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EXHIBIT 1.1
WARRANT AGREEMENT
WARRANT AGREEMENT, dated as of _______________, 1996, between AmVestors
Financial Corporation, a Kansas corporation (the "Company"), and Boatmen's
Trust Company, a Missouri corporation, warrant agent (the "Warrant Agent").
RECITALS
A. In connection with the merger of Financial Benefit Group, Inc., a
Delaware corporation ("FBG"), with and into AmVestors Acquisition Subsidiary,
Inc., a Delaware corporation and a wholly-owned subsidiary of the Company (the
"Merger Subsidiary"), the Company, FBG and the Merger Subsidiary have entered
into the Agreement and Plan of Merger, dated as of September 8, 1995, as
amended (the "Merger Agreement").
B. Pursuant to Section 1.2(e) of the Merger Agreement, the Company
proposes to issue, as part of the merger consideration, a new issue of warrants
(the "Warrants"), entitling the holders thereof to purchase shares (the
"Warrant Shares") of common stock, no par value, of the Company (the "Common
Stock") and which Warrants shall be governed by the terms and provisions of
this Warrant Agreement.
C. The Company desires the Warrant Agent to act on behalf of the Company,
and the Warrant Agent is willing so to act, in connection with the issuance,
registration, registration of transfer, replacement and exchange of warrant
certificates and the exercise of Warrants.
NOW, THEREFORE, in consideration of the premises and the mutual agreements
herein set forth, the parties hereto agree as follows:
AGREEMENTS
Section 1. Appointment of Warrant Agent
The Company hereby appoints the Warrant Agent to act as agent for the
Company in accordance with the instructions set forth herein, and the Warrant
Agent hereby accepts such appointment, upon the terms and conditions
hereinafter set forth.
Section 2. Amount Issued
Subject to the provisions of this Warrant Agreement, ___________ Warrants
to purchase up to an aggregate of _______________ Warrant Shares may be issued
and delivered by the Company hereunder. The Warrants issued hereunder shall be
deemed to have been issued on the Closing Date (as defined in the Merger
Agreement).
Section 3. Purchase Price; Form of Warrant Certificate
3.1 The certificates evidencing the Warrants (the "Warrant Certificates")
(and the forms of election to purchase Warrant Shares and of assignment to be
printed on the reverse thereof) shall be substantially in the form set forth in
Exhibit A hereto and may have such letters, numbers or other marks of
identification or designation and such legends, summaries or endorsements
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printed, lithographed or engraved thereon as the Company may deem appropriate
and as are not inconsistent with the provisions of this Warrant Agreement, or
as may be required to comply with any law or with any rule or regulation made
pursuant thereto or with any rule or regulation of The Nasdaq Stock Market or
any national stock exchange on which the Warrants may from time to time be
listed. The Warrant Certificates shall be dated as of the Closing Date, upon
initial issuance by the Company, and thereafter, upon transfer or exchange, as
of the date of countersignature thereof by the Warrant Agent.
3.2 Each Warrant shall entitle the holder thereof to purchase one share of
Common Stock upon the exercise thereof at the applicable Exercise Price (as
defined in Section 6 hereof) subject to adjustment as provided in Section 13
hereof; provided, however, that, as discussed in Section 13(f) herein, the
Warrants are exercisable only for whole shares and no fractional shares will be
issued. Each Warrant Certificate shall be executed on behalf of the Company by
the manual or facsimile signature of the present or any future president of the
Company, under its corporate seal, affixed or in facsimile, attested by the
manual or facsimile signature of the present or any future Secretary or
Assistant Secretary of the Company.
3.3 The term "Common Stock" shall mean the aforementioned Common Stock,
together with any other securities or property that may be issued by the
Company in connection therewith or in substitution therefor, as provided
herein.
Section 4. Registration and Countersignature
4.1 The Warrant Agent shall maintain books for the registration, and
registration of transfer, of the Warrant Certificates. The Warrant
Certificates shall be countersigned by the Warrant Agent and shall not be valid
for any purpose unless so countersigned. The Warrant Certificates shall be so
countersigned, however, by the Warrant Agent and shall be delivered by the
Warrant Agent, notwithstanding that the persons whose manual or facsimile
signatures appear thereon as proper officers of the Company shall have ceased
to be such officers at time of such countersignature or delivery.
4.2 Prior to due presentment for registration or transfer of the Warrant
Certificates, the Company and the Warrant Agent shall deem and treat the
registered holder thereof as the absolute owner of Warrants (notwithstanding
any notation of ownership or other writing on the Warrant Certificate made by
anyone other than the Company or the Warrant Agent), for the purpose of any
exercise thereof and for all other purposes and no transfer or exchange will be
effective unless made in accordance with Sections 10 and 11 herein and neither
the Company nor the Warrant Agent shall be affected by any notice to the
contrary.
Section 5. Registration of Transfers and Exchanges
The Warrant Agent shall from time to time register the transfer of any
outstanding Warrant Certificates upon the books to be maintained by the Warrant
Agent for that purpose, upon surrender thereof to the Company or to the Warrant
Agent accompanied (if so required by the Company or the Warrant Agent) by a
written instrument or instruments of transfer in form satisfactory to the
Company and the Warrant Agent, duly executed by the registered holder or by a
duly authorized representative or attorney, such signature to be guaranteed by
an eligible guarantee institution with a membership in an approved Medallion
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Signature Guarantee Program, which institution may be a commercial bank, trust
company or savings association having an office in the United States, a broker
or dealer that is a member of the National Association of Securities Dealers,
Inc. or a member of a national securities exchange (any such entity, as further
defined in Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended,
an "Eligible Institution"). In all cases of written requests pursuant to
Sections 5 or 6 hereof by an attorney, the original power of attorney, duly
approved, or copy thereof, duly certified and satisfactory to the Warrant
Agent, shall be deposited and remain with the Warrant Agent. In the case of
written request by executors, administrators, guardians or other legal
representatives, duly authenticated evidence of their authority satisfactory to
the Warrant Agent shall be produced and deposited with the Warrant Agent. Upon
any such registration of transfer, a new Warrant Certificate shall be issued to
the transferee and the surrendered Warrant Certificate shall be cancelled by
the Warrant Agent. Warrant Certificates so cancelled shall be delivered by the
Warrant Agent to the Company from time to time or otherwise disposed of by the
Warrant Agent in a manner satisfactory to the Company. Warrant Certificates
may be exchanged at the option of the holder thereof when surrendered at the
principal office of the Warrant Agent in St. Louis or the principal office of
the Company in Topeka (in such event the Company shall forward the Warrant
Certificates surrendered and the instruments of transfer to the Warrant Agent)
for another Warrant Certificate or other Warrant Certificates of like tenor and
representing in the aggregate the number of Warrants evidenced by the Warrant
Certificate or Warrant Certificates so surrendered. The Warrant Agent shall
countersign and deliver, in accordance with the provisions of this Section 5
and of Section 4 hereof, the new Warrant Certificate or Warrant Certificates
required pursuant to the provisions of this Section 5, and the Company,
whenever required by the Warrant Agent, will supply the Warrant Agent with
Warrant Certificates duly executed on behalf of the Company for such purpose.
