Exhibit 10.35
Hammond Suddards Edge
DATED 3 September 2001
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ISA INTERNATIONAL PLC (1)
and
DAISYTEK INTERNATIONAL (2)
CORPORATION
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DEED POLL
Relation to the issue of a Warrant to subscribe for
Ordinary Shares in the capital of the Company
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[Hammond Suddards Edge Letterhead]
CONTENTS
1. DEFINITIONS AND INTERPRETATION.........................................1
2. WARRANT................................................................2
3. WARRANT RIGHTS.........................................................2
4. EXERCISE OF WARRANT....................................................2
5. TAKEOVER, RECONSTRUCTION AND WINDING UP................................3
6. VARIATION OF CAPITAL...................................................3
7. TRANSFER...............................................................5
8. REGISTER AND TRANSFER..................................................5
9. ALLOTMENT..............................................................6
10. UNDERTAKINGS...........................................................6
11. LISTING OF THE WARRANTS................................................6
12. SEVERABILITY...........................................................6
13. NOTICES................................................................6
14. REPLACEMENT OF CERTIFICATES............................................7
17. GOVERNING LAW..........................................................7
18. EXPERT.................................................................7
19. TERMINATION............................................................7
THIS DEED POLL is executed on 3 September 2001 by ISA INTERNATIONAL PLC
(registered number: 192505) a public limited company incorporated in England and
Wales whose registered office is situate at 66/70 Vicar Lane, Bradford,
West Yorkshire BD1 5AG (the "Company")
WHEREAS
(A) By resolutions of its board of Directors passed on 3 September 2001 the
Company has determined to create and issue a warrant to subscribe for
shares in the capital of the Company by execution of this Deed Poll.
(B) The capital of the Company at the date of this Deed Poll comprises
L12,750,000 divided into 95,000,000 ordinary shares of 5p each of which
8,000,000 have been issued or agreed to be issued and 80,000,000
convertible preference shares of 0.10 pence each of which 57,778,398 have
been issued.
NOW THIS DEED POLL WITNESSES AND THE COMPANY DECLARES as follows:
1 DEFINITIONS AND INTERPRETATION
1.1 In this Deed Poll the following terms shall have the following meanings:
"BOARD" means the board of directors of the Company for the time being;
"BUSINESS DAY" means a day other than a Saturday or Sunday on which banks
generally are open for business in the City of London;
"CONTROL" means the right to exercise or control the exercise of a majority
of the voting rights generally exercisable by the shareholders of the
Company (in respect of any class or classes of shares of the Company) from
time to time;
"DILUTIVE OPTIONS" shall bear the meaning ascribed to that expression in a
Subscription and Shareholders' Agreement made between the Company and
Daisytek International Corporation;
"EXERCISE NOTICE" means the notice by which the Warrant can be exercised as
set out in Schedule 2;
"MAXIMUM PRICE" means the sum of L2,000,000;
"ORDINARY SHARES" means the ordinary share of 5p each in the capital of the
Company having the rights and entitlements set out under the Articles of
Association of the Company;
"SUBSCRIPTION PRICE" means the Maximum Price divided by 15,384,615 (being
the maximum number of Warrant Shares to be subscribed for under the
Warrant) multiplied by the number of Warrant Shares reflected on the face
of the Exercise Notice presented by the Warrant Holder to the Company in
accordance with the terms and conditions of this Deed Poll;
"TRANSFEREE" means any person to whom the Warrant Holder has transferred
the right to subscribe for all or part of the Warrants;
"WARRANT CERTIFICATE" means a certificate issued under this Deed Poll
evidencing the holder's title to the Warrant in the form set out in
Schedule 1.
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"WARRANT HOLDER" means the holder of the Warrant;
"WARRANT SHARES" means 15,384,615 Ordinary Shares being the subject of the
Warrant or any number thereof.
"WARRANT" means the warrant of the Company constituted by this Deed Poll to
subscribe for the Warrant Shares.
1.2 In this Deed Poll references to the Warrant Holder include references to
the successors in title of the Warrant Holder.
The headings in this Deed Poll do not affect its interpretation.
2 WARRANT
2.1 In consideration of the payment by the Warrant Holder to the Company of L1
(the receipt of which is hereby acknowledged) the Company hereby creates
and grants the right for the Warrant Holder (or its permitted transferees
or persons deriving title to the Warrant therefrom) to subscribe in cash at
the Subscription Price for up to the total number of Warrant Shares in
accordance with the terms and conditions of this Deed Poll.
