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EXHIBIT 4.3
EXECUTION COPY
__________________________________________________________
WARRANT AGREEMENT
Dated as of February 23, 1998
By and Between
DTI HOLDINGS, INC.
and
THE BANK OF NEW YORK,
Warrant Agent
____________________
Warrants to Purchase Common Stock
(Par Value $0.01 Per Share)
__________________________________________________________
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TABLE OF CONTENTS
Page
ARTICLE I
ISSUANCE, FORM, EXECUTION, DELIVERY AND
REGISTRATION OF WARRANT CERTIFICATES
SECTION 1.01. Issuance of Warrants.................................. 2
SECTION 1.02. Form of Warrant Certificates.......................... 2
SECTION 1.03. Execution of Warrant Certificates..................... 3
SECTION 1.04. Authentication and Delivery........................... 3
SECTION 1.05. Temporary Warrant Certificates........................ 4
SECTION 1.06. Separation of Warrants and Notes...................... 4
SECTION 1.07. Registration.......................................... 5
SECTION 1.08. Registration of Transfers or Exchanges................ 5
SECTION 1.09. Lost, Stolen, Destroyed, Defaced or Mutilated Warrant
Certificates..................................... 11
SECTION 1.10. Offices for Exercise, etc............................. 11
ARTICLE II
DURATION, EXERCISE OF WARRANTS; EXERCISE PRICE
AND REPURCHASE OF WARRANTS
SECTION 2.01. Duration of Warrants.................................. 12
SECTION 2.02. Exercise, Exercise Price, Settlement and Delivery..... 13
SECTION 2.03. Cancellation of Warrant Certificates.................. 16
SECTION 2.04. Notice of an Exercise Event........................... 16
ARTICLE III
OTHER PROVISIONS RELATING TO
RIGHTS OF HOLDERS OF WARRANTS
SECTION 3.01. Enforcement of Rights................................. 16
SECTION 3.02. Obtaining Stock Exchange Listings..................... 17
ARTICLE IV
CERTAIN COVENANTS OF THE COMPANY
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Page
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SECTION 4.01. Payment of Taxes.......................................... 17
SECTION 4.02. Rules 144 and 144A........................................ 17
SECTION 4.03. Form of Initial Public Equity Offering.................... 17
SECTION 4.04. Securities Act and Applicable State Securities Laws....... 18
SECTION 4.05. Resolution of Preemptive Rights, if Any................... 18
ARTICLE V
ADJUSTMENTS
SECTION 5.01. Adjustment of Exercise Rate; Notices...................... 18
SECTION 5.02. Fractional Warrant Shares................................. 25
SECTION 5.03. Certain Distributions..................................... 25
ARTICLE VI
CONCERNING THE WARRANT AGENT
SECTION 6.01. Warrant Agent............................................. 26
SECTION 6.02. Conditions of Warrant Agent's Obligations................. 26
SECTION 6.03. Resignation and Appointment of Successor.................. 30
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Amendment................................................. 32
SECTION 7.02. Notices and Demands to the Company and Warrant Agent...... 33
SECTION 7.03. Addresses for Notices to Parties and for Transmission of
Documents............................................... 33
SECTION 7.04. Notices to Holders........................................ 34
SECTION 7.05. Applicable Law............................................ 34
SECTION 7.06. Persons Having Rights Under Agreement..................... 34
SECTION 7.07. Headings.................................................. 34
SECTION 7.08. Counterparts.............................................. 34
SECTION 7.09. Inspection of Agreement................................... 34
SECTION 7.10. Availability of Equitable Remedies........................ 35
SECTION 7.11. Obtaining of Governmental Approvals....................... 35
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EXHIBIT A - Form of Warrant Certificate
EXHIBIT B - Form of Legend for Global Warrant
EXHIBIT C - Certificate to Be Delivered upon Exchange or Registration of
Transfer of Warrants
EXHIBIT D - Form of Certificate to Be Delivered in Connection with
Regulation S Transfers
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INDEX OF DEFINED TERMS
Defined Term Page
Affiliate.....................................................................21
Agreement..................................................................... 1
Business Day..................................................................12
Capital Stock.................................................................23
Cashless Exercise.............................................................14
Cashless Exercise Ratio.......................................................14
Common Stock.................................................................. 2
Convertible Preferred Stock...................................................24
Current Market Value..........................................................24
Definitive Warrants........................................................... 2
Distribution..................................................................25
Distribution Rights...........................................................25
Election to Exercise......................................................... 13
Exercisability Date.......................................................... 13
Exercise Date................................................................ 14
Exercise Event............................................................... 13
Exercise Price............................................................... 13
Exercise Rate................................................................ 13
Expiration Date.............................................................. 12
Global Shares................................................................ 15
Global Warrants.............................................................. 2
Indenture.................................................................... 1
Independent Financial Expert................................................. 25
Initial Public Equity Offering............................................... 13
Initial Purchasers........................................................... 1
Issue Date................................................................... 21
Legended Regulation S Global Warrant......................................... 4
Merrill Lynch................................................................ 1
Notes........................................................................ 1
Officers' Certificate........................................................ 9
Person....................................................................... 13
Private Placement Legend..................................................... 10
Purchase Agreement........................................................... 1
Related Parties.............................................................. 27
Requisite Warrant Holders.................................................... 32
Resale Restriction Termination Date.......................................... 6
Securities Act............................................................... 4
Separability Date............................................................ 4
Separation................................................................... 5
Subject Class................................................................ 18
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Page
Surviving Person..............................................................21
Time of Determination.........................................................25
Trustee....................................................................... 1
Units......................................................................... 1
Warrant....................................................................... 1
Warrant Agent................................................................. 1
Warrant Agent Office..........................................................12
Warrant Certificates.......................................................... 1
Warrant Exercise Office.......................................................11
Warrant Register.............................................................. 5
Warrant Registration Rights Agreement......................................... 1
Warrant Shares................................................................ 2
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WARRANT AGREEMENT
WARRANT AGREEMENT ("Agreement"), dated as of February 23, 1998 by and
between DTI HOLDINGS, INC. (the "Company"), a corporation organized and
incorporated under the Missouri General Business Corporation Law, and THE BANK
OF NEW YORK, warrant agent (with any successor Warrant Agent, the "Warrant
Agent").
WHEREAS, the Company has entered into a purchase agreement (the "Purchase
Agreement") dated February 13, 1998 with Merrill Lynch & Co., Merrill Lynch,
Pierce, Fenner & Smith Incorporated ("Merrill Lynch") and TD Securities (USA)
Inc. (together with Merrill Lynch, the "Initial Purchasers"), severally, in
which the Company has agreed to sell to the Initial Purchasers 506,000 units
(the "Units"), each consisting of (i) $1,000 principal amount at maturity of
Senior Discount Notes due 2008 (the "Notes") of the Company to be issued under
an indenture dated as of February 23, 1998 (the "Indenture"), between the
Company and The Bank of New York, trustee (in such capacity, the "Trustee"),
and (ii) five warrants (the "Warrants"), each initially entitling the holder
thereof to purchase 1.552 shares of Common Stock (as defined herein) of the
Company, set forth opposite such Initial Purchaser's name on Schedule I to the
Purchase Agreement. The certificates evidencing the Warrants are herein
referred to collectively as the "Warrant Certificates"; and
WHEREAS, the Notes and the Warrants comprising the Units shall not be
separately transferable until the Separability Date (as defined herein); and
WHEREAS, the holders of the Warrants are entitled to the benefits of a
Warrant Registration Rights Agreement dated as of February 23, 1998 between the
Company and the Initial Purchasers (the "Warrant Registration Rights
Agreement"); and
WHEREAS, the Company desires the Warrant Agent as warrant agent to assist
the Company in connection with the issuance, exchange, cancellation,
replacement and exercise of the Warrants, and in this Agreement wishes to set
forth, among other things, the terms and conditions on which the Warrants may
be issued, exchanged, cancelled, replaced and exercised;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
ISSUANCE, FORM, EXECUTION, DELIVERY AND
REGISTRATION OF WARRANT CERTIFICATES
SECTION 1.01. Issuance of Warrants. Warrants comprising part of the
Units shall be originally issued in connection with the issuance of the Units
and such Warrants shall not
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be separately transferable from the Notes until on or after the Separability
Date as provided in Section 1.06 hereof.
Each Warrant Certificate shall evidence the number of Warrants specified
therein. Each Warrant evidenced by a Warrant Certificate shall, when it
becomes exercisable as provided herein and therein, represent the right,
subject to the provisions contained herein and therein, to purchase from the
Company (and the Company shall issue and sell to the holder of such Warrant)
1.552 fully paid, registered and non-assessable Warrant Shares at an exercise
price of $0.01 per share. The number of shares of the Company's common stock,
par value $0.01 per share, and any other class or series of common equity
equivalent shares of the Company hereafter created (the "Common Stock")
issuable upon exercise of a Warrant is subject to adjustment as provided herein
and in the Warrant. The shares of Common Stock issuable upon exercise of a
Warrant are hereinafter referred to as the "Warrant Shares" and, unless the
context otherwise requires, such term shall also include any other securities
or property issuable and deliverable upon exercise of a Warrant as provided in
Article V, subject to adjustment as provided herein and in the Warrant.
SECTION 1.02. Form of Warrant Certificates. The Warrant Certificates
will initially be issued either in global form (the "Global Warrants") or in
registered form as definitive Warrant Certificates (the "Definitive Warrants"),
in either case substantially in the form of Exhibit A attached hereto. Any
Global Warrants to be delivered pursuant to this Agreement shall bear the
legend set forth in Exhibit B attached hereto. The Global Warrants shall
represent such of the outstanding Warrants as shall be specified therein, and
each Global Warrant shall provide that it shall represent the aggregate amount
of outstanding Warrants from time to time endorsed thereon and that the
aggregate amount of outstanding Warrants represented thereby may from time to
time be reduced or increased, as appropriate. Any endorsement of a Global
Warrant to reflect the amount of any increase or decrease in the amount of
outstanding Warrants represented thereby shall be made by the Warrant Agent and
the Depositary (as defined below) in accordance with instructions given by the
holder thereof. The Depository Trust Company shall act as the "Depositary"
with respect to the Global Warrants until a successor shall be appointed by the
Company and the Warrant Agent. Upon written request, a holder of Warrants may
receive from the Warrant Agent or the Depositary Definitive Warrants as set
forth in Section 1.08 hereof.
SECTION 1.03. Execution of Warrant Certificates. The Warrant
Certificates shall be executed on behalf of the Company by the chairman of its
board of directors, its president, its chief financial officer or any vice
president and attested by its secretary or assistant secretary. Such
signatures may be the manual or facsimile signatures of the present or any
future such officers. The seal of the Company may be in the form of a
facsimile thereof and may be impressed, affixed, imprinted or otherwise
reproduced on the Warrant Certificates. Typographical and other minor errors
or defects in any such reproduction of any such signature shall not affect the
validity or enforceability of any Warrant Certificate that has been duly
countersigned and delivered by the Warrant Agent.
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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
Certificate so signed shall be authenticated and delivered by the Warrant Agent
or disposed of by the Company, such Warrant Certificate nevertheless may be
authenticated and delivered or disposed of as though the person who signed such
Warrant Certificate had not ceased to be such officer of the Company. Any
Warrant Certificate may be signed on behalf of the Company by such persons as,
at the actual date of the execution of such Warrant Certificate, shall be the
proper officers of the Company, although at the date of the execution and
delivery of this Agreement any such person was not such an officer.
SECTION 1.04. Authentication and Delivery. Subject to the immediately
following paragraph, Warrant Certificates shall be authenticated by manual
signature and dated the date of authentication by the Warrant Agent and shall
not be valid for any purpose unless so authenticated and dated. The Warrant
Certificates shall be numbered and shall be registered in the Warrant Register
(as defined in Section 1.07 hereof).
Upon the receipt by the Warrant Agent of a written order of the Company,
which order shall be signed by the chairman of its board of directors, its
president, its chief financial officer or any vice president and attested by
its secretary or assistant secretary, and shall specify the amount of Warrants
to be authenticated, whether the Warrants are to be Global Warrants or
Definitive Warrants, the date of such Warrants and such other information 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 1.03 hereof, to authenticate the Warrant Certificates and
upon the holder's request deliver them. Such authentication 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
authenticated any of the Warrant Certificates shall cease to be such authorized
signatory before the Warrant Certificate shall be disposed of by the Company or
the Warrant Agent, such Warrant Certificate nevertheless may be delivered or
disposed of as though the person who authenticated such Warrant Certificate had
not ceased to be such authorized signatory of the Warrant Agent; and any
Warrant Certificate may be authenticated on behalf of the Warrant Agent by such
persons as, at the actual time of authentication 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.