Section 6. Duration and Exercise of Warrants
6.1 (a) The Warrants may be exercised at any time or from time to time
after the date hereof and will expire at 5:00 p.m., Central Standard time, on
________, 2002 (the "Expiration Date"), at which time all rights evidenced by
the Warrants shall cease and the Warrants shall become void.
(b) Subject to the provisions of this Warrant Agreement, the
registered holder of each Warrant shall have the right to purchase from the
Company (and the Company shall issue and sell to such registered holder) the
number of fully paid and nonassessable Warrant Shares set forth on such
holder's Warrant Certificate (or such number of Warrant Shares as may result
from adjustments made from time to time as provided in this Warrant Agreement),
at the price of $_____ per Warrant Share in lawful money of the United States
of America (such exercise price per Warrant Shares, as adjusted from time to
time as provided herein, being referred to herein as the "Exercise Price"),
upon (i) surrender of the Warrant Certificate to the Company at the principal
office of the Warrant Agent in St. Louis or the principal office of the Company
in Topeka with the exercise form on the reverse thereof duly completed and
signed by the registered holder or holders thereof or by a duly appointed legal
representative thereof or by a duly authorized attorney, such signature to be
guaranteed by an Eligible Institution if the Warrant Shares are to be issued to
a person other than the registered holder of the Warrants and (ii) payment, in
lawful money of the United States of America and in accordance with Section 6.2
hereof, of the Exercise Price for the Warrant Share or Warrant Shares in
respect of which such Warrant is exercised. Upon surrender of a Warrant
Certificate, and payment of the Exercise Price, the Company shall issue and
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cause to be delivered with all reasonable dispatch to or upon the written order
of the registered holder of such Warrants and in such name or names as such
registered holder may designate, a certificate or certificates for the number
of Warrant Shares so purchased upon the exercise of such Warrants, together
with cash in respect of any fraction of a Warrant Share issuable upon such
surrender. As set forth in Section 13(d), no adjustment shall be made for
certain cash dividends paid or payable on Warrant Shares issuable upon exercise
of a Warrant.
(c) Each person in whose name any certificate for Warrant Shares is
issued upon the exercise of Warrants shall for all purposes be deemed to have
become the holder of record of the Common Stock represented thereby on, and
such certificate shall be dated, the date upon which the Warrant Certificate
evidencing such Warrants was duly surrendered and payment of the Exercise Price
(and any applicable transfer taxes) was made; provided, however, that if the
date of such surrender and payment is a date upon which the Common Stock
transfer books of the Company are closed, such person shall be deemed to have
become the record holder of such Warrant Shares on, and such certificate shall
be dated, the next succeeding business day on which the Common Stock transfer
books of the Company are open.
6.2 The Exercise Price payable upon exercise of Warrants may be paid
by money order or bank draft. Subject to Section 7 hereof, upon surrender of a
Warrant Certificate and payment of the Exercise Price (and if the Exercise
Price is paid by check other than an official bank draft, upon collection of
the proceeds of such check), the Company shall issue and cause to be
registered, countersigned and delivered to or upon the written order of the
registered holder of such Warrant and in such name or names as may duly be
designated, a certificate for the Warrant Shares being issued pursuant to the
Warrant then being exercised (as adjusted as provided in Section 13 hereof).
Such certificate shall be deemed to have been issued and any person so
designated to be named therein shall be deemed to have become a holder of
record of such share or shares of Common Stock, as of the date of surrender of
such Warrant Certificate and payment of the Exercise Price; provided, however,
that if, at the date of surrender of such Warrant Certificate and payment of
such Exercise Price, the transfer books for the Common Stock shall be closed,
the certificate for such share or shares of Common Stock shall be issuable as
of the date on which such books shall next be opened (whether before, on or
after the Expiration Date) and until such date the Company shall be under no
duty to deliver any certificate for such share or shares.
6.3 In the event that less than all the Warrants represented by a Warrant
Certificate are exercised by the registered holder thereof or a duly authorized
representative before 5:00 p.m., Central Standard time, on the Expiration Date,
a new Warrant Certificate will be issued for the remaining number of Warrants
exercisable pursuant to the Warrant Certificate so surrendered, and the Warrant
Agent shall countersign and deliver the required new Warrant Certificate
pursuant to the provisions of this Section 6 and of Section 4 hereof and the
Company, whenever required by the Warrant Agent, shall deliver to the Warrant
Agent a Warrant Certificate duly executed on behalf of the Company for such
purpose.
6.4 The number of shares of Common Stock to be received upon exercise of a
Warrant and the price to be paid for a share of Common Stock are subject to
adjustment from time to time as hereinafter set forth.
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Section 7. Payment of Taxes
The Company shall pay all documentary stamp and transfer taxes attributable
to the original issuance of the Warrants and of the shares of Common Stock upon
the exercise of Warrants; provided, however, that the Company shall not be
required to (a) pay any tax which may be payable in respect of any transfer or
delivery of Warrant Certificates or the issuance or delivery of certificates
for shares of Common Stock in a name other than that of the registered holder
of the Warrant Certificate upon the exercise of a Warrant or (b) issue or
deliver any certificate for shares of Common Stock upon the exercise of any
Warrants until any such tax required to be paid under clause (a) shall have
been paid, all such tax being payable by the holder of such Warrant at the time
of surrender.
