AND A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON
TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH
LETTER IS AN EXHIBIT TO THE AGREEMENT GOVERNING THIS SECURITY AND
MAY BE OBTAINED FROM THE TRANSFER AGENT) IS DELIVERED PRIOR TO
SUCH TRANSFER BY THE TRANSFEREE TO THE ISSUER AND THE TRANSFER
AGENT, (5) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY
RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT, (6) PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR
(7) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE
WITH ANY OTHER APPLICABLE SECURITIES LAWS. THE HOLDER HEREOF
AGREES, THAT PRIOR TO SUCH TRANSFER, IT WILL FURNISH TO THE ISSUER
AND THE TRANSFER AGENT AN OPINION OF COUNSEL IF THE ISSUER SO
REQUESTS (OTHER THAN WITH RESPECT TO A TRANSFER PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT) AND
SUCH CERTIFICATES AND OTHER INFORMATION AS THEY MAY REASONABLY
REQUIRE TO CONFIRM THAT ANY TRANSFER BY THE HOLDER OF THIS
SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS AND IS BEING
MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
THE HOLDER 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 THIS LEGEND. THE HOLDER HEREOF, BY
PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF
THE ISSUER THAT IT IS (1) AN ACCREDITED INVESTOR AS DEFINED IN
RULE 501(A)(1), (2), (3), (5), (6) OR (7) OF REGULATION D UNDER
THE SECURITIES ACT AND THAT IT IS HOLDING THIS SECURITY FOR
INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (2) A NON-U.S.
PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN
ACCOUNT SATISFYING THE REQUIREMENTS OF RULE 902 UNDER) REGULATION
S UNDER THE SECURITIES ACT.
The Company may, but is not obligated to instruct the transfer
agent for the Company's Common Stock to place the following legend on any
certificate evidencing shares of Common Stock held by or transferred to an
"affiliate" (as defined in Rule 501(b) of Regulation D under the Securities
Act) of the Company:
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A PERSON
WHO MAY BE DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR PURPOSES OF
RULE 144 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "1933 ACT"), AND MAY BE SOLD ONLY IN COMPLIANCE WITH RULE
144, PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
1933 ACT OR PURSUANT TO A VALID EXEMPTION FROM REGISTRATION UNDER
THE 1933 ACT.
Any such Common Stock as to which such restrictions on transfer
shall have expired in accordance with their terms may, upon surrender of
the certificates representing such shares of Common Stock for exchange in
accordance with the procedures of the transfer agent for the Common Stock,
be exchanged for a new certificate or certificates for a like aggregate
number of shares of Common Stock, which shall not bear the restrictive
legend required by this Section 6(d).
(e) Any Warrant or Common Stock issued upon the exercise of a
Warrant that, prior to the expiration of the holding period applicable to
sales thereof under Rule 144(k) under the Securities Act (or any successor
rule), is purchased or owned by the Company or any Affiliate thereof may
not be resold by the Company or such Affiliate unless registered under the
Securities Act or resold pursuant to an exemption from the registration
requirements of the Securities Act in a transaction that results in such
Warrants or Common Stock, as the case may be, no longer being "restricted
securities" (as defined under Rule 144). (f) Until the Separation Date, as
defined in Section 10(f) hereof, any certificate evidencing any Warrant
(and all securities issued in exchange therefor or substitution thereof,
other than Common Stock issued upon exercise thereof) shall bear a legend
(the "Unit Legend") in substantially the following form:
EXCEPT AS DESCRIBED IN THE NEXT SENTENCE, EACH WARRANT REPRESENTED
BY THIS CERTIFICATE MUST TRADE AS A UNIT WITH ONE ONE-YEAR WARRANT
(AS DEFINED IN THE WARRANT AGREEMENT GOVERNING THIS SECURITY) AND
MAY NOT BE TRANSFERRED OR EXCHANGED WITHOUT THE SIMULTANEOUS
TRANSFER OR EXCHANGE OF CERTIFICATES REPRESENTING ONE ONE-YEAR
WARRANT FOR EACH WARRANT BEING TRANSFERRED OR EXCHANGED. UPON THE
EXERCISE OF THE ONE-YEAR WARRANTS TO WHICH ALL OR A PORTION OF THE
WARRANTS REPRESENTED BY THIS CERTIFICATE RELATE, SUCH WARRANTS (OR
THE PORTION OF SUCH WARRANTS EQUAL TO THE NUMBER OF ONE-YEAR
WARRANTS EXERCISED) MAY BE TRANSFERRED SEPARATELY AND THIS LEGEND
SHALL BE REMOVED WITH RESPECT TO SUCH WARRANTS (OR THE PORTION OF
SUCH WARRANTS EQUAL TO THE NUMBER OF ONE-YEAR WARRANTS EXERCISED).
(g) Notwithstanding any provision of Section 6 to the contrary, in
the event Rule 144(k) as promulgated under the Securities Act (or any
successor rule) is amended to change the two-year period under Rule 144(k)
(or the corresponding period under any successor rule), from and after
receipt by the Warrant Agent of the Officer's Certificate and Opinion of
Counsel provided for in this Section 6(f), (i) each reference in Section
6(c) and 6(d) to "two (2) years" shall be deemed for all purposes hereof to
be references to such changed period and (ii) all corresponding references
in the Warrants shall be deemed for all purposes hereof to be references to
such changed period, provided that such changes shall not become effective
if they are otherwise prohibited by, or would otherwise cause a violation
of, the then-applicable federal securities laws. As soon as practicable
after the Company has knowledge of the effectiveness of any such amendment
to change the two-year period under Rule 144(k) (or the corresponding
period under any successor rule), unless such changes would otherwise be
prohibited by, or would otherwise cause a violation of, the then-applicable
securities law, the Company shall provide to the Warrant Agent an Officer's
Certificate and Opinion of Counsel informing the Warrant Agent of the
effectiveness of such amendment and the effectiveness of the foregoing
changes to Sections 6(c) and 6(d) and the Warrants. The provisions of this
Section 6(f) will not be effective until such time as the Opinion of
Counsel and Officer's Certificate have been received by the Warrant Agent
hereunder. This Section 6(f) shall apply to successive amendments to Rule
144(k) (or any successor rule) changing the holding period thereunder.
(h) The Warrant Agent shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer
imposed under this Agreement or under applicable law with respect to any
transfer of any interest in any Warrant other than to require delivery of
such certificates and other documentation or evidence as are expressly
required by, and to do so if and when expressly required by the terms of,
this Agreement, and to examine the same to determine substantial compliance
as to form with the express requirements hereof and thereof.
(i) No service charge shall be charged to the Warrantholder for
any exchange or registration of transfer of Warrants, but the Company may
require payment of a sum sufficient to cover any tax, assessments or other
governmental charges that may be imposed in connection with the issue and
delivery of Warrant Certificates in any name other than that of such
Warrantholder.
(j) All Warrants surrendered for the purpose of exercise,
repurchase, exchange or registration of transfer, shall, if surrendered to
the Company or any Warrant registrar, be surrendered to the Warrant Agent
and promptly canceled by it, or if surrendered to the Warrant Agent, shall
be promptly canceled by it, and no Warrants shall be issued in lieu thereof
except as expressly permitted by any of the provisions of this Agreement.
The Warrant Agent shall dispose of canceled Warrants in accordance with its
customary procedures. If the Company shall acquire any of the Warrants,
such acquisition shall not operate as a redemption of satisfaction of the
indebtedness represented by such Warrants unless and until the same are
delivered to the Warrant Agent for cancellation.
(k) During any period in which the Company is not subject to
Section 13 or 15(d) of the Exchange Act, Warrantholders (or holders of
interests therein) and prospective purchasers designated by such
Warrantholders (or such holders of interests therein) shall have the right
to obtain from the Company upon request by such Warrantholders (or such
holders of interests) or prospective purchasers the information that would
be required by paragraph (d)(4)(i) of Rule 144A in connection with any
transfer or proposed transfer of securities eligible to be transferred
pursuant to Rule 144A. In addition, if the Common Stock is eligible for
sale pursuant to Rule 144A, the holders of the shares of Common Stock
issuable upon exercise of the Warrants and prospective purchasers
designated by such holders shall have the right to obtain from the Company
upon request by such holder or prospective purchasers, during any period in
which the Company is not subject to Section 13 or 15(d) of the Exchange
Act, the information required by paragraph (d)(4)(i) of Rule 144A in
connection with any transfer or proposed transfer of such shares of Common
Stock.
SECTION 7. Lost, Stolen, Destroyed, Defaced or Mutilated Warrant
Certificates. Upon receipt by the Company and the Warrant Agent (or any
agent of the Company or the Warrant Agent, if requested by the Company) of
evidence satisfactory to them of the loss, theft, destruction, defacement,
or mutilation of any Warrant Certificate and of indemnity satisfactory to
them and, in the case of mutilation or defacement, upon surrender thereof
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 or holder in due course, the Company
shall execute, and an authorized signatory of the Warrant Agent shall
manually countersign and make available for delivery, in exchange for or in
lieu of the lost, stolen, destroyed, defaced or mutilated Warrant
Certificate, a new Warrant Certificate representing a like number of
Warrants, bearing a number or other distinguishing symbol not
contemporaneously outstanding. Every substitute Warrant Certificate
executed and delivered pursuant to this Section 7 in lieu of any lost,
stolen or destroyed Warrant Certificate shall constitute 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 (but shall be subject to all the
limitations of rights set forth in) this Agreement equally and
proportionately with any and all other Warrant Certificates duly executed
and delivered hereunder. The provisions of this Section 7 are exclusive
with respect to the replacement of lost, stolen, destroyed, defaced or
mutilated Warrant Certificates and shall preclude (to the extent lawful)
any and all other rights or remedies notwithstanding any law or statute
existing or hereafter enacted to the contrary with respect to the
replacement of lost, stolen, destroyed, defaced or mutilated Warrant
Certificates.
The Warrant Agent is hereby authorized to countersign in
accordance with the provisions of this Agreement and make available for
delivery the new Warrant Certificates required pursuant to the provisions
of this Section 7.
SECTION 8. Offices for Exercise, Etc. So long as any of the
Warrants remain outstanding, the Company shall designate and maintain in
the Borough of Manhattan, the City of New York: (a) an office or agency
where the Warrant Certificates may be presented for exercise, (b) an office
or agency where the Warrant Certificates may be presented for registration
of transfer and for exchange (including the exchange of temporary Warrant
Certificates for definitive Warrant Certificates pursuant to Section 5(c)
hereof), and (c) an office or agency where notices and demands to or upon
the Company in respect of the Warrants or of this Agreement may be served.
