Exhibit 4.3
Series A Warrant Certificate
NEITHER THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES
ISSUABLE UPON EXERCISE OF THE SECURITIES REPRESENTED HEREBY HAVE BEEN REGISTERED
UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAW, AND SUCH SECURITIES MAY NOT BE OFFERED, SOLD, TRANSFERRED
OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
OR PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE STATE SECURITIES
LAWS.
THIS CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO CERTAIN RIGHTS
AND IS SUBJECT TO CERTAIN RESTRICTIONS AS SET FORTH IN THE RESTRUCTURING
AGREEMENT DATED AS OF OCTOBER 8, 1999, AMONG THE CYPRESS GROUP L.L.C., TPG
PARTNERS II, L.P., NAZEM, INC. AND GENESIS HEALTH VENTURES, INC. (THE
"COMPANY"), THE TERMS OF WHICH ARE INCORPORATED HEREIN BY REFERENCE AND A COPY
OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE OFFICE OF THE COMPANY.
No. W-_____ ____________ Warrants
SERIES A WARRANTS
Exercisable commencing ___________, 1999
Void after Expiration Time (as defined herein)
GENESIS HEALTH VENTURES, INC., a Pennsylvania corporation (the
"Company"), hereby certifies that, for value received, ______________, or
registered assigns (the "Warrantholder"), is the owner of _______________
Warrants (as defined below), each of which entitles the Warrantholder to
purchase from the Company one fully paid, duly authorized and nonassessable
share of Voting Common Stock, at any time from and after ____________, 1999 (the
"Issue Date") and continuing up to the Expiration Time (as defined herein) at a
per share exercise price determined according to the terms and subject to the
conditions set forth in this certificate (the "Warrant Certificate"). The number
of shares of Voting Common Stock issuable upon exercise of each such Warrant and
the exercise price per share of Voting Common Stock are subject to adjustment
from time to time pursuant to the provisions of Section 9 of this Warrant
Certificate. The Warrants evidenced by this Warrant Certificate are part of a
series of warrants to purchase up to 2,000,000 shares of Voting Common Stock
(collectively, the "Warrants"), issued pursuant to a Restructuring Agreement,
dated as of October 8, 1999 (as it may be amended, supplemented or otherwise
modified from time to time, the "Restructuring Agreement"), among The Cypress
Group L.L.C., a Delaware limited liability company, TPG Partners II, L.P., a
Delaware limited partnership, Nazem, Inc., a Delaware corporation, and the
Company, and are entitled to certain rights and privileges and are subject to
certain restrictions set forth therein.
Section 1. Definitions. As used in this Warrant Certificate,
the following terms shall have the meanings set forth below:
1.1 "Articles of Incorporation" means the Amended and Restated
Articles of Incorporation of the Company, as amended from time to time.
1.2 "Board of Directors" means the board of directors of the
Company.
1.3 "Business Day" means any day, other than a Saturday,
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.
1.4 "Capital Stock" means any and all shares, interests,
participations, rights in or other equivalents (however designated and
whether voting or non-voting) or corporate stock, and any and all
rights (other any evidence of indebtedness), warrants or options
exchangeable for or convertible into such corporate stock.
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1.5 "Closing Price" means, with respect to any security, the
average of the daily closing prices of such security for the 30 Trading
Day period ending on the relevant date of determination. The closing
price for each day shall be the last reported sale price regular way
or, in case no such reported sale takes place on such day, the average
of the reported closing bid and asked prices regular way, in either
case, on The New York Stock Exchange (the "NYSE"), or, if such security
is not listed or admitted to trading on the NYSE, on the American Stock
Exchange, or if such security is not listed or admitted to trading on
the American Stock Exchange, the average of the closing bid and asked
prices of such security in the over-the-counter market as reported on
the NASDAQ system of the National Association of Securities Dealers,
Inc., or if such security is not so quoted, the average of the closing
bid and asked prices of such security in the over-the-counter market as
furnished by any nationally recognized New York Stock Exchange member
firm selected by the Company for such purposes. If such security is not
so listed, quoted or traded, the closing price shall mean the amount
which a willing buyer would pay to a willing seller in an arm's length
transaction as determined by an independent investment banking or
appraisal firm experienced in the valuation of such securities or
property selected in good faith by the Board of Directors of the issuer
of such security.
1.6 "Common Stock" means the Non-Voting Common Stock or the
Voting Common Stock.
1.7 "Company" has the meaning set forth in the preamble
hereto.
1.8 "Constituent Person" has the meaning set forth in Section
9.3(a) hereof.
1.9 "Equity Securities" of any Person means any and all common
stock, preferred stock, any other class of capital stock and
partnership or limited liability company interests of such Person or
any other similar interests of any Person that is not a corporation,
partnership or limited liability company.