Section 8. Mutilated or Missing Warrant Certificates
In case any Warrant Certificate shall be mutilated, lost, stolen or
destroyed, upon cancellation of the mutilated, lost, stolen or destroyed
Warrant Certificate, the Company shall issue, and the Warrant Agent shall
countersign and deliver in exchange and substitution for the mutilated, lost,
stolen or destroyed Warrant Certificate, a new Warrant Certificate of like
tenor and evidencing the number of shares of Common Stock purchasable upon
exercise of the Warrant Certificate so mutilated, lost, stolen or destroyed,
but only upon receipt of evidence satisfactory to the Warrant Agent of such
loss, theft or destruction of such Warrant Certificate and an indemnity, if
requested, also satisfactory to it. Applicants for any such substitute Warrant
Certificate shall also comply with such other reasonable requirements and pay
such other reasonable charges as the Company or the Warrant Agent may
prescribe, including the posting of a customary bond. Any such new Warrant
Certificate shall constitute an original contractual obligation of the Company,
whether or not the allegedly mutilated, lost, stolen or destroyed Warrant
Certificate shall be at any time enforceable by anyone.
Section 9. Reservation of Shares; Stock Certificates
The Company covenants and agrees that it shall at all times reserve or
cause to be reserved for issuance and delivery upon exercise of the Warrants, a
sufficient number of shares of Common Stock or other securities of the Company
from time to time issuable upon exercise of the Warrants. The Company
covenants and agrees that it shall take all such action as may be necessary to
ensure that all such shares shall be duly authorized and, when issued upon such
exercise, shall be validly issued, fully paid and nonassessable, free and clear
of all liens, security interests, charges and other encumbrances or
restrictions on sale and free and clear of all preemptive rights. The Company
will keep a copy of this Warrant Agreement on file with its transfer agent,
Boatmen's Trust Company, or any successor thereto (the "Transfer Agent"). The
Warrant Agent is hereby irrevocably authorized to requisition from time to time
from such Transfer Agent certificates issuable upon exercise of outstanding
Warrants. The Company will supply such Transfer Agent with duly executed
certificates for such purpose. All Warrant Certificates surrendered upon
exercise of Warrants shall be cancelled by the Warrant Agent and shall
thereafter be delivered to the Company or otherwise disposed of in a manner
satisfactory to the Company. Unless all Warrants shall have been exercised
prior to 5:00 p.m. Central Standard time, on the Expiration Date, the Warrant
Agent shall certify to the Company, as of the close of business on the
Expiration Date, the total aggregate amount of Warrants then outstanding, and
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thereafter no shares of Common Stock shall be subject to reservation in respect
of such Warrants.
Section 10. Transfer and Registration of Warrants and Warrant Shares
10.1 The Warrants and the Warrant Shares, and any interest in either,
may be sold, assigned, pledged, encumbered or in any other manner transferred
or disposed of, in whole or in part, only in accordance with Section 11 hereof
and in compliance with applicable United States federal and state securities
laws and the terms and conditions hereof.
10.2 The Warrants have been registered under the Securities Exchange
Act of 1934, as amended, pursuant to a registration statement on Form 8-A
(Registration No. [___________]) which was declared effective by the Securities
and Exchange Commission (the "SEC") on [_____________], 1996. The Company will
use its best efforts to keep such registration statement in effect in
accordance with applicable federal securities laws through the Expiration Date
or until such earlier time as no Warrants remain outstanding. The Company
covenants and agrees:
(a) to prepare and file with the SEC such amendments and supplements
to such Registration Statement and the prospectus used in connection therewith
as may be necessary to keep such Registration Statement effective in accordance
with applicable federal securities laws through the Expiration Date;
(b) as expeditiously as possible, to register or qualify the Warrants,
and to register or qualify the Warrant Shares, under the securities or Blue Sky
laws of each jurisdiction in which such registration or qualification is
necessary; and
(c) to pay all expenses incurred by the Company in complying with this
Section 10.2, including, without limitation, (i) all registration and filing
fees, (ii) all printing expenses, (iii) all fees and disbursements of counsel
and independent public accountants for the Company, (iv) all Blue Sky fees and
expenses (including fees and expenses of counsel in connection with any Blue
Sky surveys), and the entire expense of any special audits incident to or
required by any such registration.
Section 11. Exchange, Transfer or Assignment of Warrants
11.1 The Warrants may be exchanged or transferred, at the option of the
holder, upon presentation and surrender of Warrant Certificates to the Warrant
Agent or to the Company, for other Warrant Certificates of different
denominations, entitling the holder or holders thereof to purchase in the
aggregate the same number of Warrant Shares. Subject to the preceding
sentence, a Warrant Certificate may be divided or combined with other Warrant
Certificates that carry the same rights upon presentation thereof at the office
of the Warrant Agent or the Company, together with written notice specifying
the names and denominations in which new Warrant Certificates are to be issued
and signed by the holder thereof.
11.2 The Warrants may be assigned or transferred, at the option of the
holder, upon surrender of Warrant Certificates to the Warrant Agent, with the
Warrant Assignment Form contained therein duly executed and accompanied by
funds sufficient to pay any transfer tax. The Warrant Agent shall execute and
deliver a new Warrant Certificate or Certificates in the name of the assignee
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or assignees named in such instrument of assignment and, if the holder's entire
interest in the Warrants is not being transferred or assigned, in the name of
the holder, and the Warrant Certificate surrendered shall promptly be
cancelled.
11.3 Any transfer, exchange or assignment of the Warrants shall be
without charge (other than the cost of any transfer tax to be paid by holder
pursuant to Section 7 hereof) to the holder and any new Warrant Certificates
issued pursuant to this Section 11 shall be dated the state such new Warrant
Certificate is issued.
Section 12. Rights of Warrant Holder
The holder of any Warrant shall not, by virtue thereof, be entitled to any
rights of a shareholder in the Company, either at law or in equity, and the
rights of the holder are limited to those expressed in this Warrant Agreement.