The Company may from time to time change or rescind such designation, as it
may deem desirable or expedient; provided, however, that an office or
agency shall at all times be maintained in the Borough of Manhattan, City
of New York, as provided in the first sentence of this Section 8. In
addition to such office or offices or agency or agencies, the Company may
from time to time designate and maintain one or more additional offices or
agencies within or outside the Borough of Manhattan, City of New York,
where Warrant Certificates may be presented for exercise or for
registration of transfer or for exchange, and the Company may from time to
time change or rescind such designation, as it may deem desirable or
expedient. The Company will give to the Warrant Agent written notice of the
location of any such office or agency and of any change of location
thereof. The Company hereby designates the Warrant Agent's Corporate
Office, as the initial agency maintained for each such purpose. In case the
Company shall fail to maintain any such office or agency or shall fail to
give such notice of the location or of any change in the location thereof,
presentations and demands may be made and notice may be served at the
Corporate Office and the Company appoints the Warrant Agent as its agent to
receive all such presentations, surrenders, notices and demands.
SECTION 9. Duration of Warrants; Early Termination of Warrants.
(a) The Warrants shall, subject to their earlier termination
described below in Section 9(b), expire at 5:00 p.m., New York City time,
on August 28, 2006 (such date, the "Expiration Date"). Each Warrant may be
exercised on any Business Day on or prior to the close of business on the
Expiration Date.
Any Warrant not exercised before the close of business on the
Expiration Date, or the Termination Date (as defined below) if applicable,
as the case may be, shall become void, and all rights of the holder under
the Warrant Certificate evidencing such Warrant and under this Agreement
shall cease.
(b) With respect to any Warrant, if at any time prior to the
Expiration Date, the One-Year Warrant with which such Warrant comprises a
Unit expires or terminates pursuant to the terms of the One-Year Warrant
Agreement without having been exercised pursuant to the terms thereof (the
date of such expiration or termination, the "Termination Date") then such
Warrant shall become void, and all rights of the holder under the Warrant
Certificate evidencing such Warrant and under this Agreement shall cease.
SECTION 10. Exercise, Exercise Price, Settlement and Delivery;
Separation of Warrants.
(a) Warrants may be exercised at any time during the period
commencing on the Separation Date and ending at 5:00 p.m., New York City
time, on the Expiration Date by (i) surrendering, at any office or agency
maintained for that purpose by the Company pursuant to Section 8 (each a
"Warrant Exercise Office"), the Warrant Certificate evidencing such
Warrants with the exercise form appended to the Warrant Certificate (the
"Exercise Form") duly completed and signed by the registered holder or
holders thereof or by the duly appointed legal representative thereof or by
a duly authorized attorney, and in the case of a transfer, such signature
shall be guaranteed by an eligible guarantor institution, (ii) sending
copies of such Exercise Form via facsimile to the Company, attention
General Counsel ((000) 000-0000) and Xxxxxx & Xxxxxxx, attention Xxxx
Xxxxxxx ((000) 000-0000), (iii) paying in full the Exercise Price for each
such Warrant exercised and any other amounts required to be paid pursuant
to Section 10(b) hereof, (iv) except in the event of a Cashless Exercise
(as defined in Section 10(b)) or in the event of the exercise of a Warrant
that has been transferred pursuant to a registration statement that has
been declared effective under the Securities Act, and which was effective
at the time of such transfer, furnishing to the Company and the Warrant
Agent a signed letter containing certain representations and agreements
relating to the restrictions on transfer set forth in Exhibit B hereto and
an opinion of counsel if the Company so requests, and (v) providing such
additional documentation or certifications as the Company and/or the
Warrant Agent may reasonably request.
(b) Simultaneously with the exercise of each Warrant, payment in
full of the Exercise Price shall be made:
(i) in cash or by certified or official bank check to be delivered
to the office or agency where the Warrant Certificate is being surrendered;
(ii) by tendering a principal amount of Notes in integral
multiples of $1,000, including any accrued but unpaid interest thereon up
to, but not including, the Exercise Date, equal to, together with any
payment of cash pursuant to Section 10(b)(i) above, the Exercise Price; or
(iii) solely by the surrender of the applicable Warrant
Certificate, and without the payment of the Exercise Price in cash, for
such number of shares of Common Stock equal to the product of (1) the
number of shares of Common Stock for which such Warrant is exercisable upon
payment of the Exercise Price in cash as of the date of exercise and (2)
the Cashless Exercise Ratio (such exercise, a "Cashless Exercise").
For purposes of this Agreement, the "Cashless Exercise Ratio" shall equal a
fraction, the numerator of which is the excess of the Closing Price per
share of the Common Stock on the last Trading Day before the Exercise Date
(determined as set forth in Section 10(c)) over the Exercise Price Per
Share (as defined below) as of the last Trading Day before the Exercise
Date and the denominator of which is the Closing Price per share of the
Common Stock on the last Trading Day before the Exercise Date. Upon
surrender of a Warrant Certificate representing more than one Warrant in
connection with the holder's option to elect a Cashless Exercise, the
number of shares of Common Stock deliverable upon a Cashless Exercise shall
be equal to the number of shares of Common Stock for which such Warrants
are exercisable (or if only a portion of such Warrants are being exercised,
such number of shares of Common Stock issuable upon exercise of the
Warrants that the holder specifies are to be exercised pursuant to a
Cashless Exercise) upon payment of the Exercise Price in cash as of the
date of exercise multiplied by the Cashless Exercise Ratio.
In accordance with Section 10(e) hereof and subject to Section 16
hereof, if any holder exercises less than all of the Warrants evidenced by
a Warrant Certificate, a new Warrant Certificate will be issued to such
holders for the remaining number of Warrants. All provisions of this
Agreement shall be applicable with respect to an exercise of a Warrant
Certificate pursuant to a Cashless Exercise for less than the full number
of Warrants represented thereby. "Exercise Price Per Share" means with
respect to the Common Stock the Exercise Price divided by the number of
shares of Common Stock for which a Warrant is then exercisable (without
giving effect to the Cashless Exercise option). No payment or adjustment
shall be made on account of any dividends on the shares of Common Stock
issued upon exercise of a Warrant.
(c) Upon such surrender of a Warrant Certificate, payment and
collection of the Exercise Price at any Warrant Exercise Office (other than
the Corporate Office), delivery of the letter and opinion of counsel
referenced in Section 10(a), if required, and delivery of such additional
documentation or certifications as the Company and/or the Warrant Agent may
reasonably request, such Warrant Certificate and payment shall be promptly
delivered to the Warrant Agent. The "Exercise Date" for a Warrant shall be
the date when all of the applicable items referred to in the first sentence
of paragraphs (a) and (b) of this Section 10 are received by the Warrant
Agent, the Company and Xxxxxx & Xxxxxxx, at or prior to 11:00 a.m., New
York City time, on a Business Day and the exercise of the Warrants will be
effective as of such Exercise Date. If any items referred to in the first
sentence of such paragraphs (a) and (b) are received after 11:00 a.m., New
York City time, on a Business Day, the exercise of the Warrants to which
such item relates will be effective on the next succeeding Business Day.
Notwithstanding the foregoing, in the case of an exercise of Warrants on
the Expiration Date or the Termination Date, if applicable, if all of the
items referred to in the first sentence of paragraphs (a) and (b) are
received by the Warrant Agent, the Company and Xxxxxx & Xxxxxxx, as
applicable, at or prior to 5:00 p.m., New York City time, on such
Expiration Date or Termination Date, the exercise of the Warrants to which
such items relate will be effective on the Expiration Date or the
Termination Date, if applicable. For purposes of determining satisfaction
of the requirement set forth above with respect to the Exercise Date for
any Warrant, any facsimile required to be sent shall be deemed to have been
received on a given day if such facsimile was sent before 11:00 a.m., New
York City time, on such date (or 5:00 p.m., New York City time, if such
date is the Expiration Date or the Termination Date), to the number listed
above (unless a different number is specified in a notice filed with the
Warrant Agent and mailed by the Warrant Agent at the Company's expense to
each holder of Warrants at such holder's address appearing on the Warrant
register) and confirmation of the transmission of such facsimile is
obtained.
(d) Upon the exercise of a Warrant in accordance with the terms
hereof, the receipt of a Warrant Certificate and payment of the Exercise
Price (or election of the Cashless Exercise option), the Warrant Agent
shall: (i) except to the extent exercise of the Warrant has been effected
through Cashless Exercise, cause an amount equal to the Exercise Price to
be paid to the Company by crediting the same to the account designated by
the Company in writing to the Warrant Agent for that purpose; (ii) promptly
advise the Company by telephone of the amount so deposited to the Company's
account and promptly confirm such telephonic advice in writing; and (iii)
as soon as practicable, advise the Company in writing of the number of
Warrants exercised in accordance with the terms and conditions of this
Agreement and the Warrant Certificates, the instructions of each exercising
holder of the Warrant Certificates with respect to delivery of the shares
of Common Stock to which such holder is entitled upon such exercise, and
such other information as the Company shall reasonably request.
(e) Subject to Section 6 hereof, the Company shall use its
reasonable best efforts to issue or cause to be issued to or upon the
written order of the registered holder of the Warrant Certificate
evidencing such exercised Warrant or Warrants, the shares of Common Stock
to which such holder is entitled, in fully registered form, registered in
such name or names as may be directed by such holder pursuant to the
Exercise Form, as appended to the Warrant Certificate, within three (3)
Business Days of such Exercise Date, and in any event, shall issue or
caused to be issued such shares within ten (10) Business Days of such
Exercise Date. Such shares of Common Stock shall be deemed to have been
issued and any persons who are designated to be named therein shall be
deemed to have become the holder of record of such shares of Common Stock
as of the close of business on the Exercise Date. After such exercise of
any Warrant or Warrants, the Company shall also issue or cause to be issued
to or upon the written order of the registered holder of such Warrant
Certificate, a new Warrant Certificate, countersigned by the Warrant Agent
pursuant to written instruction, evidencing the number of Warrants, if any,
remaining unexercised unless such Warrants shall have expired.
(f) The Warrants and the One-Year Warrants shall not be separately
transferable prior to the Separation Date. The "Separation Date," with
respect to any Warrant, shall be the date upon which the One-Year Warrant
with which such Warrant comprises a Unit shall have been exercised in
accordance with its terms and the terms of the One-Year Warrant Agreement.
In connection with the exercise of such One-Year Warrant, the Warrant
Certificate representing the Warrant with which such One-Year Warrant
comprised a Unit shall be surrendered to the Warrant Exercise Office.
Unless simultaneously exercised, as soon as practicable after the exercise
of such One-Year Warrant, the Company shall issue, or cause to be issued to
or upon the written order of the registered holder of the Warrant
Certificate, a new Warrant Certificate representing such separated Warrant,
which does not bear the Unit Legend described in Section 6(e) hereof. If
fewer than all Warrants represented by a Warrant Certificate shall be so
separated, the Company shall issue, or cause to be issued to or upon the
written order of the registered holder of such Warrant Certificate, a new
Warrant Certificate representing the remaining number of unseparated
Warrants, which Warrant Certificate shall bear the Unit Legend contained in
Section 6(e) hereof.