1.10 "Excluded Stock" means shares of Common Stock issued or
reserved for issuance by the Company (a) as a stock dividend payable in
shares of Common Stock, (b) upon any subdivision or split-up of the
outstanding shares of Common Stock, (c) upon conversion of shares of
Series H Preferred Stock or Series I Preferred Stock of the Company or
(d) pursuant to bona fide employee benefit plans, provided, that such
shares are issued for consideration equal to or greater than the fair
value thereof on the date of the award.
1.11
"Excluded Transaction" means (i) any underwritten public offering of
Common Stock or (ii) any issuance of Common Stock solely in exchange
for assets or all of the stock of another Person (whether by merger,
exchange or otherwise) in a transaction in which a
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nationally recognized investment banking firm has advised the Company
that the transaction is fair and reasonable to the Company from a
financial point of view.
1.12 "Exercise Price" has the meaning set forth in Section 8
hereof.
1.13 "Expiration Date" means ____________, 2009.
1.14 "Expiration Time" means 5:00 P.M., New York City time, on
the Expiration Date.
1.15 "Fair Market Value" of any securities shall mean the
Closing Price thereof and of any consideration, other than cash or
securities, shall mean the amount which a willing buyer would pay to a
willing seller in an arm's length transaction as determined by an
independent investment banking or appraisal firm experienced in the
valuation of such property selected in good faith by the Board of
Directors.
1.16 "Fractional Warrant Share" means any fraction of a whole
share of Voting Common Stock issued, or issuable upon, exercise of the
Warrants.
1.17 "Issue Date" has the meaning set forth in the preamble
hereto.
1.18 "Non-Electing Shares" has the meaning set forth in
Section 9.3(a) hereof.
1.19 "Non-Voting Common Stock" means the non-voting common
stock, par value $.02 per share, of the Company.
1.20 "NYSE" has the meaning set forth in Section 1.5 hereof.
1.21 "Organic Change" means, with respect to any Person, any
transaction (including without limitation any recapitalization, capital
reorganization or reclassification of any class or series of Equity
Securities, any consolidation of such Person with, or merger of such
Person into, any other Person, any merger of another Person into such
Person (other than a merger which does not result in a
reclassification, conversion, exchange or cancellation of outstanding
shares of capital stock of such Person), and any sale or transfer or
lease of all or substantially all of the assets of such Person, but not
including any stock split, combination or subdivision which is the
subject of Section 9.1(c)) pursuant to which any class or series of
Equity Securities of such Person is converted into the right to receive
other securities, cash or other property.
1.22 "Person" means any individual, firm, corporation,
company, limited liability company, association, partnership, joint
venture, trust or unincorporated organization, or a government or any
agency or political subdivision thereof.
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1.23 "Restructuring Agreement" has the meaning set forth in
the preamble hereto.
1.24 "Securities Act" means the U.S. Securities Act of 1933,
as amended, and the rules and regulations promulgated thereunder.
1.25 "Trading Day" means, with respect to any security, any
day on which the NYSE is open for trading, or if the shares of such
security are not listed or admitted to trading on the NYSE, any day on
which the principal national securities exchange or national quotation
system on which the shares of such security are listed, admitted to
trading or quoted is open for trading, or if the shares of such
security are not so listed, admitted to trading or quoted, any Business
Day.
1.26 "Trigger Event" has the meaning set forth in Section
9.1(a) hereof.
1.27 "Voting Common Stock" means the voting common stock, par
value $.02 per share, of the Company.
1.28 "Warrant Certificate" has the meaning in the preamble
hereto.
1.29 "Warrant Register" has the meaning set forth in Section
2.2 hereof.
1.30 "Warrant Shares" means the shares of Voting Common Stock
issued, or issuable upon, exercise of the Warrants.
1.31 "Warrantholder" has the meaning set forth in the preamble
hereto.
1.32 "Warrants" has the meaning set forth in the preamble
hereto.
Section 2. Transferability.
2.1. Registration. The Warrants shall be issued only in
registered form.
2.2.Transfer. The Warrants evidenced by this Warrant
Certificate may be sold or otherwise transferred at any time (except as such
sale or transfer may be restricted pursuant to the Securities Act or any
applicable state securities laws) and any such sale or transfer shall be
effected on the books of the Company (the "Warrant Register") maintained at its
principal executive offices upon surrender of this Warrant Certificate for
registration of transfer duly endorsed by the Warrantholder or by its duly
authorized attorney or representative, or accompanied by proper evidence of
succession, assignment or authority to transfer. Upon any registration of
transfer, the Company shall execute and deliver a new Warrant certificate or
certificates in appropriate denominations to the Person or Persons entitled
thereto.