Section 13. Antidilution Provisions
The Exercise Price and the number of Warrant Shares that may be purchased
upon the exercise of a Warrant and the number of Warrants outstanding will be
subject to change or adjustment as follows:
(a) Stock Dividends, Stock Splits and Reverse Stock Splits and
Combinations. If at any time after the date of the issuance of the Warrants
and before 5:00 p.m., Central Standard time, on the Expiration Date, (i) the
Company shall fix a record date for the issuance of any stock dividend payable
in shares of capital stock of the Company or (ii) the number of shares of
Common Stock shall have been increased by a subdivision or stock split of
shares of Common Stock or decreased by a reverse stock split or combination of
shares of Common Stock, then, on the record date fixed for the determination of
holders of Common Stock entitled to receive such dividend or immediately after
the effective date of such subdivision, stock split, reverse stock split or
combination, as the case may be, the number of Warrant Shares to be delivered
upon exercise of any Warrant will be appropriately increased or decreased, as
the case may be, so that each holder of a Warrant thereafter will be entitled
to receive the number of shares of Common Stock that such holder would have
owned or have been entitled to receive immediately following such action had
the Warrant been exercised immediately prior thereto, and the Exercise Price
will be appropriately adjusted. The time of occurrence of any event giving
rise to an adjustment made pursuant to this Section 13(a) shall, in the case of
a subdivision, stock split, reverse stock split or combination, be the
effective date thereof and shall, in the case of a dividend or distribution, be
the record date thereof.
(b) Reorganization, Reclassification, Etc. If any capital
reorganization of the Company, or any reclassification of the Common Stock, or
any consolidation of the Company with or merger of the Company with or into any
other corporation or any sale, lease or other transfer of all or substantially
all of the assets of the Company to any other entity (including any individual,
partnership, joint venture, corporation, trust or group thereof), shall be
effected in such a way that the holders of the Common Stock shall be entitled
to receive stock, securities or assets with respect to or in exchange for
Common Stock, then, upon exercise of the Warrants in accordance with the terms
of this Warrant Agreement and the Warrant Certificates, each holder shall have
the right to receive the kind and amount of stock, securities or assets
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receivable upon such reorganization, reclassification, consolidation, merger or
sale, lease or other transfer by a holder of the number of shares of Common
Stock that such holder would have owned or would have been entitled to receive
upon exercise of the Warrants had the Warrants been exercised immediately
before such reorganization, reclassification, consolidation, merger or sale,
lease or other transfer, subject to adjustments that shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Section 13.
(c) Issuance. If at any time after the date of issuance of the
Warrants and before 5:00 p.m., Central Standard time, on the Expiration Date
the Company shall (i) issue any shares of Common Stock (other than shares
issued upon exercise of the Warrants or shares of Common Stock that may be
issued pursuant to any option, rights or warrants outstanding as of the date
hereof) without consideration or at a price per share less than the Closing
Price (as defined in Section 13(f) hereof) immediately prior to such issuance,
or (ii) issue options, rights or warrants to subscribe for or purchase Common
Stock (or securities convertible into Common Stock) without consideration or at
a price per share (or having a conversion price per share, if a security
convertible into Common Stock) less than the Closing Price immediately prior to
such issuance, the Exercise Price to be in effect after the date of such
issuance shall be determined by multiplying the Exercise Price in effect
immediately prior to such distribution or issuance by a fraction (i) the
numerator of which shall be the number of shares of Common Stock outstanding on
the date of such issuance plus the number of shares of Common Stock which the
aggregate offering price of the total number of shares of Common Stock so to be
issued or to be offered for subscription or purchase (or the aggregate initial
conversion price of the convertible securities so to be offered) would purchase
at such Closing Price and (ii) the denominator of which shall be the number of
shares of Common Stock outstanding on the date of such issuance plus the number
of additional shares of Common Stock to be issued or to be offered for
subscription or purchase (or into which the convertible securities so to be
offered are initially convertible); provided, however, that the provisions of
this subsection (c) shall not apply to any issuance of Common Stock upon
exercise of any Warrants. There shall be added to such subscription price and
included in the amount thereof for the purpose of making the above calculation
the price paid to the Company for any rights or warrants to subscribe for or
purchase, or for any securities convertible into, Common Stock which are
exercised or converted in connection with an issuance of Common Stock under
this subsection (c). In case such subscription price may be paid in a
consideration part or all of which shall be in a form other than cash, the
value of such consideration shall be determined in good faith by the Board of
Directors of the Company. Shares of Common Stock owned by or held for the
account of the Company or any majority-owned subsidiary shall not be deemed
outstanding for the purpose of any such computation. An adjustment made
pursuant to this Section 13(c) shall become effective retroactively to the time
immediately after the date such issuance is fixed (which date of issuance shall
be the record date if a record date therefor is fixed).
(d) Distributions. If at any time after the date of issuance of the
Warrants and before 5:00 p.m., Central Standard time, on the Expiration Date
the Company shall, to or for the account or benefit of the holders of the
outstanding shares of Common Stock, make any distribution, payment or transfer
of any asset, property or security (but excluding those described in Section
13(a) or (b) hereof and any cash distributions made as a dividend which in any
fiscal year in the aggregate are less than net earnings from continuing
operations for the previous fiscal year or dividends which are consistent with
past practice) of the Company or any of its subsidiaries, and thereafter,
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successively upon each such distribution or issuance, the Exercise Price in
effect immediately prior to such distribution or issuance shall forthwith be
reduced to a price determined by multiplying the Exercise Price in effect
immediately prior to such distribution or issuance by a fraction (i) the
numerator of which shall be the Closing Price per share of Common Stock at the
record date for the determination of shareholders entitled to receive such
distribution or issuance, less the then fair market value (as determined in
good faith by the Board of Directors of the Company, whose determination shall
be conclusive) of the portion of such distribution applicable to one share of
Common Stock and (ii) the denominator of which shall be such Closing Price per
share of Common Stock. An adjustment made pursuant to this Section 13(d) shall
become effective retroactively to the time immediately after the record date
for the determination of shareholders entitled to receive such distribution or
issuance.