SECTION 11. Cancellation of Warrant Certificates. Upon the
termination of any Warrant pursuant to Section 9(b), the Warrant
Certificate evidencing such Warrant shall thereupon be surrendered by the
holder thereof to the Warrant Agent, and when so delivered, shall be
canceled by the Warrant Agent and retired. The Warrant Agent shall cancel
all Warrant Certificates properly surrendered for exchange, substitution,
transfer or exercise. The Warrant Agent shall dispose of such canceled
Warrant Certificates in accordance with its customary procedures.
SECTION 12. Adjustment of Exercise Price and Number of Shares
Issuable. The Exercise Price, the number of Shares issuable upon the
exercise of each Warrant and the number of Warrants outstanding are subject
to adjustment from time to time upon the occurrence of the events
enumerated in this Section 12.
(a) In case the Company shall hereafter pay a dividend or make a
distribution to all holders of the outstanding Common Stock in shares of
Common Stock, the Exercise Price in effect at the opening of business on
the date following the date fixed for the determination of stockholders
entitled to receive such dividend or other distribution shall be reduced by
multiplying such Exercise Price by a fraction of which the numerator shall
be the number of shares of Common Stock outstanding at the close of
business on the Record Date (as defined in Section 12(h)) fixed for such
determination and the denominator shall be the sum of such number of shares
and the total number of shares constituting such dividend or other
distribution, such reduction to become effective immediately after the
opening of business on the day following the Record Date. If any dividend
or distribution of the type described in this Section 12(a) is declared but
not so paid or made, the Exercise Price shall again be adjusted to the
Exercise Price which would then be in effect if such dividend or
distribution had not been declared.
(b) In case the outstanding shares of Common Stock shall be
subdivided into a greater number of shares of Common Stock, the Exercise
Price in effect at the opening of business on the day following the day
upon which such subdivision becomes effective shall be proportionately
reduced, and conversely, in case outstanding shares of Common Stock shall
be combined into a smaller number of shares of Common Stock, the Exercise
Price in effect at the opening of business on the day following the day
upon which such combination becomes effective shall be proportionately
increased, such reduction or increase, as the case may be, to become
effective immediately after the opening of business on the day following
the day upon which such subdivision or combination becomes effective.
(c) In case the Company shall issue rights or warrants to all
holders of its outstanding shares of Common Stock entitling them (for a
period expiring within forty-five (45) days after the date fixed for the
determination of stockholders entitled to receive such rights or warrants)
to subscribe for or purchase shares of Common Stock at a price per share
less than the Current Market Price (as defined in Section 12(h)) on the
Record Date fixed for the determination of stockholders entitled to receive
such rights or warrants, the Exercise Price shall be adjusted so that the
same shall equal the price determined by multiplying the Exercise Price in
effect at the opening of business on the date after such Record Date by a
fraction of which the numerator shall be the sum of the number of shares of
Common Stock outstanding at the close of business on the Record Date plus
the number of shares that the aggregate offering price of the total number
of shares so offered for subscription or purchase would purchase at such
Current Market Price, and of which the denominator shall be the sum of the
number of shares of Common Stock outstanding at the close of business on
the Record Date plus the total number of additional shares of Common Stock
so offered for subscription or purchase.
Such adjustment shall become effective immediately after the
opening of business on the day following the Record Date fixed for
determination of stockholders entitled to receive such rights or warrants.
To the extent that shares of Common Stock are not delivered pursuant to
such rights or warrants, upon the expiration or termination of such rights
or warrants the Exercise Price shall be readjusted to the Exercise Price
that would then be in effect had the adjustments made upon the issuance of
such rights or warrants been made on the basis of delivery of only the
number of shares of Common Stock actually delivered. In the event that such
rights or warrants are not so issued, the Exercise Price shall again be
adjusted to be the Exercise Price that would then be in effect if such date
fixed for the determination of stockholders entitled to receive such rights
or warrants had not been fixed. In determining whether any rights or
warrants entitle the holders to subscribe for or purchase shares of Common
Stock at less than such Current Market Price, and in determining the
aggregate offering price of such shares of Common Stock, there shall be
taken into account any consideration received for such rights or warrants,
the value of such consideration, if other than cash, to be determined by
the Board of Directors.
(d) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock shares of any class of
capital stock of the Company (other than any dividends or distributions to
which Section 12(a) applies) or evidences of its indebtedness or other
assets (including securities, but excluding (1) any rights or warrants
referred to in Section 12(c) and (2) dividends and distributions paid
exclusively in cash (except as set forth in Section 12(e) and (f), (the
foregoing hereinafter in this Section 12(d) called the "Securities")),
unless the Company elects to reserve such Securities for distribution to
the Warrantholders upon conversion of the Warrants so that any such holder
converting Warrants will receive upon such conversion, in addition to the
shares of Common Stock to which such holder is entitled, the amount and
kind of such Securities which such holder would have received if such
holder had converted its Warrants into Common Stock immediately prior to
the Record Date (as defined in Section 12(h) for such distribution of the
Securities) then, in each such case, the Exercise Price shall be reduced so
that the same shall be equal to the price determined by multiplying the
Exercise Price in effect immediately prior to the close of business on the
Record Date (as defined in Section 12(h)) with respect to such distribution
by a fraction of which the numerator shall be the Current Market Price
(determined as provided in Section 12(h)) on such date less the fair market
value (as determined by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution) on such date of the
portion of the Securities so distributed applicable to one share of Common
Stock and the denominator shall be such Current Market Price, such
reduction to become effective immediately prior to the opening of business
on the day following the Record Date; provided, however, that in the event
the then fair market value (as so determined) of the portion of the
Securities so distributed applicable to one share of Common Stock is equal
to or greater than the Current Market Price on the Record Date, in lieu of
the foregoing adjustment, adequate provision shall be made so that each
Warrantholder shall have the right to receive upon conversion of a Warrant
(or any portion thereof) the amount of Securities such holder would have
received had such holder converted such Warrant (or portion thereof)
immediately prior to such Record Date.
In the event that such dividend or distribution is not so paid or
made, the Exercise Price shall again be adjusted to be the Exercise Price
which would then be in effect if such dividend or distribution had not been
declared. If the Board of Directors determines the fair market value of any
distribution for purposes of this Section 12(d) by reference to the actual
or when issued trading market for any securities comprising all or part of
such distribution, it must in doing so consider the prices in such market
over the same period (the "Reference Period") used in computing the Current
Market Price pursuant to Section 12(h) to the extent possible, unless the
Board of Directors in a Board Resolution reasonably determines that
determining the fair market value during the Reference Period would not be
in the best interest of the Warrantholder.
In the event that the Company implements a new stockholder rights
plan, such rights plan shall provide that upon exercise of the Warrants the
holders will receive, in addition to the Common Stock issuable upon such
exercise, the rights issued under such rights plan (notwithstanding the
occurrence of an event causing such rights to separate from the Common
Stock at or prior to the time of exercise). Any distribution of rights or
warrants pursuant to a stockholder rights plan complying with the
requirements set forth in the immediately preceding sentence of this
paragraph shall not constitute a distribution of rights or warrants for the
purposes of this Section 12(d).
Rights or warrants distributed by the Company to all holders of
Common Stock entitling the holders thereof to subscribe for or purchase
shares of the Company's capital stock (either initially or under certain
circumstances), which rights or warrants, until the occurrence of a
specified event or events ("Trigger Event"), (i) are deemed to be
transferred with such shares of Common Stock, (ii) are not exercisable, and
(iii) are also issued in respect of future issuances of Common Stock, shall
be deemed not to have been distributed for purposes of this Section 12(d)
(and no adjustment to the Exercise Price under this Section 12(d) will be
required) until the occurrence of the earliest Trigger Event. If such right
or warrant is subject to subsequent events, upon the occurrence of which
such right or warrant shall become exercisable to purchase different
securities, evidences of indebtedness or other assets or entitle the holder
to purchase a different number or amount of the foregoing or to purchase
any of the foregoing at a different purchase price, then the occurrence of
each such event shall be deemed to be the date of issuance and record date
with respect to a new right or warrant (and a termination or expiration of
the existing right or warrant without exercise by the holder thereof). In
addition, in the event of any distribution (or deemed distribution) of
rights or warrants, or any Trigger Event or other event (of the type
described in the preceding sentence) with respect thereto, that resulted in
an adjustment to the Exercise Price under this Section 12(d), (1) in the
case of any such rights or warrants that shall all have been redeemed or
repurchased without exercise by any holders thereof, the Exercise Price
shall be readjusted upon such final redemption or repurchase to give effect
to such distribution or Trigger Event, as the case may be, as though it
were a cash distribution, equal to the per share redemption or repurchase
price received by a holder of Common Stock with respect to such rights or
warrants (assuming such holder had retained such rights or warrants), made
to all holders of Common Stock as of the date of such redemption or
repurchase, and (2) in the case of such rights or warrants all of which
shall have expired or been terminated without exercise, the Exercise Price
shall be readjusted as if such rights and warrants had never been issued.
For purposes of this Section 12(d) and Sections 12(a) and (c), any
dividend or distribution to which this Section 12(d) is applicable that
also includes shares of Common Stock, or rights or warrants to subscribe
for or purchase shares of Common Stock to which Section 12(c) applies (or
both), shall be deemed instead to be (1) a dividend or distribution of the
evidences of indebtedness, assets, shares of capital stock, rights or
warrants other than such shares of Common Stock or rights or warrants to
which Section 12(c) applies (and any Exercise Price reduction required by
this Section 12(e) with respect to such dividend or distribution shall then
be made) immediately followed by (2) a dividend or distribution of such
shares of Common Stock or such rights or warrants (and any further Exercise
Price reduction required by Sections 12(a) and (c) with respect to such
dividend or distribution shall then be made, except (A) the Record Date of
such dividend or distribution shall be substituted as "the date fixed for
the determination of stockholders entitled to receive such dividend or
other distribution", "Record Date fixed for such determination" and "Record
Date" within the meaning of Section 12(a) and as "the date fixed for the
determination of stockholders entitled to receive such rights or warrants",
"the Record Date fixed for the determination of the stockholders entitled
to receive such rights or warrants" and "such Record Date" within the
meaning of Section 12(c) and (B) any shares of Common Stock included in
such dividend or distribution shall not be deemed "outstanding at the close
of business on the date fixed for such determination" within the meaning of
Section 12(a).
