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[FORM OF GLOBAL WARRANT CERTIFICATE]
No. 1 CUSIP No. _________
SALOMON SMITH BARNEY HOLDINGS INC.
__________ Call Warrants
on the 2000 TEN+(SM) Index
Expiring _______, 2002
This certifies that CEDE & Co., or registered assigns, is the registered
holder of _________ Call Warrants on the 2000 TEN+(SM) Index Expiring ________,
2002 (the "Warrants"). Each Warrant entitles the beneficial owner thereof (each
a "Warrantholder") to receive, subject to the conditions set forth herein and in
the Warrant Agreement (as defined below), from Salomon Smith Barney Holdings
Inc. (the "Company") the cash settlement value in U.S. dollars (rounded down to
the nearest cent) (the "Cash Settlement Value") which is the greater of (A) zero
and (B) the product (rounded down to the nearest cent) of (i) the quotient
obtained by dividing (x) the amount, if any, by which the Spot Index Value (as
defined below) for the applicable Valuation Date exceeds the Strike Index Value
(as defined below) by (y) the Initial Index Value and (ii) $10. In no event
shall a Warrantholder be entitled to any interest on any Cash Settlement Value.
The "Initial Index Value" means the value of the Index at the close of
trading on the CBOE on September [ ], 2000.
The "Strike Index Value" means 80% of the Initial Index Value.
The "Spot Index Value" means the value of the Index at the close of
trading on the CBOE on the applicable Valuation Date; provided, however, that
the Spot Index Value with respect to the Expiration Date, any Early Extended
Expiration Date or any Extended Expiration Date means the value of the Index at
the opening of trading on the CBOE on the applicable Valuation Date.
Subject to the terms of the Warrant Agreement, each Warrant may be
irrevocably exercised in whole but not in part, at or prior to 3:00 p.m., New
York City time, on any Business Day from September 29, 2000 until 3:00 p.m., New
York City time, on the earlier of (i) the fourth Business Day immediately
preceding ______, 2002 (the "Expiration Date") and (ii) the Delisting Date, if
any. Except in the event of automatic exercise, each Warrant shall be
irrevocably exercised upon receipt by the Warrant Agent of such Warrant
delivered free on the records of the Depository to the Warrant Agent's
Depository Participant Account (entitled Citibank, N.A. Corporate Trust Warrant
Agent Account, No. [ ] or such other account at the Depository as the Warrant
Agent shall designate in writing to the Company) (the "Warrant Account")
pursuant to an Exercise Notice to the Warrant Agent from a Participant, in the
case of Warrants held through the facilities of the Depository, Clearstream, in
the case of Warrants held through Clearstream, or a Euroclear participant, in
the case of Warrants held through Euroclear,
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acting, directly or indirectly, on behalf of the Warrantholder; provided,
however, that Exercise Notices are subject to rejection by the Warrant Agent as
provided herein. An Exercise Notice shall be unconditional.
This Global Warrant Certificate shall not be valid unless countersigned
by the Warrant Agent.
The Warrants evidenced by this Global Warrant Certificate are part of a
duly authorized issue of Warrants issued by the Company pursuant to a Warrant
Agreement, dated as of September 29, 2000 (the "Warrant Agreement"), among the
Company, Citibank, N.A. (the "Warrant Agent") and Salomon Smith Barney Inc. (the
"Determination Agent"), and is subject to the terms and provisions contained in
the Warrant Agreement, to all of which terms and provisions the Warrantholders,
the entities through which such Warrantholders hold their beneficial interests
in the Warrants and the registered holder of this Global Warrant Certificate
consent by acceptance of this Global Warrant Certificate by the Depository and
which Warrant Agreement is hereby incorporated by reference in and made a part
of this Global Warrant Certificate. A copy of the Warrant Agreement is on file
at the Warrant Agent's Office, which is located at 111 Wall Street, 5th Floor,
New York, New York 10043.
The Warrants constitute direct, unconditional and unsecured obligations
of the Company and rank on a parity with the Company's other unsecured
contractual obligations and with the Company's unsecured and unsubordinated
debt.
Subject to the terms of the Warrant Agreement and this Global Warrant
Certificate, and except for Warrants subject to automatic exercise or held
through the facilities of Clearstream or Euroclear, and subject to the Limit
Option, the "Exercise Date" for a Warrant will be (i) the Business Day on which
the Warrant Agent receives the Warrant and Exercise Notice in proper form with
respect to such Warrant, if received at or prior to 3:00 p.m., New York City
time, on such day, or (ii) if the Warrant Agent receives such Warrant and
Exercise Notice after 3:00 p.m., New York City time, on a Business Day, then the
Business Day next succeeding such Business Day. In the case of Warrants held
through the facilities of Clearstream or Euroclear, except for Warrants subject
to automatic exercise, and subject to the Limit Option, the "Exercise Date" for
a Warrant will be (i) the Business Day on which the Warrant Agent receives the
Exercise Notice in proper form with respect to such Warrant if such Exercise
Notice is received at or prior to 3:00 p.m., New York City time, on such day;
provided that the Warrant is received by the Warrant Agent by 3:00 p.m., New
York City time, on the Valuation Date (as defined below), or (ii) if the Warrant
Agent receives such Exercise Notice after 3:00 p.m., New York City time, on a
Business Day, then the Business Day next succeeding such Business Day; provided
that the Warrant is received by 3:00 p.m., New York City time, on the Valuation
Date relating to exercises of Warrants on such succeeding Business Day. In the
event that a Warrant is received after 3:00 p.m., New York City time, on the
Valuation Date, then the Exercise Date for such Warrant will be the day on which
such Warrant is received or, if such day is not a Business Day, the next
succeeding Business Day. In the case of Warrants held through the facilities of
Euroclear, (a) participants must also transmit, by facsimile, to the Warrant
Agent a copy of the Exercise Notice submitted to Euroclear by 3:00 p.m., New
York City time, on the desired Exercise Date and (b) Euroclear must confirm by
telex to the Warrant Agent by 9:00 a.m., New York City time, on the Valuation
Date that the Warrants will be received by the
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Warrant Agent on such date; provided that if such telex communication is
received after 9:00 a.m., New York City time, on the Valuation Date, the Company
will be entitled to direct the Warrant Agent to reject the related Exercise
Notice or waive the requirement for timely delivery of such telex communication.