The Warrant Agent's authentication on all Warrant Certificates shall be in
substantially the form set forth in Exhibit A hereto.
SECTION 1.05. Temporary Warrant Certificates. Warrants sold in offshore
transactions in reliance on Regulation S will initially be represented by one
or more permanent
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legended global Warrants in definitive, fully registered form (each a
"Legended Regulation S Global Warrant"). The Company may execute, and the
Warrant Agent shall authenticate and deliver, Legended Regulation S Global
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 Legended Regulation S Global Warrants will be exchangeable for one or
more unlegended permanent global Warrants on or after one year following the
Issue Date upon certification that the beneficial interests in such global
Warrants are owned by non-U.S. persons at any office or agency maintained by
the Company for that purpose pursuant to Section 1.10 hereof. Subject to the
provisions of Section 4.01 hereof, such exchange shall be without charge to the
holder. Upon surrender for cancellation of any one or more Legended Regulation
S Global Warrant Certificates, the Company shall execute, and the Warrant Agent
shall authenticate and deliver in exchange therefor, one or more unlegended
permanent global Warrant Certificates representing in the aggregate a like
number of Warrants. Until so exchanged, the holder of a Legended Regulation S
Global Warrant Certificate shall in all respects be entitled to the same
benefits under this Agreement as a holder of an unlegended permanent global
Warrant Certificate provided that prior to the later of (i) the 40th day after
the Issue Date and (ii) one year after the Issue Date with respect to the
Warrants, beneficial interests in the Legended Regulation S Global Warrant may
be only held through Euroclear or Cedel Bank. Cedel Bank and Euroclear will
hold interests in the Global Warrant on behalf of their participants through
DTC.
SECTION 1.06. Separation of Warrants and Notes. The Notes and the
Warrants will not be separately transferable until the Separability Date.
"Separability Date" shall mean the earliest to occur of: (i) September 1,
1998, (ii) the date on which a registration statement under the Securities Act
of 1933, as amended (the "Securities Act"), with respect to a registered
exchange offer for the Notes is declared effective under the Securities Act,
(iii) the occurrence of an Exercise Event (as defined herein), (iv) the
occurrence of an Event of Default (as defined in the Indenture) or (v) such
earlier date as determined by Merrill Lynch in its sole discretion and
specified to the Company and the Warrant Agent in writing. Notwithstanding the
foregoing, in the event a Change of Control (as defined in the Indenture) is
proposed and the Company commences a Change of Control Offer (as defined in the
Indenture) prior to the Separability Date, as determined by the preceding
sentence, the Separability Date shall be such earlier date of commencement.
The separation of the Warrants and the Notes is herein referred to as a
"Separation."
SECTION 1.07. Registration. The Company will keep, at the office or
agency maintained by the Company for such purpose, a register or registers in
which, subject to such reasonable regulations as it may prescribe, the Company
shall provide for the registration of, and registration of transfer and
exchange of, Warrants as provided in this Article. Each person designated by
the Company from time to time as a person authorized to register the transfer
and
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exchange of the Warrants is hereinafter called, individually and collectively,
the "Registrar." The Company hereby initially appoints the Warrant Agent as
Registrar. Upon written notice to the Warrant Agent and any acting Registrar,
the Company may appoint a successor Registrar for such purposes.
The Company will at all times designate one person (who may be the Company
and who need not be a Registrar) to act as repository of a master list of names
and addresses of the holders of Warrants (the "Warrant Register"). The Warrant
Agent will act as such repository unless and until some other person is, by
written notice from the Company to the Warrant Agent and the Registrar,
designated by the Company to act as such. The Company shall cause each
Registrar to furnish to such repository, on a current basis, such information
as to all registrations of transfer and exchanges effected by such Registrar,
as may be necessary to enable such repository to maintain the Warrant Register
on as current a basis as is practicable.
SECTION 1.08. Registration of Transfers or Exchanges.
(a) Transfer or Exchange of Definitive Warrants. When Definitive Warrants
are presented to the Warrant Agent with a request from the holder:
(i) to register the transfer of the Definitive Warrants; or
(ii) to exchange such Definitive Warrants for an equal number of
Definitive Warrants of other authorized denominations,
the Warrant Agent shall register the transfer or make the exchange as requested
if the requirements under this Warrant Agreement as set forth in this Section
1.08 hereof for such transactions are met; provided, however, that the
Definitive Warrants presented or surrendered by a holder for registration of
transfer or exchange:
(x) shall be duly endorsed or accompanied by a written instruction of
transfer or exchange in form satisfactory to the Company and the
Warrant Agent, duly executed by such holder or by his attorney, duly
authorized in writing; and
(y) in the case of Warrants the offer and sale of which have not been
registered under the Securities Act and are presented for transfer or
exchange prior to (X) the date which is two years (or such shorter
period as may be prescribed by Rule 144(k) (or any successor
provision thereto)) after the later of the date of original issuance
of the Warrants and the last date on which the Company or any
affiliate of the Company was the owner of such Warrants, or any
predecessor thereto, and (Y) such later date, if any, as may be
required by any subsequent change in applicable law (the "Resale
Restriction Termination Date"), such Warrants shall be accompanied by
the following additional information and documents, as applicable:
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(A) if such Warrants are being delivered to the Warrant Agent by a
holder for registration in the name of such holder, without
transfer, a certification from such holder to that effect (in
substantially the form of Exhibit C hereto); or
(B) if such Warrants are being transferred to a qualified
institutional buyer as such term is defined in Rule 144A under
the Securities Act (a "QIB") in accordance with Rule 144A under
the Securities Act, a certification from the transferor to that
effect (in substantially the form of Exhibit C hereto); or
(C) if such Warrants are being transferred in reliance on Regulation
S under the Securities Act, delivery by the transferor of a
certification to that effect (in substantially the form of
Exhibit C hereto), and a Certificate for Regulation S Transfers
(in substantially the form of Exhibit D hereto); or
(D) if such Warrants are being transferred in reliance on Rule 144
under the Securities Act, delivery by the transferor of (i) a
certification from the transferor to that effect (in
substantially the form of Exhibit C hereto), and (ii) an opinion
of counsel reasonably satisfactory to the Company to the effect
that such transfer is in compliance with the Securities Act; or
(E) if such Warrants are being transferred in reliance on another
exemption from the registration requirements of the Securities
Act, a certification from the transferor to that effect (in
substantially the form of Exhibit C hereto) and an opinion of
counsel reasonably satisfactory to the Company to the effect
that such transfer is in compliance with the Securities Act;
provided that the Company may, based upon the views of its own
counsel, instruct the Warrant Agent not to register such
transfer in any case where the proposed transferee is not a QIB
or Non-U.S. Person.
(b) Restrictions on Transfer of a Definitive Warrant for a Beneficial
Interest in a Global Warrant. A Definitive Warrant may not be transferred by a
holder for a beneficial interest in a Global Warrant except upon satisfaction
of the requirements set forth below. Upon receipt by the Warrant Agent of a
Definitive Warrant, duly endorsed or accompanied by appropriate instruments of
transfer, in form satisfactory to the Warrant Agent, together with:
(A) certification from such holder (in substantially the form of
Exhibit C hereto) that such Definitive Warrant is being
transferred to a QIB in accordance with Rule 144A under the
Securities Act; and
(B) written instructions directing the Warrant Agent to make, or to
direct the Depositary to make, an endorsement on the Global
Warrant to reflect an
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increase in the aggregate amount of the Warrants represented by
the Global Warrant,
then the Warrant Agent shall cancel such Definitive Warrant and cause, or
direct the Depositary to cause, in accordance with the standing instructions
and procedures existing between the Depositary and the Warrant Agent, the
number of Warrant Shares represented by the Global Warrant to be increased
accordingly. If no Global Warrant is then outstanding, the Company shall
issue, and the Warrant Agent shall upon written instructions from the Company
authenticate, a new Global Warrant in the appropriate amount.
(c) Transfer or Exchange of Global Warrants. The transfer or exchange of
Global Warrants or beneficial interests therein shall be effected through the
Depositary, in accordance with this Section 1.08, the Private Placement Legend
(as defined below), this Agreement (including those restrictions on transfer
set forth herein) and the procedures of the Depositary therefor.
(d) Transfer or Exchange of a Beneficial Interest in a Global Warrant for
a Definitive Warrant.
(i) Any person having a beneficial interest in a Global Warrant may
transfer or exchange such beneficial interest for a Definitive
Warrant upon receipt by the Warrant Agent of written instructions (or
such other form of instructions as is customary for the Depositary)
from the Depositary or its nominee on behalf of any person having a
beneficial interest in a Global Warrant, including a written order
containing registration instructions and, in the case of any such
transfer or exchange prior to the Resale Restriction Termination
Date, the following additional information and documents:
(A) if such beneficial interest is being transferred to the person
designated by the Depositary as being the beneficial owner, a
certification from such person to that effect (in substantially
the form of Exhibit C hereto); or
(B) if such beneficial interest is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a
certification from the transferor to that effect (in
substantially the form of Exhibit C hereto); or
(C) if such beneficial interest is being transferred in reliance on
Regulation S under the Securities Act, delivery by the
transferor of (i) a certification to that effect (in
substantially in the form of Exhibit C hereto), and (ii) a
Certificate for Regulation S Transfers in substantially the form
of Exhibit D hereto; or
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(D) if such beneficial interest is being transferred in reliance on
Rule 144 under the Securities Act, delivery by the transferor of
(i) a certification to that effect (in substantially the form of
Exhibit C hereto) and (ii) an opinion of counsel reasonably
satisfactory to the Company to the effect that such transfer is
in compliance with the Securities Act; or
(E) if such beneficial interest is being transferred in reliance on
another exemption from the registration requirements of the
Securities Act, a certification from the transferor to that
effect (in substantially the form of Exhibit C hereto) and an
opinion of counsel reasonably satisfactory to the Company to the
effect that such transfer is in compliance with the Securities
Act; provided that the Company may instruct the Warrant Agent
not to register such transfer in any case where the proposed
transferee is not a QIB or Non-U.S. Person;
then the Warrant Agent will cause, in accordance with the standing
instructions and procedures existing between the Depositary and the
Warrant Agent, the aggregate amount of the Global Warrant to be
reduced and, following such reduction, the Company will execute and,
upon receipt of an authentication order in the form of an officers'
certificate (a certificate signed by the chairman or a co-chairman of
the board, the president, the chief financial officer, any executive
vice president or any senior vice president of the Company signing
alone, or by any vice president signing together with the secretary,
any assistant secretary, the treasurer, or any assistant treasurer of
the Company) (an "Officers' Certificate"), the Warrant Agent will
authenticate and deliver to the transferee a Definitive Warrant.
(ii) Definitive Warrants issued in exchange for a beneficial interest in a
Global Warrant pursuant to this Section 1.08(d) shall be registered
in such names and in such authorized denominations as the Depositary,
pursuant to instructions from its direct or indirect participants or
otherwise, shall instruct the Warrant Agent in writing. The Warrant
Agent shall deliver such Definitive Warrants to the persons in whose
names such Warrants are so registered and adjust the Global Warrant
pursuant to paragraph (h) of this Section 1.08.
(e) Restrictions on Transfer or Exchange of Global Warrants.
Notwithstanding any other provisions of this Agreement (other than the
provisions set forth in subsection (f) of this Section 1.08), a Global Warrant
may not be transferred or exchanged as a whole except by the Depositary to a
nominee of the Depositary; by a nominee of the Depositary to the Depositary or
another nominee of the Depositary; or by the Depositary or any such nominee to
a successor Depositary or a nominee of such successor Depositary.
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(f) Authentication of Definitive Warrants in Absence of Depositary. If at
any time:
(i) the Depositary for the Global Warrants notifies the Company that the
Depositary is unwilling or unable to continue as Depositary for the
Global Warrant and a successor Depositary for the Global Warrant is
not appointed by the Company within 90 days after delivery of such
notice; or
(ii) the Company, at its sole discretion, notifies the Warrant Agent in
writing that it elects to cause the issuance of Definitive Warrants
for all Global Warrants under this Agreement,
then the Company will execute, and the Warrant Agent will, upon receipt of an
Officers' Certificate requesting the authentication and delivery of Definitive
Warrants, authenticate and deliver Definitive Warrants, in an aggregate number
equal to the aggregate number of warrants represented by the Global Warrant, in
exchange for such Global Warrant.
(g) Private Placement Legend. Upon the transfer or exchange of Warrant
Certificates not bearing the legend set forth in the first paragraph of Exhibit
A attached hereto (the "Private Placement Legend"), the Warrant Agent shall
deliver Warrant Certificates that do not bear the Private Placement Legend.