(e) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock cash (excluding any cash that
is distributed upon a merger or consolidation to which Section 13 applies
or as part of a distribution referred to in Section 12(d)), in an aggregate
amount that, combined together with (1) the aggregate amount of any other
such distributions to all holders of its Common Stock made exclusively in
cash within the twelve (12) months preceding the date of payment of such
distribution, and in respect of which no adjustment pursuant to this
Section 12(e) has been made, and (2) the aggregate of any cash plus the
fair market value (as determined by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution) of
consideration payable in respect of any tender offer by the Company or any
of its subsidiaries for all or any portion of the Common Stock concluded
within the twelve (12) months preceding the date of payment of such
distribution, and in respect of which no adjustment pursuant to Section
12(f) has been made, exceeds 10% of the product of the Current Market Price
(determined as provided in Section 12(h)) on the Record Date with respect
to such distribution times the number of shares of Common Stock outstanding
on such date, then, and in each such case, immediately after the close of
business on such date, the Exercise Price shall be reduced so that the same
shall equal the price determined by multiplying the Exercise Price in
effect immediately prior to the close of business on such Record Date by a
fraction (i) the numerator of which shall be equal to the Current Market
Price on the Record Date less an amount equal to the quotient of (x) the
excess of such combined amount over such 10% and (y) the number of shares
of Common Stock outstanding on the Record Date and (ii) the denominator of
which shall be equal to the Current Market Price on such date; provided,
however, that in the event the portion of the cash so distributed
applicable to one share of Common Stock is equal to or greater than the
Current Market Price of the Common Stock on the Record Date, in lieu of the
foregoing adjustment, adequate provision shall be made so that each
Warrantholder shall have the right to receive upon exercise of a Warrant
(or any portion thereof) the amount of cash such holder would have received
had such holder exercised such Warrant (or portion thereof) immediately
prior to such Record Date. In the event that such dividend or distribution
is not so paid or made, the Exercise Price shall again be adjusted to be
the Exercise Price that would then be in effect if such dividend or
distribution had not been declared.
(f) In case a tender offer made by the Company or any Subsidiary
for all or any portion of the Common Stock shall expire and such tender
offer (as amended upon the expiration thereof) shall require the payment to
stockholders (based on the acceptance (up to any maximum specified in the
terms of the tender offer) of Purchased Shares (as defined below)) of an
aggregate consideration having a fair market value (as determined by the
Board of Directors, whose determination shall be conclusive and described
in a Board Resolution) that combined together with (1) the aggregate of the
cash plus the fair market value (as determined by the Board of Directors,
whose determination shall be conclusive and described in a Board
Resolution), as of the expiration of such tender offer, of consideration
payable in respect of any other tender offers, by the Company or any of its
subsidiaries for all or any portion of the Common Stock expiring within the
twelve (12) months preceding the expiration of such tender offer and in
respect of which no adjustment pursuant to this Section 12(f) has been made
and (2) the aggregate amount of any distributions to all holders of the
Company's Common Stock made exclusively in cash within twelve (12) months
preceding the expiration of such tender offer and in respect of which no
adjustment pursuant to Section 12(e) has been made, exceeds 10% of the
product of the Current Market Price (determined as provided in Section
12(h)) as of the last time (the "Expiration Time") tenders could have been
made pursuant to such tender offer (as it may be amended) times the number
of shares of Common Stock outstanding (including any tendered shares) on
the Expiration Time, then, and in each such case, immediately prior to the
opening of business on the day after the date of the Expiration Time, the
Exercise Price shall be adjusted so that the same shall equal the price
determined by multiplying the Exercise Price in effect immediately prior to
close of business on the date of the Expiration Time by a fraction of which
the numerator shall be the number of shares of Common Stock outstanding
(including any tendered shares) on the Expiration Time multiplied by the
Current Market Price of the Common Stock on the Trading Day next succeeding
the Expiration Time and the denominator shall be the sum of (x) the fair
market value (determined as aforesaid) of the aggregate consideration
payable to stockholders based on the acceptance (up to any maximum
specified in the terms of the tender offer) of all shares validly tendered
and not withdrawn as of the Expiration Time (the shares deemed so accepted,
up to any such maximum, being referred to as the "Purchased Shares") and
(y) the product of the number of shares of Common Stock outstanding (less
any Purchased Shares) on the Expiration Time and the Current Market Price
of the Common Stock on the Trading Day next succeeding the Expiration Time,
such reduction (if any) to become effective immediately prior to the
opening of business on the day following the Expiration Time. .In the event
that the Company is obligated to purchase shares pursuant to any such
tender offer, but the Company is permanently prevented by applicable law
from effecting any such purchases or all such purchases are rescinded, the
Exercise Price shall again be adjusted to be the Exercise Price that would
then be in effect if such tender offer had not been made. If the
application of this Section 12(f) to any tender offer would result in an
increase in the Exercise Price, no adjustment shall be made for such tender
offer under this Section 12(f).
(g) In case of a tender or exchange offer made by a person other
than the Company or any Subsidiary for an amount that increases the
offeror's ownership of Common Stock to more than 25% of the Common Stock
outstanding and shall involve the payment by such person of consideration
per share of Common Stock having a fair market value (as determined by the
Board of Directors in good faith, whose determination shall be conclusive,
and described in a resolution of the Board of Directors) at the last time
(the "Expiration Time") tenders or exchanges may be made pursuant to such
tender or exchange offer (as it shall have been amended) that exceeds the
Current Market Price of the Common Stock on the Trading Day next succeeding
the Expiration Time, and in which, as of the Expiration Time the Board of
Directors is not recommending rejection of the offer, the Exercise Price
shall be reduced so that the same shall equal the price determined by
multiplying the Exercise Price in effect immediately prior to the
Expiration Time by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding (including any tendered or exchanged
shares) on the Expiration Time multiplied by the current Market Price of
the Common Stock on the Trading Day next succeeding the Expiration Time and
the denominator shall be the sum of (x) the fair market value (determined
as aforesaid) of the aggregate consideration payable to stockholders based
on the acceptance (up to any maximum specified in the terms of the tender
or exchange offer) of all shares validly tendered or exchanged and not
withdrawn as of the Expiration Time (the shares deemed so accepted, up to
any such maximum, being referred to as the "Purchased Shares") and (y) the
product of the number of shares of Common Stock outstanding (less any
Purchased Shares) on the Expiration Time and the Current Market Price of
the Common Stock on the Trading Day next succeeding the Expiration Time,
such reduction to become effective immediately prior to the opening of
business on the day following the Expiration Time.
In the event that such person is obligated to purchase shares
pursuant to any such tender or exchange offer, but such person is
permanently prevented by applicable law from effecting any such purchases
or all such purchases are rescinded, the Exercise Price shall again be
adjusted to be the Exercise Price that would then be in effect if such
tender or exchange offer had not been made. Notwithstanding the foregoing,
the adjustment described in this Section 12(g) shall not be made if, as of
the Expiration Time, the offering documents with respect to such offer
disclose a plan or intention to cause the Company to engage in any
transaction described in Section 13.
(h) For purposes of this Section 12, the following terms shall
have the meaning indicated:
(i) "Closing Price" with respect to any securities on any day
shall mean the closing sale price regular way on such day or, in case no
such sale takes place on such day, the average of the reported closing bid
and asked prices, regular way, in each case on the Nasdaq National Market
or New York Stock Exchange, as applicable, or, if such security is not
listed or admitted to trading on such National Market or Exchange, on the
principal national security exchange or quotation system on which such
security is quoted or listed or admitted to trading, or, if not quoted or
listed or admitted to trading on any national securities exchange or
quotation system, the average of the closing bid and asked prices of such
security on the over-the-counter market on the day in question as reported
by the National Quotation Bureau Incorporated, or a similar generally
accepted reporting service, or if not so available, in such manner as
furnished by any New York Stock Exchange member firm selected from time to
time by the Board of Directors for that purpose, or a price determined in
good faith by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution.
(ii) "Current Market Price" shall mean the average of the daily
Closing Prices per share of Common Stock for the ten (10) consecutive
Trading Days immediately prior to the date in question; provided, however,
that (1) if the "ex" date (as hereinafter defined) for any event (other
than the issuance or distribution requiring such computation) that requires
an adjustment to the Exercise Price pursuant to Section 12(a), (b), (c),
(d), (e), (f) or (g) occurs during such ten (10) consecutive Trading Days,
the Closing Price for each Trading Day prior to the "ex" date for such
other event shall be adjusted by multiplying such Closing Price by the same
fraction by which the Exercise Price is so required to be adjusted as a
result of such other event, (2) if the "ex" date for any event (other than
the issuance or distribution requiring such computation) that requires an
adjustment to the Exercise Price pursuant to Section 12(a), (b), (c), (d),
(e), (f) or (g) occurs on or after the "ex" date for the issuance or
distribution requiring such computation and prior to the day in question,
the Closing Price for each Trading Day on and after the "ex" date for such
other event shall be adjusted by multiplying such Closing Price by the
reciprocal of the fraction by which the Exercise Price is so required to be
adjusted as a result of such other event, and (3) if the "ex" date for the
issuance or distribution requiring such computation is prior to the day in
question, after taking into account any adjustment required pursuant to
clause (1) or (2) of this proviso, the Closing Price for each Trading Day
on or after such "ex" date shall be adjusted by adding thereto the amount
of any cash and the fair market value (as determined by the Board of
Directors in a manner consistent with any determination of such value for
purposes of Section 12(d), (f) or (g), whose determination shall be
conclusive and described in a Board Resolution) of the evidences of
indebtedness, shares of capital stock or assets being distributed
applicable to one share of Common Stock as of the close of business on the
day before such "ex" date. For purposes of any computation under Sections
12(f) or (g), the Current Market Price of the Common Stock on any date
shall be deemed to be the average of the daily Closing Prices per share of
Common Stock for such day and the next two succeeding Trading Days;
provided, however, that if the "ex" date for any event (other than the
tender offer requiring such computation) that requires an adjustment to the
Exercise Price pursuant to Section 12(a), (b), (c), (d), (e), (f) and (g)
occurs on or after the Expiration Time for the tender or exchange offer
requiring such computation and prior to the day in question, the Closing
Price for each Trading Day on and after the "ex" date for such other event
shall be adjusted by multiplying such Closing Price by the reciprocal of
the fraction by which the Exercise Price is so required to be adjusted as a
result of such other event. For purposes of this paragraph, the term "ex"
date, (1) when used with respect to any issuance or distribution, means the
first date on which the Common Stock trades regular way on the relevant
exchange or in the relevant market from which the Closing Price was
obtained without the right to receive such issuance or distribution, (2)
when used with respect to any subdivision or combination of shares of
Common Stock, means the first date on which the Common Stock trades regular
way on such exchange or in such market after the time at which such
subdivision or combination becomes effective, and (3) when used with
respect to any tender or exchange offer means the first date on which the
Common Stock trades regular way on such exchange or in such market after
the Expiration Time of such offer. Notwithstanding the foregoing, whenever
successive adjustments to the Exercise Price are called for pursuant to
this Section 12, such adjustments shall be made to the Current Market Price
as may be necessary or appropriate to effectuate the intent of this Section
12 and to avoid unjust or inequitable results as determined in good faith
by the Board of Directors.
(iii) "Fair market value" shall mean the amount which a willing
buyer would pay a willing seller in an arm's length transaction.