The "Valuation Date" for a Warrant will be the first Business Day
following the Exercise Date, subject to postponement pursuant to the Warrant
Agreement.
Subject to the terms of the Warrant Agreement and except in the event of
automatic exercise, in connection with any exercise of Warrants, the related
Exercise Notice may specify that such exercise is subject to the condition that
the Spot Index Value that would otherwise be used to determine the Cash
Settlement Value of such Warrants shall not have declined by five or more points
from the Limit Option Index Value for such Warrants. "Limit Option Index Value",
with respect to any Warrants subject to the Limit Option, means the Spot Index
Value on the Business Day that such Exercise Notice has been received (or shall
be deemed to have been received). The option of a Warrantholder to condition an
exercise of Warrants is herein referred to as the "Limit Option". To be valid,
such election must be specified in the related Exercise Notice. Each of the
Warrant Agent and the Company shall be entitled to rely conclusively on such
Exercise Notice, as received by the Warrant Agent, in determining whether such
election has been validly made.
The valuation of and payment for any exercised Warrant may be postponed
as a result of an Extraordinary Event or a Market Disruption Event or as a
result of the exercise of a number of Warrants exceeding the maximum permissible
amount as described herein, in which case the Warrantholder will receive the
Cash Settlement Value or, under certain circumstances, the Alternative
Settlement Amount for such Warrant, in either case determined as of a later
date. In addition, the term of any outstanding Warrants may be extended for a
period not to exceed 30 days if a Market Disruption Event or an Extraordinary
Event is continuing on the Expiration Date; provided that such Warrants are not
deemed to be worthless at that time.
Subject to the terms of the Warrant Agreement, in the event the Warrants
are delisted from, or permanently suspended from trading on (within the meaning
of the Securities and Exchange Act of 1934, as amended), the CBOE and not
accepted at the same time for listing on another United States national
securities exchange, Warrants not previously exercised will be deemed
automatically exercised on the Delisting Date, in which case the Warrantholder
will receive the Cash Settlement Value or, under certain circumstances, the
Alternative Settlement Amount.
All Warrants for which the Warrant Agent has not received an Exercise
Notice in proper form at or prior to 3:00 p.m., New York City time, on the
earlier of (i) the fourth Business Day preceding the Expiration Date (subject to
extension), (ii) the Extended Expiration Date, (iii) the Early Extended
Expiration Date, (iv) the Cancellation Date or (v) the Delisting Date, or for
which the Warrant Agent has received an Exercise Notice in proper form but with
respect to which timely delivery of the relevant Warrants has not been made,
will be deemed automatically exercised on such date without any requirement of
an Exercise Notice to the Warrant Agent.
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Subject to the terms of the Warrant Agreement, all exercises of Warrants
(except in the case of automatic exercise of Warrants) shall be subject, at the
Company's option, to the limitation that not more than 250,000 Warrants in total
may be exercised on any Exercise Date and not more than 100,000 Warrants may be
exercised by or on behalf of any person or entity, either individually or in
concert with any other person or entity, on any Exercise Date.
Prior to due presentment for registration of transfer, the Company, the
Warrant Agent, and any agent of the Company or the Warrant Agent, may deem and
treat the registered owner hereof as the absolute owner of the Warrants
evidenced hereby (notwithstanding any notation of ownership or other writing
hereon) for any purpose whatsoever, and as the person entitled to exercise the
rights represented by the Warrants evidenced hereby, and neither the Company nor
the Warrant Agent, nor any agent of the Company or the Warrant Agent, shall be
affected by any notice to the contrary.
The Warrant Agent shall, in accordance with the Warrant Agreement, from
time to time register the transfer of this Global Warrant Certificate in its
records (which may be maintained electronically) to be maintained by it for that
purpose at the Warrant Agent's Office upon surrender hereof, duly endorsed, or
accompanied by a written instrument or instruments of transfer in form
satisfactory to the Warrant Agent, duly executed by the registered holder hereof
or by the duly appointed legal representative or duly authorized attorney
thereof, such signature to be guaranteed by a bank or trust company with a
correspondent office in The City of New York or by a member of a national
securities exchange. Upon any such registration of transfer, a new Global
Warrant Certificate shall be issued to the transferee.
Capitalized terms included herein but not defined herein have the
meanings assigned thereto in the Warrant Agreement.
The Warrant Agreement and the terms of the Warrants are subject to
amendment, as provided in the Warrant Agreement.
THIS GLOBAL WARRANT CERTIFICATE SHALL BE GOVERNED BY, AND INTERPRETED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ITS
CONFLICTS OF LAWS PRINCIPLES.
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IN WITNESS WHEREOF, Salomon Smith Barney Holdings Inc. has caused this
instrument to be duly executed.
Dated: September 29, 2000 SALOMON SMITH BARNEY HOLDINGS INC.
By:
-----------------------------
Name:
Title:
[Corporate Seal]
Attest:
------------------------
Assistant Secretary
Countersigned for authentication
purposes only as of the date
above written:
CITIBANK, N.A.
as Warrant Agent,
By:
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Authorized Officer
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