(e) Fractional Shares. No fractional shares of Common Stock or scrip
shall be issued to any holder in connection with the exercise of a Warrant.
Instead of any fractional shares of Common Stock that would otherwise be
issuable to such holder, the Company will pay to such holder a cash amount in
respect of such fractional interest equal to that fractional interest of the
then current Closing Price.
(f) Definition of Closing Price. For the purposes of this Warrant
Agreement, "Closing Price" means the closing price per share of the Common
Stock on the principal national securities exchange on which the Common Stock
is listed or admitted to trading or, if not listed or traded on any such
exchange, on The Nasdaq Stock Market or such other over-the-counter quotations
system on which such shares of Common Stock are traded or, if not listed or
traded on any such exchange or system, the fair market value as reasonably
determined by the Board of Directors of the Company or any committee of such
Board.
(g) Definition of Common Stock. Unless the context requires
otherwise, all references to Common Stock and Warrant Shares in this Warrant
Agreement and in the Warrant Certificates shall, in the event of an adjustment
pursuant to this Section 13, be deemed to refer also to any other securities or
property then issuable upon exercise of the Warrants as a result of such
adjustment. In the event that at any time, as a result of an adjustment made
pursuant to this Section 13, securities other than shares of Common Stock are
issuable upon exercise of the Warrants, thereafter the number of such other
shares so issuable shall be subject to adjustment from time to time in a manner
and on terms as nearly equivalent as practicable to the provisions with respect
to the Common Stock contained in this Section 13, and all other provisions of
this Warrant Agreement with respect to Common Stock shall apply on like terms
to any such other shares.
(h) Threshold Requirement. No adjustment in the Exercise Price or in
the number of Warrant Shares purchasable hereunder shall be required unless
such adjustment would require an increase or decrease of at least one percent
(1%) in such Exercise Price or in the number of Warrant Shares purchasable upon
the exercise of each Warrant; provided, however, that any adjustments which by
reason of this Section 13(g) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Section 13 shall be made to the nearest cent and to the nearest one-
thousandth of a Warrant Share, as the case may be.
(i) Voluntary Adjustment by the Company. The Company may at its
option, at any time during the term of the Warrants, reduce the then current
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Exercise Price to any amount and for any period of time deemed appropriate by
the Board of Directors of the Company or extend the Expiration Date of the
Warrants.
Section 14. Officer's Certificate
Whenever the number of Warrant Shares that may be purchased upon exercise
of the Warrants is adjusted as required by the provisions of this Warrant
Agreement, the Company will forthwith file in the custody of its Secretary or
an Assistant Secretary at its principal office and with the Warrant Agent an
officer's certificate showing the adjusted number of Warrant Shares that may be
purchased upon exercise of the Warrants and the adjusted Exercise Price,
determined as herein provided, setting forth in reasonable detail the facts
requiring such adjustments and the manner of computing such adjustment. Each
such officer's certificate shall be made available at all reasonable times for
inspection by the holder.
Section 15. Notice of Certain Events
Upon any adjustment of the Exercise Price pursuant to Section 13, the
Company shall promptly, but in any event within 20 days thereafter, cause to be
mailed to the registered holders of the Warrants, a certificate setting forth
the Exercise Price as so adjusted and the number of shares of Common Stock
issuable upon the exercise of each Warrant as so adjusted and describing in
reasonable detail the facts accounting for such adjustment and the method of
calculation used. Where appropriate, such certificate may be given in advance
and included as part of the notice required to be mailed under the other
provisions of this Section 15.
At any time during the period commencing on the date of this Warrant
Agreement and ending on the Expiration Date, in the event:
(a) the Company authorizes the issuance of rights or warrants to
subscribe for or purchase shares of Common Stock or any other subscription
rights or warrants to all holders of Common Stock; or
(b) there shall be an adjustment to the Warrants pursuant to Section
13(b) or 13(d) herein;
(c) of the voluntary or involuntary dissolution, partial dissolution,
liquidation or winding-up of the Company.
then the Company will cause to be mailed to the registered holders of the
Warrants, at least 20 days before the applicable record or effective date
hereinafter specified, a notice stating (A) the date as of which the holders of
Common Stock of record entitled to receive any such rights, warrants or
distributions are to be determined or (B) the date on which any such
consolidation, merger, conveyance, transfer, dissolution, liquidation or
winding-up is expected to become effective, and (C) the date as of which it is
expected that holders of Common Stock of record will be entitled to exchange
their shares of Common Stock for securities or other property, if any,
deliverable upon such reorganization, reclassification, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding-up.
11
Notwithstanding the foregoing, failure to give notice as required by this
Warrant Agreement, shall not affect the validity of the underlying corporate
action taken.
Section 16. Listing on Securities Exchanges; Reservation of Shares
(a) The Company will use its best efforts to cause all shares of the
Common Stock from time to time issuable upon the exercise of the Warrants to be
listed on the New York Stock Exchange, and will maintain such listing so long
as any other shares of Common Stock are so listed; and the Company shall so
list on a national securities exchange or The Nasdaq Stock Market, or such
other over-the-counter quotation system, and shall maintain such listing of,
any other shares of capital stock of the Company issuable upon the exercise of
the Warrants if and so long as any shares of capital stock of the same class
are listed on such national securities exchange or are traded on The Nasdaq
Stock Market or such over-the-counter quotation system. Any such listing or
quotation will be at the Company's expense.
(b) The Company will use its best efforts to cause the Warrants to be
listed on a national securities exchange or The Nasdaq Stock Market, or such
other over-the-counter quotation system on which any Common Stock may at any
time be listed. Any such listing or quotation will be at the Company's
expense.
(c) For the purpose of enabling it to satisfy any obligation to issue
Warrant Shares upon the exercise of Warrants, the Company covenants and agrees
that it shall, at all times through the Expiration Date, reserve and keep
available, or cause to be reserved and available, free from preemptive rights a
sufficient number of shares of authorized but unissued Common Stock, the number
of Warrant Shares or other securities deliverable upon the exercise of all
outstanding Warrants, and the Transfer Agent for the Common Stock hereby is
irrevocably authorized and directed at all times to reserve such number of
authorized and unissued shares of Common Stock or such other securities as
shall be required for such purpose.