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Section 3. Exchange of Warrant Certificate. Any Warrant
certificate may be exchanged for another certificate or certificates of like
tenor entitling the Warrantholder to purchase a like aggregate number of Warrant
Shares as the certificate or certificates surrendered then entitles such
Warrantholder to purchase. Any Warrantholder desiring to exchange a Warrant
certificate shall make such request in writing delivered to the Company, and
shall surrender, properly endorsed, the certificate evidencing the Warrant to be
so exchanged. Thereupon, the Company shall execute and deliver to the Person
entitled thereto a new Warrant certificate or certificates as so requested.
Section 4. Term of Warrants; Exercise of Warrants.
4.1.Duration of Warrants. On the terms and subject to the
conditions set forth in this Warrant Certificate, the Warrantholder may exercise
the Warrants evidenced hereby, in whole or in part, at any time and from time to
time after the Issue Date and before the Expiration Time. If the Warrants
evidenced hereby are not exercised by the Expiration Time, they shall become
void, and all rights hereunder shall thereupon cease.
4.2. Exercise of Warrant.
(a) On the terms and subject to the conditions set
forth in this Warrant Certificate, the Warrantholder may exercise the
Warrants evidenced hereby, in whole or in part, by presentation and
surrender to the Company of this Warrant Certificate together with the
attached Election to Exercise duly filled in and signed, and
accompanied by payment to the Company of the Exercise Price for the
number of Warrant Shares specified in such Election to Exercise.
Payment of the aggregate Exercise Price shall be made in cash in an
amount equal to the aggregate Exercise Price.
(b) On the terms and subject to the conditions set
forth in this Warrant Certificate, upon such presentation and surrender
of this Warrant Certificate and payment of such aggregate Exercise
Price as set forth in paragraph (a) of this Section 4.2, the Company
shall promptly issue and cause to be delivered to the Warrantholder, or
to such Persons as the Warrantholder may designate in writing, a
certificate or certificates (in such name or names as the Warrantholder
may designate in writing) for the specified number of duly authorized,
fully paid and nonassessable Warrant Shares issuable upon exercise, and
shall deliver to the Warrantholder cash, as provided in Section 10
hereof, with respect to any Fractional Warrant Shares otherwise
issuable upon such surrender. In the event that the Warrants evidenced
by this Warrant Certificate are exercised in part prior to the
Expiration Time, the Company shall issue and cause to be delivered to
the Warrantholder, or to such Persons as the Warrantholder may
designate in writing, a certificate or certificates (in such name or
names as the Warrantholder may designate in writing) evidencing any
remaining unexercised Warrants.
(c) Each Person in whose name any certificate for
Warrant Shares is issued shall for all purposes be deemed to have
become the holder of record of the
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Warrant Shares represented thereby on the first date on which both the
Warrant certificate evidencing the respective Warrants was surrendered
and payment of the Exercise Price and any applicable taxes was made,
irrespective of date of issue or delivery of such certificate.
Section 5. Payment of Taxes. The Company shall pay any and all
documentary, stamp or similar issue or transfer taxes and other governmental
charges that may be imposed under the laws of the United States of America or
any political subdivision or taxing authority thereof or therein in respect of
any issue or delivery of Warrant Shares or of other securities or property
deliverable upon exercise of the Warrants evidenced by this Warrant Certificate
or certificates representing such shares or securities (other than income taxes
imposed on the Warrantholder); provided that the Company shall not be required
to pay any such tax or other charge that may be imposed in connection with any
transfer involved in the issuance of any certificate for Warrant Shares or other
securities or property, or payment of cash, to any Person other than the holder
of the Warrant certificate surrendered upon exercise, and in case of any such
tax or charge, the Company shall not be required to issue any security or
property or pay any cash until such tax or charge has been paid or it has been
established to the Company's satisfaction that no such tax or charge is payable.
Section 6. Mutilated or Missing Warrant. If any Warrant
certificate is lost, stolen, mutilated or destroyed, the Company shall issue in
exchange and substitution for any mutilated Warrant certificate upon surrender
and cancellation of such mutilated Warrant certificate, or in lieu of and
substitution for any Warrant certificate lost, stolen or destroyed upon receipt
of a proper affidavit or other evidence reasonably satisfactory to the Company
and bond of indemnity in form and amount and with corporate surety reasonably
satisfactory to the Company protecting the Company, a new Warrant certificate of
like tenor and representing an equivalent number of Warrants as the Warrant
certificate so lost, stolen, mutilated or destroyed. Any such new Warrant
certificate shall constitute an original contractual obligation of the Company,
whether or not the allegedly lost, stolen, mutilated or destroyed Warrant
certificate shall be at any time enforceable by anyone. An applicant for such
substitute Warrant certificate shall also comply with such other reasonable
regulations and pay such other reasonable charges as the Company may prescribe.