Upon the transfer, exchange or replacement of Warrant Certificates bearing the
Private Placement Legend, the Warrant Agent shall deliver Warrant Certificates
that bear the Private Placement Legend unless, and the Warrant Agent is hereby
authorized to deliver Warrant Certificates without the Private Placement Legend
if, (i) there is delivered to the Warrant Agent an opinion of counsel
reasonably satisfactory to the Company and the Warrant Agent to the effect that
neither such legend nor the related restrictions on transfer are required in
order to maintain compliance with the provisions of the Securities Act or (ii)
the Warrants to be transferred or exchanged represented by such Warrant
Certificates are being transferred or exchanged pursuant to an effective
registration statement under the Securities Act.
(h) Cancellation or Adjustment of a Global Warrant. At such time as all
beneficial interests in a Global Warrant have either been exchanged for
Definitive Warrants, redeemed, repurchased or cancelled, such Global Warrant
shall be returned to the Company or, upon written order to the Warrant Agent in
the form of an Officers' Certificate from the Company, retained and cancelled
by the Warrant Agent. At any time prior to such cancellation, if any
beneficial interest in a Global Warrant is exchanged for Definitive Warrants,
redeemed, repurchased or cancelled, the number of Warrants represented by such
Global Warrant shall be reduced and an endorsement shall be made on such Global
Warrant by the Warrant Agent to reflect such reduction.
(i) Obligations with Respect to Transfers or Exchanges of Definitive
Warrants.
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(i) To permit registrations of transfers or exchanges, the Company shall
execute, at the Warrant Agent's request, and the Warrant Agent shall
authenticate, Definitive Warrants and Global Warrants.
(ii) All Definitive Warrants and Global Warrants issued upon any
registration, transfer or exchange of Definitive Warrants or Global
Warrants, as the case may be, shall be the valid obligations of the
Company, entitled to the same benefits under this Warrant Agreement
as the Definitive Warrants or Global Warrants surrendered upon the
registration of transfer or exchange.
(iii) Prior to due presentment for registration of transfer of any
Warrant, the Warrant Agent and the Company may deem and treat the
person in whose name any Warrant is registered as the absolute owner
of such Warrant, and neither the Warrant Agent nor the Company shall
be affected by notice to the contrary.
SECTION 1.09. 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 authenticate and deliver, 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. Upon the issuance of any new Warrant Certificate under this
Section in a name other than the prior registered holder of the lost, stolen,
destroyed, defaced or mutilated Warrant Certificate, the Company may require
the payment from the holder of such Warrant Certificate of a sum sufficient to
cover any tax, stamp tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Warrant Agent and the Registrar) in connection therewith. Every substitute
Warrant Certificate executed and delivered pursuant to this Section 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 1.09 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.
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The Warrant Agent is hereby authorized to authenticate in accordance with
the provisions of this Agreement and deliver the new Warrant Certificates
required pursuant to the provisions of this Section.
SECTION 1.10. Offices for Exercise, etc. So long as any of the Warrants
remain outstanding, the Company will 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 (each a "Warrant Exercise Office"),
(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
1.05 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, The City of New York,
as provided in the first sentence of this Section. 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
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 at its principal corporate trust office
identified in Section 7.03 in the Borough of Manhattan, The City of New York
(the "Warrant Agent 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 Warrant Agent Office and the Company appoints the Warrant Agent
as its agent to receive all such presentations, surrenders, notices and
demands.
ARTICLE II
DURATION, EXERCISE OF WARRANTS; EXERCISE PRICE
AND REPURCHASE OF WARRANTS
SECTION 2.01. Duration of Warrants. Subject to the terms and conditions
established herein, the Warrants shall expire at 5:00 p.m., New York City time,
on March 1, 2008. The applicable date of expiration of a particular Warrant is
referred to herein as the "Expiration Date" of such Warrant. Each Warrant may
be exercised on any Business Day (as defined below) on or after the
Exercisability Date (as defined in Section 2.02) and on or prior to the close
of business on the Expiration Date.
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Any Warrant not exercised before the close of business on the Expiration
Date shall become void, and all rights of the holder under the Warrant
Certificate evidencing such Warrant and under this Agreement shall cease.
"Business Day" shall mean any day on which (i) banks in The City of New
York, (ii) the principal U.S. securities exchange or market, if any, on which
any Common Stock is listed or admitted to trading and (iii) the principal U.S.
securities exchange or market, if any, on which the Warrants are listed or
admitted to trading, are open for business.
SECTION 2.02. Exercise, Exercise Price, Settlement and Delivery. (a)
Subject to the provisions of this Agreement, a holder of a Warrant shall have
the right to purchase from the Company on or after the Exercisability Date and
on or prior to the close of business on the Expiration Date 1.552 fully paid,
registered and non-assessable Warrant Shares (and any other securities or
property purchasable or deliverable upon exercise of such Warrant as provided
in Article V), subject to adjustment in accordance with Article V hereof, at
the purchase price of $0.01 for each share purchased (the "Exercise Price").
The number and amount of Warrant Shares issuable upon exercise of a Warrant
(the "Exercise Rate") shall be subject to adjustment from time to time as set
forth in Article V hereof.
"Exercisability Date" means, with respect to each Warrant, the first day
on or after the Separability Date on which there shall have occurred an
Exercise Event (as defined herein).
"Exercise Event" means, with respect to each Warrant, the date of the
occurrence of the earliest of: (i) the time immediately prior to the
occurrence of a Change of Control (as such term is defined in the Indenture);
(ii)(a) the 180th day (or such earlier date as determined by the Company in its
sole discretion) following the closing of an Initial Public Equity Offering (as
defined herein) or (b) upon the closing of an Initial Public Equity Offering,
but only in respect of Warrants, if any, required to be exercised to permit the
holders thereof to sell Warrant Shares pursuant to their respective
registration rights, (iii) a class of equity securities of the Company is
listed on a national securities exchange or authorized for quotation on the
Nasdaq National Market or is otherwise subject to registration under the
Exchange Act, or (iv) September 1, 1999.
"Initial Public Equity Offering" means a primary public offering (whether
or not underwritten, but excluding any offering pursuant to Form S-8 or F-8
under the Securities Act or any other publicly registered offering pursuant to
the Securities Act pertaining to an issuance of shares of Common Stock or
securities exercisable therefor under any benefit plan, employee compensation
plan, or employee or director stock purchase plan) of Common Stock pursuant to
an effective registration statement under the Securities Act.
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof or any other entity, including any predecessor of any such
entity.
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(b) Warrants may be exercised on or after the date they are exercisable
hereunder by (i) surrendering at any Warrant Exercise Office the Warrant
Certificate evidencing such Warrants with the form of election to purchase
Warrant Shares set forth on the reverse side of the Warrant Certificate (the
"Election to Exercise") 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, and (ii) paying in full the
Exercise Price for each such Warrant exercised. Each Warrant may be exercised
only in whole.
(c) Simultaneously with the exercise of each Warrant, payment in full of
the aggregate Exercise Price may be made, at the option of the holder, (i) in
cash or by certified or official bank check, (ii) by a Cashless Exercise (as
defined below) or (iii) by any combination of (i) and (ii), to the office or
agency where the Warrant Certificate is being surrendered. For purposes of
this Agreement, a "Cashless Exercise" shall mean an exercise of a Warrant in
accordance with the immediately following two sentences. To effect a Cashless
Exercise, the holder may exercise a Warrant or Warrants without payment of the
Exercise Price in cash by surrendering such Warrant or Warrants (represented by
one or more Warrant Certificates) and, in exchange therefor, receiving such
number of shares of Common Stock equal to the product of (1) that number of
shares of Common Stock for which such Warrant or Warrants are exercisable and
which would be issuable in the event of an exercise with payment in cash of the
Exercise Price and (2) the Cashless Exercise Ratio (as defined below). The
"Cashless Exercise Ratio" shall equal a fraction, the numerator of which is the
excess of the Current Market Value (calculated as set forth in this Agreement)
per share of Common Stock on the date of exercise over the Exercise Price per
share of Common Stock as of the date of exercise and the denominator of which
is the Current Market Value per share of Common Stock on the date of exercise.
Upon surrender of a Warrant Certificate representing more than one Warrant in
connection with a holder's option to elect a Cashless Exercise, such holder
must specify the number of Warrants for which such Warrant Certificate is to be
exercised (without giving effect to such Cashless Exercise). All provisions of
this Agreement shall be applicable with respect to a Cashless Exercise of a
Warrant Certificate for less than the full number of Warrants represented
thereby. No payment or adjustment shall be made on account of any
distributions of dividends on the Common Stock issuable upon exercise of a
Warrant. If the Company has not effected the registration under the Securities
Act of the offer and sale of the Warrant Shares by the Company to the holders
of the Warrants on or prior to the Exercise Date (as defined below) thereof,
the Company may elect to require that the holders of the Warrants effect the
exercise thereof solely pursuant to the Cashless Exercise option and may also
amend the Warrants to eliminate the requirement for payment of the Exercise
Price with respect to such Cashless Exercise option. The Warrant Agent shall
have no obligation under this section to calculate the Cashless Exercise Ratio.
(d) Upon surrender of a Warrant Certificate and payment and collection of
the Exercise Price at any Warrant Exercise Office (other than any Warrant
Exercise Office that also is an office of the Warrant Agent), such Warrant
Certificate and payment shall be promptly
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delivered to the Warrant Agent. The "Exercise Date" for a Warrant shall be the
date when all of the items referred to in the first sentence of paragraphs (b)
and (c) of this Section 2.02 are received by the Warrant Agent 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 paragraphs (b) and (c) 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, if all of the items referred to in the first sentence of
paragraphs (b) and (c) are received by the Warrant Agent at or prior to 5:00
p.m., New York City time, on the Expiration Date, the exercise of the Warrants
to which such items relate will be effective on the Expiration Date.
(e) 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 a Cashless
Exercise, cause an amount equal to the aggregate Exercise Price to be paid to
the Company by crediting such amount in immediately available funds to the
account designated by the Company in writing to the Warrant Agent for that
purpose; (ii) advise the Company immediately 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
Warrant Shares to which such holder is entitled upon such exercise, and such
other information as the Company shall reasonably request.
(f) Subject to Section 5.02 hereof, as soon as practicable after the
exercise of any Warrant or Warrants in accordance with the terms hereof, the
Company shall 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, a certificate or certificates evidencing the Warrant Shares 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 Election to
Exercise, as set forth on the reverse of the Warrant Certificate. Such
certificate or certificates evidencing the Warrant Shares shall be deemed to
have been issued and any persons who are designated to be named therein shall
be deemed to have become the holders of record of such Warrant Shares as of the
close of business on the Exercise Date; the Warrant Shares may initially be
issued in global form (the "Global Shares"). Such Global Shares shall
represent such of the outstanding Warrant Shares as shall be specified therein
and each Global Share shall provide that it represents the aggregate amount of
outstanding Warrant Shares from time to time endorsed thereon and that the
aggregate amount of outstanding Warrant Shares represented thereby may from
time to time be reduced or increased, as appropriate. Any endorsement of a
Global Share to reflect any increase or decrease in the amount of outstanding
Warrant Shares represented thereby shall be made by the registrar for the
Warrant Shares and the Depositary (referred to below) in accordance with
instructions
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given by the holder thereof. The Depository Trust Company shall (if possible)
act as the Depositary with respect to the Global Shares until a successor shall
be appointed by the Company and the registrar for the Warrant Shares. After
exercise of any Warrant or Warrant Shares, 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.
SECTION 2.03. Cancellation of Warrant Certificates. In the event the
Company shall purchase or otherwise acquire Warrants, the Warrant Certificates
evidencing such Warrants may thereupon be delivered to the Warrant Agent, and if
so delivered, shall at the Company's written instruction be canceled by it and
retired. The Warrant Agent shall cancel all Warrant Certificates properly
surrendered for exchange, substitution, transfer or exercise. Upon the
Company's written request, the Warrant Agent shall deliver such canceled Warrant
Certificates to the Company.
SECTION 2.04. Notice of an Exercise Event. The Company shall, as soon as
practicable after the occurrence of an Exercise Event, send or cause to be sent
to each holder of Warrants and to each beneficial owner of the Warrants with
respect to which such Exercise Event has occurred to the extent that the
Warrants are held of record by a depositary or other agent (with a copy to the
Warrant Agent), by first-class mail, at the addresses appearing on the Warrant
Register, a notice prepared by the Company advising such holder of the Exercise
Event which has occurred, which notice shall describe the type of Exercise Event
and the date of the occurrence thereof, as applicable, and, in either case, the
date of expiration of the right to exercise the Warrants prominently set forth
in the face of such notice.