2.2 The Company shall comply with the terms of this Deed Poll and shall observe
and perform the provisions of this Deed Poll which shall be binding on the
Company and the Warrant Holder and all persons claiming through or under
them respectively.
3 WARRANT RIGHTS
3.1 This Deed Poll entitles the Warrant Holder, subject to the terms and
conditions of this Deed Poll, to subscribe for up to the total number of
Warrant Shares, and to require the Company to procure the issue of such
Warrant Shares to the Warrant Holder subject to payment by the Warrant
Holder to the Company of the Subscription Price and compliance by the
Warrant Holder with its obligations under Clause 4.
4 EXERCISE OF WARRANT
4.1 The Warrant may be exercised by the Warrant Holder at any time in whole or
in part and on more than one occasion subject to the Warrant Holders
maximum entitlement of Warrant Shares by delivery to the registered office
of the Company of the Exercise Notice together with the Warrant Certificate
and payment in pounds sterling of the full Subscription Price for the
Warrant Shares reflected on the Exercise Notice and instructions as to
delivery of the Warrant Shares to be issued pursuant to the Warrant.
4.2 The Warrant Holder shall indicate upon the Exercise Notice the number of
Warrant Shares which it is subscribing for pursuant to the terms of the
Warrant and at the same time as sending the Exercise Notice to the Company
the Warrant Holder shall include a cheque made payable to the Company for
the Subscription Price for such Warrant Shares.
4.3 If the Warrant is exercised in full it shall be cancelled. In the event of
a partial exercise of the Warrant by the Warrant Holder the Company will
(together with the share certificates referred to in Clause 5 below) issue
and despatch to the Warrant Holder, or will procure the issue and despatch
to the Warrant Holder, of a replacement Warrant Certificate in respect of
the Warrant Holder's remaining entitlement of Warrant Shares.
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4.4 The Warrant Holder may exercise the Warrant Rights at any time prior to
termination of this Deed Poll pursuant to Clauses 5 or 19 below.
5 TAKEOVER, RECONSTRUCTION AND WINDING UP
5.1 The Board will, within 7 days of becoming aware of it, notify the Warrant
Holder if any person (or persons acting in concert) has obtained Control of
the Company:
(a) following a general offer to acquire the whole of the issued share
capital of the Company which is made on a condition such that if it is
satisfied the person making the offer will have Control of the
Company; or
(b) following a general offer to acquire all the shares in the Company
which are of the same class as the Warrant Shares; or
(c) in pursuance of a compromise or arrangement sanctioned by the court
under Section 425 of the Companies Act 1985.
5.2 On receiving a notice under this Clause the Warrant Holder may, subject to
the other provisions of this Deed Poll exercise the Warrant within one
month (or such longer period as the Board may permit) of such notification.
To the extent that it is not exercised within such period the Warrant will
lapse.
5.3 The Board will forthwith notify the Warrant Holder if a resolution is
passed for the voluntary winding up of the Company. The Warrant may,
subject to the other provisions of this Deed Poll, be exercised within six
months of such notification and failing such exercise shall lapse.
6 VARIATION OF CAPITAL
6.1 While this Warrant remains exercisable in whole or in part;
(a) the Company shall not offer or agree to make any allotment or issue of
any Ordinary Shares or securities convertible into Ordinary Shares or
grant any warrants or options to subscribe for Ordinary Shares where
the Price per share payable upon the issue of such Ordinary Shares (or
in the case of the conversion or exercise of any warrant or option
giving rise to the issue of Ordinary Shares payable on grant and/or on
or before such issue or conversion) shall be less than Market Value of
each Ordinary Share at the time of such offer, agreement or grant
without the prior written consent of the Warrant Holder (other than
the Dilutive Options) and the Company shall notify the Warrant Holder
in writing of any intention by the Board to allot, issue or grant (as
the case may be) such Ordinary Shares no less than 7 Business Days
prior to the proposed date of the offer, agreement or grant (as the
case may be), where;
"Price" means the price per Ordinary Share inclusive of any amount
payable on any issue of any Ordinary Share as well as any amount
payable on the conversion or exercise of any convertible security,
option or warrant; and
"Market Value" shall mean the average mid market price for the last
three Business Days prior to the offer, agreement or grant or, if the
Ordinary Shares are no longer listed, shall mean either the value of
each Ordinary Share as may be agreed upon by all of the Company and
the Warrant Holder in writing or where there is no such agreement the
Company or the Warrant Holder may within
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seven Business Days of receipt by the Warrant Holder of the
written notification referred to above refer the matter to
the auditors of the Company (the "Articles") to request that
they determine the value of each ordinary share. The Company
shall procure that the Company's auditors shall within 14
Business Days of such request value each Ordinary Share. The
Company's auditors shall act as experts and not as
arbitrators and at the cost of the Company, and shall value
each Ordinary Share calculated by first determining the sum
which a willing purchaser would offer to a willing vendor
for the whole of the issued share capital of the Company,
and then by dividing the resultant figure between the number
of Ordinary Shares then in issue;
(b) if the Company makes an offer or invitation to the holders
of Ordinary Shares of the Company for subscription of any
share or loan capital of the Company then the Company shall
procure that at the same time the same offer or invitation
is made to the Warrant Holder on the basis applicable as if
its rights to acquire Warrant Shares pursuant to this
Warrant had been exercised on the record date of such offer
or invitation. The record date shall be the date on which
holders of Ordinary Shares are required to be registered for
the purpose of acceptance of such offer or invitation;
6.2 Subject to Clause 6.3 below in the event of any variation of
the share capital of the Company (whenever effected) by way of
capitalisation or rights issue (including a variation in share
capital having an effect similar to a rights issue), or
sub-division, consolidation or reduction, or otherwise, the Board
may make such adjustments as it considers appropriate under
Clause 6.3.