(d) The Company covenants and agrees that it shall take all such
action as may be necessary too ensure that all Warrant Shares will at the time
of delivery of certificates for such Warrant Shares (subject to payment of the
Exercise Price) be duly and validly authorized and issued and fully paid and
nonassessable shares, free from any preemptive rights and taxes, liens, charges
and security interests created by or imposed upon the Company.
Section 17. Availability of Information
The Company shall comply with all applicable public information reporting
requirements of the SEC to which it may from time to time be subject.
Section 18. Duties of Warrant Agent
The Warrant Agent undertakes the duties and obligations imposed by this
Warrant Agreement upon the following terms and conditions, by all of which the
Company and the holders of Warrants, by their acceptance thereof, shall be
bound:
12
(a) The statements contained herein and in the Warrant Certificates
shall be taken as statements of the Company, and the Warrant Agent assumes no
responsibility for the correctness of any of the same except such as describe
the Warrant Agent or action taken or to be taken by it. The Warrant Agent
assumes no responsibility with respect to the delivery of Warrant Certificates
except as herein otherwise provided.
(b) The Warrant Agent shall not be responsible for any failure of the
Company to comply with any of the covenants contained in this Warrant Agreement
or in the Warrant Certificates to be complied with by the Company.
(c) The Warrant Agent may consult at any time with counsel
satisfactory to it (who may be counsel for the Company) and the Warrant Agent
shall incur no liability or responsibility to the Company or to any holder of
any Warrant in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with the opinion or the advice of such counsel,
provided the Warrant Agent shall have exercised reasonable care in the
selection and continued employment of such counsel.
(d) The Warrant Agent shall incur no liability or responsibility to
the Company or to any holder of any Warrant for any action taken in good faith
reliance on any notice, resolution, waiver, consent, order, certificate or
other paper, document or instrument believed by it to be genuine and to have
been signed, sent or presented by the party or parties.
(e) The Company agrees (i) to pay to the Warrant Agent reasonable
compensation for all services rendered by the Warrant Agent in the execution of
this Warrant Agreement, (ii) to reimburse the Warrant Agent for all expenses,
taxes and governmental charges and other charges of any kind and nature
incurred by the Warrant Agent in the execution of this Warrant Agreement (other
than taxes measured by the Warrant Agent's net income), and (iii) upon request,
to advance to the Warrant Agent funds to pay cash in lieu of fractional shares
of Common Stock issuable upon exercise of Warrants.
(e) The Warrant Agent shall be under no obligation to institute any
action, suit or legal proceeding or to take any other action likely to involve
expense unless the Company or one or more registered holders of Warrants shall
furnish the Warrant Agent with reasonable security and indemnity for any costs
and expenses which may be incurred. All rights of action under this Warrant
Agreement or under any of the Warrants may be enforced by the Warrant Agent
without the possession of any of the Warrant Certificates or the production
thereof at any trial or other proceeding relative thereto, and any such action,
suit or proceeding instituted by the Warrant Agent shall be brought in its name
as Warrant Agent, and any recovery of judgment shall be for the ratable benefit
of the registered holders of the Warrants, as their respective rights or
interest may appear.
(f) The Warrant Agent and any stockholder, director, officer or
employee of the Warrant Agent may buy, sell or deal in any of the Warrants or
other securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with or lend
money to or otherwise act as fully and freely as though it were not the Warrant
Agent under this Warrant Agreement. Nothing herein shall preclude the Warrant
Agent from acting in any other capacity for the Company or for any other legal
entity.
The Warrant Agent shall act hereunder solely as agent, and its duties shall
be determined solely by the provisions hereof. The Warrant Agent shall not be
13
liable for anything which it may do or refrain from doing in connection with
this Warrant Agreement except for its own negligence, bad faith or willful
misconduct.
Section 19. Merger, Consolidation or Change of Name of Warrant Agent
Any corporation into which the Warrant Agent may be merged or with which it
may be consolidated, or any corporation resulting from any merger or
consolidation to which the Warrant Agent shall be a party, or any corporation
succeeding to the corporate trust business of the Warrant Agent, shall be the
successor to the Warrant Agent hereunder without the execution or filing of any
paper or any further act on the part of any of the parties hereto, provided
that such corporation would be eligible for appointment as a successor warrant
agent under the provisions of Section 20 hereof. If at the time such successor
to the Warrant Agent shall succeed to the agency created by this Warrant
Agreement, and if at that time any of the Warrant Certificates shall have been
countersigned but not delivered, any such successor to the Warrant Agent may
adopt the countersignature of the predecessor warrant agent and deliver such
Warrant Certificates so countersigned; and if at that time any of the Warrant
Certificates shall not have been countersigned, any successor to the Warrant
Agent may countersign such Warrant Certificates either in the name of the
predecessor Warrant Agent or in the name of the successor Warrant Agent; and in
all such cases such Warrant Certificates shall have the full force and effect
provided in the Warrant Certificates and in this Warrant Agreement.
If at any time the name of the Warrant Agent shall be changed and at such
time any of the Warrant Certificates shall have been countersigned but not
delivered, the Warrant Agent may adopt the countersign under its prior name and
deliver Warrant Certificates so countersigned; and if at that time any of the
Warrant Certificates shall not have been countersigned, the Warrant Agent may
countersign such Warrant Certificates either in its prior name or in its
changed name; and in all such cases such Warrant Certificates shall have the
full force and effect provided in the Warrant Certificates and in this Warrant
Agreement.