ARTICLE III
OTHER PROVISIONS RELATING TO
RIGHTS OF HOLDERS OF WARRANTS
SECTION 3.01. Enforcement of Rights. (a) Notwithstanding any of the
provisions of this Agreement, any holder of any Warrant Certificate, without
the consent of the Warrant Agent, the holder of any Warrant Shares or the
holder of any other Warrant Certificate, may, in and for his own behalf,
enforce, and may institute and maintain any suit, action or proceeding against
the Company suitable to enforce, his right to exercise the Warrant or Warrants
evidenced by his Warrant Certificate in the manner provided in such Warrant
Certificate and in this Agreement.
(b) Neither the Warrants nor any Warrant Certificate shall entitle the
holders thereof to any of the rights of shareholders of the Company, including,
without limitation, the right to vote or to receive any dividends or other
payments or to consent or to receive notice as
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shareholders in respect of the meetings of shareholders or for the election of
directors of the Company or any other matter, or any rights whatsoever as
shareholders of the Company, except as expressly provided in Section 5.03
hereof.
SECTION 3.02. Obtaining Stock Exchange Listings. The Company will from
time to time take all action which may be necessary so that the Warrant Shares,
immediately upon their issuance upon the exercise of Warrants, will be listed on
the principal securities exchanges and markets within the United States
(including the Nasdaq National Market), if any, on which other shares of Common
Stock are then listed.
ARTICLE IV
CERTAIN COVENANTS OF THE COMPANY
SECTION 4.01. Payment of Taxes. The Company will pay all documentary
stamp taxes attributable to the initial issuance of Warrants and of the Warrant
Shares upon the exercise of Warrants; provided, however, that the Company shall
not be required to pay any tax or other governmental charge which may be
payable in respect of any transfer or exchange of any Warrant Certificates or
any certificates for Warrant Shares in a name other than the registered holder
of a Warrant Certificate surrendered upon the exercise of a Warrant. In any
such case, no transfer or exchange shall be made unless or until the person or
persons requesting issuance thereof shall have paid to the Company the amount
of such tax or other governmental charge or shall have established to the
satisfaction of the Company that such tax or other governmental charge has been
paid or an exemption is available therefrom.
SECTION 4.02. Rules 144 and 144A. The Company covenants that it will
file the reports required to be filed by it under the Securities Act and the
Exchange Act and the rules, regulations and policies adopted by the Securities
and Exchange Commission thereunder in a timely manner in accordance with the
requirements of the Securities Act and the Exchange Act and, if at any time the
Company is not required to file such reports, it will mail to each owner or
beneficial owner of Warrants, such information as is referred to in Rule
144A(d)(4) under the Securities Act.
SECTION 4.03. Form of Initial Public Equity Offering. The Company agrees
that it will not make an Initial Public Equity Offering of any class of its
Capital Stock (as defined below) (other than the class of Capital Stock into
which the Warrants are exercisable) without adopting any amendments to the
terms of the Company's articles of incorporation that may be necessary to
provide that the Warrant Shares are convertible into such class of Capital
Stock subject to the Initial Public Equity Offering (the "Subject Class") on a
share-for-share basis or other equitable basis and that the rights, conditions
and privileges of the Subject Class shall not be adverse to the holders of the
Warrant Shares.
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SECTION 4.04. Securities Act and Applicable State Securities Laws. The
Company will also agree to comply with all applicable laws, including the
Securities Act and any applicable state securities laws, in connection with the
offer and sale of Common Stock (and other securities and property deliverable)
upon exercise of the Warrants.
SECTION 4.05. Resolution of Preemptive Rights, if Any. The Warrant
Shares shall not be subject to any preemptive or similar rights.
ARTICLE V
ADJUSTMENTS
SECTION 5.01. Adjustment of Exercise Rate; Notices. The Exercise Rate is
subject to adjustment from time to time as provided in this Section.
(a) Adjustment for Change in Capital Stock. If, after the Issue Date (as
defined herein), the Company:
(i) pays a dividend or makes a distribution on shares of its Common
Stock payable in shares of its Common Stock or certain other Capital Stock
of the Company (other than any such dividend to the extent covered by
Section 5.03);
(ii) subdivides or splits any of its outstanding shares of Common
Stock into a greater number of shares;
(iii) combines any of its outstanding shares of Common Stock into a
smaller number of shares; or
(iv) issues by reclassification of any of its Common Stock or any
shares of any of its Capital Stock;
then the Exercise Rate in effect immediately prior to such action for each
Warrant then outstanding shall be adjusted so that the holder of a Warrant
thereafter exercised may receive the number of shares of Capital Stock of the
Company which such holder would have owned immediately following such action if
such holder had exercised the Warrant immediately prior to such action or
immediately prior to the record date applicable thereto, if any (regardless of
whether the Warrants then outstanding are then exercisable and without giving
effect to the Cashless Exercise option). If there are no outstanding shares of
Common Stock that are of the same class as the Warrant Shares at the time of
any such action and such action has therefore been taken only in respect of
shares of another class of Common Stock, such adjustment shall relate to the
Warrant Shares as Warrant Shares (and not in the form of shares of Common
Stock) if it would not frustrate the intent and purposes of this Section 5.01.
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The adjustment shall become effective immediately after the record date in
the case of a dividend or distribution and immediately after the effective date
in the case of a subdivision, combination or reclassification. In the event
that such dividend or distribution is not so paid or made or such subdivision,
combination or reclassification is not effected, the Exercise Rate shall again
be adjusted to be the Exercise Rate which would then be in effect if such
record date or effective date had not been so fixed.
If after an adjustment a holder of a Warrant upon exercise of such Warrant
may receive shares of two or more classes of Capital Stock of the Company, the
Exercise Rate shall thereafter be subject to adjustment upon the occurrence of
an action taken with respect to any such class of Capital Stock as is
contemplated by this Article V with respect to the Common Stock, on terms
comparable to those applicable to Common Stock in this Article V.
(b) Adjustment for Sale of Common Stock Below Current Market Value. If,
after the Issue Date, the Company grants or sells to any Affiliate of the
Company (other than a wholly-owned subsidiary) any Common Stock or any
securities convertible into or exchangeable or exercisable for any Common Stock
(other than (1) pursuant to the exercise of the Warrants, (2) pursuant to any
security convertible into, or exchangeable or exercisable for, shares of Common
Stock outstanding as of the Issue Date (3) upon the conversion, exchange or
exercise of any convertible, exchangeable or exercisable security as to which
upon the issuance thereof an adjustment pursuant to this Article V has been
made or which did not require any adjustment pursuant to this Article V or (4)
upon the conversion, exchange or exercise of convertible, exchangeable or
exercisable securities of the Company outstanding on the Issue Date (to the
extent in accordance with the terms of such securities as in effect on such
date)) at a price below the then Current Market Value (calculated as set forth
in Section 5.01(l) hereof), the Exercise Rate for each Warrant then outstanding
shall be adjusted in accordance with the formula:
E1 = E x (O + N)
---------------
(O + (N x P/M))
where:
E1 = the adjusted Exercise Rate for each Warrant then outstanding;
E = the then current Exercise Rate for each Warrant then outstanding;
O = the number of shares of Common Stock outstanding immediately prior
to the sale of Common Stock or issuance of securities convertible,
exchangeable or exercisable for Common Stock;
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N = the number of shares of Common Stock so sold or the maximum stated
number of shares of Common Stock issuable upon the conversion,
exchange or exercise of any such convertible, exchangeable or
exercisable securities, as the case may be;
P = the proceeds per share of Common Stock received by the Company,
which (i) in the case of shares of Common Stock is the amount
received by the Company in consideration for the sale and issuance
of such shares; and (ii) in the case of securities convertible
into or exchangeable or exercisable for shares of Common Stock is
the amount received by the Company in consideration for the sale
and issuance of such convertible or exchangeable or exercisable
securities, plus the minimum aggregate amount of additional
consideration, other than the surrender of such convertible or
exchangeable securities, payable to the Company upon exercise,
conversion or exchange thereof; and
M = the Current Market Value as of the Time of Determination (as
defined herein) or at the time of sale, as the case may be
(calculated as set forth in Section 5.01(l) hereof.
The adjustment shall become effective immediately after the record date
for the determination of shareholders entitled to receive the rights, warrants
or options to which this paragraph (b) applies or upon consummation of the sale
of Common Stock, as the case may be. To the extent that shares of Common Stock
are not delivered after the expiration of such rights or warrants, the Exercise
Rate for each Warrant then outstanding shall be readjusted to the Exercise Rate
which would otherwise be in effect had the adjustment 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 Rate for each Warrant then outstanding
shall again be adjusted to be the Exercise Rate which would then be in effect
if such date fixed for determination of shareholders entitled to receive such
rights or warrants had not been so fixed.
No adjustment shall be made under this paragraph (b) if the application of
the formula stated above in this paragraph (b) would result in a value of E1
that is lower than the value of E.
No adjustment shall be made under this paragraph (b) for any adjustment
which is the subject of paragraphs (a) and (d) of this Section 5.01.
No adjustment in the Exercise Rate shall be made under this paragraph (b)
upon the conversion, exchange or exercise of options to acquire shares of
Common Stock by officers, directors or employees of the Company; provided that
the exercise price of such options, at the time of issuance thereof, is at
least equal to the then Current Market Value of the Common Stock underlying
such options.
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"Affiliate" has the meaning set forth in the Indenture.
"Issue Date" means the date of the Indenture.
(c) Notice of Adjustment. Whenever the Exercise Rate is adjusted, the
Company shall promptly mail to holders of Warrants then outstanding at the
addresses appearing on the Warrant Register a notice of the adjustment. The
Company shall file with the Warrant Agent and any other Registrar such notice
and a certificate from the Company's independent public accountants briefly
stating the facts requiring the adjustment and the manner of computing it. The
certificate shall be conclusive evidence that the adjustment is correct.
Neither the Warrant Agent nor any such Registrar shall be under any duty or
responsibility with respect to any such certificate except to exhibit the same
during normal business hours to any holder desiring inspection thereof.
(d) Reorganization of Company; Special Distributions. (i) If the
Company, in a single transaction or through a series of related transactions,
consolidates with or merges with or into any other person or sells, assigns,
transfers, leases, conveys or otherwise disposes of all or substantially all of
its properties and assets to another person or group of affiliated persons or
is a party to a merger or binding share exchange which reclassifies or changes
its outstanding Common Stock (a "Fundamental Transaction"), as a condition to
consummating any such transaction the person formed by or surviving any such
consolidation or merger if other than the Company or the person to whom such
transfer has been made (the "Surviving Person") shall enter into a supplemental
warrant agreement. The supplemental warrant agreement shall provide (a) that
the holder of a Warrant then outstanding may exercise it for the kind and
amount of securities, cash or other assets which such holder would have
received immediately after the Fundamental Transaction if such holder had
exercised the Warrant immediately before the effective date of the transaction
(whether or not the Warrants were then exercisable and without giving effect to
the Cashless Exercise option); it being understood that the Warrants will
remain exercisable only in accordance with their terms so that conditions to
exercise will remain applicable, such as payment of Exercise Price, assuming
(to the extent applicable) that such holder (i) was not a constituent person or
an affiliate of a constituent person to such transaction, (ii) made no election
with respect thereto, and (iii) was treated alike with the plurality of
non-electing holders, and (b) that the Surviving Person shall succeed to and be
substituted to every right and obligation of the Company in respect of this
Agreement and the Warrants. The supplemental warrant agreement shall provide
for adjustments which shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Article V. The Surviving Person shall
mail to holders of Warrants at the addresses appearing on the Warrant Register
a notice briefly describing the supplemental warrant agreement. If the issuer
of securities deliverable upon exercise of Warrants is an affiliate of the
Surviving Person, that issuer shall join in the supplemental warrant agreement.
(ii) Notwithstanding the foregoing, if the Company enters into a
Fundamental Transaction with another Person (other than a subsidiary of the
Company) and consideration is
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payable to holders of shares of Capital Stock (or other securities or property)
issuable or, deliverable upon exercise of the Warrants that are exercisable in
exchange for such shares in connection with such Fundamental Transaction which
consists solely of cash, then the holders of Warrants shall be entitled to
receive distributions on the date of such event on an equal basis with holders
of such shares (or other securities issuable upon exercise of the Warrants) as
if the Warrants had been exercised immediately prior to such event, less the
aggregate Exercise Price therefor. Upon receipt of such payment, if any, the
rights of a holder of such Warrant shall terminate and cease and such holder's
Warrants shall expire.
(iii) If this paragraph (d) applies, it shall supersede the application of
paragraph (a) of this Section 5.01.
(e) Company Determination Final. Any determination that the Company or
the board of directors of the Company must make pursuant to this Article V
shall be conclusive.