All Warrant certificates shall be held and owned upon the express condition that
the foregoing provisions are exclusive with respect to the replacement of lost,
stolen, mutilated or destroyed Warrant certificates, and shall preclude 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 negotiable
instruments or other securities without their surrender.
Section 7. Reservation of Shares. The Company hereby agrees
that there shall be reserved for issuance and delivery upon exercise of the
Warrants evidenced by this Warrant Certificate, free from preemptive rights, the
number of shares of authorized but unissued shares of Voting Common Stock as
shall be required for issuance or delivery upon exercise of all of the Warrants
evidenced by this Warrant Certificate. The Company further agrees that it will
not, by amendment of the Articles of Incorporation or through reorganization,
consolidation, merger, dissolution or sale of assets, or by any other voluntary
act, avoid or seek to avoid the observance or performance of any of the
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covenants, stipulations or conditions to be observed or performed hereunder by
the Company. Without limiting the generality of the foregoing, the Company
agrees that before taking any action which would cause an adjustment reducing
the Exercise Price below the then-par value of Warrant Shares issuable upon
exercise hereof, the Company shall from time to time take all such action that
may be necessary in order that the Company may validly and legally issue fully
paid and nonassessable shares of Voting Common Stock at the Exercise Price as so
adjusted.
Section 8. Exercise Price. The price per share (the "Exercise
Price") at which Warrant Shares shall be purchasable upon the exercise of the
Warrants evidenced by this Warrant Certificate shall be $5.00, subject to
adjustment pursuant to Section 9 hereof.
Section 9. Adjustment of Exercise Price and Number of Shares.
The number and kind of securities purchasable upon the exercise of the Warrants
evidenced by this Warrant Certificate and the Exercise Price thereof shall be
subject to adjustment from time to time after the date hereof upon the happening
of certain events, as follows:
9.1. Adjustments to Exercise Price. The Exercise Price shall
be subject to adjustment from time to time as follows:
(a) Common Stock Issued at Less Than the Closing Price. If the
Company shall issue any Common Stock, other than Excluded Stock or
Common Stock issued in an Excluded Transaction, without consideration
or for a consideration per share less than the Closing Price
immediately prior to such issuance, the Exercise Price in effect
immediately prior to each such issuance shall immediately (except as
provided below) be reduced to the price determined by multiplying the
Exercise Price in effect immediately prior to such issuance by a
fraction (1) the numerator of which shall be the sum of (A) the number
of shares of Voting Common Stock and Non-Voting Common Stock
outstanding immediately prior to such issuance and (B) the number of
shares of Voting Common Stock and Non-Voting Common Stock that the
aggregate consideration, if any, received by the Company upon such
issuance, would purchase at such Closing Price and (2) the denominator
of which shall be the total number of shares of Voting Common Stock and
Non-Voting Common Stock outstanding immediately after such issuance.
For purposes of any adjustment of the Exercise Price
pursuant to this subsection (a), the following provisions shall be
applicable.
(i) Cash. In the case of the issuance of
Common Stock for cash, the amount of the consideration
received by the Company shall be deemed to be the amount of
the cash proceeds received by the Company for such shares
before deducting therefrom any discounts, commissions, taxes
or other expenses allowed, paid or incurred by the Company for
any underwriting or otherwise in connection with the issuance
and sale thereof.
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(ii) Consideration Other Than Cash. In the
case of the issuance of shares of any class of Common Stock
(otherwise than upon conversion of shares of Capital Stock of
the Company) for a consideration in whole or in part other
than cash, including securities acquired in exchange therefor
(other than securities by their terms so exchangeable), the
consideration other than cash shall be deemed to be the Fair
Market Value thereof, irrespective of any accounting
treatment.