6.3 An adjustment made under this sub-clause will be to one or more
of the following:
(i) the number of Warrant Shares in respect of which
the Warrant may be exercised;
(ii) the price at which the Warrant Shares may be
acquired by the exercise of the Warrants (provided
that the price cannot be reduced below the nominal
value of the Warrant Shares);
(iii) where Warrants have been exercised but no Warrant
Shares have been allotted or transferred pursuant
to such exercise, the number of Warrant Shares
which may be so allotted or transferred and the
price at which they may be acquired;
6.4 No adjustment under Clause 6.3 may be made without the prior
confirmation in writing by the Company's auditors that it is in
their opinion fair and reasonable.
6.5 The Company will send to the Warrant Holder within 28 days of any
adjustment of rights pursuant to these terms and conditions
notice giving particulars of the adjustment.
6.6 If any question shall arise in regard to the nature or extent of
any adjustment to be made pursuant to any of the provisions of
this Clause 6 the same shall be referred for determination either
by some person, firm or company nominated jointly for such
purpose by the Company and the Warrant Holder or, failing
agreement on such joint nomination, by a firm of Chartered
Accountants to be nominated on request of the Company or the
Warrant Holder by the President from time to time of the
Institute of Chartered Accountants in England and Wales and so
that any person, firm or company so nominated shall be deemed to
be acting at the cost of the Company and as an expert or
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experts and not as an arbitrator or arbitrators and his or their decisions
shall be binding on all concerned.
7. TRANSFER
7.1 The Warrant shall be freely transferable either in whole or in part at the
election of the Warrant Holder at any time that the Warrant remains in
force, subject at all times to the terms and conditions of this Deed Poll,
provided that the Warrant Holder shall transfer the entire legal and
beneficial interest in the Warrant, or in the case of a transfer of the
right to subscribe for part of the Warrant Shares, the entire legal and
beneficial interest in the Warrant relating to those Warrant Shares to be
transferred in part.
7.2 No transfer of the Warrant (either in whole or in part) shall be recognised
by the Company unless there has been delivered to the Company an instrument
in writing in the usual or common form (or in any other form which the
Board approves), which shall be signed by both the Warrant Holder (the
"Transferor") and the Transferee and which shall indicate on the face of it
the number of Warrants to be transferred (a "Transfer Form").
7.3 Within 15 Business Days of receipt by the Company of a properly executed
Transfer Form, the Company shall issue a Warrant Certificate to the
Transferee in the form of the Certificate contained in Schedule 1 in
respect of those Warrant Shares to which the Transferee is entitled to
subscribe, and where there has been a transfer in part, the Company shall
issue to the Transferor a replacement Warrant Certificate in respect of the
remaining Warrant Shares to which the Transferor is entitled.
8. REGISTER AND TRANSFER
8.1 The Company shall keep the Register at its registered office in which shall
be entered:
(a) the name and address of the holders of the Warrant;
(b) the number of the Warrants held by each registered Warrant Holder;
(c) the date on which the name of every such registered Warrant Holder is
entered in respect of the Warrant standing in its name; and
(d) the serial number of each Warrant Certificate issued and the date of
the issue thereof.
8.2 Any change of name or address on the part of the Warrant Holder shall
promptly be notified to the Company and thereupon the Register shall be
altered accordingly. The Warrant Holder shall be entitled at all
reasonable times during normal business hours to inspect the Register and
to take copies thereof (free of charge).