(f) Warrant Agent's Adjustment Disclaimer. The Warrant Agent shall have
no duty to determine when an adjustment under this Article V should be made,
how it should be made or what it should be. The Warrant Agent shall have no
duty to determine whether a supplemental warrant agreement under paragraph (d)
need be entered into or whether any provisions of any supplemental warrant
agreement are correct. The Warrant Agent shall not be accountable for and
makes no representation as to the validity or value of any securities or assets
issued upon exercise of Warrants. The Warrant Agent shall not be responsible
for the Company's failure to comply with this Article V.
(g) Adjustment for Tax Purposes. In the event of a taxable distribution
to holders of shares of Common Stock which results in an adjustment to the
number of shares of Common Stock or other consideration for which such a
Warrant may be exercised, the holders of the Warrants may, in certain
circumstances, be deemed to have received a distribution subject to United
States federal income tax as a dividend.
(h) Underlying Warrant Shares. The Company shall at all times reserve and
keep available, free from preemptive rights, out of its authorized but unissued
Common Stock or Common Stock held in the treasury of the Company, for the
purpose of effecting the exercise of Warrants, the full number of Warrant
Shares then deliverable upon the exercise of all Warrants then outstanding and
payment of the exercise price, and the shares so deliverable shall be fully
paid and nonassessable and free from all liens and security interests.
(i) Specificity of Adjustment. Regardless of any adjustment in the number
or kind of shares purchasable upon the exercise of the Warrants, Warrant
Certificates theretofore or thereafter issued may continue to express the same
number and kind of Warrant Shares per Warrant as are stated on the Warrant
Certificates initially issuable pursuant to this Agreement.
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(j) Voluntary Adjustment. The Company from time to time may increase the
Exercise Rate by any number and for any period of time (provided that such
period is not less than 20 Business Days). Whenever the Exercise Rate is so
increased, the Company shall mail to holders at the addresses appearing on the
Warrant Register and file with the Warrant Agent a notice of the increase. The
Company shall give the notice at least 15 days before the date the increased
Exercise Rate takes effect. The notice shall state the increased Exercise Rate
and the period it will be in effect. A voluntary increase in the Exercise Rate
shall not change or adjust the Exercise Rate otherwise in effect as determined
by this Section 5.01.
(k) Multiple Adjustments. After an adjustment to the Exercise Rate for
outstanding Warrants under this Article V, any subsequent event requiring an
adjustment under this Article V shall cause an adjustment to the Exercise Rate
for outstanding Warrants as so adjusted.
(l) Definitions.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, partnership interests, participations, rights in or other
equivalents (however designated and whether voting or non-voting) of, such
person's capital stock, and any rights (other than debt securities convertible
into capital stock), warrants or options exchangeable for or convertible into
such capital stock whether outstanding on the Issue Date or issued after the
Issue Date.
"Convertible Preferred Stock" shall mean any securities convertible or
exercisable or exchangeable into Common Stock, whether outstanding on the Issue
Date or thereafter issued.
"Current Market Value" per share of Common Stock of the Company or any
other security at any date shall mean (i) if the security is not registered
under the Exchange Act, (a) the value of the security, determined in good faith
by the board of directors of the Company and certified in a board resolution,
based on the most recently completed arm's-length transaction between the
Company and a person other than an Affiliate of the Company and the closing of
which occurs on such date or shall have occurred within the six-month period
preceding such date, or (b) if no such transaction shall have occurred on such
date or within such six-month period, the fair market value of the security as
determined by a nationally or regionally recognized Independent Financial
Expert (as defined herein) (provided that, in the case of the calculation of
Current Market Value for determining the cash value of fractional shares, any
such determination within six months that is, in the good faith judgment of the
Board, a reasonable determination of value, may be utilized) or (ii) (a) if the
security is registered under the Exchange Act, the average of the daily closing
sales prices of the securities for the 20 consecutive trading days immediately
preceding such date, or (b) if the security has been registered under the
Exchange Act for less than 20 consecutive trading days before such date, then
the average of the daily closing sales prices for all of the trading days
before such date for which closing sales prices are available, in the case of
each of (ii)(a) and (ii)(b), as certified to the Warrant Agent by the
president, any vice president or the chief financial officer of the Company.
The closing sales price for each such
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trading day shall be: (A) in the case of a security listed or admitted to
trading on any U.S. national securities exchange or quotation system, the
closing sales price, regular way, on such day, or if no sale takes place on
such day, the average of the closing bid and asked prices on such day, (B) in
the case of a security not then listed or admitted to trading on any U.S.
national securities exchange or quotation system, the last reported sale price
on such day, or if no sale takes place on such day, the average of the closing
bid and asked prices on such day, as reported by a reputable quotation source
designated by the Company, (C) in the case of a security not then listed or
admitted to trading on any U.S. national securities exchange or quotation
system and as to which no such reported sale price or bid and asked prices are
available, the average of the reported high bid and low asked prices on such
day, as reported by a reputable quotation service, or a newspaper of general
circulation in the Borough of Manhattan, The City and State of New York
customarily published on each Business Day, designated by the Company, or, if
there shall be no bid and asked prices on such day, the average of the high bid
and low asked prices, as so reported, on the most recent day (not more than 30
days prior to the date in question) for which prices have been so reported and
(D) if there are not bid and asked prices reported during the 30 days prior to
the date in question, the Current Market Value shall be determined as if the
securities were not registered under the Exchange Act.
"Independent Financial Expert" means a U.S. investment banking firm of
national standing in the United States (i) which does not, and whose directors,
officers and employees or Affiliates do not have a direct or indirect material
financial interest for its proprietary account in the Company or any of its
Affiliates and (ii) which, in the judgment of the board of directors of the
Company, is otherwise independent with respect to the Company and its
Affiliates and qualified to perform the task for which it is to be engaged.
"Time of Determination" means, (i) in the case of any distribution of
securities or other property to existing shareholders to which paragraph (b)
applies, the time and date of the determination of shareholders entitled to
receive such securities or property or (ii) in the case of any other issuance
and sale to which paragraph (b) applies, the time and date of such issuance or
sale.
(m) When De Minimis Adjustment May Be Deferred. No adjustment in the
Exercise Rate need be made unless the adjustment would require an increase of
at least 1% in the Exercise Rate. Any adjustments that are not made shall be
carried forward and taken into account in any subsequent adjustments. All
calculations under this Article V shall be made to the nearest 1/1000th of a
share, as the case may be.
SECTION 5.02. Fractional Warrant Shares. The Company shall not be
required to issue fractional Warrant Shares upon exercise of the Warrants or
distribute Warrant Certificates that evidence fractional Warrant Shares. In
the event a holder is required by Section 2.02(c) to make a Cashless Exercise,
the number of Warrant Shares issuable shall be rounded up to the nearest whole
number. In addition, in no event shall any holder of Warrants be required to
make any payment of a fractional cent. In lieu of fractional Warrant Shares,
there
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shall be paid to the registered holders of Warrant Certificates at the time
Warrants evidenced thereby are exercised as herein provided an amount in cash
equal to the same fraction of the Current Market Value per Warrant Share on the
Business Day preceding the date the Warrant Certificates evidencing such
Warrants are surrendered for exercise. Such payments shall be made by check or
by transfer to an account maintained by such registered holder with a bank in
The City of New York. If any holder surrenders for exercise more than one
Warrant Certificate, the number of Warrant Shares deliverable to such holder
may, at the option of the Company, be computed on the basis of the aggregate
amount of all the Warrants exercised by such holder.
SECTION 5.03. Certain Distributions. If at any time after the
Exercisability Date, the Company grants, issues or sells options, convertible
securities, or rights to purchase Capital Stock, warrants or other securities
pro rata to the record holders of Common Stock (the "Distribution Rights") or,
without duplication, makes any dividend or otherwise makes any distribution,
including (subject to applicable law) pursuant to any plan of liquidation
("Distribution") on shares of any Common Stock (whether in cash, property,
evidences of indebtedness or otherwise), then the Company shall grant, issue,
sell or make to each registered holder of Warrants then outstanding the
aggregate Distribution Rights or Distribution, as the case may be, which such
holder would have acquired if such holder had held the maximum number of shares
of Common Stock acquirable upon complete exercise of each holder's Warrants
(regardless of whether the Warrants are then exercisable and without giving
effect to the Cashless Exercise option) immediately before the record date for
the grant, issuance or sale of such Distribution Rights or Distribution, as the
case may be, or, if there is no such record date, the date as of which the
record holders of Common Stock are to be determined for the grant, issue or
sale of such Distribution Rights or Distribution, as the case may be.
ARTICLE VI
CONCERNING THE WARRANT AGENT
SECTION 6.01. Warrant Agent. The Company hereby appoints The Bank of New
York as Warrant Agent of the Company in respect of the Warrants and the Warrant
Certificates upon the terms and subject to the conditions set forth herein and
in the Warrant Certificates; and The Bank of New York hereby accepts such
appointment. The Warrant Agent shall have the powers and authority
specifically granted to and conferred upon it in the Warrant Certificates and
hereby and such further powers and authority to act on behalf of the Company as
the Company may hereafter grant to or confer upon it and it shall accept in
writing. All of the terms and provisions with respect to such powers and
authority contained in the Warrant Certificates are subject to and governed by
the terms and provisions hereof. The Warrant Agent may act through agents and
shall not be responsible for the misconduct or negligence of any such agent
appointed with due care.
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SECTION 6.02. Conditions of Warrant Agent's Obligations. The Warrant
Agent accepts its obligations herein set forth upon the terms and conditions
hereof and in the Warrant Certificates, including the following, to all of
which the Company agrees and to all of which the rights hereunder of the
holders from time to time of the Warrant Certificates shall be subject:
(a) The Warrant Agent shall be entitled to compensation to be agreed
upon with the Company in writing for all services rendered by it and the
Company agrees promptly to pay such compensation and to reimburse the
Warrant Agent for its reasonable out-of-pocket expenses (including
reasonable fees and expenses of counsel) incurred without gross negligence
or willful misconduct on its part in connection with the services rendered
by it hereunder. The Company also agrees to indemnify the Warrant Agent
and any predecessor Warrant Agent, their directors, officers, affiliates,
agents and employees for, and to hold them and their directors, officers,
affiliates, agents and employees harmless against, any loss, liability or
expense of any nature whatsoever (including, without limitation,
reasonable fees and expenses of counsel) incurred without gross negligence
or willful misconduct on the part of the Warrant Agent, arising out of or
in connection with its acting as such Warrant Agent hereunder and its
exercise of its rights and performance of its obligations hereunder. The
obligations of the Company under this Section 6.02 shall survive the
exercise and the expiration of the Warrant Certificates and the
resignation and removal of the Warrant Agent.
(b) In acting under this Agreement and in connection with the Warrant
Certificates, the Warrant Agent is acting solely as agent of the Company
and does not assume any obligation or relationship of agency or trust for
or with any of the owners or holders of the Warrant Certificates.
(c) The Warrant Agent may consult with counsel of its selection and
any advice or written opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in accordance with such advice
or opinion.
(d) The Warrant Agent shall be fully protected and shall incur no
liability for or in respect of any action taken or omitted to be taken or
thing suffered by it in reliance upon any Warrant Certificate, notice,
direction, consent, certificate, affidavit, opinion of counsel,
instruction, statement or other paper or document reasonably believed by
it to be genuine and to have been presented or signed by the proper
parties.
(e) The Warrant Agent, and its officers, directors, affiliates and
employees ("Related Parties"), may become the owners of, or acquire any
interest in, Warrant Certificates, shares or other obligations of the
Company with the same rights that it or they would have if it were not the
Warrant Agent hereunder and, to the extent permitted by applicable law, it
or they may engage or be interested in any financial or other transaction
with the Company and may act on, or as depositary, trustee or agent for,
any
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committee or body of holders of shares or other obligations of the Company
as freely as if it were not the Warrant Agent hereunder. Nothing in this
Agreement shall be deemed to prevent the Warrant Agent or such Related
Parties from acting in any other capacity for the Company.
(f) The Warrant Agent shall not be under any liability for interest
on, and shall not be required to invest, any monies at any time received
by it pursuant to any of the provisions of this Agreement or of the
Warrant Certificates.
(g) The Warrant Agent shall not be under any responsibility in
respect of the validity of this Agreement (or any term or provision
hereof) or the execution and delivery hereof (except the due execution and
delivery hereof by the Warrant Agent) or in respect of the validity or
execution of any Warrant Certificate (except its authentication thereof).
(h) The recitals and other statements contained herein and in the
Warrant Certificates (except as to the Warrant Agent's authentication
thereon) shall be taken as the statements of the Company and the Warrant
Agent assumes no responsibility for the correctness of the same. The
Warrant Agent does not make any representation as to the validity or
sufficiency of this Agreement or the Warrant Certificates, except for its
due execution and delivery of this Agreement; provided, however, that the
Warrant Agent shall not be relieved of its duty to authenticate the
Warrant Certificates as authorized by this Agreement. The Warrant Agent
shall not be accountable for the use or application by the Company of the
proceeds of the exercise of any Warrant.