(iii) Options and Convertible Securities. In
the case of the issuance of (x) options, warrants or rights to
purchase or acquire Common Stock (whether or not at the time
exercisable) (but any adjustment pursuant to this provision
shall be made only to the extent any adjustment shall not have
been made pursuant to Section 9(d)(iv) hereof), (y) securities
by their terms convertible into or exchangeable for Common
Stock (whether or not at the time so convertible or
exchangeable) or (z) options, warrants or rights to purchase
such convertible or exchangeable securities (whether or not at
the time exercisable),
(A) the aggregate maximum number of
shares of Common Stock deliverable upon exercise of such
options, warrants or rights to purchase or acquire Common
Stock shall be deemed to have been issued at the time such
options, warrants or rights were issued and for a
consideration equal to the price (determined in the manner
provided in the immediately preceding subclauses (i) and (ii)
of this Section 9.1(a)), if any, received by the Company upon
the issuance of such options, warrants or rights plus the
minimum purchase price provided in such options, warrants or
rights for the shares of Common Stock covered thereby,
(B) the aggregate maximum number of
shares of Common Stock deliverable upon conversion of or in
exchange for any such convertible or exchangeable securities,
or upon the exercise of options, warrants or other rights to
purchase or acquire such convertible or exchangeable
securities and the subsequent conversion or exchange thereof,
shall be deemed to have been issued at the time such
convertible or exchangeable securities were issued or such
options, warrants or rights were issued and for a
consideration equal to the consideration, if any, received by
the Company for any such convertible or exchangeable
securities or options, warrants or rights (excluding any cash
received on account of accrued interest or dividends), plus
the additional consideration (determined in the manner
provided in the immediately preceding subclauses (i) and (ii)
of this Section 9.1(a)), if any, to be received by the Company
upon the conversion or exchange of such securities, or upon
the exercise of any related options, warrants or rights to
purchase or acquire such convertible or exchangeable
securities and the subsequent conversion or exchange thereof,
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(C) on any change in the number of
shares of Common Stock deliverable upon exercise of any such
options, warrants or rights or conversion or exchange of such
convertible or exchangeable securities or any change in the
consideration to be received by the Company upon such
exercise, conversion or exchange (but excluding any change
resulting solely from the operation of the anti-dilution
provisions thereof if, and only if, such anti-dilution
provisions would not require an adjustment to the exercise
price or conversion price thereof in the event of any change
to the Exercise Price pursuant to the provisions of this
Section 9.1), the Exercise Price as then in effect shall
forthwith be readjusted to such Exercise Price as would have
been obtained had an adjustment been made upon the issuance of
such options, warrants or rights not exercised prior to such
change, or of such convertible or exchangeable securities not
converted or exchanged prior to such change, upon the basis of
such change,
(D) on the expiration or
cancellation of any such options, warrants or rights that are
unexercised, or the termination of the right to convert or
exchange such convertible or exchangeable securities, if the
Exercise Price shall have been adjusted upon the issuance
thereof, the Exercise Price shall forthwith be readjusted to
such Exercise Price as would have been obtained had an
adjustment been made upon the issuance of such options,
warrants or rights or such convertible or exchangeable
securities on the basis of the issuance of only the number of
shares of Common Stock actually issued upon the exercise of
such options, warrants or rights, or upon the conversion or
exchange of such convertible or exchangeable securities and
(E) if the Exercise Price shall have
been adjusted upon the issuance of any such options, warrants
or rights or convertible or exchangeable securities, no
further adjustment of the Exercise Price shall be made for the
actual issuance of Common Stock upon the exercise, conversion
or exchange thereof.
(b) Excluded Stock. All shares of Excluded Stock which the
Company has reserved for issuance shall be deemed to be outstanding for
all purposes of computations under Section 9.1(a) hereof.
(c) Stock Dividends, Subdivisions, Reclassifications or
Combinations. If the Company shall declare a dividend or make a
distribution on the Common Stock in shares of Common Stock, then the
Exercise Price in effect at the time of the record date for such
dividend shall immediately be reduced to a price determined by
multiplying such Exercise Price by a fraction (i) the numerator of
which shall be the number of shares of Voting Common Stock and
Non-Voting Common Stock outstanding at the close of business on such
record date and (ii) the denominator of which shall be the sum of such
number of shares of Voting Common Stock and Non-Voting Common Stock
outstanding
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and the total number of shares of Voting Common Stock and Non-Voting
Common Stock constituting such dividend or distribution. If the Company
shall split, subdivide or reclassify (including by way of merger,
consolidation or otherwise) the outstanding shares of Common Stock 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 split, subdivision or reclassification becomes effective
shall immediately be proportionately reduced, and, conversely, if the
Company shall combine or reclassify (including by way of merger,
consolidation or otherwise) the outstanding shares of Common Stock 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 or reclassification becomes effective shall
immediately be proportionately increased. Successive adjustments in the
Exercise Price shall be made whenever any event specified above shall
occur.