Section 20. Change of Warrant Agent
The Warrant Agent may resign and be discharged from its duties under this
Warrant Agreement by giving to the Company notice in writing, and to the
holders of the Warrants notice in writing and sent, postage prepaid, by first
class mail to each registered holder of a Warrant at such holder's address
appearing in the Warrant Register, specifying a date when such resignation
shall take effect, which notice shall be sent at least two weeks prior to the
date so specified. If the Warrant Agent shall resign or otherwise become
incapable of acting, the Company shall appoint a successor to the Warrant
Agent. If the Company shall fail to make such appointment within a period of
30 days after it has been notified in writing of such resignation or incapacity
by the resigning or incapacitated Warrant Agent or by the registered holder of
a Warrant (who shall, with such notice, submit such holder's Warrant
Certificate for inspection by the Company), then the registered holder of any
Warrant may apply to any court of competent jurisdiction for the appointment of
a successor to the Warrant Agent. Notwithstanding any provision to the
contrary contained herein, the removal or resignation of the Warrant Agent will
be effective upon the expiration of the applicable notice period, and in the
event a successor has not then been appointed, the Company shall assume the
role of Warrant Agent until such time as a successor Warrant Agent has been
14
appointed in accordance with the terms of this Agreement. Any successor
Warrant Agent shall be (a) a corporation organized and doing business under the
laws of the United States or of any state thereof, in good standing, which is
authorized under such laws to exercise corporate trust or stock transfer powers
and is subject to supervision or examination by federal or state authority and
which has at the time of its appointment as Warrant Agent a combined capital
surplus of at least twenty million dollars ($20,000,000) or (b) an affiliate of
a corporation described in clause (a) of this sentence. The Company shall
cause written notice to be delivered to the registered holders of Warrants
notifying such holders of the name and address of any successor Warrant Agent.
After appointment the successor Warrant Agent shall be vested with the same
powers, rights, duties and responsibilities as if it had been originally named
as Warrant Agent without further act or deed; but the former Warrant Agent
shall deliver and transfer to the successor Warrant Agent any property at the
time held by it hereunder, and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Failure to give any notice
provided for in this Section 21, however, or any defect therein, shall not
affect the legality or validity of the resignation or removal of the Warrant
Agent or the appointment of the successor Warrant Agent, as the case may be.
Section 21. Identity of Transfer Agent
Forthwith upon the appointment after the date hereof of any subsequent
Transfer Agent for shares of the Common Stock, the Company will file with the
Warrant Agent a statement setting forth the name and address of such Transfer
Agent.
Section 22. Successors
All covenants and provisions of this Warrant Agreement by or for the
benefit of the Company, the Warrant Agent or the holders of the Warrants shall
bind and inure to the benefit of their respective successors, assigns, heirs
and personal representatives.
Section 23. Termination
This Warrant Agreement shall terminate at 5:00 p.m., Central Standard time,
on the Expiration Date or such earlier date upon which all Warrants have been
exercised or redeemed, except that the Warrant Agent shall account to the
Company for all cash held by it at 5:00 p.m., Central Standard time, on such
Expiration Date.
Section 24. Governing Law
This Warrant Agreement and each warrant certificate shall be governed by
and construed in accordance with the laws of the State of Kansas. The Company
irrevocably agrees that all actions or proceedings in any way, manner or
respect, arising out of or from or related to this Warrant Agreement shall be
litigated in courts having situs within the City of St. Louis, State of Kansas.
15
Section 24. Counterparts
This Warrant Agreement may be executed in any number of counterparts and
each of such counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and the same
agreement.
Section 25. Headings
The headings of sections of this Warrant Agreement have been inserted for
convenience of reference only, are not to be considered a part hereof and shall
in no way modify or restrict any of the terms or provisions hereof.
Section 26. Amendments
This Warrant Agreement may be amended by the written consent of the Company
and the affirmative vote or the written consent of holders holding not less
than two-thirds in interest of the then outstanding Warrants; provided,
however, that, except as expressly provided herein, this Warrant Agreement may
not be amended to change (a) the Exercise Price, (b) the period during which
the Warrants may be exercised, (c) the number or type of securities to be
issued upon the exercise of the Warrants, or (d) the provisions of this
Section 26, without the consent of each holder of the Warrants.
Section 27. Notices
Any notice pursuant to this Warrant Agreement to be given by the Warrant
Agent or by the registered holder of any Warrant to the Company shall be given
in writing and shall be deemed effectively given upon personal delivery to the
Company or upon deposit with the United States Post Office, postage prepaid,
registered or certified mail with return receipt requested and addressed (until
another address is filed in writing by the Company with the Warrant Agent) as
follows:
AmVestors Financial Corporation
415 S.W. Eighth Avenue
P.O. Box 2039
Topeka, KS 66601-2039
Attention: Mark V. Heitz, President
Any notice pursuant to this Warrant Agreement to be given by the Company or by
the registered holder of any Warrant to the Warrant Agent shall be given in
writing and shall be deemed effectively given upon personal delivery to the
Company or upon deposit with the United States Post Office, postage prepaid,
registered or certified mail with return receipt requested and addressed (until
another address is filed in writing by the Warrant Agent with the Company or
notice of the address of a successor Warrant Agent is given pursuant to this
Warrant Agreement) as follows:
Boatmen's Trust Company
Corporate Trust Division
510 Locust Street, Second Floor
St. Louis, MO 63101
Attention: H.E. Bradford
16
Section 28. Benefits of This Warrant Agreement
Nothing in this Warrant Agreement shall be construed to give to any person
or corporation, other than the Company, the Warrant Agent and the registered
holders of the Warrants, any legal or equitable right, remedy or claim under
this Warrant Agreement; but this Warrant Agreement shall be for the sole and
exclusive benefit of the Company, the Warrant Agent and the registered holders
of the Warrants.
IN WITNESS WHEREOF, the parties hereto have caused this Warrant Agreement
to be executed as of the first date written above.
AMVESTORS FINANCIAL CORPORATION
By
-------------------------------------
Name:
Title:
Attest:
By -------------------------------
Name:
Title:
BOATMEN'S TRUST COMPANY
By
-------------------------------------
Name:
Title:
Attest:
By -------------------------------
Name:
Title:
17
Exhibit A
FORM OF WARRANT CERTIFICATE
---------------------------
No. W-__
VOID AFTER _________, 2002
WARRANT CERTIFICATE
FOR PURCHASE OF COMMON STOCK
AMVESTORS FINANCIAL CORPORATION
This certifies that FOR VALUE RECEIVED, _________________________ is the
registered holder (the "Registered Holder") of the number of Warrants (the
"Warrants") specified above. Each Warrant represented hereby entitles the
Registered Holder, but only subject to the terms and conditions set forth
herein and in the Warrant Agreement (as hereinafter defined), to purchase one
fully paid and nonassessable share (each a "Warrant Share") of Common Stock, no
par value (the "Common Stock"), of AmVestors Financial Corporation, a Kansas
corporation (the "Company") at any time after issuance through the Expiration
Date (as hereinafter defined), upon presentation and surrender of this Warrant
Certificate and the Subscription Form on the reverse hereof duly executed at
the principal office of Boatmen's Trust Company as Warrant Agent or its
successor (the "Warrant Agent"), accompanied by payment of $____ per share of
Common Stock (the "Exercise Price") in lawful money of the United States of
America by money order or certified or official bank check made payable to the
Company.