(i) Before the Warrant Agent acts or refrains from acting with
respect to any matter contemplated by this Warrant Agreement, it may
require:
(1) an Officers' Certificate (as defined in the Indenture)
stating on behalf of the Company that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Warrant
Agreement relating to the proposed action have been complied with;
and
(2) if reasonably necessary in the sole judgment of the Warrant
Agent, an opinion of counsel for the Company stating that, in the
opinion of such counsel, all such conditions precedent have been
complied with, provided that such matter is one customarily opined
upon by counsel.
Each Officers' Certificate or, if requested, an opinion of counsel
with respect to compliance with a condition or covenant provided for in
this Warrant Agreement shall include:
(1) a statement that the person making such certificate or
opinion has read such covenant or condition;
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(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such person, he or she
has made such examination or investigation as is necessary to enable
him or her to express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(4) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
(j) The Warrant Agent shall be obligated to perform such duties as
are specifically set forth herein and in the Warrant Certificates, and no
implied duties or obligations shall be read into this Agreement or the
Warrant Certificates against the Warrant Agent. The Warrant Agent shall
not be accountable or under any duty or responsibility for the use by the
Company of any of the Warrant Certificates duly authenticated by the
Warrant Agent and delivered by it to the Company pursuant to this
Agreement. The Warrant Agent shall have no duty or responsibility in case
of any default by the Company in the performance of its covenants or
agreements contained in the Warrant Certificates or in the case of the
receipt of any written demand from a holder of a Warrant Certificate with
respect to such default, including, without limiting the generality of the
foregoing, any duty or responsibility to initiate or attempt to initiate
any proceedings at law or otherwise or, except as provided in Section 7.02
hereof, to make any demand upon the Company.
(k) Unless otherwise specifically provided herein, any order,
certificate, notice, request, direction or other communication from the
Company made or given under any provision of this Agreement shall be
sufficient if signed by the chairman or a co-chairman of the board, the
president, the chief financial officer, any executive vice president or
any senior vice president of the Company signing alone, or by any vice
president signing together with the secretary, any assistant secretary,
the treasurer, or any assistant treasurer of the Company.
(l) The Warrant Agent shall have no responsibility in respect of any
adjustment pursuant to Article V hereof.
(m) The Company agrees that it will perform, execute, acknowledge and
deliver, or cause to be performed, executed, acknowledged and delivered,
all such further and other acts, instruments and assurances as may
reasonably be required by the Warrant Agent for the carrying out or
performing by the Warrant Agent of the provisions of this Agreement.
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(n) The Warrant Agent is hereby authorized and directed to accept
written instructions with respect to the performance of its duties
hereunder from any one of the chairman or a co-chairman of the board, the
president, the chief financial officer, any executive vice president or
any senior vice president alone, or any vice president together with the
secretary, assistant secretary, the treasurer or any assistant treasurer,
of the Company or any other officer or official of the Company reasonably
believed to be authorized to give such instructions and to apply to such
officers or officials for advice or instructions in connection with its
duties, and it shall not be liable for any action taken or suffered to be
taken by it in good faith in accordance with instructions with respect to
any matter arising in connection with the Warrant Agent's duties and
obligations arising under this Agreement. Such application by the Warrant
Agent for written instructions from the Company may, at the option of the
Warrant Agent, set forth in writing any action proposed to be taken or
omitted by the Warrant Agent with respect to its duties or obligations
under this Agreement and the date on or after which such action shall be
taken and the Warrant Agent shall not be liable for any action taken or
omitted in accordance with a proposal included in any such application on
or after the date specified therein (which date shall be not less than 10
Business Days after the Company receives such application unless the
Company consents to a shorter period); provided that (i) such application
includes a statement to the effect that it is being made pursuant to this
paragraph (n) and that unless objected to prior to such date specified in
the application, the Warrant Agent will not be liable for any such action
or omission to the extent set forth in such paragraph (n) and (ii) prior
to taking or omitting any such action, the Warrant Agent has not received
written instructions objecting to such proposed action or omission.
(o) Whenever in the performance of its duties under this Agreement
the Warrant Agent shall deem it necessary or desirable that any fact or
matter be proved or established by the Company prior to taking or
suffering any action hereunder, such fact or matter (unless other evidence
in respect thereof be herein specifically prescribed) may be deemed to be
conclusively proved and established by a certificate signed on behalf of
the Company by any one of the chairman of the board of directors, the
president, the treasurer, the controller, any vice president or the
secretary or assistant secretary of the Company or any other officer or
official of the Company reasonably believed to be authorized to give such
instructions and delivered to the Warrant Agent; and such certificate
shall be full authorization to the Warrant Agent for any action taken or
suffered in good faith by it under the provisions of this Agreement in
reliance upon such certificate.
(p) The Warrant Agent shall not be required to risk or expend its own
funds in the performance of its obligations and duties hereunder.
SECTION 6.03. Resignation and Appointment of Successor. (a) The Company
agrees, for the benefit of the holders from time to time of the Warrant
Certificates, that there shall at all times be a Warrant Agent hereunder.
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(b) The Warrant Agent may at any time resign as Warrant Agent by giving
written notice to the Company of such intention on its part, specifying the
date on which its desired resignation shall become effective; provided,
however, that such date shall be at least 60 days after the date on which such
notice is given unless the Company agrees to accept less notice. Upon
receiving such notice of resignation, the Company shall promptly appoint a
successor Warrant Agent, qualified as provided in Section 6.03(d) hereof, by
written instrument in duplicate signed on behalf of the Company, one copy of
which shall be delivered to the resigning Warrant Agent and one copy to the
successor Warrant Agent. As provided in Section 6.03(d) hereof, such
resignation shall become effective upon the earlier of (x) the acceptance of
the appointment by the successor Warrant Agent or (y) 60 days after receipt by
the Company of notice of such resignation. The Company may, at any time and
for any reason, and shall, upon any event set forth in the next succeeding
sentence, remove the Warrant Agent and appoint a successor Warrant Agent by
written instrument in duplicate, specifying such removal and the date on which
it is intended to become effective, signed on behalf of the Company, one copy
of which shall be delivered to the Warrant Agent being removed and one copy to
the successor Warrant Agent. The Warrant Agent shall be removed as aforesaid
if it shall become incapable of acting, or shall be adjudged a bankrupt or
insolvent, or a receiver of the Warrant Agent or of its property shall be
appointed, or any public officer shall take charge or control of it or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation. Any removal of the Warrant Agent and any appointment of a
successor Warrant Agent shall become effective upon acceptance of appointment
by the successor Warrant Agent as provided in Section 6.03(d). As soon as
practicable after appointment of the successor Warrant Agent, the Company shall
cause written notice of the change in the Warrant Agent to be given to each of
the registered holders of the Warrants in the manner provided for in Section
7.04 hereof.
(c) Upon resignation or removal of the Warrant Agent, if the Company shall
fail to appoint a successor Warrant Agent within a period of 60 days after
receipt of such notice of resignation or removal, then the holder of any
Warrant Certificate or the retiring Warrant Agent may apply to a court of
competent jurisdiction for the appointment of a successor to the 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.
(d) Any successor Warrant Agent, whether appointed by the Company or by a
court, shall be a bank or trust company in good standing, incorporated under
the laws of the United States of America or any State thereof and having, at
the time of its appointment, a combined capital surplus of at least $50
million. Such successor Warrant Agent shall execute and deliver to its
predecessor and to the Company an instrument accepting such appointment
hereunder and all the provisions of this Agreement, and thereupon such
successor Warrant Agent, without any further act, deed or conveyance, shall
become vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with like effect as if originally named as Warrant Agent
hereunder, and such predecessor shall thereupon become obligated to (i)
transfer
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and deliver, and such successor Warrant Agent shall be entitled to receive, all
securities, records or other property on deposit with or held by such
predecessor as Warrant Agent hereunder and (ii) upon payment of the amounts
then due it pursuant to Section 6.02(a) hereof, pay over, and such successor
Warrant Agent shall be entitled to receive, all monies deposited with or held
by any predecessor Warrant Agent hereunder.
(e) Any corporation or bank into which the Warrant Agent hereunder may be
merged or converted, or any corporation or bank with which the Warrant Agent
may be consolidated, or any corporation or bank resulting from any merger,
conversion or consolidation to which the Warrant Agent shall be a party, or any
corporation or bank to which the Warrant Agent shall sell or otherwise transfer
all or substantially all of its corporate trust business, shall be the
successor to the Warrant Agent under this Agreement (provided that such
corporation or bank shall be qualified as aforesaid) without the execution or
filing of any document or any further act on the part of any of the parties
hereto.
(f) No Warrant Agent under this Warrant Agreement shall be personally
liable for any action or omission of any successor Warrant Agent.
ARTICLE VII
MISCELLANEOUS
SECTION 7.01. Amendment. This Agreement and the terms of the Warrants
may be amended by the Company and the Warrant Agent, without the consent of the
holder of any Warrant Certificate, for the purpose of curing any ambiguity, or
of curing, correcting or supplementing any defective or inconsistent provision
contained herein or therein, or to effect any assumptions of the Company's
obligations hereunder and thereunder by a successor corporation under certain
circumstances or in any other manner which the Company may deem necessary or
desirable and which shall not adversely affect the interests of the holders of
the Warrant Certificates.
The Company and the Warrant Agent may amend, modify or supplement this
Agreement and the terms of the Warrants, and waivers to departures from the
terms hereof and thereof may be given, with the consent of the Requisite
Warrant Holders (as defined below) for the purpose of adding any provision to
or changing in any manner or eliminating any of the provisions of this
Agreement or modifying in any manner the rights of the holders of the
outstanding Warrants. "Requisite Warrant Holders" means (i) in the case of any
amendment, modification, supplement or waiver affecting only Warrant Holders as
such holders of a majority in number of the outstanding Warrants, voting
separately as a class, or (ii) in the case of any amendment, modification,
supplement or waiver affecting Warrant Holders, a majority in number of Warrant
Shares represented by the Warrants that would be issuable assuming exercise
thereof at the time such amendment, modification, supplement or waiver is voted
upon. Notwithstanding
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any other provision of this Agreement, the Warrant Agent's consent must be
obtained regarding any supplement or amendment which alters the Warrant Agent's
rights or duties (it being expressly understood that the foregoing shall not be
in derogation of the right of the Company to remove the Warrant Agent in
accordance with Section 6.03 hereof). For purposes of any amendment,
modification or waiver hereunder, Warrants held by the Company or any of its
Affiliates shall be disregarded.
Any modification or amendment made in accordance with this Agreement will
be conclusive and binding on all present and future holders of Warrant
Certificates whether or not they have consented to such modification or
amendment or waiver and whether or not notation of such modification or
amendment is made upon such Warrant Certificates. Any instrument given by or
on behalf of any holder of a Warrant Certificate in connection with any consent
to any modification or amendment will be conclusive and binding on all
subsequent holders of such Warrant Certificate.
SECTION 7.02. Notices and Demands to the Company and Warrant Agent. If
the Warrant Agent shall receive any notice or demand addressed to the Company
by the holder of a Warrant Certificate pursuant to the provisions hereof or of
the Warrant Certificates, the Warrant Agent shall promptly forward such notice
or demand to the Company.
SECTION 7.03. Addresses for Notices to Parties and for Transmission of
Documents. All notices hereunder to the parties hereto shall be deemed to have
been given when sent by certified or registered mail, postage prepaid, or by
facsimile transmission, confirmed by first class mail, postage prepaid,
addressed to any party hereto as follows:
To the Company:
DTI Holdings, Inc.
11111 Dorsett Road
St. Louis, Missouri 63043
Facsimile: (314) 253-6699
Attention: Richard D. Weinstein
with copies to:
Bryan Cave LLP
One Metropolitan Square
211 N. Broadway, Suite 3600
St. Louis, Missouri 63102-2758
Facsimile: (314) 259-2020
Attention: J. Mark Klamer
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To the Warrant Agent:
The Bank of New York
101 Barclay Street
New York, New York 10286
Facsimile: (212) 815-5915
Attention: Corporate Trust & Agencies Department
or at any other address of which either of the foregoing shall have notified
the other in writing.
SECTION 7.04. Notices to Holders. Notices to holders of Warrants shall
be mailed to such holders at the addresses of such holders as they appear in
the Warrant Register. Any such notice shall be sufficiently given if sent by
first-class mail, postage prepaid to the address of such holder.