(d) Other Distributions. In case the Company shall fix a
record date for the making of a distribution to all holders of shares
of its Common Stock of (i) shares of any class other than the Common
Stock, (ii) evidences of indebtedness of the Company or any subsidiary,
(iii) assets or other property, including but not limited to,
securities issued by subsidiaries or others (excluding regular cash
dividends, and dividends or distributions referred to in Section 9.1(c)
hereof), or (iv) options, warrants or other rights, in each such case
the Exercise Price in effect immediately prior thereto shall be reduced
immediately thereafter to the price determined by dividing (x) an
amount equal to the difference resulting from (1) the number of shares
of Voting Common Stock and Non-Voting Common Stock outstanding on such
record date multiplied by the Exercise Price per share of Voting Common
Stock on such record date, less (2) the Fair Market Value of such
shares or evidences of indebtedness, assets, property, options,
warrants or rights to be so distributed, by (y) the number of shares of
Voting Common Stock and Non-Voting Common Stock outstanding on such
record date. Such adjustment shall be made successively whenever such a
record date is fixed. Rights (including, without limitation, those to
be issued pursuant to, and in accordance with, the Rights Agreement,
dated as of April 20, 1995, between the Company and Mellon Securities
Trust Company, as Rights Agent) issued by the Company to all holders of
Common Stock entitling the holders thereof to subscribe for or purchase
Equity Securities, which rights (A) are deemed to be transferred with
such shares of Common Stock, (B) are not exercisable and (C) are also
issued in respect of future issuances of Common Stock, including shares
of Common Stock issued upon exercise of the Warrants evidenced by this
Warrant Certificate, in each case in clauses (A) through (C) until the
occurrence of a specified event or events (a "Trigger Event"), shall
for purposes of this paragraph not be deemed issued until the
occurrence of the earliest Trigger Event.
(e) Minimum Adjustment Requirement. No adjustment shall be
required unless such adjustment would result in an increase or decrease
of at least $0.01 in the
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Exercise Price then subject to adjustment; provided, however, that any
adjustments that are not made by reason of this subsection (e) shall be
carried forward and taken into account in any subsequent adjustment. In
case the Company shall at any time issue shares of Common Stock by way
of dividend on any stock of the Company or split, subdivide or
reclassify the outstanding shares of any class of Common Stock, or
combine the outstanding shares of Common Stock, said amount of $0.01
specified in the preceding sentence (as theretofore increased or
decreased, if said amount shall have been adjusted in accordance with
the provisions of this subsection (g)) shall forthwith be
proportionately increased in the case of such a combination or
decreased in the case of such a split, subdivision or reclassification
or stock dividend so as appropriately to reflect the same.
(f) Calculations. All calculations under this Section 9.1
shall be made to the nearest $0.01 or to the nearest one ten thousandth
of a share, as the case may be.
(g) Certificate. Whenever an adjustment in the Exercise Price
is made as required or permitted by the provisions of this Section 9.1,
the Company shall promptly prepare a certificate of an authorized
officer of the Company setting forth (i) the adjusted Exercise Price as
provided in this Section 9.1 and a brief statement of the facts
requiring such adjustment and the computation thereof and (ii) the
number of shares of Voting Common Stock (or portions thereof)
purchasable upon exercise of a Warrant after such adjustment in the
Exercise Price in accordance with Section 9.2 hereof and the record
date therefor, and promptly after preparing such certificate shall mail
or cause to be mailed a notice of such adjustment to each Warrantholder
at his or her last address as the same appears on the Warrant Register.
(h) Notice. In case:
(i) the Company shall declare any dividend or any
distribution of any kind or character (whether in cash,
securities or other property) on or in respect of shares of
any class of Common Stock or to the shareholders of the
Company (in their capacity as such), excluding any regular
periodic cash dividend paid out of current or retained
earnings (as such terms are used in generally accepted
accounting principles); or
(ii) the Company shall authorize the granting to the
holders of shares of Common Stock of rights to subscribe for
or purchase any shares of capital stock or of any other right;
or
(iii) of any reclassification of shares of any class
of Common Stock (other than a split, subdivision or
combination of outstanding shares of any class of Common
Stock), 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
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(iv) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then the Company shall cause to be mailed to the Warrantholders, at
their last addresses as they shall appear upon the Warrant Register, at
least ten days prior to the applicable record 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, if a
record is not to be taken, the date as of which the holders of shares
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, and, if
applicable, the date as of which it is expected that holders of Common
Stock of record shall be entitled to exchange shares of any class of
Common Stock for securities or other property (including cash)
deliverable upon such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up. Failure to give any
such notice, or any defect therein, shall not affect the validity of
the proceedings referred to in clauses (i), (ii), (iii) and (iv) above.