This Warrant Certificate and each Warrant represented hereby are issued
pursuant to, and are subject in all respects to the terms and conditions set
forth in the Warrant Agreement, dated _____________, 1996 (the "Warrant
Agreement"), by and between the Company and the Warrant Agent.
Prior to the Expiration Date, upon the occurrence of certain events
provided for in the Warrant Agreement, the Exercise Price or the number of
shares of Common Stock subject to purchase upon the exercise of each Warrant
represented hereby are subject to modification or adjustment.
Each Warrant represented hereby is exercisable at the option of the
Registered Holder but no fractional shares of Common Stock will be issued. In
the case of the exercise of less then all of the Warrants represented hereby,
the Company shall cancel this Warrant Certificate upon the surrender hereof and
shall execute and deliver a new Warrant Certificate or Warrant Certificates,
which the Warrant Agent shall countersign, for the balance of such Warrants.
The "Expiration Date" shall mean __________, 2002, or such earlier date as
all of the Warrants shall be exercised or redeemed. No Warrant may be
exercised after the 5:00 P.M. (Central Standard time) on the Expiration Date
and all rights of the registered holders of the Warrants shall cease after 5:00
P.M., Central Standard time, on the Expiration Date.
The Warrants have been registered under the Securities Exchange Act of
1934, as amended, pursuant to a registration statement on Form 8-A
(Registration No. [__________]) which was declared effective by the Securities
and Exchange Commission on [__________], 1996. The Company has agreed to use
its best efforts to keep such registration statement in effect until the
Expiration Date, or until such earlier time as no Warrants remain outstanding,
18
and to register and qualify the Warrants and the Warrant Shares to be delivered
upon exercise of the Warrants under the laws of each jurisdiction in which such
registration or qualification is necessary.
This Warrant Certificate is exchangeable upon surrender hereof by the
Registered Holder at the principal office of the Warrant Agent in St. Louis or
the principal office of the Company in Topeka for another Warrant Certificate
or Warrant Certificates of like tenor and representing in the aggregate the
number of Warrants evidenced by the Warrant Certificate or Warrant Certificates
so surrendered.
Prior to due presentment for registration or transfer of this Warrant
Certificate, the Company and the Warrant Agent shall deem and treat the
Registered Holder hereof as the absolute owner of Warrants (notwithstanding any
notation of ownership or other writing on the Warrant Certificate made by
anyone other than the Company or the Warrant Agent), for the purpose of any
exercise thereof and for all other purposes and no transfer or exchange will be
effective unless made in accordance with Sections 10 and 11 of the Warrant
Agreement and neither the Company nor the Warrant Agent shall be affected by
any notice to the contrary.
This Warrant Certificate shall be governed by and construed in accordance
with the laws of the State of Kansas.
This Warrant Certificate is not valid unless countersigned by the Warrant
Agent.
IN WITNESS WHEREOF, the Company has caused this Warrant Certificate to be
signed by its duly authorized officers and has caused its corporate seal to be
affixed hereunto.
Dated:
--------------------------------
AMVESTORS FINANCIAL CORPORATION
By:
---------------------------------
Name: Ralph Laster, Jr.
Title: Chairman
ATTEST:
- ---------------------------------------
Name: Lynn F. Hammes
Title: Secretary
COUNTERSIGNED:
BOATMEN'S TRUST COMPANY,
as warrant agent
By:
-----------------------------------
Authorized Officer
19
SUBSCRIPTION FORM
To Be Executed by the Registered Holder in Order to Exercise Warrants
The undersigned Registered Holder hereby irrevocably elects to exercise
__________ Warrants represented by this Warrant Certificate, and to purchase
the securities issuable upon the exercise of such Warrants, and requests that
certificates for such securities shall be issued in the name of
______________________________
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER
and be delivered to
(PLEASE PRINT OR TYPE NAME AND ADDRESS)
and if such number of exercised Warrants shall not be all the Warrants
evidenced by this Warrant Certificate, that a new Warrant Certificate for the
balance of such Warrants be registered in the name of, and delivered to the
Registered Holder at the address stated below.
The undersigned represents that the exercise of the Warrants evidenced
hereby was solicited by a member of the National Association of Securities
Dealers, Inc., if not solicited by an NASD member, please write "unsolicited"
in the space below.
(Name of NASD Member)
Dated: X
------------------------- ---------------------------------------------
(Signature of Registered Holder)
(PLEASE PRINT OR TYPE NAME AND ADDRESS OF REGISTERED HOLDER)
---------------------------------------
Signature Guarantee Stamp Required Here
if Securities are to be Delivered to
Person Other Than Registered Holder
ASSIGNMENT
To Be Executed by the Registered Holder in Order to Assign Warrants
FOR VALUE RECEIVED, ______________________________ hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF TRANSFEREE
(PLEASE PRINT OR TYPE NAME AND ADDRESS)
- -------------------------------------------------------------------------------
of the Warrants represented by this Warrant Certificate, and hereby irrevocably
constitutes and appoints
20
______________________________________________________________________ Attorney
to transfer the Warrant Certificate on the books of the Company, with full
power of substitution in the premises.
Dated: X
------------------------- ---------------------------------------------
(Signature of Registered Holder)
---------------------------------------
Signature Guarantee Stamp Required Here
THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO THE
NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND ALL REQUIRED
SIGNATURE GUARANTEES MUST BE PROVIDED BY A MEMBER OF THE MEDALLION STAMP
PROGRAM.