(iv) "Record Date" shall mean, with respect to any dividend,
distribution or other transaction or event in which the holders of Common
Stock have the right to receive any cash, securities or other property or
in which the Common Stock (or other applicable security) is exchanged for
or converted into any combination of cash, securities or other property,
the date fixed for determination of stockholders entitled to receive such
cash, securities or other property (whether such date is fixed by the Board
of Directors or by statute, contract or otherwise).
(v) "Trading Day" shall mean (x) if the applicable security is
listed or admitted for trading on the New York Stock Exchange or another
national security exchange, a day on which the New York Stock Exchange or
such other national security exchange, as applicable, is open for business
or (y) if the applicable security is quoted on the Nasdaq National Market,
a day on which trades may be made thereon or (z) if the applicable security
is not so listed, admitted for trading or quoted, any day other than a
Saturday or Sunday or a day on which banking institutions in the State of
New York are authorized or obligated by law or executive order to close.
(i) The Company may make such reductions in the Exercise Price, in
addition to those required by Sections 12(a), (b), (c), (d), (e), (f) and
(g), as the Board of Directors considers to be advisable to avoid or
diminish any income tax to holders of Common Stock or rights to purchase
Common Stock resulting from any dividend or distribution of stock (or
rights to acquire stock) or from any event treated as such for income tax
purposes.
To the extent permitted by applicable law, the Company from time
to time may reduce the Exercise Price by any amount for any period of time
if the period is at least twenty (20) days, the reduction is irrevocable
during such period and the Board of Directors shall have made a
determination that such reduction would be in the best interests of the
Company, which determination shall be conclusive and described in a Board
Resolution. Whenever the Exercise Price is reduced pursuant to the
preceding sentence, the Company shall mail to the holder of each Warrant at
his last address appearing on the Warrant register provided for in Section
8 a notice of the reduction at least fifteen (15) days prior to the date
the reduced Exercise Price is to take effect, and such notice shall state
the reduced Exercise Price and the period during which it will be in
effect.
(j) No adjustment in the Exercise Price shall be required under
this Section 12 unless such adjustment would require an increase or
decrease of at least 1% in the Exercise Price; provided, however, that any
adjustments which by reason of this Section 12(j) are not required to be
made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 12 shall be made by the
Company and shall be made to the nearest cent or to the nearest one
hundredth of a share, as the case may be. No adjustment need be made for a
change in the par value or no par value of the Common Stock.
(k) Whenever the Exercise Price is adjusted as provided in this
Section 12, the Company shall promptly file with the Warrant Agent an
Officer's Certificate setting forth the Exercise Price after such
adjustment and setting forth a brief statement of the facts requiring such
adjustment. The Warrant Agent shall be fully protected in relying on any
such certificate and on any adjustment therein contained and shall not be
deemed to have knowledge of such adjustment unless and until it shall have
received such certificate. Promptly after delivery of such certificate, the
Company shall prepare a notice of such adjustment of the Exercise Price
setting forth the adjusted Exercise Price and the date on which each
adjustment becomes effective and shall mail such notice of such adjustment
of the Exercise Price to the holder of each Warrant at his last address
appearing on the Warrant register provided for in Section 8, within twenty
(20) days of the effective date of such adjustment. Failure to deliver such
notice shall not effect the legality or validity of any such adjustment.
(l) In any case in which this Section 12 provides that an
adjustment shall become effective immediately after a Record Date for an
event, the Company may defer until the occurrence of such event (i) issuing
to the holder of any Warrant exercised after such Record Date and before
the occurrence of such event the additional shares of Common Stock issuable
upon such exercise by reason of the adjustment required by such event over
and above the Common Stock issuable upon such conversion before giving
effect to such adjustment and (ii) paying to such holder any amount in cash
in lieu of any fraction pursuant to Section 17.
(m) For purposes of this Section 12, the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in respect of
scrip certificates issued in lieu of fractions of shares of Common Stock.
The Company will not pay any dividend or make any distribution on shares of
Common Stock held in the treasury of the Company.
(n) Upon each adjustment of the Exercise Price pursuant to this
Section 12, each Warrant shall thereupon evidence the right to purchase
that number of shares of Common Stock (calculated to the nearest hundredth
of a share) obtained by multiplying the number of shares of Common Stock
purchasable immediately prior to such adjustment upon exercise of the
Warrant by the Exercise Price in effect immediately prior to such
adjustment and dividing the product so obtained by the Exercise Price in
effect immediately after such adjustment. The adjustment pursuant to this
Section 12(o) to the number of shares of Common Stock purchasable upon
exercise of a Warrant shall be made each time an adjustment of the Exercise
Price is made pursuant to this Section 12 (or would be made but for Section
12(j) hereof).
SECTION 13. Effect of Reclassification, Consolidation, Merger or
Sale. If any of the following events occur, namely (i) any reclassification
or change of the outstanding shares of Common Stock (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), (ii) any
consolidation, merger or combination of the Company with another person as
a result of which holders of Common Stock shall be entitled to receive
stock, securities or other property or assets (including cash) with respect
to or in exchange for such Common Stock, (iii) any statutory exchange, as a
result of which holders of Common Stock generally shall be entitled to
receive stock, securities or other property or assets (including cash) with
respect to or in exchange for such Common Stock (such transaction, a
"Statutory Exchange"), (iv) any sale or conveyance of the properties and
assets of the Company as, or substantially as, an entirety to any other
person as a result of which holders of Common Stock shall be entitled to
receive stock, securities or other property or assets (including cash) with
respect to or in exchange for such Common Stock, then the Company or the
successor or purchasing person, as the case may be, shall execute with the
Warrant Agent a supplemental warrant agreement providing that such Warrant
shall be exercisable for the kind and amount of shares of stock and other
securities or property or assets (including cash) receivable upon such
reclassification, change, consolidation, merger, combination, Statutory
Exchange, sale or conveyance by a holder of a number of shares of Common
Stock issuable upon exercise of such Warrants (assuming, for such purposes,
a sufficient number of authorized shares of Common Stock available for
issuance upon exercise of all such Warrants) immediately prior to such
reclassification, change, consolidation, merger, combination, Statutory
Exchange, sale or conveyance assuming such holder of Common Stock did not
exercise his rights of election, if any, that holders of Common Stock who
were entitled to vote or consent to such transaction had as to the kind or
amount of securities, cash or other property receivable upon such
consolidation, merger, combination, Statutory Exchange, sale or conveyance
(provided that, if the kind or amount of securities, cash or other property
receivable upon such consolidation, merger, combination, Statutory
Exchange, sale or conveyance is not the same for each share of Common Stock
in respect of which such rights of election shall not have been exercised
("non-electing share"), then for the purposes of this Section 13 the kind
and amount of securities, cash or other property receivable upon such
consolidation, merger, combination, Statutory Exchange, sale or conveyance
for each non-electing share shall be deemed to be the kind and amount so
receivable per share by a plurality of the non-electing shares). Such
supplemental warrant agreement shall provide for adjustments which shall be
as nearly equivalent as may be practicable to the adjustments provided for
in Section 12. If, in the case of any such reclassification, change,
consolidation, merger, combination, Statutory Exchange, sale or conveyance,
the stock or other securities and assets receivable thereupon by a holder
of shares of Common Stock include shares of stock or other securities and
assets of a corporation other than the successor or purchasing person, as
the case may be, in such reclassification, change, consolidation, merger,
combination, Statutory Exchange, sale or conveyance, then such supplemental
warrant agreement shall also be executed by such other person and shall
contain such additional provisions to protect the interests of the holders
of the Warrants as the Board of Directors shall reasonably consider
necessary by reason of the foregoing. The Exercise Price for the stock and
other securities, property and assets (including cash) so receivable upon
such event shall be an amount equal to the Exercise Price immediately prior
to such event.
The Company shall cause notice of the execution of such
supplemental warrant agreement to be mailed to each holder of Warrants, at
such holder's address appearing on the Warrant register provided for in
Section 6 of this Warrant agreement, within twenty (20) days after
execution thereof. Failure to deliver such notice shall not affect the
legality or validity of such supplemental warrant agreement.
The above provisions of this Section shall similarly apply to
successive reclassifications, changes, consolidations, mergers,
combinations, sales and conveyances.
If this Section 13 applies to any event or occurrence, Section 12
shall not apply.
SECTION 14. Taxes on Shares Issued. The issue of stock
certificates upon exercise of Warrants shall be made without charge to the
exercising Warrantholder for any tax in respect of the issue thereof. The
Company shall not, however, be required to pay any tax which may be payable
in respect of any transfer involved in the issue and delivery of stock in
any name other than that of the holder of any Warrant exercised, and the
Company shall not be required to issue or deliver any such stock
certificate unless and until the person or persons requesting the issue
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 15. Reservation of Shares; Shares to Be Fully Paid;
Listing of Common Stock. The Company shall reserve, free from preemptive
rights, and keep available out of its authorized but unissued shares or
shares held in treasury, sufficient shares of Common Stock for issuance
upon exercise of the Warrants from time to time as such Warrants are
presented for exercise.
Before taking any action which would cause an adjustment reducing
the Exercise Price below the then par value, if any, of the shares of
Common Stock issuable upon conversion of the Warrants, the Company will
take all corporate action which may, in the opinion of its counsel, be
necessary in order that the Company may validly and legally issue shares of
such Common Stock at such adjusted Exercise Price.
The Company covenants that all shares of Common Stock issued upon
exercise of Warrants will be duly and validly issued and fully paid and
non-assessable by the Company and free from all taxes, liens and charges
with respect to the issue thereof.
The Company further covenants that if at any time the Common Stock
shall be listed on the New York Stock Exchange, Nasdaq National Market or
any other national securities exchange or automated quotation system the
Company will, if permitted by the rules of such exchange or automated
quotation system, list and keep listed, so long as the Common Stock shall
be so listed on such exchange or automated quotation system, all Common
Stock issuable upon conversion of the Warrants.
SECTION 16. Fractional Warrants and Fractional Shares
(a) Notwithstanding anything contained in this Agreement to the
contrary, the Company shall not be required to issue fractions of Warrants
or distribute Warrant Certificates which evidence fractional Warrants.
(b) Notwithstanding anything contained in this Agreement to the
contrary, the Company shall not be required to issue fractions of shares of
Common Stock upon exercise of the Warrants or to distribute certificates
which evidence such fractional shares. If more than one Warrant shall be
presented for exercise in full at the same time by the same holder, the
number of full shares of Common Stock which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
shares of Common Stock purchasable on exercise of all Warrants so
presented. In lieu any of fractional shares, there shall be paid to the
registered holders of Warrant Certificates at the time such Warrant
Certificates are exercised, as herein provided, an amount in cash equal to
the same fraction of the current market value of a share of Common Stock.
For purposes of this Section 16(b), the current market value of a share of
Common Stock shall be the Closing Price of a share of Common Stock for the
Trading Day immediately prior to the date of such exercise.