8.3 The Warrant Holder shall be recognised by the Company as entitled to its
Warrant free from any equity, set-off or counterclaim on the part of the
Company against the original or any intermediate holder of the Warrant.
8.4 The Warrant shall be transferable only in accordance with Clause 7 and
every transfer of the Warrant shall be effected by a Transfer Form. The
Transfer Form shall be sent together with the Warrant Certificate of the
Transferor having title to those warrants being transferred to the
Registered Office of the Company and the Transferor shall be deemed to
remain the holder of the Warrant comprised therein until the name of the
Transferee is
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entered in the Register in respect thereof. No fee shall be payable on any
registration of a transfer.
9. ALLOTMENT
9.1 As soon as practicable and subject to receipt by the Company of the Warrant
Certificate together with payment, each as required by Clause 4.1, the
Company shall allot to the Warrant Holder the Warrant Shares issued fully
paid and the Warrant Shares shall rank pari passu with the fully paid
Ordinary Shares of the Company in issue except that the Warrant Shares so
allotted will not rank for any dividend or other distribution which has
previously been announced or declared if the record date for such dividend
or other distribution is prior to the date of receipt by the Company of the
Exercise Notice.
9.2 Forthwith after allotment of the Warrant Shares under Clause 9.1 the
Company shall issue and deliver to the Warrant Holder, free of charge,
share certificate(s) in respect of the Warrant Shares and shall enter the
name of the Warrant Holder in the register of members of the Company in
respect of the number of Warrant Shares issued to it.
10. UNDERTAKINGS
10.1 The Company undertakes to ensure that whilst the Warrant Rights remain
exercisable, it will at all times keep available for issue free from
pre-emption rights out of its authorised but unissued share capital a
number of Ordinary Shares equivalent to the number of Warrant Shares.
10.2 The Company undertakes at its cost to apply promptly for, and to use its
best endeavours to procure, admission or listing of the Warrant Shares on
any stock market or exchange on which the ordinary share capital of the
Company is admitted to trading or listed at the time of their issue.
11. LISTING OF THE WARRANTS
No application has been or is intended to be made to any stock exchange for
any of the Warrants to be listed or otherwise traded.
12. SEVERABILITY
If any provision of this Deed Poll is void or unenforceable at law then
such provision shall be severed from this Deed Poll and the remainder of
this Deed Poll shall continue in full force and effect.
13. NOTICES
13.1 Any written notice to be given hereunder shall be given by personal
delivery, prepaid (first class) letter or facsimile message:
13.1.1 by the Company to the Warrant Holder, to it at its address shown
in this Deed Poll.
13.1.2 by the Warrant Holder to the Company at its registered office
for the time being.
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13.2 Any notice given pursuant to Clause 13.1 shall be deemed to have been
served:
13.2.1 at the time of delivery, if delivered personally to the address
specified in Clause 13.1 or if sent by facsimile;
13.2.2 on the second day following its posting, if sent by pre-paid letter
by first class post to the address specified in Clause 13.1.
14. REPLACEMENT OF CERTIFICATES
If the Warrant Certificate is mutilated, defaced, lost or stolen or
destroyed it will be replaced at the registered office of the Company for
the time being upon payment by the claimant of such reasonable costs as may
be incurred in connection with that replacement and on such terms as to
evidence and indemnity as the Company may reasonably require. A mutilated
or defaced Warrant Certificate must be surrendered before a replacement
will be issued.
15. INFORMATION
The Company shall send or procure to be sent to the Warrant Holder a copy
of each annual report and accounts of the Company together with all
documents required by law to be annexed thereto and copies of every
statement, notice, or circular issued to the members of the Company
concurrently with the issue of the same to its members.
16. ARTICLES
In the event of inconsistency between this Deed Poll and the Articles of
Association of the Company the provisions of this Deed Poll shall prevail.
17. GOVERNING LAW
This Deed Poll and the Warrant issued under it shall be governed by and
construed in accordance with English law.
18. EXPERT
Any dispute arising in relation to this Deed Poll, shall be referred for
conclusive determination to an independent chartered accountant, who shall
act as expert not arbitrator, nominated by the Board.
19. TERMINATION
The Warrant shall lapse and shall cease to be capable of exercise in the
event that the Warrant Holder ceases to be holder of or beneficially
interested in any share capital of any class of the Company (other than
pursuant to any interest it may have through its holding of the Warrant),
or 3 September 2006, whichever is the later.
IN WITNESS whereof this Deed Poll has been executed the day and year first
above written.
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