(i) Section 305. Anything in this Section 9.1 to the contrary
notwithstanding, the Company shall be entitled, but not required, to
make such reductions in the Exercise Price, in addition to those
required by this Section 9.1, as it in its discretion shall determine
to be advisable, including, without limitation, in order that any
dividend in or distribution of shares of Common Stock or shares of
capital stock of any class other than Common Stock, subdivision,
reclassification or combination of shares of Common Stock, issuance of
rights or warrants, or any other transaction having a similar effect,
shall not be treated as a distribution of property by the Company to
its shareholders under Section 305 of the Internal Revenue Code of
1986, as amended, or any successor provision and shall not be taxable
to them.
(j) When Adjustment Not Required. If the Company shall take a
record of the holders of any class of Common Stock for purposes of
taking any action that requires an adjustment of the Exercise Price
under this Section 9, and shall, thereafter and before the effective
date of such action, legally abandon its plan to take such action, then
thereafter no adjustment shall be required by reason of the taking of
such record and any such adjustment previously made in respect thereof
shall be rescinded and annulled.
9.2.Adjustment to Number of Warrant Shares. Upon each
adjustment of the Exercise Price pursuant to Section 9.1 hereof, the number of
Warrant Shares purchasable upon exercise of a Warrant outstanding prior to the
effectiveness of such adjustment shall be adjusted to the number, calculated to
the nearest one-hundredth of a share, obtained by (a) multiplying the number of
Warrant Shares purchasable immediately prior to such adjustment upon the
exercise of a Warrant by the Exercise Price in effect prior to such adjustment
and (b) dividing the product so obtained by the Exercise Price in effect after
such adjustment of the Exercise Price.
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9.3. Organic Change.
(a) Company Survives. Upon the consummation of an Organic
Change (other than a transaction in which the Company is not the
surviving entity), lawful provision shall be made as part of the terms
of such transaction whereby the terms of the Warrant Certificates shall
be modified, without payment of any additional consideration therefor,
so as to provide that upon exercise of Warrants following the
consummation of such Organic Change, the Warrantholders of such
Warrants shall have the right to purchase only the kind and amount of
securities, cash and other property receivable upon such Organic Change
by a holder of the number of Warrant Shares into which such Warrants
might have been exercised immediately prior to such Organic Change,
assuming such holder of Warrant Shares (i) is not a Person with which
the Company consolidated or into which the Company merged or which
merged into the Company or to which a sale, transfer or lease of all or
substantially all of the assets of the Company was made, as the case
may be (a "Constituent Person"), or an affiliate of a Constituent
Person, and (ii) failed to exercise his rights of election, if any, as
to the kind and amount of securities, cash and other property
receivable upon such Organic Change (provided that if the kind and
amount of securities, cash and other property receivable upon such
Organic Change is not the same for each share of Common Stock held
immediately prior to such Organic Change by Persons others than a
Constituent Person or an affiliate thereof and in respect of which such
rights of election shall not have been exercised ("Non-Electing
Shares"), then for the purpose of this subsection (a) the kind and
amount of securities, cash and other property receivable upon such
Organic Change by 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); provided, however, that no adjustment shall be made
as a result of such Organic Change to the Exercise Price or the number
of Warrant Shares notwithstanding any provision of Section 9 hereof
unless any event requiring any such adjustment shall have occurred or
shall occur prior to, upon or after such Organic Change. Lawful
provision also shall be made as part of the terms of the Organic Change
so that all other terms of the Warrant Certificates shall remain in
full force and effect following such an Organic Change. The provisions
of this Section 9.3(a) shall similarly apply to successive Organic
Changes.
(b) Company Does Not Survive. The Company shall not enter into
an Organic Change that is a transaction in which the Company is not the
surviving entity unless lawful provision shall be made as part of the
terms of such transaction whereby the surviving entity shall issue new
securities to each Warrantholder, without payment of any additional
consideration therefor, with terms that provide that upon the exercise
of the Warrants, the Warrantholders of such Warrants shall have the
right to purchase only the kind and amount of securities, cash and
other property receivable upon such Organic Change by a holder of the
number of Warrant Shares into which such Warrants might have been
exercised immediately prior to such Organic Change, assuming such
holder of Warrant Shares (i) is not a Constituent Person or an
affiliate of a Constituent Person and
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(ii) failed to exercise his rights of election, if any, as to the kind
and amount of securities, cash and other property receivable upon such
Organic Change (provided that if the kind and amount of securities,
cash and other property receivable upon such Organic Change is not the
same for each Non-Electing Share, then for the purpose of this
subsection (b) the kind and amount of securities, cash and other
property receivable upon such Organic Change by 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); provided, however, that no
adjustment shall be made as a result of such Organic Change to the
Exercise Price or the number of Warrant Shares notwithstanding any
provision of Section 9 hereof unless any event requiring any such
adjustment shall have occurred or shall occur prior to, upon or after
such Organic Change. The certificate or articles of incorporation or
other constituent document of the surviving entity shall provide for
such adjustments which, for events subsequent to the effective date of
such certificate or articles of incorporation or other constituent
document, shall be equivalent to the adjustments provided for in
Section 9.1 hereof.