SECTION 17. Notice to Warrantholders Prior to Certain Actions. In
case:
(a) the Company shall declare a dividend (or any other
distribution) on its Common Stock that would require an adjustment in the
Exercise Price pursuant to Section 12; or
(b) the Company shall authorize the granting to the holders of its
Common Stock of rights or warrants to subscribe for or purchase any share
of any class or any other rights or warrants; or
(c) of any reclassification of the Common Stock of the Company
(other than a subdivision or combination of its outstanding Common Stock,
or a change in par value, or from par value to no par value, or from no par
value to par value), or of any consolidation or merger to which the Company
is a party and for which approval of any shareholders of the Company is
required, or of the sale or transfer of all or substantially all of the
assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company;
the Company shall cause to be filed with the Warrant Agent and mailed by
the Warrant Agent at the Company's expense to each holder of Warrants at
such holder's address appearing on the Warrant register as promptly as
possible but in any event at least fifteen days prior to the applicable
date hereinafter specified, a notice stating (x) the date on which a record
is to be taken for the purpose of such dividend, distribution or rights or
warrants, or, if a record is not to be taken, the date as of which the
holders of Common Stock of record to be entitled to such dividend,
distribution or rights are to be determined, or (y) the date on which such
reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding-up is expected to become effective or occur, and the
date as of which it is expected that holders of Common Stock of record
shall be entitled to exchange their Common Stock for securities or other
property deliverable upon such reclassification, consolidation, merger,
sale, transfer, dissolution, liquidation or winding-up. Failure to give
such notice, or any defect therein, shall not affect the legality or
validity of such dividend, distribution, reclassification, consolidation,
merger, sale, transfer, dissolution, liquidation or winding-up.
SECTION 18. Merger, Consolidation or Change of Name of Warrant
Agent. Any corporation into which the Warrant Agent may be merged or
converted or with which it 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 succeeding to all or
substantially all the corporate trust 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 21. 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 warrant
agent; and in all such cases such Warrant Certificates shall have the full
force provided in the Warrant Certificates and in this Agreement.
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 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 provided in the Warrant Certificates
and in this Agreement.
SECTION 19. Warrant Agent. The Warrant Agent undertakes the duties
and obligations expressly imposed by this Agreement upon the following
terms and conditions, and no implied duties or obligations shall be read
into this Agreement against the Warrant Agent, 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 of its
own selection (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 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 may conclusively rely upon and 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 notice,
resolution, waiver, consent, order, certificate, or other paper, document
or instrument (whether in its original or facsimile form) 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 such
compensation as shall be agreed between the Company and the Warrant Agent
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 connection with the execution and administration of
its duties under this Agreement and to fully indemnify the Warrant Agent
and save it harmless against any and all liabilities, claims, damages,
losses and expenses including judgments, costs and reasonable counsel fees
and expenses, for anything done or omitted by the Warrant Agent in the
execution and administration of its duties under this Agreement except as
determined by a court of competent jurisdiction to have been caused by its
gross negligence or willful misconduct. The provisions of this Section
19(e) shall survive the termination of this Agreement..
(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
Warrant Certificates shall furnish the Warrant Agent with security and
indemnity satisfactory to it for any costs and expenses which may be
incurred. 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 thereof, 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
and no duties shall be inferred or implied against the Warrant Agent. The
Warrant Agent shall not be liable for anything which it may do or refrain
from doing in connection with this Agreement except for its own gross
negligence or willful misconduct.
(i) No provision of this Agreement shall require the Warrant Agent
to expend or risk its own funds or otherwise incur any financial liability
in the performance of any of its duties hereunder or in the exercise of is
rights if there shall be reasonable grounds for believing repayment of such
funds or adequate indemnification against such risk or liability is not
reasonably assured to it.
SECTION 20. Disposition of Proceeds of Exercise of Warrants. The
Warrant Agent shall account promptly to the Company with respect to
Warrants exercised and concurrently pay to the Company all moneys or Notes
received by the Warrant Agent on the purchase of shares of Common Stock
upon the exercise of Warrants.
SECTION 21. Change of Warrant Agent. If the Warrant Agent shall
become incapable of acting as Warrant Agent, the Company shall appoint a
successor. 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 incapacitated Warrant Agent or by the registered holder of a Warrant
Certificate, then the Warrant Agent or registered holder of any Warrant
Certificate may apply, at the reasonable expense of the Company, to any
court of competent jurisdiction for the appointment of a successor to the
incapacitated Warrant Agent. Pending appointment of a successor to the
Warrant Agent, either by the Company or by such a court, the duties of the
Warrant Agent shall be carried out by the Company. Any successor warrant
agent whether appointed by the Company or by such a court, shall be a bank
or trust company, in good standing, incorporated under the laws of the
State of New York or of the United States of America, and having its
principal office in the Borough of Manhattan in New York, New York, and
must have at the time of its appointment as Warrant Agent a combined
capital and surplus of at least one hundred million dollars. After
appointment the successor 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; but the former Warrant
Agent shall, upon payment of all amounts owed to it hereunder, deliver and
transfer to the successor 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 21, however, or any defect therein, shall not affect the
legality or validity of the removal of the Warrant Agent or the appointment
of a successor warrant agent as the case may be.
SECTION 22. 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 Certificate to or on the
Company shall be sufficiently given or made if sent by mail, first class or
registered, postage prepaid, addressed (until another address is filed in
writing by the Company with the Warrant Agent), as follows:
TiVo Inc.
0000 Xxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Chief Financial Officer
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 principal corporate trust office of the Warrant Agent.
Any notice pursuant to this Agreement to be given by the Company
or by the registered holder of any Warrant Certificate to the Warrant Agent
shall be sufficiently given if sent by first-class mail, postage pre-paid,
addressed (until another address is filed in writing by the Warrant Agent
with the Company) to the Warrant Agent as follows:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00X
Xxx Xxxx, XX 00000
Attention: Corporate Trust Administration
SECTION 23. 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 Warrant Certificates 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 adversely affect the interests
of the holders of Warrant Certificates; provided, however, that the written
consent of the holders of Warrant Certificates representing a majority of
the Warrants then outstanding (but not including any Warrants then held by
the Company or its Affiliates) is required to amend or supplement the
Warrant Agreement in any manner that would have a material adverse effect
on the interests of the Warrantholders and provided further, that the
consent of each holder of the Warrants affected is required for any
amendment which would increase the Exercise Price or decrease the number of
shares of Common Stock purchasable upon exercise of the Warrants, except,
in any case, pursuant to the adjustments provided for in Section 12.
Upon the delivery of a certificate from an appropriate officer of
the Company which states that the proposed supplement or amendment is in
compliance with the terms of this Section, the Warrant Agent shall execute
such supplement or amendment. Notwithstanding any other provision hereof,
the Warrant Agent's consent must be obtained regarding any amendment or
supplement pursuant to this Section 23 which alters the Warrant Agent's
rights or duties.
It shall not be necessary for the consent of the Warrantholders
under this Section 23 to approve the particular form of any proposed
supplemental warrant agreement, but it shall be sufficient if such consent
shall approve the substance thereof.
SECTION 24. 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 25. Termination. This Agreement shall terminate at the
close of business on August 28, 2006. Notwithstanding the foregoing, this
Agreement will terminate on any earlier date if all Warrants have been
exercised or terminated pursuant to Section 9(b). The provisions of Section
19 shall survive such termination.
SECTION 26. 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, INCLUDING WITHOUT LIMITATION, SECTION
5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
SECTION 27. 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 the Warrant
Certificates 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 the Warrant
Certificates.
SECTION 28. 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.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed, as of the day and year first above written.
TIVO INC.
By: /s/ Xxxxxxx Xxxxxx
--------------------
Name: Xxxxxxx Xxxxxx
Title: President and Chief
Executive Officer
Attest:
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Senior Vice President, Finance and
Administration and Chief Financial Officer
THE BANK OF NEW YORK, as Warrant Agent
By: /s/ Xxxxxxx Xxxxxxx
----------------------------
Name: Xxxxxxx Xxxxxxx
Title: Assistant Treasurer
EXHIBIT A
FORM OF WARRANT
TIVO INC.
No. CUSIP No.
------------------- -------------------
[THE FOLLOWING PARAGRAPHS SHALL APPEAR ON THE FACE OF EACH RESTRICTED WARRANT.]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE
"SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, AGREES
FOR THE BENEFIT OF THE ISSUER THAT THIS SECURITY MAY NOT BE RESOLD, PLEDGED
OR OTHERWISE TRANSFERRED OTHER THAN (1) TO THE ISSUER, (2) IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT (AS
INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF
TRANSFER APPEARING ON THIS SECURITY), (3) TO A PERSON THAT IS AN ACCREDITED
INVESTOR AS DEFINED IN RULE 501(A)(1), (2), (3), (5), (6) OR (7) OF
REGULATION D UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY
THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER APPEARING ON THIS SECURITY)
AND THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION, AND A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE SECURITY
EVIDENCED HEREBY (THE FORM OF WHICH LETTER IS AN EXHIBIT TO THE AGREEMENT
GOVERNING THIS SECURITY AND MAY BE OBTAINED FROM THE WARRANT AGENT) IS
DELIVERED PRIOR TO SUCH TRANSFER BY THE TRANSFEREE TO THE ISSUER AND THE
WARRANT AGENT, (4) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY
RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT, (5) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (6) IN
ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY OTHER APPLICABLE
SECURITIES LAWS. THE HOLDER HEREOF AGREES, THAT PRIOR TO SUCH TRANSFER, IT
WILL FURNISH TO THE ISSUER AND THE WARRANT AGENT AN OPINION OF COUNSEL IF
THE ISSUER SO REQUESTS (OTHER THAN WITH RESPECT TO A TRANSFER PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT) AND SUCH
CERTIFICATES AND OTHER INFORMATION AS THEY MAY REASONABLY REQUIRE TO
CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE
FOREGOING RESTRICTIONS AND IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR
IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. THE HOLDER 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 SUCH LEGEND. THE HOLDER HEREOF, BY
PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE
ISSUER THAT IT IS AN ACCREDITED INVESTOR AS DEFINED IN RULE 501(A)(1), (2),
(3), (5), (6) OR (7) OF REGULATION D UNDER THE SECURITIES ACT AND THAT IT
IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION
OR (3) NON-U.S. PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR
AN ACCOUNT SATISFYING THE REQUIREMENTS OF RULE 902 UNDER) REGULATION S
UNDER THE SECURITIES ACT.