SECTION 7.05. Applicable Law. THIS AGREEMENT AND EACH WARRANT
CERTIFICATE ISSUED HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 7.06. Persons Having Rights Under Agreement. Nothing in this
Agreement expressed or implied and nothing that may be inferred from any of the
provisions hereof is intended, or shall be construed, to confer upon, or give
to, any person or corporation other than the Company, the Warrant Agent and the
holders of the Warrant Certificates and, with respect to Sections 4.03 and
4.04, the holders of Warrant Shares issued pursuant to Warrants, any right,
remedy or claim under or by reason of this Agreement or of any covenant,
condition, stipulation, promise or agreement hereof; and all covenants (except
for Section 4.03 which shall be for the benefit of all holders of Warrant
Shares issued pursuant to Warrants), conditions, stipulations, promises and
agreements in this Agreement contained shall be for the sole and exclusive
benefit of the Company and the Warrant Agent and their successors and of the
holders of the Warrant Certificates.
SECTION 7.07. Headings. The descriptive headings of the several Articles
and Sections of this Agreement are inserted for convenience only and shall not
control or affect the meaning or construction of any of the provisions hereof.
SECTION 7.08. Counterparts. This Agreement may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original;
but such counterparts shall together constitute but one and the same
instrument.
SECTION 7.09. Inspection of Agreement. A copy of this Agreement shall be
available during regular business hours at the principal corporate trust office
of the Warrant Agent, for inspection by the holder of any Warrant Certificate.
The Warrant Agent may require such holder to submit his Warrant Certificate for
inspection by it.
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SECTION 7.10. Availability of Equitable Remedies. Since a breach of the
provisions of this Agreement could not adequately be compensated by money
damages, holders of Warrants shall be entitled, in addition to any other right
or remedy available to them, to an injunction restraining such breach or a
threatened breach and to specific performance of any such provision of this
Agreement, and in either case no bond or other security shall be required in
connection therewith, and the parties hereby consent to such injunction and to
the ordering of specific performance.
SECTION 7.11. Obtaining of Governmental Approvals. The Company will from
time to time take all action required to be taken by it which may be necessary
to obtain and keep effective any and all permits, consents and approvals of
governmental agencies and authorities and securities acts filings under U.S.
federal and state laws, and the rules and regulations of all stock exchanges on
which the Warrants may become listed which may be or become requisite in
connection with the issuance, sale, transfer, and delivery of the Warrant
Certificates, the exercise of the Warrants or the issuance, sale, transfer and
delivery of the Warrant Shares issued upon exercise of the Warrants.
[Signature Page Follows]
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IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereto as of the day and year first above written.
DTI HOLDINGS, INC.
By: /s/ Richard D. Weinstein
-----------------------------------
Name: Richard D. Weinstein
Title: Chief Executive Officer
THE BANK OF NEW YORK,
Warrant Agent
By: /s/ Robert A. Massimillo
-----------------------------------
Name:
Title:
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EXHIBIT A
[FORM OF WARRANT CERTIFICATE]
[FACE]
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR OTHER
SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR PARTICIPATION
HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT. THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF (1)
REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING
THIS SECURITY IN AN "OFFSHORE TRANSACTION" PURSUANT TO REGULATION S, (2) AGREES
THAT IT WILL NOT PRIOR TO (X) THE DATE WHICH IS TWO YEARS (OR SHORTER PERIOD AS
MAY BE PRESCRIBED BY RULE 144(K) (OR ANY SUCCESSOR PROVISION THEREOF) UNDER THE
SECURITIES ACT) AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY
PREDECESSOR OF THIS SECURITY) OR THE LAST DAY ON WHICH THE COMPANY OR ANY
AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY OR ANY PREDECESSOR OF
THIS SECURITY AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE
LAWS (THE "RESALE RESTRICTION TERMINATION DATE"), OFFER, SELL OR OTHERWISE
TRANSFER THIS SECURITY EXCEPT (A) TO THE ISSUER OR ITS SUBSIDIARY, (B) PURSUANT
TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED
INSTITUTIONAL BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT
PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL
BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT, PURSUANT TO RULE 904 OF REGULATION S OR (E) PURSUANT TO ANOTHER
AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION
WITH ANY TRANSFER OF THESE SECURITIES WITHIN THE TIME PERIOD REFERRED TO ABOVE,
THE HOLDER MUST CHECK THE APPROPRIATE
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BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND
SUBMIT THIS CERTIFICATE TO THE WARRANT AGENT. THIS LEGEND WILL BE REMOVED UPON
THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE. AS
USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S.
PERSON" HAVE THE RESPECTIVE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
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CUSIP #[ ]
No. ___ [ ] Warrants
WARRANT CERTIFICATE
DTI HOLDINGS, INC.
This Warrant Certificate certifies that [ ], or registered
assigns, is the registered holder of [ ] Warrants (the "Warrants") to
purchase shares of Common Stock, par value $0.01 per share, issuable upon
exercise of the Warrants (the "Warrant Shares") of DTI HOLDINGS, INC., a
corporation organized and incorporated under the Missouri General Business
Corporation Law (the "Company," which term includes its successors and
assigns). Each Warrant entitles the holder to purchase from the Company at any
time from 9:00 a.m. New York City time on or after the Exercisability Date
until 5:00 p.m., New York City time, on March 1, 2008 (the "Expiration Date"),
1.552 fully paid, registered and non-assessable Warrant Shares, subject to
adjustment as provided in Article V of the Warrant Agreement, at an exercise
price of $0.01 for each share purchased (the "Exercise Price"); upon surrender
of this Warrant Certificate and payment of the Exercise Price (i) in cash or by
certified or official bank check, (ii) by a Cashless Exercise or (iii) by any
combination of (i) and (ii), at any office or agency maintained for that
purpose by the Company (the "Warrant Exercise Office"), subject to the
conditions set forth herein and in the Warrant Agreement. For purposes of this
Warrant, a "Cashless Exercise" shall mean an exercise of a Warrant in
accordance with the immediately following two sentences. To effect a Cashless
Exercise, the holder may exercise a Warrant or Warrants without payment of the
Exercise Price in cash by surrendering such Warrant or Warrants (represented by
one or more Warrant Certificates) and in exchange therefor, receiving such
number of shares of Common Stock equal to the product of (1) that number of
shares of Common Stock for which such Warrant or Warrants are exercisable and
which would be issuable in the event of an exercise with payment of the
Exercise Price and (2) the Cashless Exercise Ratio. The "Cashless Exercise
Ratio" shall equal a fraction, the numerator of which is the excess of the
Current Market Value (calculated as set forth in this Warrant) per share of
Common Stock on the date of exercise over the Exercise Price per share of
Common Stock as of the date of exercise and the denominator of which is the
Current Market Value per share of Common Stock on the date of exercise. Upon
surrender of a Warrant Certificate representing more than one Warrant in
connection with the holder's option to elect a Cashless Exercise, the holder
must specify the number of Warrants for which such Warrant Certificate is to be
exercised (without giving effect to the Cashless Exercise). All provisions of
the Warrant Agreement shall be applicable with respect to a Cashless Exercise
of a Warrant Certificate for less than the full number of Warrants represented
thereby. Capitalized terms used herein without being defined herein shall have
the definitions ascribed to such terms in the Warrant Agreement.
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"Current Market Value" per share of Common Stock of the Company or any
other security at any date shall mean (i) if the security is not registered
under the Exchange Act, (a) the value of the security, determined in good faith
by the board of directors of the Company and certified in a board resolution,
based on the most recently completed arm's-length transaction between the
Company and a person other than an Affiliate of the Company and the closing of
which occurs on such date or shall have occurred within the six-month period
preceding such date, or (b) if no such transaction shall have occurred on such
date or within such six-month period, the fair market value of the security as
determined by a nationally or regionally recognized Independent Financial
Expert (as defined herein) (provided that, in the case of the calculation of
Current Market Value for determining the cash value of fractional shares, any
such determination within six months that is, in the good faith judgment of the
board, a reasonable determination of value, may be utilized) or (ii) (a) if the
security is registered under the Exchange Act, the average of the daily closing
sales prices of the securities for the 20 consecutive trading days immediately
preceding such date, or (b) if the security has been registered under the
Exchange Act for less than 20 consecutive trading days before such date, then
the average of the closing sales prices for all of the trading days before such
date for which closing sales prices are available, in the case of each of
(ii)(a) and (ii)(b), as certified to the Warrant Agent by the president, any
vice president or the chief financial officer of the Company. The closing
sales price for each such trading day shall be: (A) in the case of a security
listed or admitted to trading on any U.S. national securities exchange or
quotation system, the closing sales price, regular way, on such day, or if no
sale takes place on such day, the average of the closing bid and asked prices
on such day, (B) in the case of a security not then listed or admitted to
trading on any U.S. national securities exchange or quotation system, the last
reported sale price on such day, or if no sale takes place on such day, the
average of the closing bid and asked prices on such day, as reported by a
reputable quotation source designated by the Company, (C) in the case of a
security not then listed or admitted to trading on any U.S. national securities
exchange or quotation system and as to which no such reported sale price or bid
and asked prices are available, the average of the reported high bid and low
asked prices on such day, as reported by a reputable quotation service, or a
newspaper of general circulation in the Borough of Manhattan, The City and
State of New York customarily published on each Business Day, designated by the
Company, or, if there shall be no bid and asked prices on such day, the average
of the high bid and low asked prices, as so reported, on the most recent day
(not more than 30 days prior to the date in question) for which prices have
been so reported and (D) if there are not bid and asked prices reported during
the 30 days prior to the date in question, the Current Market Value shall be
determined as if the securities were not registered under the Exchange Act.
"Exercise Event" means, with respect to each Warrant, the date of the
occurrence of the earliest of: (i) the time immediately prior to a Change of
Control (as such term is defined in the Indenture); (ii)(a) the 180th day (or
such earlier date as determined by the Company in its sole discretion)
following the closing of an Initial Public Equity Offering (as defined herein)
or (b) upon the closing of an Initial Public Equity Offering, but only in
respect of Warrants, if any,
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required to be exercised to permit the holders thereof to sell Warrant Shares
pursuant to their respective registration rights, (iii) a class of equity
securities of the Company is listed on a national securities exchange or
authorized for quotation on the Nasdaq National Market or is otherwise subject
to registration under the Exchange Act, or (iv) September 1, 1999.
"Independent Financial Expert" means a U.S. investment banking firm of
national standing in the United States, (i) which does not, and whose
directors, officers and employees or Affiliates do not have a direct or
indirect material financial interest for its proprietary account in the Company
or any of its Affiliates and (ii) which, in the judgment of the board of
directors of the Company, is otherwise independent with respect to the Company
and its Affiliates and qualified to perform the task for which it is to be
engaged.
"Separability Date" shall mean the earliest to occur of: (i) September 1,
1998, (ii) the date on which a registration statement under the Securities Act
of 1933, as amended (the "Securities Act"), with respect to a registered
exchange offer for the Notes is declared effective under the Securities Act,
(iii) the occurrence of an Exercise Event, (iv) the occurrence of an Event of
Default (as defined in the Indenture) or (v) such earlier date as determined by
Merrill Lynch in its sole discretion and specified to the Company and the
Warrant Agent in writing. Notwithstanding the foregoing, in the event a Change
of Control (as defined in the Indenture) is proposed and the Company commences
a Change of Control Offer (as defined in the Indenture) prior to the
Separability Date, as determined by the preceding sentence, the Separability
Date shall be such earlier date of commencement.
The Company has initially designated the principal corporate trust office
of the Warrant Agent in the Borough of Manhattan, The City of New York, as the
initial Warrant Agent Office. The number of shares of Common Stock issuable
upon exercise of the Warrants ("Exercise Rate") is subject to adjustment upon
the occurrence of certain events set forth in the Warrant Agreement.
Any Warrants not exercised on or prior to 5:00 p.m., New York City time,
on March 1, 2008 shall thereafter be void.
If the Company, in a single transaction or through a series of related
transactions, consolidates with or merges with or into, or sells all or
substantially all of its property and assets to, another Person (other than a
subsidiary of the Company) solely for cash, the holders of Warrants which are
then exercisable shall be entitled to receive distributions on the date of such
event on an equal basis with holders of shares of Capital Stock (or other
securities issuable upon exercise of the Warrants) as if the Warrants had been
exercised immediately prior to such event less the aggregate Exercise Price
therefor.
Reference is hereby made to the further provisions on the reverse hereof
which provisions shall for all purposes have the same effect as though fully
set forth at this place.
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This Warrant Certificate shall not be valid unless authenticated by the
Warrant Agent, as such term is used in the Warrant Agreement.
THIS WARRANT CERTIFICATE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK.
WITNESS the facsimile seal of the Company and facsimile signatures of its
duly authorized officers.