9.4. Statement on Warrants. The form of Warrant Certificate
need not be changed because of any adjustment made pursuant to Section 9.1 or
Section 9.2 hereof, and Warrants issued after such adjustment may state the same
Exercise Price and the same number of Warrant Shares as are stated in this
Warrant Certificate.
Section 10. Fractional Interests. The Company shall not be
required to issue Fractional Warrant Shares on the exercise of the Warrants
evidenced by this Warrant Certificate. If any Fractional Warrant Share would,
but for the provisions of this Section 10, be issuable on the exercise of the
Warrants evidenced by this Warrant Certificate (or specified portions thereof),
the Company shall pay an amount in cash equal to the fraction of a Warrant Share
represented by such Fractional Warrant Share multiplied by the Closing Price on
the day of such exercise.
Section 11. No Rights as Shareholder. Nothing in this Warrant
Certificate shall be construed as conferring upon the Warrantholder or its
transferees any rights as a shareholder of the Company, including the right to
vote, receive dividends, consent or receive notices as a shareholder with
respect to any meeting of shareholders for the election of directors of the
Company or any other matter.
Section 12. Successors. All the covenants and provisions of
this Warrant Certificate by or for the benefit of the Company or the
Warrantholder shall bind and inure to the benefit of their respective successors
and permitted assigns hereunder.
Section 13. Governing Law; Etc. The validity, construction and
performance of this Warrant Certificate shall be governed by, and interpreted in
accordance with, the laws of New York without reference to its conflict of laws
rules. Each of the parties hereto irrevocably consents to the service of process
in any action or proceeding hereunder by the mailing of copies thereof by
registered or certified airmail, postage prepaid, if to (i) the Company, at 148
West State Street, Kennett Square, Pennsylvania 19348, Attention: General
Counsel, or at such other address specified by the
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Company in writing to the Warrantholder, and (ii) any Warrantholder, at the
address of such Warrantholder specified in the Warrant Register. The foregoing
shall not limit the rights of any party hereto to serve process in any other
manner permitted by the law or to obtain execution of judgment in any other
jurisdiction. The parties agree to waive any and all rights that they may have
to a jury trial with respect to disputes arising out of this Agreement.
Section 14. Benefits of this Agreement. Nothing in this
Warrant Certificate shall be construed to give to any Person other than the
Company and the Warrantholder any legal or equitable right, remedy or claim
under this Warrant Certificate, and this Warrant Certificate shall be for the
sole and exclusive benefit of the Company and the Warrantholder.
[remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the Company has caused this Warrant to be
duly executed, as of this ____th day of ______________, 1999.
GENESIS HEALTH VENTURES, INC.
By:
Name:
Title:
Attest:
- ------------------------------
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ELECTION TO EXERCISE
(To be executed upon exercise of Warrants)
To GENESIS HEALTH VENTURES, INC.:
The undersigned hereby irrevocably elects to exercise the right of
purchase represented by the within Warrant Certificate for, and to purchase
thereunder, _________ Warrant Shares, as provided for therein, and tenders
herewith payment of the purchase price in full in the form of cash in the amount
of $_________.
Please issue a certificate or certificates for such Warrant Shares in
the name of, and pay any cash for any Fractional Warrant Shares to (please print
name address and social security or other identifying number)*:
Name:
Address:
- --------
* The Warrant Certificate contains restrictions on the sale and other transfer
of the Warrants evidenced by such Warrant Certificate.
Soc. Sec.:
AND, if said number of Warrant Shares shall not be all the shares purchasable
under the within Warrant Certificate, a new Warrant Certificate is to be issued
in the name of the undersigned for the balance remaining of the Warrant Shares
purchasable thereunder rounded up to the next higher whole number of Warrant
Shares.
Signature:**
- --------
** The above signature should correspond exactly with the name on the face of
this Warrant Certificate or with the name of the assignee appearing in the
assignment form below.
ASSIGNMENT FORM
(To be signed only upon assignment of Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto
(Name and Address of Assignee must be Printed or Typewritten)
Warrants to purchase ___________________ Warrant Shares of the Company,
evidenced by the within Warrant Certificate hereby irrevocably constituting and
appointing __________________ Attorney to transfer said Warrants on the books of
the Company, with full power of substitution in the premises.
Dated:___________________________, ____
______________________________
Signature of Registered Holder
______________________________
Signature Guaranteed: Signature of Guarantor
- --------
* The above signature should correspond exactly with the name on the face of
this Warrant Certificate.
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