[THE FOLLOWING PARAGRAPH SHALL APPEAR ON THE FACE OF EACH WARRANT THAT
COMPRISES A PART OF A UNIT:]
EXCEPT AS DESCRIBED IN THE NEXT SENTENCE, EACH WARRANT REPRESENTED BY THIS
CERTIFICATE MUST TRADE AS A UNIT WITH ONE ONE-YEAR WARRANT (AS DEFINED IN
THE WARRANT AGREEMENT GOVERNING THIS SECURITY) AND MAY NOT BE TRANSFERRED
OR EXCHANGED WITHOUT THE SIMULTANEOUS TRANSFER OR EXCHANGE OF CERTIFICATES
REPRESENTING ONE ONE-YEAR WARRANT FOR EACH WARRANT BEING TRANSFERRED OR
EXCHANGED. UPON THE EXERCISE OF THE ONE-YEAR WARRANTS TO WHICH ALL OR A
PORTION OF THE WARRANTS REPRESENTED BY THIS CERTIFICATE RELATE, SUCH
WARRANTS (OR THE PORTION OF SUCH WARRANTS EQUAL TO THE NUMBER OF ONE-YEAR
WARRANTS EXERCISED) MAY BE TRANSFERRED SEPARATELY AND THIS LEGEND SHALL BE
REMOVED WITH RESPECT TO SUCH WARRANTS (OR THE PORTION OF SUCH WARRANTS
EQUAL TO THE NUMBER OF ONE-YEAR WARRANTS EXERCISED).
[THE COMPANY MAY, BUT IS NOT OBLIGATED TO INSTRUCT THE WARRANT AGENT TO
PLACE THE FOLLOWING LEGEND ON ANY WARRANT HELD BY OR TRANSFERRED TO AN
"AFFILIATE" (AS DEFINED IN RULE 501(B) OF REGULATION D UNDER THE SECURITIES
ACT):]
THE SHARES REPRESENTED BY THIS CERTIFICATE ARE HELD BY A PERSON WHO MAY BE
DEEMED TO BE AN AFFILIATE OF THE ISSUER FOR PURPOSES OF RULE 144
PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"),
AND MAY BE SOLD ONLY IN COMPLIANCE WITH RULE 144, PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE 1933 ACT OR PURSUANT TO A VALID EXEMPTION
FROM REGISTRATION UNDER THE 1933 ACT.
WARRANT
REPRESENTING _________ WARRANTS TO PURCHASE COMMON STOCK
This certifies that _________, or its registered assigns, is the
registered owner of __________ Warrants, each expiring August 28, 2006 and
each of which entitles the registered owner thereof (the "Warrantholder")
to purchase at any time prior to the expiration hereof from TIVO INC., a
Delaware corporation (the "Company"), 0.33 of one share of Common Stock
(the "Common Stock"), $0.001 par value per share, of the Company at the
purchase price of $7.85 per share of Common Stock (the "Exercise Price"),
subject to adjustment as provided in the Warrant Agreement hereinafter
referred to.
The Warrants evidenced by this Warrant are issued under and in
accordance with the Warrant Agreement, dated as of August 28, 2001 (the
"Warrant Agreement"), between the Company and The Bank of New York, as
warrant agent (the "Warrant Agent"), and the Registration Rights Agreement,
dated of even date therewith (the "Registration Rights Agreement"), among
the Company and the initial purchasers of the Warrants, and are subject to
the terms and provisions contained therein, to all of which terms and
provisions the holder of this Warrant consents by acceptance of this
Warrant and which Warrant Agreement and Registration Rights Agreement are
hereby incorporated by reference in and made a part of this Warrant.
Until the Separation Date, any Warrants represented by this
Certificate shall be transferable or exchangeable only as a Unit with a
like number of One-Year Warrants (as defined in the Warrant Agreement). The
Separation Date, with respect to any Warrant shall be the date upon which
such One-Year Warrant with which such Warrant comprises a Unit shall have
been exercised in accordance with its terms and the terms of the One-Year
Warrant Agreement (as defined in the Warrant Agreement).
Reference is hereby made to the Warrant Agreement and the
Registration Rights Agreement for a full description of the rights,
limitations of rights, obligations, duties and immunities thereunder of the
Company and the Warrantholders. The summary of the terms of the Warrant
Agreement and the Registration Rights Agreement contained in this Warrant
is qualified in its entirety by express reference to such agreements. All
capitalized terms used but not defined in this Warrant shall have the
meanings assigned to them in the Warrant Agreement.
As provided in the Warrant Agreement, and subject to the terms and
conditions set forth therein including early termination of the Warrants,
the Warrants shall be exercisable, unless earlier terminated as described
below, at any time during the period commencing on the Separation Date and
ending at 5:00 p.m., New York time, on August 28, 2006 (the "Expiration
Date"). This Warrant may be exercised on any Business Day on or prior to
close of business on the Expiration Date.
Any Warrant not exercised before the close of business on the
Expiration Date, or the Termination Date, as the case may be, shall become
void, and all rights of the holder under the Warrant Certificate evidencing
such Warrant and under this Agreement shall cease.
With respect to any Warrant, if at any time prior to the
Expiration Date, the One-Year Warrant with which such Warrant comprises a
Unit expires or terminates pursuant to the terms of the One-Year Warrant
Agreement without having been exercised pursuant to the terms thereof (the
date of such expiration or termination, the "Termination Date") then such
Warrant shall terminate if not exercised before 5:00 p.m., New York City
time, on the Termination Date.
The Exercise Price and the number of shares of Common Stock
purchasable upon exercise of each Warrant are subject to adjustment as
provided in the Warrant Agreement. If any of the following events occur,
namely (i) any reclassification or change of the outstanding shares of
Common Stock (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), (ii) any consolidation, merger or combination of the
Company with another person as a result of which holders of Common Stock
shall be entitled to receive stock, securities or other property or assets
(including cash) with respect to or in exchange for such Common Stock,
(iii) any statutory exchange, as a result of which holders of Common Stock
generally shall be entitled to receive stock, securities or other property
or assets (including cash) with respect to or in exchange for such Common
Stock (such transaction, a "Statutory Exchange"), (iv) any sale or
conveyance of the properties and assets of the Company as, or substantially
as, an entirety to any other person as a result of which holders of Common
Stock shall be entitled to receive stock, securities or other property or
assets (including cash) with respect to or in exchange for such Common
Stock, then the Company or the successor or purchasing person, as the case
may be, shall execute with the Warrant Agent a supplemental warrant
agreement providing that such Warrant shall be exercisable for the kind and
amount of shares of stock and other securities or property or assets
(including cash) receivable upon such reclassification, change,
consolidation, merger, combination, Statutory Exchange, sale or conveyance
by a holder of a number of shares of Common Stock issuable upon exercise of
such Warrants (assuming, for such purposes, a sufficient number of
authorized shares of Common Stock available for issuance upon exercise of
all such Warrants) immediately prior to such reclassification, change,
consolidation, merger, combination, Statutory Exchange, sale or conveyance
assuming such holder of Common Stock did not exercise his rights of
election, if any, that holders of Common Stock who were entitled to vote or
consent to such transaction had as to the kind or amount of securities,
cash or other property receivable upon such consolidation, merger,
combination, Statutory Exchange, sale or conveyance (provided that, if the
kind or amount of securities, cash or other property receivable upon such
consolidation, merger, combination, Statutory Exchange, sale or conveyance
is not the same for each share of Common Stock in respect of which such
rights of election shall not have been exercised ("non-electing share"),
then for the purposes of Section 13 of the Warrant Agreement the kind and
amount of securities, cash or other property receivable upon such
consolidation, merger, combination, Statutory Exchange, sale or conveyance
for each non-electing share shall be deemed to be the kind and amount so
receivable per share by a plurality of the non-electing shares). Such
supplemental warrant agreement shall provide for adjustments which shall be
as nearly equivalent as may be practicable to the adjustments provided for
in Section 12 of the Warrant Agreement. If, in the case of any such
reclassification, change, consolidation, merger, combination, Statutory
Exchange, sale or conveyance, the stock or other securities and assets
receivable thereupon by a holder of shares of Common Stock include shares
of stock or other securities and assets of a corporation other than the
successor or purchasing person, as the case may be, in such
reclassification, change, consolidation, merger, combination, Statutory
Exchange, sale or conveyance, then such supplemental warrant agreement
shall also be executed by such other person and shall contain such
additional provisions to protect the interests of the holders of the
Warrants as the Board of Directors shall reasonably consider necessary by
reason of the foregoing. The Exercise Price for the stock and other
securities, property and assets (including cash) so receivable upon such
event shall be an amount equal to the Exercise Price immediately prior to
such event.
The Company shall not be required to issue fractions of shares of
Common Sock upon exercise of the Warrants or to distribute certificates
which evidence such fractional shares. If more than one Warrant shall be
presented for exercise in full at the same time by the same holder, the
number of full shares of Common Stock which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
shares of Common Stock purchasable on exercise of all Warrants so
presented. In lieu any of fractional shares, there shall be paid to the
registered holders of Warrant Certificates at the time such Warrant
Certificates are exercised an amount in cash equal to the same fraction of
the current market value of a share of Common Stock. For purposes of this
calculation, the current market value of a share of Common Stock shall be
the Closing Price of a share of Common Stock for the Trading Day
immediately prior to the date of such exercise.
The Company covenants that it will at all times through 5:00 p.m.,
New York time, on the Expiration Date (or, if the Expiration Date shall not
be a Business Day, then on the next-succeeding Business Day) reserve, free
from preemptive rights, and keep available out of its authorized but
unissued shares or shares held in treasury or a combination thereof of
Common Stock, solely for the purpose of issue upon exercise of Warrants as
herein provided, sufficient shares of Common Stock, for issuance upon
exercise of, the Warrants from time to time as such Warrants are presented
for exercise. The Company covenants that all shares of Common Stock issued
upon exercise of Warrants shall be duly and validly issued and fully paid
and non-assessable and free from all taxes, liens and charges with respect
to the issue thereof.
The initial issuance of certificates of Common Stock upon the
exercise of Warrants shall be made without charge to the exercising
Warrantholders for any tax in respect of the issuance of such stock
certificates, and such stock certificates shall be issued in the respective
names of, or in such names as may be directed by, the registered holders of
the Warrants exercised, subject to the restrictions on transfer set forth
herein and in the Warrant Agreement; provided, however, that the Company
shall not be required to pay any tax that may be payable in respect of any
transfer involved in the issuance and delivery of any such stock
certificate, any Warrant Certificates or other securities in a name other
than that of the registered holder of the Warrant Certificate surrendered
upon exercise of the Warrant, and the Company shall not be required to
issue or deliver such certificates or other securities unless and 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.
Subject to the terms and provisions of the Registration Rights
Agreement, the Company shall file under the Securities Act a registration
statement providing for the registration of all of the Warrants and the
shares of Common Stock issuable upon exercise thereof.
As provided in the Warrant Agreement and the Registration Rights
Agreement, the Warrantholders have additional rights and duties with
respect to the registration of the Warrants and the Common Stock issuable
upon exercise of the Warrants. A Warrantholder may be required to indemnify
and hold the Company and certain other persons harmless in connection with
written information furnished to the Company by or on behalf of such
Warrantholder specifically for use in any registration statement, or any
preliminary or final or summary Prospectus contained therein or any
amendment or supplement thereto.
By its acceptance of any Warrant represented by a Warrant
Certificate bearing a restrictive legend, each holder and beneficial owner
of such a Warrant acknowledges the restrictions on transfer of such a
Warrant set forth in such legend and agrees that it will transfer such a
Warrant only in accordance with such legend.