Dated:
DTI HOLDINGS, INC.
By: ___________________________________
Name:
Title:
Attest:
By: ________________________________
Name:
Title:
Certificate of Authentication:
This is one of the Warrants
referred to in the within
mentioned Warrant Agreement:
THE BANK OF NEW YORK,
Warrant Agent
By: __________________________________
Authorized Signatory
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[FORM OF WARRANT CERTIFICATE]
[REVERSE]
DTI HOLDINGS, INC.
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants expiring at 5:00 p.m., New York City time, on
March 1, 2008 (the "Expiration Date"), each of which represents the right to
purchase at any time on or after the Exercisability Date (as defined in the
Warrant Agreement) and on or prior to the Expiration Date 1.552 Warrant Shares,
subject to adjustment as set forth in the Warrant Agreement. The Warrants are
issued pursuant to a Warrant Agreement dated as of February 23, 1998 (the
"Warrant Agreement"), duly executed and delivered by the Company to The Bank of
New York, Warrant Agent (the "Warrant Agent"), which Warrant Agreement is
hereby incorporated by reference in and made a part of this instrument and is
hereby referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Warrant Agent, the Company
and the holders (the words "holders" or "holder" meaning the registered holders
or registered holder) of the Warrants.
Warrants may be exercised by (i) surrendering at any Warrant Exercise
Office this Warrant Certificate with the form of Election to Exercise set forth
hereon duly completed and executed and (ii) to the extent such exercise is not
being effected through a Cashless Exercise by paying in full the Warrant
Exercise Price for each such Warrant exercised and any other amounts required
to be paid pursuant to the Warrant Agreement.
If all of the items referred to in the last sentence of the preceding
paragraph are received by the Warrant Agent at or prior to 11:00 a.m., New York
City time, on a Business Day, the exercise of the Warrant to which such items
relate will be effective on such Business Day. If any items referred to in the
last sentence of the preceding paragraph 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 deemed to be effective on the next succeeding Business
Day. Notwithstanding the foregoing, in the case of an exercise of Warrants on
March 1, 2008, if all of the items referred to in the last sentence of the
preceding paragraph are received by the Warrant Agent at or prior to 5:00 p.m.,
New York City time, on such Expiration Date, the exercise of the Warrants to
which such items relate will be effective on the Expiration Date.
As soon as practicable after the exercise of any Warrant or Warrants, the
Company shall issue or cause to be issued to or upon the written order of the
registered holder of this Warrant Certificate, a certificate or certificates
evidencing such Warrant Share or Warrant Shares 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 Election to Exercise, as set forth on
the reverse of this Warrant Certificate. Such certificate or certificates
evidencing the Warrant Share or Warrant Shares shall be deemed to have been
issued and any persons who are designated to be named
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therein shall be deemed to have become the holder of record of such Warrant
Share or Warrant Shares as of the close of business on the date upon which the
exercise of this Warrant was deemed to be effective as provided in the
preceding paragraph.
The Company shall not be required to issue fractional Warrant Shares upon
exercise of the Warrants or distribute Warrant Certificates that evidence
fractional Warrant Shares. In lieu of fractional Warrant Shares, there shall
be paid to the registered Holder of this Warrant Certificate at the time such
Warrant Certificate is exercised an amount in cash equal to the same fraction
of the Current Market Value per share of Common Stock on the Business Day
preceding the date this Warrant Certificate is surrendered for exercise.
Warrant Certificates, when surrendered at any office or agency maintained
by the Company for that purpose by the registered holder thereof in person or
by legal representative or attorney duly authorized in writing, may be
exchanged for a new Warrant Certificate or new Warrant Certificates evidencing
in the aggregate a like number of Warrants, in the manner and subject to the
limitations provided in the Warrant Agreement, without charge except for any
tax or other governmental charge imposed in connection therewith.
Upon due presentment for registration of transfer of this Warrant
Certificate at any office or agency maintained by the Company for that purpose,
a new Warrant Certificate evidencing in the aggregate a like number of Warrants
shall be issued to the transferee in exchange for this Warrant Certificate,
subject to the limitations provided in the Warrant Agreement, without charge
except for any tax or other governmental charge imposed in connection
therewith.
The Company and the Warrant Agent may deem and treat the registered holder
hereof as the absolute owner of this Warrant Certificate (notwithstanding any
notation of ownership or other writing hereon made by anyone) for the purpose
of any exercise hereof and for all other purposes, and neither the Company nor
the Warrant Agent shall be affected by any notice to the contrary.
The term "Business Day" shall mean any day on which (i) banks in The City
of New York, (ii) the principal U.S. securities exchange or market, if any, on
which the Common Stock is listed or admitted to trading and (iii) the principal
U.S. securities exchange or market, if any, on which the Warrants are listed or
admitted to trading, are open for business.
The Warrants and the Warrant Shares are entitled to the benefits of a
registration rights agreement relating to the Warrants and the Warrant Shares
(the "Warrant Registration Rights Agreement"), pursuant to which the holders
representing not less than 50% of Warrant Shares and Registrable Securities (as
defined in the Warrant Registration Rights Agreement) have, at any time and
from time to time on or after (i) the time immediately prior to a Change of
Control (as such term is defined in the Indenture); (ii)(a) the 180th day (or
such earlier date as determined by the Company in its sole discretion)
following the consummation of an Initial Public Equity Offering (as defined
herein) or (b) upon the consummation of an Initial Public
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Equity Offering (as defined herein) or (b) upon the consummation of an Initial
Public Equity Offering, but only in respect of Warrants, if any, required to be
exercised to permit the holders thereof to sell Warrant Shares pursuant to
their respective registration rights, (iii) a class of equity securities of the
Company is listed on a national securities exchange or authorized for quotation
on the Nasdaq National Market or is otherwise subject to registration under the
Exchange Act, or (iv) September 1, 1999, the right to require the Company to
effect two demand registrations of the Warrant Shares and Registrable
Securities. The Warrant Registration Rights Agreement also provides the
holders of Registrable Securities with the right, subject to the conditions and
limitations contained therein, to include the Registrable Securities in certain
registration statements filed by the Company for its account or for the account
of any of its securityholders.
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[FORM OF ELECTION TO EXERCISE]
(To be executed upon exercise of Warrants on the Exercise Date)
The undersigned hereby irrevocably elects to exercise [ ] of the
Warrants represented by this Warrant Certificate and purchase the whole number
of Warrant Shares issuable upon the exercise of such Warrants and herewith
tenders payment for such Warrant Shares as follows:
$ ___________ in cash or by certified or official bank check; or by
surrender of Warrants pursuant to a Cashless Exercise (as defined in the Warrant
Agreement) for [ ] shares of Common Stock at the current Cashless
Exercise Ratio.
The undersigned requests that a certificate representing such Warrant
Shares be registered in the name of ____________________ whose address is
____________________ and that such shares be delivered to ____________________
whose address is ____________________. Any cash payments to be paid in lieu of
a fractional share of Common Stock should be delivered to ____________________
whose address is ____________________ and the check representing payment thereof
should be delivered to ____________________ whose address is
____________________.
Dated _________________, ____
Name of holder of
Warrant Certificate:______________________________________________________
(Please Print)
Tax Identification or
Social Security Number:___________________________________________________
Address: _________________________________________________________________
_________________________________________________________________
Signature:________________________________________________________________
Note: The above signature must correspond with the name as
written upon the face of this Warrant Certificate in every
particular, without alteration or enlargement or any change
whatever and if the certificate representing the Warrant
Shares or any Warrant Certificate representing Warrants not
exercised is to be registered in a name other than that in
which this Warrant Certificate is registered, or if any
cash payment to be paid in lieu of a fractional share is to
be made
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to a person other than the registered holder of this
Warrant Certificate, the signature of the holder
hereof must be guaranteed as provided in the Warrant
Agreement.
Dated ______________, ____
Signature:____________________________________________
Note: The above signature must correspond
with the name as written upon the face
of this Warrant Certificate in every
particular, without alteration or
enlargement or any change whatever.
Signature Guaranteed:_________________________________
[FORM OF ASSIGNMENT]
For value received __________________________ hereby sells, assigns and
transfers unto _____________________________ the within Warrant Certificate,
together with all right, title and interest therein, and does hereby
irrevocably constitute and appoint __________________ attorney, to transfer
said Warrant Certificate on the books of the within-named Company, with full
power of substitution in the premises.
Dated ________________, ____
Signature:____________________________________________
Note: The above signature must correspond
with the name as written upon the face
of this Warrant Certificate in every
particular, without alteration or
enlargement or any change whatever.
Signature Guaranteed:_________________________________
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SCHEDULE OF EXCHANGES OF CERTIFICATED WARRANTS
The following exchanges of a part of this Global Warrant for certificated
Warrants have been made:
Number of Warrants
Amount of decrease Amount of increase of this Global
in Number of in Number of Warrant following Signature of
Date of Warrants of this Warrants of this such decrease (or authorized officer
Exchange Global Warrant Global Warrant increase) of Warrant Agent
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EXHIBIT B
FORM OF LEGEND FOR GLOBAL WARRANT
Any Global Warrant authenticated and delivered hereunder shall bear a
legend in substantially the following form:
THIS SECURITY IS A GLOBAL WARRANT WITHIN THE MEANING OF THE WARRANT
AGREEMENT HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A
DEPOSITORY OR A SUCCESSOR DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE
FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE WARRANT AGREEMENT, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A
TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE
DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER
NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE WARRANT AGREEMENT.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
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EXHIBIT C
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF WARRANTS
Re: Warrants to Purchase Common Stock (the "Warrants") of DTI HOLDINGS, INC.
This Certificate relates to ____ Warrants held in* ___ book-entry or*
_______ certificated form by ______ (the "Transferor").
The Transferor:*
/___/ has requested the Warrant Agent by written order to deliver in
exchange for its beneficial interest in the Global Warrant held by the
Depositary a Warrant or Warrants in definitive, registered form of authorized
denominations and an aggregate number equal to its beneficial interest in such
Global Warrant (or the portion thereof indicated above); or
/___/ has requested the Warrant Agent by written order to exchange or
register the transfer of a Warrant or Warrants.
In connection with such request and in respect of each such Warrant, the
Transferor does hereby certify that the Transferor is familiar with the Warrant
Agreement relating to the above captioned Warrants and the restrictions on
transfers thereof as provided in Section 1.08 of such Warrant Agreement, and
that the transfer of this Warrant does not require registration under the
Securities Act of 1933, as amended (the "Act") because*:
/___/ Such Warrant is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 1.08 (a)(y)(A) or Section 1.08
(d)(i)(A) of the Warrant Agreement).
/___/ Such Warrant is being transferred to a qualified institutional buyer
(as defined in Rule 144A under the Act), in reliance on Rule 144A.
________________________
*Check applicable box.
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/___/ Such Warrant is being transferred in reliance on Regulation S under
the Act.
/___/ Such Warrant is being transferred in accordance with Rule 144 under
the Act.
/___/ Such Warrant is being transferred in reliance on and in compliance
with an exemption from the registration requirements of the Act.
____________________________________
[INSERT NAME OF TRANSFEROR]
By:_________________________________
Date:_____________________
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EXHIBIT D
FORM OF CERTIFICATE TO BE
DELIVERED IN CONNECTION
WITH REGULATION S TRANSFERS
______________________,
The Bank of New York
101 Barclay Street
New York, New York 10286
Attention: Corporate Trust Department
Ladies and Gentlemen:
In connection with our proposed sale of Warrants of DTI Holdings, Inc.
(the "Company"), we confirm that such sale has been effected pursuant to and in
accordance with Regulation S under the Securities Act of 1933, as amended (the
"Securities Act"), and, accordingly, we represent that:
(1) the offer of the Warrants was not made to a person in the United
States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the United
States, or (b) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction has been
pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United States
in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S under the Securities Act, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
(5) we have advised the transferee of the transfer restrictions
applicable to the Warrants; and
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57
(6) if the circumstances set forth in Rule 904(c) under the
Securities Act are applicable, we have complied with the additional
conditions therein, including (if applicable) sending a confirmation or
other notice stating that the Warrants may be offered and sold during the
restricted period specified in Rule 903(c)(2) or (3), as applicable, in
accordance with the provisions of Regulation S; pursuant to registration
of the Warrants under the Securities Act; or pursuant to an available
exemption from the registration requirements under the Act.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or official inquiry
with respect to the matters covered hereby. Defined terms used herein without
definition have the respective meanings provided in Regulation S under the
Securities Act.
Very truly yours,
[Name of Transferor]
By:_____________________________
[Authorized Signature]
Upon transfer the Warrants would be registered in the name of the new
beneficial owner as follows:
Name:____________________________________
Address:__________________________________
Taxpayer ID Number:_______________________
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