Subject to the restrictions on transfer set forth herein and in
the Warrant Agreement, this Warrant and all rights hereunder are
transferable by the registered Warrantholder hereof, in whole or in part,
on the Warrant register, upon surrender of this Warrant Certificate duly
endorsed, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Warrant Agent duly executed, with
signatures guaranteed as specified in the attached "Form of Assignment," by
the registered Warrantholder hereof or his attorney duly authorized in
writing and upon payment of any necessary transfer tax or other
governmental charge imposed upon such transfer. Upon any partial transfer,
the Company will issue and the Warrant Agent will countersign and deliver
to such Warrantholder a new Warrant Certificate or Warrant Certificates
with respect to any portion not so transferred. Each taker and holder of
this Warrant, by taking and holding the same, consents and agrees that
prior to the registration of transfer as provided in the Warrant Agreement,
the Company and the Warrant Agent may treat the person in whose name the
Warrants are registered as the absolute owner hereof for any purpose and as
the person entitled to exercise the rights represented hereby, any notice
to the contrary notwithstanding.
This Warrant Certificate may be exchanged at the office of the
Warrant Agent for Warrant Certificates representing the same aggregate
number of Warrants, each new Warrant Certificate to represent such number
of Warrants as the holder hereof shall designate at the time of such
exchange.
Prior to the exercise of the Warrants represented hereby, the
holder of this Warrant shall not be entitled, as such, to any rights of a
stockholder of the Company, including, without limitation, the right to
vote or to consent to any action of the stockholders of the Company, to
receive dividends or other distributions, to exercise any preemptive right
or to receive any notice of meetings of stockholders of the Company, and
shall not be entitled to receive any notice of any proceedings of the
Company except as provided in the Warrant Agreement.
Copies of the Warrant Agreement are on file at the office of the
Warrant Agent and may be obtained by writing to the Warrant Agent at the
following address:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 00X
Xxx Xxxx, XX 00000
Attention: Corporate Trust Administration
THE WARRANT AGREEMENT AND THIS WARRANT SHALL BE DEEMED TO BE A CONTRACT
MADE UNDER THE LAWS OF THE STATE OF NEW YORK, INCLUDING WITHOUT LIMITATION,
SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW.
This Warrant shall not be valid for any purpose until it shall
have been countersigned by the Warrant Agent.
TIVO INC.
By:
--------------------------------
Name:
Title:
Attest:
By:
-----------------------
Name:
Title:
Countersigned:
THE BANK OF NEW YORK
as Warrant Agent
By:
-------------------------
Authorized Signatory
Dated:
EXERCISE FORM
(To be executed only upon exercise of Warrant)
The undersigned registered holder of a Warrant Certificate
representing __________ Warrants irrevocably elects to exercise __________
of the Warrants represented by the Warrant Certificate for the purchase of
0.33 of one share (subject to adjustment as set forth in the Warrant
Agreement) of Common Stock, $0.001 par value, of TiVo Inc., for each
Warrant so exercised, and herewith
|_| makes payment of $__________ (such payment being in cash or by
certified or official bank check payable to the order or at the direction
of TiVo Inc.),
|_| tenders $_______ principal amount of the Company's 7% Convertible
Senior Notes due 2006, plus payment of $__________ (such payment being in
cash or by certified or official bank check payable to the order or at the
direction of TiVo Inc.),
|_| elects to make a "Cashless Exercise" of such Warrants as
provided in Section 10(b) of the Warrant Agreement,
all at the exercise price and on the terms and conditions specified in the
Warrant and the Warrant Agreement therein referred to, and surrenders all
of its right, title and interest in the number of Warrants exercised herein
to TiVo Inc., and directs that the shares of Common Stock or other
securities or property deliverable upon the exercise of such Warrants, and
any Warrant Certificate or interests in the Warrant representing
unexercised Warrants, be registered or placed in the name and at the
address specified below and delivered thereto.
Dated:
------------------------------------
(Signature of Warrantholder)
------------------------------------
(Street Address)
------------------------------------
(City) (State) (Zip Code)
Signature Guaranteed By:
------------------------------------
This form must be delivered to the Warrant Agent at the Corporate Office,
which initially shall be 000 Xxxxxxx Xxxxxx, Xxxxx 00X, Xxx Xxxx, X.X.
10286, Attention: Corporate Trust Administration. Copies of this form must
be sent by facsimile to TiVo Inc., attention General Counsel ((650)
519-5333) and Xxxxxx & Xxxxxxx, attention Xxxx Xxxxxxx ((000) 000-0000).
1. COMMON STOCK AND/OR CHECK TO BE ISSUED TO:
IF IN CERTIFICATED FORM:
Social Security Number or identifying number:______________________
Name:
---------------------------------------------------------------
Street Address:
-----------------------------------------------------
City, State and Zip Code:
-------------------------------------------
IF IN BOOK-ENTRY FORM THROUGH DTC:
ACCOUNT NUMBER:
-----------------------------------------------------
ACCOUNT NAME:
-------------------------------------------------------
ANY UNEXERCISED WARRANTS REPRESENTED BY THE EXERCISING HOLDER'S INTEREST IN
THE WARRANT TO BE ISSUED IN CERTIFICATED FORM TO:
Social Security Number or identifying number:____________________
Name:
-------------------------------------------------------------
Street Address:
---------------------------------------------------
City, State and Zip Code:
-----------------------------------------
FORM OF ASSIGNMENT AND TRANSFER
FOR VALUE RECEIVED the undersigned registered holder of the within
Warrant Certificate hereby sells, assigns and transfers unto the
Assignee(s) named below (including the undersigned with respect to any
Warrants constituting a part of the Warrants evidenced by the within
Warrant Certificate not being assigned hereby) all of the right of the
undersigned under the within Warrant Certificate, with respect to the
number of Warrants set forth below:
Social Security
Number Number or Other
Name of Assignees Address of Warrants Identifying Number
and does hereby irrevocably constitute and appoint ____________________,
the undersigned's attorney, to make such transfer on the books of TiVo Inc.
maintained for the purpose, with full power of substitution in the
premises.
In connection with any transfer occurring within two years (or
such longer or shorter holding period required under Rule 144(k) of the
Securities Act) of the original issuance of such Warrant (unless such
Warrant is being transferred pursuant to a registration statement that has
been declared effective under the Securities Act), the undersigned confirms
that such Warrant is being transferred:
|_| *To TiVo Inc. or a subsidiary thereof; or
|_| *To an Institutional Accredited Investor pursuant to and
in compliance with the Securities Act of 1933, as
amended; or
|_| *To an Individual Accredited Investor pursuant to and in
compliance with the Securities Act of 1933, as amended;
or
|_| *In an offshore transaction pursuant to and in compliance
with Regulation S under the Securities Act of 1933, as
amended; or
|_| *Pursuant to and in compliance with Rule 144 under the
Securities Act of 1933, as amended;
and unless the box below is checked, the undersigned confirms that such
Warrant is not being transferred to an "affiliate" of the Company as
defined in Rule 144 under the Securities Act of 1933, as amended (an
"Affiliate"):
|_| *The transferee is an Affiliate of the Company.
Dated:
------------------------------------
(Signature of Warrantholder)
------------------------------------
(Street Address)
------------------------------------
(City) (State) (Zip Code)
Signature Guaranteed By:
------------------------------------
EXHIBIT B
FORM OF TRANSFER LETTER OF REPRESENTATIONS
(To be delivered upon exercise of Warrants
or upon certain transfers of Warrants
WITHOUT EFFECTIVE REGISTRATION STATEMENT)
We are delivering this letter in connection with (i) the exercise
of Warrants (as defined in the Warrant Agreement, dated as of August 28,
2001, between TiVo Inc., a Delaware corporation (the "Company") and The
Bank of New York, a New York banking corporation (the "Warrant Agent")) by
us for shares of common stock, par value $.001 per share, of the Company
(the "Common Stock") or (ii) the sale or transfer to us of Warrants, other
than pursuant to a registration statement that has been declared effective
under the Securities Act of 1933, as amended (the "Securities Act"). The
Warrants and the Common Stock are sometimes referred to herein as the
"Securities."
We hereby confirm that:
(i) we are an "accredited investor" within the meaning of
Rule 501(a)(1),(2), (3), (5), (6) or (7) under the Securities Act;
(ii) any purchase or receipt of the Securities by us will
be for investment purposes and for our own account, not as a
nominee or agent;
(iii) we have such knowledge and experience in financial
and business matters that we are capable of evaluating the merits
and risks of purchasing or receiving the Securities ;
(iii) we do not have need for liquidity in our investment
in the Securities , we have the ability to bear the economic risks
of our investment in the Securities for an indefinite period of
time and we are able to afford the complete loss of our investment
in the Securities;
(iv) we are not acquiring the Securities with a view to
any distribution thereof in a transaction that would violate the
Securities Act or the securities laws of any State of the United
States or any other applicable jurisdiction, and we have no
present intention of selling, granting any participation in, or
otherwise distributing the same;
(v) we have had access to such information regarding the
Company necessary in order for us to make an informed decision and
any such information which we have requested have been made
available for us or our attorney, accountant, or advisor; and
(vi) we or our attorney, accountant, or advisor have had
a reasonable opportunity to ask questions of and receive answers
from a person or persons acting on behalf of the Company
concerning the business, management and financial affairs of the
Company and the terms and conditions of the acquisition by us of
the Securities and all such questions have been answered to our
full satisfaction, and we have acquired sufficient information
about the Company to make an informed and knowledgeable decision
to acquire the Securities.
We understand that the Securities have not been registered under
the Securities Act, and we agree, on our own behalf and on behalf of each
account for which we acquire any Securities, that such Securities may be
offered, resold, pledged or otherwise transferred only (i) in a transaction
meeting the requirements of Rule 144 under the Securities Act, outside the
United States in a transaction meeting the requirements of Rule 904 under
the Securities Act, or in accordance with another exemption from the
registration requirements of the Securities Act, (ii) to the Company or
(iii) pursuant to an effective registration statement, and, in each case,
in accordance with any applicable securities laws of any State of the
United States or any other applicable jurisdiction. We agree that we will
furnish the Company, the Warrant Agent and, if exercising Warrants, the
Company's transfer agent an opinion of counsel, if the Company so requests,
that the foregoing restrictions on transfer have been complied with. We
understand that the Warrant Agent will not be required to accept for
registration of transfer or exercise any Warrants, except upon presentation
of evidence satisfactory to the Company, including an opinion of counsel if
the Company so requests, that the foregoing restrictions on transfer or
exercise have been complied with.
We acknowledge that the Company and others will rely upon our
confirmations, acknowledgements and agreements set forth herein, and we
agree to notify you promptly in writing if any of our representations or
warranties herein ceases to be accurate and complete.
------------------------------
(Name)
By:____________________________
Name:
Title:
Address:
