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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
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The Bear Stearns Companies Inc.
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(Exact Name of Registrant as Specified in its Charter)
Delaware 13-3286161
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(State of Incorporation (I.R.S. Employer
or Organization) Identification No.)
245 Park Avenue
New York, New York
(212) 272-2000 10167
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(Address and Telephone Number of (Zip Code)
Principal Executive Offices)
If this Form relates to the registration of a class of debt securities and
is effective upon filing pursuant to General Instruction A(c)(1) please
check the following box. [_]
If this Form relates to the registration of a class of debt securities and
is to become effective simultaneously with the effectiveness of a
concurrent registration statement under the Securities Act of 1933 pursuant
to General Instruction A(c)(2) please check the following box. [_]
Securities to be registered pursuant to Section 12(b) of the Act:
Title of Each Class Name of Each Exchange on Which
to be so Registered Each Class is to be Registered
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Nikkei 225 Index Strike Reset American Stock Exchange
Call Warrants
Expiring October , 1997
Securities to be registered pursuant to Section 12(g) of the Act:
NONE
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(Title of Class)
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ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED.
The Registrant hereby incorporates by reference the
description of the Nikkei 225 Index Strike Reset Call Warrants
registered hereby (the "Securities") as set forth in the following
documents previously filed or to be filed by the Registrant with the
Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended (the Securities Act"):
(1) the description set forth under the caption
"Description of Warrants," on pages 11 through 13 of the Registrant's
Registration Statement on Form S-3 (Registration No. 33-60065); and
(2) the description set forth under the caption
"Description of the Warrants" in the final Prospectus Supplement
relating to the Securities to be filed with the Commission pursuant to
Rule 424(b) under the Securities Act.
ITEM 2. EXHIBITS.
1.1 - Form of Warrant Agreement relating to the Nikkei 225
Index Strike Reset Call Warrants, among the Registrant, Chemical Bank,
as Warrant Agent, and Bear, Stearns & Co. Inc., as Determination
Agent.
NYFS04...:\25\22625\0273\1324\FRM0125L.240
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SIGNATURE
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Pursuant to the requirements of Section 12 of the Securities
Exchange Act of 1934, the registrant has duly caused this registration
statement to be signed on its behalf by the undersigned, thereto duly
authorized.
THE BEAR STEARNS COMPANIES INC.
Date: October 13, 1995 By: /s/ Samuel L. Molinaro, Jr.
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Name: Samuel L. Molinaro, Jr.
Title: Senior Vice President - Finance
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INDEX TO EXHIBITS
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Sequential
Exhibit No. Description Page No.
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1.1 Form of Warrant Agreement relating to the Nikkei
225 Index Strike Reset Call Warrants made among
the Registrant, Chemical Bank, as Warrant Agent,
and Bear Stearns & Co. Inc., as Determination
Agent.
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THE BEAR STEARNS COMPANIES INC.
and
CHEMICAL BANK, Warrant Agent
and
BEAR, STEARNS & CO. INC., Determination Agent
_________________
WARRANT AGREEMENT
dated as of October ______, 1995
Nikkei 225 Index Strike Reset Call Warrants
Expiring October ______, 1997
=================================================================
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TABLE OF CONTENTS
Page
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PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I
ISSUANCE OF WARRANTS AND FORM,
EXECUTION, DELIVERY AND REGISTRATION
OF WARRANT CERTIFICATES AND
GLOBAL WARRANT CERTIFICATE
SECTION 1.01. Issuance of Warrants . . . . . . . . . . . . . 1
SECTION 1.02. Form, Execution and Delivery of Warrant
Certificates . . . . . . . . . . . . . . . . . 2
SECTION 1.03. Warrant Certificates . . . . . . . . . . . . . 3
SECTION 1.04. Registration of Transfers and Exchanges . . . 3
SECTION 1.05. Mutilated or Missing Warrant
Certificates . . . . . . . . . . . . . . . . . 4
SECTION 1.06. Registered Holders . . . . . . . . . . . . . . 5
SECTION 1.07. Conversion Option . . . . . . . . . . . . . . 5
SECTION 1.08. Global Warrant Certificate . . . . . . . . . . 7
ARTICLE II
DURATION AND EXERCISE OF WARRANTS
SECTION 2.01. Duration of Warrants; Minimum Exercise
Amounts; Exercise Notice . . . . . . . . . . . 9
SECTION 2.02. Exercise, Valuation and Delivery
of Warrants . . . . . . . . . . . . . . . . . 11
SECTION 2.03. Automatic Exercise of Warrants; Exercise
upon an Extension Event, an Extraordinary
Event or an Exercise Limitation Event . . . . 23
SECTION 2.04. Limitation of Number of Exercisable
Warrants . . . . . . . . . . . . . . . . . . . 31
NYFS04...:\25\22625\0273\1324\AGR0125W.190
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SECTION 2.05. Covenant of the Company . . . . . . . . . . . 32
SECTION 2.06. Return of Money Held Unclaimed for
Two Years . . . . . . . . . . . . . . . . . . 32
SECTION 2.07. Return of Global Warrant Certificate . . . . . 32
ARTICLE III
OTHER PROVISIONS RELATING TO
RIGHTS OF WARRANTHOLDERS
SECTION 3.01. Warrantholder May Enforce Rights . . . . . . . 33
ARTICLE IV
WARRANTS ACQUIRED BY THE COMPANY;
PAYMENT OF TAXES
SECTION 4.01. Warrants Acquired by the Company . . . . . . . 33
SECTION 4.02. Payment of Taxes . . . . . . . . . . . . . . . 34
ARTICLE V
CONCERNING THE WARRANT AGENT
SECTION 5.01. Warrant Agent . . . . . . . . . . . . . . . . 34
SECTION 5.02. Conditions of Warrant Agent's
Obligations . . . . . . . . . . . . . . . . . 34
SECTION 5.03. Resignation and Appointment of Successor . . . 36
ARTICLE VI
MISCELLANEOUS
SECTION 6.01. Amendment . . . . . . . . . . . . . . . . . . 38
SECTION 6.02. Notices and Demands to the Company,
the Warrant Agent and the
Determination Agent . . . . . . . . . . . . . 39
SECTION 6.03. Addresses for Notices . . . . . . . . . . . . 39
SECTION 6.04. Notices to Holders . . . . . . . . . . . . . . 39
SECTION 6.05. Obtaining of Approvals . . . . . . . . . . . . 39
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SECTION 6.06. Persons Having Rights Under
This Agreement . . . . . . . . . . . . . . . . 39
SECTION 6.07. Inspection of Agreement . . . . . . . . . . . 40
SECTION 6.08. Headings . . . . . . . . . . . . . . . . . . . 40
SECTION 6.09. Counterparts . . . . . . . . . . . . . . . . . 40
SECTION 6.10. Applicable Law . . . . . . . . . . . . . . . . 40
TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . 40
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . 40
EXHIBIT A - Form of Warrant Certificate
EXHIBIT A-1 - Form of Global Warrant Certificate
EXHIBIT A-2 - Exercise Notice For Warrants Represented by the
Certificate
EXHIBIT B - Confirmation of Exercise For Warrants Represented
by Warrant Certificates
EXHIBIT B-1 - Notice of Rejection of Exercise Notice for
Warrants Represented by Warrant Certificates
EXHIBIT B-2 - Confirmation of Exercise For Warrants Represented
by the Global Warrant Certificate
EXHIBIT B-3 - Notice of Rejection of Exercise Notice for
Warrants Represented by the Global Warrant
Cetificate
EXHIBIT C-1 - Notice of Rejection Relating to Limit Option For
Warrants Represented by Warrant Certificates
EXHIBIT C-2 - Notice of Rejection Relating to Limit Option For
Warrants Represented by the Global Warrant
Certificate
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WARRANT AGREEMENT
THIS AGREEMENT, dated as of October ______, 1995, among
THE BEAR STEARNS COMPANIES INC., a corporation organized and
existing under the laws of the State of Delaware (the "Company"),
CHEMICAL BANK, a New York banking corporation (the "Warrant
Agent") and BEAR, STEARNS & CO. INC., a corporation organized and
existing under the laws of the State of Delaware (the
"Determination Agent").
WHEREAS, the Company proposes to sell from time to time
Nikkei 225 Index Strike Reset Call Warrants (the "Warrants" or,
individually, a "Warrant") representing the right to receive from
the Company on exercise (including automatic exercise) an amount
in U.S. Dollars equal to the Cash Settlement Value (as defined
below) determined by reference to increases in the Nikkei 225
Index (as defined herein) or, if a Substitute Index (as defined
herein) is substituted for the Nikkei 225 Index, such Substitute
Index, on the terms and conditions set forth in this Agreement;
and
WHEREAS, 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, transfer and exercise of
the Warrants, and the Company desires to set forth herein, among
other things, the provisions of the Warrants and the terms and
conditions on which they may be issued, transferred, exercised
and cancelled;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
ISSUANCE OF WARRANTS AND FORM,
EXECUTION, DELIVERY AND REGISTRATION
OF WARRANT CERTIFICATES AND
GLOBAL WARRANT CERTIFICATE
SECTION 1.01. Issuance of Warrants. (a) The Warrants
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are unsecured contractual obligations of the Company and will
rank on a parity with the Company's other unsecured contractual
obligations and with the Company's unsecured and unsubordinated
debt.
(b) Each Warrant entitles a registered or beneficial
holder (each a "Warrantholder") to receive upon exercise
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(including automatic exercise), subject to the provisions
contained herein, the Cash Settlement Value or the Alternative
Settlement Amount, as the case may be (each as defined herein),
of such Warrant. A Warrant will not require or entitle a
Warrantholder to purchase or take delivery from the Company of
any shares of any component stocks of the Nikkei 225 Index or, in
the case of the substitution of a Substitute Index for the Nikkei
225 Index, the Substitute Index or any Successor Index to either
the Nikkei 225 Index or the Substitute Index, as the case may be
(the "Underlying Stocks"), or any other securities. Upon
exercise of a Warrant, the Company will make only a U.S. Dollar
cash payment in the amount of the Cash Settlement Value or
Alternative Settlement Amount, if any and as applicable, of such
Warrant. The Company is under no obligation to, nor will it,
sell or deliver to any Warrantholder any shares of any of the
Underlying Stocks or any other securities in connection with the
exercise of any Warrants. Warrantholders will not receive any
interest on any Cash Settlement Value or Alternative Settlement
Amount, and the Warrants will not entitle the Warrantholders to
any of the rights of holders of any of the Underlying Stocks or
any other securities.
SECTION 1.02. Form, Execution and Delivery of Warrant
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Certificates. (a) The Warrants, whenever issued, shall be
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represented by certificates in registered form substantially in
the form set forth in Exhibit A hereto (the "Warrant
Certificates"), with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted
by this Agreement, and may represent any whole number of
Warrants. The Warrant Certificates may have imprinted or
otherwise reproduced thereon such letters, numbers or other marks
of identification or designation and such legends or endorsements
as the officers of the Company executing the same may approve
(execution thereof to be conclusive evidence of such approval)
and which are not inconsistent with the provisions of this
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 any self-regulatory organization (an "SRO") on
which the Warrants may be listed, or of any securities
depository, or to conform to usage. Warrant Certificates shall
be signed on behalf of the Company by its chairman, its
president, its chief financial officer, its treasurer or one of
its managing directors and attested by its secretary or an
assistant secretary. The signature of any of such officers may
be either manual or facsimile. Typographical and other minor
errors or defects in any such signature shall not affect the
validity or enforceability of any Warrant Certificate that has
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been duly countersigned and delivered by the Warrant Agent.
(b) In case any officer of the Company who shall have
signed a Warrant Certificate, either manually or by facsimile
signature, shall cease to be such officer before such Warrant
Certificate shall have been countersigned and delivered by the
Warrant Agent to the Company or delivered by the Company, such
Warrant Certificate nevertheless may be countersigned and
delivered as though the person who signed such Warrant
Certificate had not ceased to be such officer of the Company; and
the Warrant Certificate may be signed on behalf of the Company by
any person who, at the actual date of the execution of such
Warrant Certificate, shall be a proper officer of the Company to
sign such Warrant Certificate, although at the date of the
execution of this Warrant Agreement any such person was not such
officer.
SECTION 1.03. Warrant Certificates. Each Warrant
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Certificate, when executed on behalf of the Company in accordance
with Section 1.02, shall be delivered to the Warrant Agent, which
shall manually countersign and deliver the same to or upon the
order of the Company. After the initial original issuance of
Warrants hereunder, additional Warrant Certificates may be issued
on original issuance upon two (2) New York Business Days (as
defined herein) prior notice to the Warrant Agent. Each Warrant
Certificate shall be dated the date of its countersignature. A
Warrant Certificate shall not be valid for any purpose, and no
Warrant evidenced thereby shall be exercisable, unless and until
such Warrant Certificate has been countersigned by the manual
signature of an authorized officer of the Warrant Agent. Such
countersignature by an authorized officer of the Warrant Agent
upon any Warrant Certificate signed by the Company in accordance
with Section 1.02 shall be conclusive evidence that the Warrant
Certificate so countersigned has been duly issued hereunder.
SECTION 1.04. Registration of Transfers and Exchanges.
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(a) Except as otherwise provided herein or in the Warrant
Certificate, the Warrant Agent shall from time to time register
the transfer of any outstanding Warrant Certificates upon the
records to be maintained by it for that purpose (the "Warrant
Register") at the Warrant Agent's Office (as defined herein),
subject to such reasonable regulations as the Company or the
Warrant Agent may prescribe, upon surrender thereof at the
Warrant Agent's Window (as defined herein), Attention: Transfer
Department, duly endorsed by, or accompanied by a written
instrument or instruments of transfer in form satisfactory to the
Warrant Agent and the Company duly executed by, the Registered
Holder(s) (as defined herein) thereof or by the duly appointed
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legal representative thereof or by a duly authorized attorney,
such signature to be guaranteed by a bank or trust company with a
correspondent office in The City of New York or by a broker or
dealer which is a member of the National Association of
Securities Dealers, Inc. (the "NASD") or by a member of a
national securities exchange. Upon any such registration of
transfer, a new Warrant Certificate shall be issued to the
transferee(s) and the surrendered Warrant Certificate shall be
cancelled by the Warrant Agent.
(b) At the option of a Warrantholder, unexercised
Warrant Certificates may be exchanged for other Warrant
Certificates, representing a like number of Warrants, upon
surrender to the Warrant Agent of the Warrant Certificates to be
exchanged at the Warrant Agent's Window, Attention: Transfer
Department. The "Warrant Agent's Window" shall be the window of
the Warrant Agent maintained for purposes of transfer and tender
in the Borough of Manhattan, The City of New York or at the
address of any successor Warrant Agent (as provided in Section
5.03) and which is, on the date of this Agreement, Chemical
Bank/Geoserve, Corporate Trust Securities Window, 55 Water
Street, Room 234, North Building, New York, New York 10041,
Attention: Tender Department. Upon surrender of any unexercised
Warrant Certificate for exchange, the Warrant Agent shall cancel
such Warrant Certificate, and the Company shall execute, and the
Warrant Agent shall countersign and deliver, in accordance with
Sections 1.02 and 1.03, one or more new Warrant Certificates of
like tenor and representing a like number of unexercised
Warrants.
(c) Warrant Certificates issued upon transfer or
exchange pursuant to Section 1.04(a) or (b) shall be valid
obligations of the Company, evidencing the same obligations of
the Company as the Warrant Certificates surrendered for transfer
or exchange, and entitled to the same benefits under this
Agreement as were such Warrant Certificates prior to such
surrender.
(d) Except as provided in Section 1.05, no service
charge shall be made for any registration of transfer or exchange
of Warrant Certificates, but the Company may require payment of a
sum sufficient to cover any tax or other governmental charge that
may be imposed in connection with any registration of transfer or
exchange of Warrant Certificates, other than exchanges pursuant
to this Section 1.04 not involving any transfer.
(e) In the event that upon any exercise of Warrants
evidenced by a Warrant Certificate the number of Warrants
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exercised shall be less than the total number of Warrants
evidenced by such Warrant Certificate, there shall be issued to
the Registered Holder thereof or his assignee a new Warrant
Certificate evidencing the number of Warrants not exercised.
SECTION 1.05. Mutilated or Missing Warrant
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Certificates. (a) If any Warrant Certificate is mutilated,
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lost, stolen or destroyed, the Company may in its discretion
execute, and the Warrant Agent may countersign and deliver, in
exchange and substitution for, and upon cancellation of, the
mutilated Warrant Certificate, or in replacement of the Warrant
Certificate lost, stolen or destroyed, a new Warrant Certificate
of like tenor and representing an equivalent number of Warrants,
bearing an identification number not contemporaneously
outstanding, but only (in case of loss, theft or destruction)
upon receipt of evidence satisfactory to the Company and the
Warrant Agent of such loss, theft or destruction of such Warrant
Certificate and security or indemnity, if requested, also
satisfactory to them. Applicants for such substitute Warrant
Certificates shall also comply with such other reasonable
regulations and pay such other reasonable charges as the Company
or the Warrant Agent may prescribe.
(b) In case any such mutilated, lost, stolen or
destroyed Warrant Certificate has been or is about to be
exercised, or deemed to be exercised, the Company in its absolute
discretion may, instead of issuing a new Warrant Certificate,
direct the Warrant Agent to treat the same as if it had received
the Warrant Certificate together with an irrevocable Exercise
Notice (as defined herein) in proper form in respect thereof, as
provided herein, or as being subject to automatic exercise, as
the case may be.
(c) Each new Warrant Certificate issued pursuant to
this Section 1.05 in lieu of any lost, stolen or destroyed
Warrant Certificate shall be an original, additional contractual
obligation of the Company, and shall be entitled to the same
benefits under this Agreement as the Warrant Certificate that was
lost, stolen or destroyed.
(d) Upon the issuance of any new Warrant Certificate
in accordance with this Section 1.05, the Company may require the
payment of a sum sufficient to cover any tax or other govern-
mental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Warrant
Agent) connected therewith.
(e) The provisions of this Section 1.05 are exclusive
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and shall preclude (to the extent lawful) any other rights and
remedies with respect to the replacement or payment of mutilated,
lost, stolen or destroyed Warrant Certificates.
SECTION 1.06. Registered Holders. Prior to due
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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 person in whose name a Warrant Certificate
shall be registered in the Warrant Register (a "Registered
Holder") as the absolute owner of the Warrants evidenced thereby
(notwithstanding any notation of ownership or other writing on
the Warrant Certificate) for any purpose whatsoever, and as the
person entitled to exercise the rights represented by the
Warrants evidenced thereby, 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. This Section
1.06 shall be without prejudice to the rights of Warrantholders
as described elsewhere herein.
SECTION 1.07. Conversion Option. (a) Commencing on
-----------------
the one hundred eightieth calendar day following October __,
1995, each Warrantholder will have the option (the "Conversion
Option") to convert the form in which such Warrantholder holds
his Warrants from definitive to book-entry form. The Company
shall notify each Warrantholder as soon as practicable after the
initial original issuance of the Warrants (i) that Warrant
Certificates (as defined herein) must be delivered to an entity
(a "Participant") entitled to execute, clear and settle
transactions through The Depository Trust Company, New York, New
York (the "Depository", which term, as used herein, includes any
successor securities depository selected by the Company) in
proper form for deposit in order for Warrants to be converted
into book-entry form, (ii) the date on which such conversions
will commence (which shall be such 180th calendar day (the
"Initial Conversion Date"), (iii) the date on which such
conversions will end (which date shall be the forty-fifth
calendar day after the Initial Conversion Date (the "Final
Conversion Date")) and (iv) the CUSIP number assigned to the
Warrants. The Warrant Agent, at the request and expense of the
Company and on behalf of the Company, shall mail such notice to
each Warrantholder. The period from the Initial Conversion Date
to and including the Final Conversion Date is referred to herein
as the "Conversion Option Period". Warrants in book-entry form
shall not be exchangeable for Warrant Certificates, except as
provided herein.
(b) During the Conversion Option Period, the
Depository will credit the account of each Participant that
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deposits Warrant Certificates with the quantity of Warrants
evidenced by such Warrant Certificates either by the close of
business on the New York Business Day on which such Warrant
Certificates are deposited (if received by the Depository by its
then applicable cut-off time for same-day credit) or on the
following New York Business Day (if received by the Depository by
its then applicable cut-off time for next-day credit), all in
accordance with the provisions of the Letter of Representations
relating to the Warrants, among the Company, the Warrant Agent
and the Depository (the "Representations Letter").
(c) As more fully described in the Representations
Letter, the Depository will deliver daily to the Warrant Agent
Warrant Certificates deposited at the Depository on the previous
New York Business Day. If the Warrant Agent accepts such Warrant
Certificates for conversion, it shall promptly cancel such
Warrant Certificates, debit the accounts of the Warrantholders
registered on its books, and credit the account of the Depository
with the aggregate quantity of Warrants evidenced by the
cancelled Warrant Certificates. On the first day during the
Conversion Option Period that the Warrant Agent credits Warrants
to the Depository's account, the Warrant Agent shall countersign
a global certificate evidencing such Warrants (the "Global
Warrant Certificate") in the manner provided herein. On each
subsequent day during the Conversion Option Period that the
Warrant Agent credits Warrants to the Depository's account, the
Warrant Agent may (i) as provided in the Fast Automated
Securities Transfer Balance Certificate Agreement between
Chemical Bank and the Depository (the "FAST Agreement"),
countersign a new Global Warrant Certificate or (ii) endorse the
existing Global Warrant Certificate to evidence the increased
quantity of Warrants credited to the Depository's account. If
the Warrant Agent countersigns a new Global Warrant Certificate,
it shall cancel the existing Global Warrant Certificate. Only
one Global Warrant Certificate evidencing Warrants credited to
the Depository's account shall be outstanding at any time.
(d) If (i) the Depository is at any time unwilling or
unable to continue as securities depository for the Warrants and
a successor Depository is not appointed by the Company within 90
days, or (ii) the Company shall be adjudged a bankrupt or
insolvent or make an assignment for the benefit of its creditors
or institute proceedings to be adjudicated a bankrupt or shall
consent to the filing of a bankruptcy proceeding against it, or
shall file a petition or answer or consent seeking reorganization
under Federal bankruptcy laws or any other similar applicable
Federal or State law, or shall consent to the filing of any such
petition, or shall consent to the appointment of a receiver or
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custodian of all or any substantial part of its property, or
shall admit in writing its inability to pay or meet its debts as
they mature, or if a receiver or custodian of it or all or any
substantial part of its property shall be appointed, or if a
public officer shall have taken charge or control of the Company
or of its property or affairs, for the purpose of rehabilitation,
conservation or liquidation, the Company will reissue Warrant
Certificates in exchange for the Global Warrant Certificate
registered in the names provided by the Depository to the Warrant
Agent in writing. In addition, the Company may at any time
determine not to have the Warrants represented by a Global
Warrant Certificate and, in such event, will issue Warrant
Certificates in exchange for the Global Warrant Certificate
registered in the names provided by the Depository to the Warrant
Agent in writing. In any such instance, and in accordance with
the provisions of this Agreement, each Warrantholder will be
entitled to have a number of Warrants equivalent to such
Warrantholder's beneficial interest in the Global Warrant
Certificate registered in the name of the Warrantholder and will
be entitled to physical delivery of such Warrants in definitive
form. The provisions of Section 1.08 shall apply only if and
when the Conversion Option is utilized and a Global Warrant
Certificate is issued hereunder. Unless the context shall
otherwise require, and subject to the provisions of Section 1.08,
all references in this Agreement to the Warrant Certificates
(other than in Sections 1.02, 1.03, 1.04 and 1.08) shall include
the Global Warrant Certificate in the event that the Global
Warrant Certificate is issued.
SECTION 1.08. Global Warrant Certificate. (a) Any
--------------------------
Global Warrant Certificate issued in accordance with this
Section 1.08 shall be substantially in the form set forth in
Exhibit A-1 hereto, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted
by this Agreement, and may represent any number of whole
Warrants. Each Global Warrant Certificate may have imprinted or
otherwise reproduced thereon such letters, numbers or other marks
of identification or designation and such legends or endorsements
as the officers of the Company executing the same may approve
(execution thereof to be conclusive evidence of such approval)
and which are not inconsistent with the provisions of this
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 any stock exchange on which the Warrants may be
listed or of any securities depository referred to herein, or to
conform to usage. Each Global Warrant Certificate shall be
signed on behalf of the Company upon the same conditions, in
substantially the same manner and with the same effect as the
Warrant Certificates.
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(b) The Warrant Agent is authorized, from time to time
during the Conversion Option Period, upon receipt of a Global
Warrant Certificate from the Company, duly executed on behalf of
the Company, to countersign such Global Warrant Certificate. The
Global Warrant Certificate shall be manually countersigned and
dated the date of its countersignature by the Warrant Agent and
shall not be valid for any purpose unless so countersigned. The
Warrant Agent shall deliver the Global Warrant Certificate to or
upon the order of the Depository against receipt of an appro-
priate amount of Definitive Warrants (as defined herein) (such
Definitive Warrants shall be disposed of in accordance with
instructions provided by the Company). One or more Global
Warrant Certificates may be executed by the Company and delivered
to the Warrant Agent on or after the date of execution of this
Agreement; provided that only one Global Warrant Certificate
shall be outstanding at any one time.
The Company reserves the right to issue, from time to
time after the date of execution of this Agreement, additional
Warrants, and in connection therewith the Global Warrant
Certificate may be exchanged for a new Global Warrant Certificate
to reflect the issuance by the Company of such additional
Warrants. To effect such an exchange the Company shall deliver
to the Warrant Agent a new Global Warrant Certificate duly
executed on behalf of the Company as provided in Section 1.02.
The Warrant Agent shall countersign the new Global Warrant
Certificate as provided in this Section and shall deliver the new
Global Warrant Certificate to the Depository in exchange for, and
upon receipt of, the Global Warrant Certificate then held by the
Depository. The Warrant Agent shall cancel the Global Warrant
Certificate delivered to it by the Depository, dispose of such
Global Warrant Certificate and provide a certificate of
disposition to the Company.
(c) The Global Warrant Certificate will initially be
registered in the name of a nominee of the Depository. The
Warrant holdings of the Participants will be recorded on the
books of the Depository. The holdings of customers of the
Participants and the identity of the Warrantholders will be
reflected on the books and records of such Participants and will
not be known to the Warrant Agent, the Company or the Depository.
The Global Warrant Certificate will be held by the Depository or
its agent.
Neither the Company nor the Warrant Agent will have any
responsibility or liability for any aspect of the records
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relating to beneficial ownership interests in the Global Warrant
Certificate or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests.
The Company may from time to time select a new entity
to act as Depository with respect to the Warrants and, if such
selection is made, the Company shall promptly give the Warrant
Agent notice to such effect identifying the new Depository, and
the Global Warrant Certificate shall be delivered to the Warrant
Agent and shall be transferred to the new Depository as provided
below as promptly as possible. Appropriate changes may be made
in the forms of the Global Warrant Certificate, the Exercise
Notice and the related notices to be delivered in connection with
an exercise to reflect the selection of the new Depository.
(d) Except as otherwise provided herein or in the
Global Warrant Certificate, the Warrant Agent shall from time to
time register the transfer of the Global Warrant Certificate in
its records (which may be maintained electronically), subject to
such reasonable regulations as the Company or the Warrant Agent
may prescribe, only to the Depository, to another nominee of the
Depository, to a successor Depository or to a nominee of a
successor Depository, upon surrender of such Global Warrant
Certificate, duly endorsed, or accompanied by a written
instrument or instruments of transfer in form satisfactory to the
Warrant Agent and the Company, duly executed by the Registered
Holder thereof or by the duly appointed legal representative
thereof, or by its duly authorized attorney. Such signature
shall be guaranteed by a bank or trust company with a
correspondent office in The City of New York or by a broker or
dealer which is a member of the NASD 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
and the surrendered Global Warrant Certificate shall be cancelled
by the Warrant Agent.
The Global Warrant Certificate may be transferred as
provided in paragraph (d) above, when surrendered to the Warrant
Agent's Window, Attention: Transfer Department, or at the address
of any successor Warrant Agent (as provided in Section 5.03), for
another Global Warrant Certificate of like tenor and representing
a like number of unexercised Warrants.
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ARTICLE II
DURATION AND EXERCISE OF WARRANTS
SECTION 2.01. Duration of Warrants; Minimum Exercise
--------------------------------------
Amounts; Exercise Notice. (a) Subject to the limitations set
------------------------
forth herein and in Sections 2.02 and 2.03, each Warrant may be
irrevocably exercised in whole but not in part, immediately upon
issuance. Subject to the limitations set forth herein and except
in the case of automatic exercise or following an Extension
Event, each Warrant shall be irrevocably exercised either (A) in
the case of Warrants represented by Warrant Certificates
("Definitive Warrants"), including Definitive Warrants held
through CEDEL (as defined herein) or Euroclear (as defined
herein), on any New York Business Day during the period from the
date of issuance until 3:00 P.M., New York City time, on the
earlier of (i) the New York Business Day immediately preceding
the Expiration Date (as defined below) and (ii) any Delisting
Date (as defined herein) by delivering or causing to be delivered
to the Warrant Agent (at the Warrant Agent's Window, Attention:
Tender Department) the Warrant Certificate representing such
Warrant, with the Exercise Notice duly completed and executed by
the Registered Holder of such Warrant (or in the case of
Definitive Warrants held through the facilities of CEDEL or
Euroclear, by an entity entitled to execute, clear and settle
transactions through CEDEL or Euroclear (a "CEDEL or Euroclear
Participant"), as the case may be) or (B) in the case of Warrants
represented by a Global Warrant Certificate ("Book-entry
Warrants"), on any New York Business Day during the period from
the Initial Conversion Date until 3:00 P.M., New York City time,
on the earlier of (i) the New York Business Day immediately
preceding the Expiration Date and (ii) any Delisting Date, by
causing (x) such Warrants to be transferred free to the Warrant
Agent on the records of the Depository in accordance with the
Depository's Deposit/Withdrawal at Custodian procedures, as
provided in the Representations Letter, and (y) a duly completed
and executed Exercise Notice to be received by the Warrant Agent
(the Warrant Agent's facsimile transmission number for such
purpose is (212) 946-7682) from a Participant, in the case of
Book-Entry Warrants held through the Depository, or a CEDEL or
Euroclear Participant, in the case of such Warrants held through
CEDEL or Euroclear, acting, directly or indirectly, on behalf of
the Warrantholder (such form of Exercise Notice may be obtained
from the Warrant Agent); provided, however, that Exercise Notices
are subject to rejection by the Warrant Agent as provided herein.
The "Expiration Date" shall be October ______, 1997. Neither the
Warrant Agent nor the Determination Agent will be responsible for
any losses resulting from a failure of a brokerage firm, a
Participant or a CEDEL or Euroclear Participant to properly
exercise Warrants on behalf of a Warrantholder.
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(b) No fewer than 500 Warrants may be exercised by or
on behalf of any one Warrantholder at any one time, except that
no such minimum exercise amount shall apply in the case of
automatic exercise on or following the Expiration Date or on any
Delisting Date, or in the case of cancellation of the Warrants as
a result of an Extraordinary Event (as defined herein). A
Warrantholder shall not combine Definitive Warrants and Book-
entry Warrants or Book-entry Warrants held through more than one
Participant to meet the 500 Warrant minimum exercise requirement
provided herein. With the exception of the Limit Option, an
Exercise Notice shall be unconditional. Except as provided in
Section 2.02(c), the Warrant Agent shall be entitled, with no
duty of inquiry, to rely conclusively on any Exercise Notice
received by it and on any representation of the exercising
Warrantholder contained therein.
(c) "Exercise Notice" means an irrevocable notice of
exercise to the Warrant Agent at the Warrant Agent's Window,
Attention: Tender Department (or by facsimile transmission in
accordance with Section 2.01(a)(B)(y) in the case of Exercise
Notices for Book-entry Warrants), which notice (A) for Definitive
Warrants, shall be on the reverse of the Warrant Certificate or
such other form as the Company and the Warrant Agent may approve
and (B) for Book-entry Warrants, shall be substantially in the
form set forth in Exhibit A-2 hereto or such other form as the
Company and the Warrant Agent may approve and may be given by
facsimile transmission.
SECTION 2.02. Exercise, Valuation and Delivery of
-----------------------------------
Warrants. (a) Except for Warrants subject to automatic
--------
exercise, or Warrants subject to the Limit Option or following an
Extension Event, the "Exercise Date" for a Warrant will be (A) in
the case of Warrants other than those held through the facilities
of Cedel Societe Anonyme ("CEDEL") or Euroclear System
("Euroclear") (i) the New York Business Day on which the Warrant
Agent receives at the Warrant Agent's Window, Attention: Tender
Department, the Warrant Certificate (or transfer of such Warrant
through the Depository in the case of Book-entry Warrants) and
Exercise Notice (by facsimile transmission in accordance with
Section 2.01(a)(B)(y) in the case of Exercise Notices for Book-
entry Warrants) 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
Certificate (or transfer of such Warrant through the Depository
in the case of Book-entry Warrants) or Exercise Notice after 3:00
P.M., New York City time, on a New York Business Day, then the
New York Business Day next succeeding the New York Business Day
on which such Warrant or Exercise Notice is received (B) in the
case of Warrants held through the facilities of CEDEL or
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Euroclear, (i) the New York Business Day on which the Warrant
Agent receives the Exercise Notice in proper form with respect to
such Warrant Certificate (or transfer of such Warrant through the
Depository in the case of Book-entry Warrants) 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 Certificate (or transfer
of such Warrant through the Depository) is received by the
Warrant Agent by 3:00 P.M., New York City time, on the Valuation
Date, or (ii) if the Warrant Agent receives such Exercise Notice
after 3:00 P.M., New York City time, on a New York Business Day,
then the New York Business Day next succeeding such New York
Business Day, provided that the Warrant Certificate (or transfer
of such Warrant through the Depository in the case of Book-entry
Warrants) is received by 3:00 P.M., New York City time, on the
Valuation Date relating to exercises of Warrants on such
succeeding New York Business Day; provided, further, however, in
the case of exercises by Euroclear Participants, Euroclear must
by facsimile to the Warrant Agent by 9:00 a.m., New York City
time, on the Valuation Date confirm that the Warrants will be
received by the Warrant Agent on such date, provided, that if
such facsimile is received after 9:00 a.m., New York City time
(the "Euroclear Confirmations"), on the Valuation Date, the
Company will be entitled to direct the Warrant Agent to reject
the related notice of exercise or waive the requirement for
timely delivery of such facsimile. In the event that the Warrant
Certificate (or transfer of such Warrant through the Depository
in the case of Book-entry Warrants) 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 New York Business Day, the next
succeeding New York Business Day.
(b) The "Valuation Date" for a Warrant shall be the
first Index Calculation Day (as defined herein) following the
applicable Exercise Date (subject to postponement upon the
occurrence of an Extraordinary Event or Exercise Limitation Event
(as defined herein) or as a result of the exercise of a number of
Warrants exceeding the limits on exercise set forth herein. For
purposes of this Agreement, "Index Calculation Day" means any day
the Nikkei 225 Index (or if a Substitute Index has been
substituted for the Nikkei 225 Index, such Substitute Index) or
any Successor Index (as defined herein) is calculated and
published.
(c) The Warrant Agent shall, in the case of Warrants
other than Warrants held through CEDEL or Euroclear, following
receipt of proper and timely delivery of a Warrant in accordance
with Section 2.02(a)(A) accompanied by a completed Exercise
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Notice and, in the case of Warrants held through CEDEL or
Euroclear, following receipt of proper delivery of a completed
Exercise Notice in accordance with Section 2.02(a)(B):
(i) promptly (1) for Definitive Warrants not held
through CEDEL or Euroclear, determine whether such Exercise
Notice has been duly completed and is in proper form duly
executed by the Registered Holder thereof or by the duly
appointed legal representative thereof or by a duly
authorized attorney, (2) for Definitive Warrants held
through CEDEL or Euroclear, determine whether such Exercise
Notice has been duly completed and is in proper form duly
executed by the CEDEL or Euroclear Participant tendering
such Warrant, as applicable, (3) for Book-entry Warrants not
held through CEDEL or Euroclear, determine whether such
Exercise Notice has been duly completed and is in proper
form (4) for Book-Entry Warrants held through CEDEL or
Euroclear, determine whether such Exercise Notice has been
duly completed and is in proper form duly executed by the
CEDEL or Euroclear Participant tendering such Warrant, as
applicable; and if the Warrant Agent determines that the
Exercise Notice has not been duly completed or is not in
proper form or, in the case of Definitive Warrants, has not
been so executed, the Warrant Agent (A) promptly shall
reject such Exercise Notice and shall send to the entity
that executed such Exercise Notice a notice of rejection
substantially in the form set forth in Exhibit B or Exhibit
B-1 hereto, as the case may be, and, in the case of
Definitive Warrants, shall return to the Registered Holder
that submitted such Exercise Notice, by first class mail,
the Warrant Certificates evidencing such Warrants (to the
extent received in the case of Warrants held through CEDEL
or Euroclear), or, in the case of Book-entry Warrants, shall
re-deliver such Warrants (to the extent received in the case
of Warrants held through CEDEL or Euroclear) free through
the facilities of the Depository to the account from which
they were transferred to the Warrant Agent and (B) in either
case, shall not take the actions required by clauses (ii)-
(vii) below with respect to such Exercise Notice or the
related Warrants; provided, however, that the Warrant Agent
shall deliver a copy of the Exercise Notice relating to such
Warrants to the Company as required by Section 2.02(c)(vii)
below and the Company may waive any defect in the form of
such Exercise Notice;
(ii) notify the Company and the Determination Agent
(and such other parties (not to exceed two) as the Company
shall designate in writing) by 5:00 P.M., New York City
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time, on the New York Business Day that such Exercise Notice
has been received (or shall be deemed to have been received)
of (A) the total number of Warrants covered by such Exercise
Notice, (B) the number of such Warrants subject to the Limit
Option (as defined herein) ("Contingently Tendered
Warrants") and (C) the number of such Warrants not subject
to the Limit Option;
(iii) with respect to Warrants held through Euroclear,
determine whether the Warrant Agent has received by 9:00
a.m., New York City time, on the Valuation Date relating to
such Warrants, Euroclear Confirmations with respect to such
Warrants, and if the Warrant Agent has not received any such
Euroclear Confirmations by such time, notify the Company
(and such other parties (not to exceed two) as the Company
shall designate in writing) by 10:00 a.m., New York City
time, on such Valuation Date (or if the Valuation Date is
not a New York Business Day on the next succeeding New York
Business Day) of the number of such Warrants in respect of
which the Warrant Agent has not received such Euroclear
Confirmations and (except to the extent the Company has
notified the Warrant Agent that it has waived the timing
requirement of timely delivery of such Euroclear
Confirmation) send to the Euroclear Participant that
executed such Exercise Notice for which no related Euroclear
Confirmation was received (at the address specified in such
notice) a notice of rejection substantially in the form set
forth in Exhibit B or Exhibit B-1 hereto, as the case may
be;
(iv) if any of the Warrants covered by such Exercise
Notice constitute Contingently Tendered Warrants, by 12:00
Noon, New York City time, on the Valuation Date, or if such
date is not a New York Business Day, then the next succeed-
ing New York Business Day, (A) except as provided in Section
2.02(j)(i), determine the Limit Option Reference Index (as
defined herein) for such Warrants (based on the applicable
Limit Option Reference Index provided by the Determination
Agent pursuant to Section 2.02(g)); (B) determine in
accordance with Section 2.02(j) (based on the applicable
Spot Nikkei 225 Index provided by the Determination Agent
pursuant to 2.02(g)) whether such Contingently Tendered
Warrants will be subject to exercise after giving effect to
the Limit Option and, if such Warrants will not be subject
to exercise, send, in the case of Definitive Warrants, to
the Registered Holder (or the entity that executed the
Exercise Notice, in the case of Definitive Warrants held
through CEDEL or Euroclear) or, in the case of Book-entry
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Warrants to the Participant, that submitted such Exercise
Notice a notice of rejection substantially in the form set
forth in Exhibit C-1 or Exhibit C-2 hereto, as appropriate,
with respect to such Warrants and return to the Registered
Holder (to the extent received in the case of Warrants held
through CEDEL or Euroclear) that submitted such Exercise
Notice, by first class mail, the Warrant Certificates
evidencing such Warrants (to the extent received in the case
of Warrants held through CEDEL or Euroclear), or, in the
case of Book-entry Warrants (to the extent received in the
case of Warrants held through CEDEL or Euroclear), redeliver
the Warrants free through the facilities of the Depository
to the account of such Participant; and (C) notify the
Company and the Determination Agent as to whether such
Contingently Tendered Warrants will be subject to exercise;
(v) by 12:00 Noon, New York City time, on the
Valuation Date or if such date is not a New York Business
Day, then the next succeeding New York Business Day,
(A) determine the sum of (1) the number of such Warrants not
subject to the Limit Option (i.e., the number of Warrants
determined pursuant to clause (ii)(C) above) plus (2) the
number of such Warrants that are Contingently Tendered
Warrants that will be subject to exercise notwithstanding
the Limit Option (i.e., the number of Warrants so identified
pursuant to clause (iv)(B) above) (all of such Warrants, the
"Exercised Warrants") and (B) notify the Company and the
Determination Agent of the total number of Exercised
Warrants so determined (if such number is zero, the Warrant
Agent shall not take the actions required by clauses (vi),
(vii) and (viii) of this Section 2.02(c) with respect to
such Exercise Notice or the related Warrants);
(vi) by 10:00 A.M., New York City time, on the New York
Business Day next succeeding the Valuation Date (unless the
Cash Settlement Value shall be calculated by the Determina-
tion Agent) determine the Cash Settlement Value of the
Exercised Warrants based on the Spot Nikkei 225 Index values
provided by the Determination Agent pursuant to Section
2.02(g) and in the manner set forth in Section 2.02(e);
(vii) notify the Company (and such other parties (not to
exceed two) as the Company shall designate in writing) by
12:00 noon, New York City time, on the New York Business Day
next succeeding the Valuation Date of the aggregate Cash
Settlement Value payable in respect of the Exercised
Warrants (unless the Cash Settlement Value shall be
calculated by the Determination Agent), and send notices of
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confirmation substantially in the form included in Exhibit B
or Exhibit B-1 hereto, as the case may be, to the Registered
Holder (or the entity that executed the Exercise Notice, in
the case of Definitive Warrants held through CEDEL or
Euroclear) or Participant; and
(viii) promptly deliver a copy of each Exercise Notice to
the Company and advise the Company of such other matters
relating to the Exercised Warrants as the Company shall
reasonably request. Any notice to be given to the Company
by the Warrant Agent pursuant to this Section 2.02 or
Section 2.03 shall be by telephone (promptly confirmed in
writing) or facsimile transmission.
Except in the case of Warrants subject to automatic
exercise, Warrants that upon exercise entitle the holder thereof
to receive an Alternative Settlement Amount and Warrants deemed
worthless following an Extension Event, if on any Valuation Date
the Cash Settlement Value for any Warrants then exercised would
be zero, then the attempted exercise of any such Warrants shall
be void and of no effect and (i) for Definitive Warrants, the
Warrant Certificate evidencing such Warrants (to the extent
received in the case of Warrants held through CEDEL or Euroclear)
shall be promptly returned by the Warrant Agent to the Registered
Holder (or the entity that executed the Exercise Notice, in the
case of Definitive Warrants held through CEDEL or Euroclear) by
first class mail at the Company's expense or (ii) for Book-entry
Warrants, the Warrants will be transferred by the Warrant Agent
back to the Participant that submitted them free on the records
of the Depository (to the extent received in the case of Warrants
held through CEDEL or Euroclear) and, in either case such
Warrantholder shall be permitted to re-exercise such Warrants
prior to the Expiration Date or any Delisting Date, as the case
may be.
(d) Except for Warrants subject to automatic exercise,
Warrants that upon exercise entitle the holder thereof to receive
an Alternative Settlement Amount and Warrants deemed worthless
following an Extension Event, if the Company has made adequate
New York Clearing House or next day funds available to the
Warrant Agent in a timely manner, which shall in no event be
later than 3:00 P.M., New York City time, on the fourth New York
Business Day following a Valuation Date (or, if the Valuation
Date is not a New York Business Day, on the fourth New York
Business Day following the New York Business Day next succeeding
the Valuation Date) (the "Funding Date"), the Warrant Agent will
be responsible for making its payment available (i) for Defini-
tive Warrants, to each Registered Holder of an Exercised Warrant
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in the form of a cashier's check or an official bank check, or
(in the case of payments of at least $100,000) by wire transfer
to a U.S. Dollar account maintained by such Registered Holder in
the United States (at such Registered Holder's election as
specified in the applicable Exercise Notice) prior to the close
of business on the first New York Business Day immediately
succeeding such Funding Date (the "Settlement Date") or (ii) for
Book-entry Warrants, to each appropriate Participant in the form
of a cashier's check or an official bank check, or (in the case
of payments of at least $100,000) by wire transfer to a U.S.
Dollar account maintained by such Participant in the United
States (at the Participant's election as specified in the
Exercise Notice) prior to the close of business on the Settlement
Date. For either clause (i) or (ii) above, such payment shall be
in the amount of the aggregate Cash Settlement Value in respect
of the Warrant Certificates or Warrants that were delivered to
the Warrant Agent (together with the related Exercise Notice) as
provided in Sections 2.01 and 2.02(a), (b) and (c). Each
Participant will be responsible for disbursing such payments to
the Warrantholders that it represents and to each brokerage firm
for which it acts as agent.
(e) Except in the case of the substitution of a
Substitute Index for the Nikkei 225 Index, the "Cash Settlement
Value" of an Exercised Warrant will be an amount in U.S. Dollars
equal to the greater of (i) zero and (ii) the quotient (rounded
down to the nearest cent) of (A) the amount, if any, by which the
Spot Nikkei 225 Index for the applicable Valuation Date for such
Warrant exceeds the Strike Level (as defined herein), divided by
(B) the product of 6.0 and the fixed Japanese Yen/U.S. Dollar
exchange rate of Yen ___ per U.S. $1.00. The Cash Settlement
Value is calculated using the following formula:
Cash Settlement Value = the greater of
(i) $0 and (ii) $1 x (Spot Nikkei 225 Index -- Strike Level)
-------------------------------------
6 x (Yen __/U.S. $1.00)
The "Strike Level" is ______ which was determined by the
Determination Agent and was the closing value (afternoon session)
of the Nikkei 225 Index on October ______, 1995, multiplied by
.90 but is subject to adjustment on the Reset Date as provided
below. If the closing value (afternoon session) (the "Reset Date
Closing Value") of The Nikkei 225 Index January , 1996, on
unless extended as described herein (the "Reset Date"), is lower
than the closing vlaue (afternoon session) on October , 1995
(the "Initial Closing Value"), the Strike Level shall be reduced
by the full amount, if any, by which the Initial Closing Value is
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greater than the Reset Date Closing Value. If the Company
determines that an Extraordinary Event or Exercise Limitation
Event has occurred and is continuing on the Reset Date, then the
Reset Date Closing Value shall be calculated on the basis that
the Reset Date shall be the next Index Calculation Day following
an Applicable Tokyo Business Day on which there is no
Extraordinary Event or Exercise Limitation Event. Within 30 days
following the Reset Date, the Company will notify the Warrant
Agent in writing if there has been an adjustment to the Strike
Level and will either make a public announcement regarding the
amount of such adjustment and the new Strike Level or publish
such information in a United States newspaper with a national
circulation (such as The Wall Street Journal).
-----------------------
In the event that a Substitute Index is substituted (as
provided in Section 2.02(h)) for the Nikkei 225 Index, the Strike
Level will be adjusted as follows:
Strike Level
--------------------------------- x Current Value of Substitute Index
Current Value of Nikkei 225 Index
and the Cash Settlement Value of a Warrant shall be the amount in
U.S. Dollars equal to the quotient (rounded down to the nearest
cent) of the amount, if any, by which the Spot Nikkei 225 Index
(i.e., the closing level of the Substitute Index) for the
applicable Valuation Date for such Warrant exceeds the Strike
Level (as adjusted pursuant to the formula above), divided by the
Adjusted Divisor. The "Adjusted Divisor" shall be an amount
equal to 6 multiplied by the fixed Japanese Yen/U.S. Dollar
exchange rate of Yen _____/U.S. $1.00 multiplied by a fraction,
the numerator of which shall be the Current Value of the
Substitute Index and the denominator of which shall be the
Current Value of the Nikkei 225 Index.
The "Current Value" of the Nikkei 225 Index and of the
Substitute Index shall equal their respective levels reported by
the relevant exchange at the close of business on the day that
the Determination Agent substitutes the Substitute Index for the
Nikkei 225 Index or, if such day is not a Tokyo Business Day, the
Tokyo Business Day immediately preceding such day. In the event
of such substitution, the Determination Agent shall promptly
notify the Warrant Agent of the new Strike Level and of said
Current Values.
For purposes of this Agreement, the "Nikkei 225 Index"
means the Nikkei 225 Index designed, developed, maintained and
operated by the Nihon Keizai Shimbum, Inc. (the "NKS"). The
"Spot Nikkei 225 Index" for any date means the closing value
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(afternoon session) on such date of the Nikkei 225 Index (or, in
the event of a substitution of a Substitute Index for the Nikkei
225 Index, the closing level on such date of such Substitute
Index) or any Successor Index. For purposes of this Agreement,
"New York Business Day" means any day other than a Saturday,
Sunday or a day on which either the American Stock Exchange, Inc.
(the "AMEX") or the New York Stock Exchange is not open for
securities trading or commercial banks in New York City are
required or authorized by law or executive order to remain
closed. "Tokyo Business Day" means any day other than (i) a
Saturday, Sunday or day on which banks are not open for a full
day of business in Tokyo or (ii) a day on which the Tokyo Stock
Exchange (the "TSE"), the Singapore International Monetary
Exchange Ltd. (the "SIMEX") or the Osaka Securities Exchange (the
"OSE") is not open for business. "Tokyo Trading Day" means any
day on which the TSE is open for business. References in this
Agreement to "U.S. Dollars", "U.S.$" or "$" are to the lawful
currency of the United States of America and references to
"Japanese Yen" or "Yen" are to the lawful currency of Japan.
(f) In the case of exercise of Book-Entry Warrants,
the Warrant Agent shall cause its records, which may be kept
electronically, to be marked to reflect the reduction in the
number of Warrants represented by the Global Warrant Certificate
by the number of Warrants that were delivered to the Warrant
Agent and for which payment has been made as provided in Section
2.02(d) promptly after such delivery and payment. Absent
manifest error, the Warrant Agent's records shall be conclusive
evidence of such matters.
(g) The Company hereby appoints Bear, Stearns & Co.
Inc. and Bear, Stearns & Co. Inc. accepts such appointment, to be
the Company's Determination Agent to determine the Spot Nikkei
225 Index in accordance with this Section 2.02(g) and to make
such calculations as may be required upon the occurrence of any
of the circumstances described in Section 2.02(i) or 2.03,
including, without limitation, calculation of the Cash Settlement
Value or the Alternative Settlement Amount, as applicable, of a
Warrant. The Determination Agent shall act as an independent
expert and not as an agent of the Company, and, unless otherwise
provided by this Agreement, its calculations and determinations
under this Agreement shall, absent manifest error, be final and
binding on the Company, the Warrant Agent, the Warrantholders and
any Participant. Any such calculations will be made available to
a Warrantholder for inspection at the Warrant Agent's Office.
The Company agrees, for the benefit of the Warrant-
holders that there shall at all times be a Determination Agent
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hereunder until all the Warrants are no longer outstanding or
until monies for the payment of all outstanding Warrants, if any,
shall have been paid to the Warrant Agent and shall have been
returned to the Company as provided in Section 2.06, whichever
occurs earlier. Resignation, removal and appointment of the
Determination Agent shall be in accordance with the procedures
set forth for the resignation, removal and appointment of the
Warrant Agent, as provided in Section 5.03, except that a
successor Determination Agent need not be a banking institution
with offices in the Borough of Manhattan, The City of New York,
and may only be appointed if such successor has been nominated by
the Company and approved by the predecessor Determination Agent.
The Company agrees promptly to pay the Determination
Agent the compensation to be agreed upon with the Company for all
services rendered by the Determination Agent hereunder. The
Company also agrees to indemnify the Determination Agent for, and
to hold it harmless against, any loss, liability, cost or expense
(including reasonable attorneys' fees and expenses) incurred by
the Determination Agent by reason of its being made a party to a
suit or claim arising out of this Agreement; provided, however,
that such indemnity shall in no event apply to the extent that
any such loss, liability, cost or expense is a result of the
negligence, bad faith or breach of this Agreement on its part in
connection with the services rendered by it hereunder. The
indemnity obligation of the Company shall continue
notwithstanding the termination of this Agreement or the
resignation or removal of the Determination Agent.
Provided that the Determination Agent has received the
Warrant Agent's notice pursuant to Section 2.02(c)(ii), the
Determination Agent shall provide to the Warrant Agent by 10:00
A.M., New York City time, on the Valuation Date or if such date
is not a New York Business Day, then the next succeeding New York
Business Day, the Limit Option Reference Index applicable to any
of the Warrants specified in such notice and the Spot Nikkei 225
Index for the Index Calculation Day that but for the provisions
of Section 2.02(j), if any of the Warrants covered by the
Exercise Notice delivered to the Warrant Agent constitute
Contingently Tendered Warrants, would be the Valuation Date for
the Warrants specified in such notice.
(h) Upon the occurrence of a Substitution Event, the
Company shall promptly give notice to the Warrantholders, by
publication in a United States newspaper with a national
circulation (currently expected to be the Wall Street Journal),
specifying: (i) the date on which the Substitution Event was
deemed to occur pursuant to this Section 2.02(h), (ii) that a
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Substitute Index will be substituted for the Nikkei 225 Index on
the Substitution Date (as defined herein), (iii) the name of the
Substitute Index, (iv) the Substitution Date, (v) the Strike
Level as adjusted pursuant to Section 2.02(e) and (vi) the
Adjusted Divisor. The Warrant Agent at the request and expense
of the Company and on behalf of the Company shall mail such
notice to each Warrantholder. On the Substitution Date, the
Substitute Index will be substituted for the Nikkei 225 Index.
From and after the Substitution Date, the index used to determine
the Spot Nikkei 225 Index used to calculate the Cash Settlement
Value or Alternative Settlement Amount, as the case may be, of
the Warrants will be such Substitute Index. The "Substitution
Date" shall be the thirtieth calendar day (or, if such day is not
a New York Business Day, the next succeeding New York Business
Day) following such giving of notice of the Substitution Event.
A "Substitution Event" will occur if, as determined by
the Determination Agent (whose opinion shall be conclusive and
binding on the Company and on the holders of the Warrants) the
following conditions are fulfilled:
(i) Either of the following has occurred:
(A) The AMEX or another United States securities
exchange publishes (on a basis not less regularly than
each day on which such exchange and the TSE are open
for trading) an index (the "New Japan Index") which:
for a period of 90 days immediately preceding the date
of the Substitution Event has a correlation based on
daily, closing value to closing value, percentage
changes of not less than 90% with the Nikkei 300 Index
(as defined in the Prospectus Supplement dated October
______, 1995 relating to the Warrants (the "Prospectus
Supplement")); and warrants with payments determined by
reference to the New Japan Index have been approved to
be listed on the AMEX or such other exchange by the
Securities and Exchange Commission; or
(B) Warrants with payments determined by
reference to the Nikkei 300 Index have been approved to
be listed on the AMEX or such other exchange by the
Securities and Exchange Commission; and
(ii) Either of the following has occurred:
(A) the Nikkei 225 Index (as defined in the
Prospectus Supplement) is no longer published and/or
the Nikkei 225 Futures Contracts (as defined in the
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Prospectus Supplement) have been delisted from trading
on the OSE; or
(B) the Adjusted Trading Volume and the Adjusted
Open Interest (in each case, as defined herein) for the
two Nikkei 300 Futures Contracts (as defined in the
Prospectus Supplement) with expiration dates closest in
time to the Substitution Event exceed the Adjusted
Trading Volume and the Adjusted Open Interest,
respectively, for the two Nikkei 225 Futures Contracts
with expiration dates closest in time to the
Substitution Event, each for any three-month period
prior to the date of any Substitution Event; and
(iii) To the extent required, the Company, the AMEX
and/or such exchange shall have obtained any license
necessary to use the New Japan Index or the Nikkei 300
Index.
Notwithstanding the above, unless the Nikkei 225 Index
is no longer published and/or the Nikkei 225 Futures Contracts
shall have been delisted from trading on the OSE, a Substitution
Event will not be deemed to have occurred on any of the 60
calendar days immediately preceding the Expiration Date.
A "Substitute Index" means, in the event that the
circumstances described in clause (i)(A) above have occurred, a
New Japan Index or, in the event that the circumstances described
in clause (i)(B) above have occurred, the Nikkei 300 Index.
"Adjusted Trading Volume" for the Nikkei 300 Futures
Contracts or the Nikkei 225 Futures Contracts means the
arithmetic mean, for any period, of the amounts on each trading
day equal to the product of: (x) the number of such futures
contracts traded on such day and (y) the closing level on such
day of the index to which such futures contracts relate,
multiplied by Yen l0,000, in the case of the Nikkei 300 Futures
Contracts, or Yen l,000, in the case of the Nikkei 225 Futures
Contracts (the "Contract Multiplier"). "Adjusted Open Interest"
for the Nikkei 300 Futures Contracts or the Nikkei 225 Futures
Contracts means the arithmetic mean, for any period, of the
amounts on each trading day equal to the product of: (x) the
open interest in such futures contracts on such day and (y) the
closing level on such day of the index to which such futures
contracts relate, multiplied by the Contract Multiplier.
(i) In the event that the Nikkei 225 Index (or if a
Substitute Index has been substituted for the Nikkei 225 Index,
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such Substitute Index) is not published by NKS but is published
by another person not affiliated with the Company and acceptable
to the Company (the "Third Party"), then the Spot Nikkei 225
Index for any date thereafter will be determined based on the
closing value (afternoon session) of the Nikkei 225 Index (or
such Substitute Index, as the case may be) as published by such
Third Party. If NKS or any Third Party discontinues publication
of the Nikkei 225 Index (or if a Substitute Index has been
substituted for the Nikkei 225 Index, such Substitute Index) and
publishes a successor or substitute index that the Company
determines, in its sole discretion, to be comparable to the
Nikkei 225 Index (or such Substitute Index, as the case may be)
(any such index being a "Successor Index"), then the Spot Nikkei
225 Index for any date thereafter will be determined by the
Determination Agent on behalf of the Company based on the closing
level of the Successor Index on such date. If the NKS or any
Third Party makes a material change in the formula for, or the
method of calculating, the Nikkei 225 Index, any Substitute Index
or any Successor Index, the Determination Agent shall make such
calculations as may be required to determine the applicable Cash
Settlement Value using the formula and method of calculating the
Nikkei 225 Index, any Substitute Index or any Successor Index as
in effect prior to such change or modification. If NKS and/or
any Third Party discontinues publication of the Nikkei 225 Index,
any Substitute Index and/or Successor Index, the Determination
Agent will determine the applicable Cash Settlement Value based
on the formula and method used in calculating the Nikkei 225
Index, any Substitute Index or any Successor Index as in effect
on the date the Nikkei 225 Index, such Substitute Index or such
Successor Index was last published.
If calculation or publication of the Nikkei Index,
Substitute Index or a Successor Index is modified, discontinued
or suspended, as provided in this Section 2.02(i), other than as
provided in Section 2.02(h), then the Determination Agent shall
promptly notify the Warrant Agent, and the Warrant Agent shall in
turn promptly notify the Warrantholders in accordance with
Section 6.04 hereof, of such modification, discontinuance,
suspension or substitution and of any modification or adjustment
to be made with respect to calculation of the Cash Settlement
Value or Alternative Settlement Amount, as applicable.
The Determination Agent will have no responsibility for
good faith errors or omissions in calculating or disseminating
information regarding the Nikkei 225 Index, any Substitute Index
or any Successor Index, adjustments or calculations by the
Determination Agent (as provided above) in order to arrive at a
calculation of a stock index comparable to the Nikkei 225 Index,
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any Substitute Index or any Successor Index, or the Cash
Settlement Value or the Alternative Settlement Amount, as
applicable.
(j) Except for Warrants subject to automatic exercise,
Warrants with respect to which payments of any Alternative
Settlement Amount are made and Warrants deemed worthless
following an Extension Event (all as described in Section 2.03
below) each Warrantholder, in connection with any exercise of
Warrants (including an exercise with a postponed Valuation Date
following an Extraordinary Event or an Exercise Limitation
Event), shall have the option (the "Limit Option") to specify in
the related Exercise Notice that such exercise be subject to the
condition that the Spot Nikkei 225 Index that would otherwise be
used to determine the Cash Settlement Value of such Warrants not
be five hundred (500) or more points lower than the Limit Option
Reference Index for such Warrants. "Limit Option Reference
Index", with respect to any Contingently Tendered Warrants,
means, subject to adjustment as described below, the closing
value (afternoon session) of the Nikkei 225 Index on the relevant
Exercise Date (or, if such Exercise Date is not an Index
Calculation Day, on the immediately preceding Index Calculation
Day). In the event that a Substitute Index is substituted (as
provided in Section 2.02(h)) for the Nikkei 225 Index, the Limit
Option Reference Index will be the number of points lower than
the closing level of such Substitute Index determined as follows:
500
--------------------------------- x Current Value of Substitute Index
Current Value of Nikkei 225 Index
If a Warrantholder elects the Limit Option in connection with any
exercise of Warrants, the following provisions shall apply:
(i) 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. In
connection with any exercise of 1,000 or more Warrants, a
Warrantholder may elect to subject only a portion of such
Warrants to the Limit Option; provided that the number of
such Warrants subject to the Limit Option and the number of
such Warrants not subject to the Limit Option shall in each
case not be less than 500; provided, further that, a
Warrantholder shall not combine Definitive Warrants and
Book-entry Warrants or Book-entry Warrants held through more
than one Participant to meet the 500 Warrant minimum
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exercise requirement. Registered Holders and Participants
shall be required to certify that the number of Warrants
exercised on behalf of any Warrantholder pursuant to the
related Exercise Notice that are subject to the Limit Option
is an amount that is not less than 500.
(ii) Except as otherwise provided in this Section
2.02(j), the Limit Option Reference Index shall be
determined by the Warrant Agent, which determination shall
be conclusive and binding for all purposes relating to such
exercise.
(iii) In the event that the Spot Nikkei 225 Index for
the first Index Calculation Day following the relevant
Exercise Date is five hundred (500) or more points lower
than the Limit Option Reference Index (such number of points
being subject to adjustment as provided above) for such
Warrants, such Warrants (A) shall not be subject to exercise
and shall be treated for all purposes of this Agreement and
the Warrant Certificates and Global Warrant Certificate as
if the related Exercise Notice had never been received by
the Warrant Agent, and (B) shall not constitute "Exercised
Warrants" for purposes of Section 2.02(c). If such Spot
Nikkei 225 Index is not five hundred (500) or more points
lower than such Limit Option Reference Index (such number of
points being subject to adjustment as provided above), such
Warrants shall be subject to exercise as provided in this
Section 2.02 and shall be deemed to be "Exercised Warrants"
for such purposes. The Warrant Agent's determination shall
be conclusive and binding for all purposes relating to such
Warrants.
(iv) Except as provided in Section 2.03(b), the Limit
Option (based on the Limit Option Reference Index as
determined for the relevant Exercise Date or, if applicable,
the first Index Calculation Day preceding such Exercise
Date) shall continue to be applicable to any Exercised
Warrant for which the Valuation Date has been postponed as a
result of the occurrence of an Extraordinary Event or an
Exercise Limitation Event until the Warrants are cancelled
as provided in Section 2.03(b) or until the Expiration Date
or any Delisting Date.
SECTION 2.03. Automatic Exercise of Warrants; Exercise
----------------------------------------
upon an Extension Event, an Extraordinary Event or an Exercise
--------------------------------------------------------------
Limitation Event. (a) Subject to the provisions of Section
----------------
2.03(b) regarding Extension Events, all Warrants for which the
Warrant Agent has not received a valid Exercise Notice in proper
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form at or prior to 3:00 P.M., New York City time, on (i) the New
York Business Day immediately preceding the Expiration Date or
(ii) with respect to any date prior to the Expiration Date, the
last New York Business Day prior to the effective date on which
the Warrants are delisted from, or permanently suspended from
trading (within the meaning of the Securities Exchange Act of
1934 (the "Exchange Act") and the rules and regulations of the
Securities and Exchange Commission thereunder) on the AMEX, and
not accepted prior thereto or at the same time for trading
pursuant to the rules of another SRO that are filed with the
Securities and Exchange Commission under the Exchange Act (such
New York Business Day being a "Delisting Date") or for which the
Warrant Agent has received a valid Exercise Notice in proper form
but with respect to which timely delivery of the relevant
Warrants has not been made by such time, or the Valuation Date
for which has as of such time been postponed as provided in
Section 2.03, shall be deemed to be automatically exercised as of
such date without any requirement of delivery of an Exercise
Notice to the Warrant Agent. If such Delisting Date occurs on or
after the Expiration Date and prior to any Extended Expiration
Date (as defined in Section 2.03(b)(ii)), the Warrants will be
deemed worthless. However, if the Company first receives notice
of the delisting or suspension of the Warrants on the same day on
which such Warrants are delisted or suspended, such day will be
deemed a Delisting Date for purposes of this Agreement. The
Exercise Date for such Warrants shall be the Expiration Date or
Delisting Date, as the case may be, or, if such date is not a New
York Business Day, the next succeeding New York Business Day and
the Valuation Date for such Warrants shall be the first Index
Calculation Day following such date.
The Warrant Agent shall by 5:00 P.M., New York City
time, on the Expiration Date or any earlier date on which the
Warrant Agent receives notice of any delisting of the Warrants,
as the case may be, notify the Company and the Determination
Agent (and such other parties (not to exceed two) as the Company
shall designate in writing) of the number of Warrants to be
automatically exercised. On the Valuation Date for such Warrants
(or, if such Valuation Date is not a New York Business Day, on
the next succeeding New York Business Day), the Warrant Agent
shall (i) except as provided in Section 2.02(i), determine the
Cash Settlement Value (in the manner provided in Section 2.02(e))
of the Warrants to be automatically exercised; (ii) by 5:00 P.M.,
New York City time, on the New York Business Day next succeeding
such Valuation Date, notify the Company (and such other parties
(not to exceed two) as the Company shall designate in writing) of
the Cash Settlement Value payable in respect of such exercised
Warrants (unless the Cash Settlement Value shall be calculated by
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the Determination Agent); and (iii) advise the Company of such
other matters relating to the exercised Warrants as the Company
shall reasonably request.
The Determination Agent shall by 1:00 P.M., New York
City time, on the applicable Valuation Date, notify the Warrant
Agent of the Spot Nikkei 225 Index applicable to the Warrants to
be automatically exercised.
In the case of Definitive Warrants subject to automatic
exercise (other than Definitive Warrants subject to postponed
exercise following the occurrence of an Extraordinary Event,
Exercise Limitation Event or Extension Event as described in
Section 2.03(b)), if the Company has made adequate New York
Clearing House or next day funds available to the Warrant Agent
in a timely manner, which shall in no event be later than 3:00
P.M., New York City time, on the fourth New York Business Day
following the Valuation Date for automatically exercised Warrants
(or if such Valuation Date is not a New York Business Day, on the
fourth New York Business Day following the New York Business Day
next succeeding such Valuation Date) (in any such case, the
"Automatic Funding Date"), the Warrant Agent will be responsible
for making its payment available to the appropriate Registered
Holder in the form of a cashier's check or an official bank
check, or (in the case of payments of at least $100,000) by wire
transfer to a U.S. Dollar account maintained by such Registered
Holder in the United States (at such Registered Holder's election
upon written notice to the Company and the Warrant Agent) prior
to the close of business on the Automatic Funding Date (or, in
the case of payments made by wire transfer, prior to the close of
business on the New York Business Day next succeeding the
Automatic Funding Date), against receipt by the Warrant Agent at
the Warrant Agent's Window, Attention: Tender Department, from
such Registered Holder of its Warrant Certificates. Such payment
shall be in the amount of the aggregate Cash Settlement Value in
respect of the Warrants, evidenced by such Warrant Certificates,
that were exercised automatically on the Expiration Date or on
any Delisting Date, as the case may be. Warrant Certificates
delivered to the Warrant Agent shall thereafter be promptly
cancelled by the Warrant Agent.
In the case of Book-entry Warrants subject to automatic
exercise (other than Warrants subject to postponed exercise
following the occurrence of an Extraordinary Event, Exercise
Limitation Event or Extension Event as described in Section
2.03(b)), if the Company has made adequate New York Clearing
House or next day funds available to the Warrant Agent in a
timely manner, which shall in no event be later than 3:00 P.M.,
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New York City time, on the Automatic Funding Date, the Warrant
Agent will be responsible for making funds available to the
securities depository, against receipt of the Global Warrant
Certificate, prior to the close of business, on the Automatic
Funding Date. Such funds are to be in an amount equal to the
aggregate Cash Settlement Value of the Warrants subject to such
automatic exercise.
The Company will advise the Warrant Agent as soon as
practicable of the date of any expected delisting or permanent
suspension of trading of the Warrants and will immediately inform
the Warrant Agent after the Company has received notice that such
delisting or suspension is occurring, but in no event will notice
of such delisting or suspension be given to the Warrant Agent
later than 9:30 A.M., New York City time, on the first New York
Business Day following the date on which such delisting or
suspension occurs. The Company will use its best efforts to
notify the Warrantholders, or cause the Warrantholders to be
notified, as promptly as practicable of any expected delisting or
suspension of trading of the Warrants.
(b) (i) Subject to the provisions of Section
2.03(b)(ii), if the Company determines that an Extraordinary
Event or Exercise Limitation Event has occurred and is continuing
on the Tokyo Business Day with respect to which the Spot Nikkei
225 Index on a Valuation Date is to be determined (the
"Applicable Tokyo Business Day") then the Cash Settlement Value
with respect to an exercise of Warrants shall be calculated on
the basis that the Valuation Date shall be the next Index
Calculation Day following an Applicable Tokyo Business Day on
which there is no Extraordinary Event or Exercise Limitation
Event; if the Valuation Date has not occurred on or prior to the
Expiration Date or any Delisting Date, then the Warrantholders
will receive the Alternative Settlement Amount (as defined
herein) in lieu of the Cash Settlement Value which shall be
calculated as if the Warrants had been cancelled on the
Expiration Date or any Delisting Date, as the case may be.
Upon the occurrence of an Extraordinary Event or an
Exercise Limitation Event, the Company shall use its best efforts
to notify the Warrant Agent and the Determination Agent promptly
that an Extraordinary Event or Exercise Limitation Event, as the
case may be, has occurred and shall promptly give notice to the
Warrantholders, by publication in a United States newspaper with
a national circulation (currently expected to be the Wall Street
Journal), that an Extraordinary Event or an Exercise Limitation
Event has occurred.
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If the Company determines that an Extraordinary Event
or an Exercise Limitation Event has occurred and is continuing on
the Expiration Date or on any earlier Delisting Date, the Company
shall so notify the Warrant Agent and the Determination Agent,
and the Cash Settlement Value with respect to the exercised
Warrants shall be equal to, and be calculated in the same manner
as, an "Alternative Settlement Amount", in accordance with
Section 2.03(d) herein (treating the Expiration Date or any
Delisting Date, as the case may be, as the date on which the
Warrants were cancelled for the purposes of this Section
2.03(b)).
If the Company determines that an Extraordinary Event
has occurred and is continuing, and if that Extraordinary Event
is expected by the Company to continue, the Company, prior to the
Expiration Date, may immediately cancel the Warrants by notifying
the Warrant Agent of such cancellation (the date such notice is
given being the "Cancellation Date"), and each Warrantholder's
rights with respect to the Warrants and under this Agreement
shall thereupon cease; provided, that each Warrant shall be
exercised (even if such Warrant would not otherwise be exercis-
able on such date because of the Limit Option) on the basis that
the Valuation Date for such Warrant shall be the Cancellation
Date and each Warrantholder shall receive, in lieu of the Cash
Settlement Value of such Warrant, the Alternative Settlement
Amount, determined by the Determination Agent.
If, following the determination by the Company that an
Extraordinary Event or Exercise Limitation Event has occurred and
is continuing, the Company determines that such Extraordinary
Event or Exercise Limitation Event has ceased and that no
additional Extraordinary Event or Exercise Limitation Event has
occurred or is continuing, the Company shall so notify the
Warrant Agent and the Determination Agent.
(ii) If the Company determines that an event described
in clause (i) of the definition of Exercise Limitation Event
below has occurred and is continuing on the Expiration Date (an
"Extension Event"), then the term of any outstanding Warrants
shall be automatically extended for a period of 30 days (the
thirtieth day following the Expiration Date being the "Extended
Expiration Date"), except that if the Cash Settlement Value or
the Intrinsic Value used in calculating the Alternative
Settlement Amount, as the case may be, of such Warrants would
have been zero if the Warrants had been exercised such that the
Valuation Date for such exercise was the Measurement Date (as
defined below), then the term of the Warrants shall not be
extended, the Warrants shall be deemed to be worthless and the
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Company shall not be required to make any payments in respect
thereof. Any such automatic extension shall be deemed to have
been revoked and the Warrants shall expire on the earlier of
(i) the next Index Calculation Day following a Tokyo Trading Day
on which there is no Extension Event (the "Early Extended
Expiration Date") and (ii) any Delisting Date occurring on or
after the Expiration Date. The Company will give the Warrant
Agent prompt notice by telephone or facsimile transmission and
will give prompt notice to the Warrantholders by publication in a
United States newspaper with a national circulation (currently
expected to be The Wall Street Journal) of the occurrence of an
Extension Event, any Extended Expiration Date, any Index
Calculation Day referred to in clause (i) above and any Delisting
Date referred to in clause (ii) above, but in no event will such
notice to the Warrant Agent be given later than 9:30 A.M., New
York City time, on the New York Business Day following the
Expiration Day, Index Calculation Day or Delisting Date, as
applicable.
Any Warrants that expire as described in clause (i) of
the preceding paragraph will be deemed to be exercised on the
Early Extended Expiration Date (even if such Warrants would not
otherwise be exercisable on such date because of the Limit
Option) on the basis that the Valuation Date for such exercise
shall be such Early Extended Expiration Date and the holder of
each such Warrant will receive an Alternative Settlement Amount,
whether or not an Extraordinary Event or an Exercise Limitation
Event is continuing on such Early Extended Expiration Date.
If the term of the Warrants has been extended pursuant
to the second preceding paragraph but the Company determines that
an Extension Event is continuing (A) when the Warrants expire on
the Extended Expiration Date or (B) on any Delisting Date
occurring on or after the Expiration Date, the Warrants shall be
deemed to be worthless and the Company shall not be required to
make any payments in respect thereof. The Company shall give
prompt notice of any such determination to the Warrant Agent by
telephone or facsimile transmission and to the Warrantholders by
publication in a United States newspaper with a national
circulation (currently expected to be The Wall Street Journal).
"Measurement Date" means the Tokyo Trading Day
occurring most recently prior to the Expiration Date on which
none of the events described in clause (i) of the definition of
Exercise Limitation Event below had occurred or was continuing.
(c) For purposes of this Agreement, "Extraordinary
Event" means any of the following events:
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(i) a suspension, material limitation or absence of
trading on the TSE of all the Underlying Stocks which then
comprise the Nikkei 225 Index, any Substitute Index or a
Successor Index (the "Underlying Stocks");
(ii) the enactment, publication, decree or other
promulgation of any statute, regulation, rule or order of
any court of any jurisdiction, any administrative agency or
any other U.S. or non-U.S. governmental authority that would
make it unlawful for the Company to perform any of its
obligations under this Agreement or the Warrants or that has
had or is reasonably expected to have a material adverse
effect on the ability of (A) the Company to perform its
obligations under the Warrants or to hedge or modify the
hedge of its position with respect to the Nikkei 225 Index,
any Substitute Index or a Successor Index; or (B) any
affiliate of the Company to hedge or modify the hedge of its
position with respect to any hedging transaction entered
into with the Company in connection with the Company's
obligations under the Warrants; or
(iii) any outbreak or escalation of hostilities or other
national or international calamity or crises (including,
without limitation, natural calamities that in the opinion
of the Company may materially and adversely affect the
economy of Japan or the trading of securities generally on
the TSE) that has had or is reasonably expected to have a
material adverse effect on the ability of (A) the Company to
perform its obligations under the Warrants or to modify the
hedge of its position with respect to the Nikkei 225 Index,
any Substitute Index or a Successor Index or (B) any
affiliate of the Company to hedge or modify the hedge of its
position with respect to any hedging transaction entered
into with the Company in connection with the Company's
obligations under the Warrants.
For the purpose of determining whether an Extraordinary
Event has occurred: (1) a limitation on the hours or number of
days of trading will not constitute an Extraordinary Event if it
results from an announced change in the regular business hours of
the TSE and (2) an "absence of trading" on the TSE will not
include any time when the TSE is closed for trading under
ordinary circumstances.
(d) For purposes of this Agreement, "Exercise
Limitation Event" means either of the following events:
(i) a suspension, material limitation or absence of
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trading on the TSE of 20% or more in number of the
Underlying Stocks; or
(ii) the suspension or material limitation on the
SIMEX, OSE or AMEX or any other major futures, options or
securities market of trading in futures or options contracts
related to the Nikkei 225 Index (or, in the event of a
substitution of a Substitute Index for the Nikkei 225 Index,
the Nikkei 300 Index) or a Successor Index.
For the purposes of determining whether an Exercise
Limitation Event has occurred: (1) a limitation on the hours or
number of days of trading will not constitute an Exercise
Limitation Event if it results from an announced change in the
regular business hours of the relevant exchange, (2) a decision
to permanently discontinue trading in the relevant futures or
options contract will not constitute an Exercise Limitation
Event, (3) a suspension of trading in an Underlying Stock or in a
futures or options contract referred to in clauses (i) and (ii)
above, by reason of (x) a price change violating limits set by
the TSE, SIMEX, OSE or AMEX or other futures or securities market
on which futures or options contracts related to the Nikkei 225
Index (or, in the event of a substitution of a Substitute Index,
the Nikkei 300 Index), the American Stock Exchange Japan Index
(the "Japan Index"), any New Japan Index or a Successor Index are
traded or such other futures or securities market or (y) an
imbalance of orders relating to an Underlying Stock or such
contracts will constitute a suspension or material limitation of
trading, (4) an "absence of trading" on the TSE will not include
any time when the TSE is closed for trading under ordinary
circumstances and (5) the occurrence of an Extraordinary Event
described in clause (i) of the definition of Extraordinary Event
will not constitute, and will supersede the occurrence of, an
Exercise Limitation Event.
The "Alternative Settlement Amount" is the amount
calculated using the formula set forth below:
Alternative Settlement Amount = Intrinsic Value +
(T/2 x A/B)
where
Intrinsic Value = the Cash Settlement Value of the Warrants
determined as described under Section
2.02(e), but calculated with a Spot Nikkei
225 Index determined by the Determination
Agent which, subject to approval by the
<PAGE>
<PAGE>
Company (such approval not to be unreasonably
withheld), in the reasonable opinion of the
Determination Agent, fairly reflects the
value of the Underlying Stocks on the
Cancellation Date, Expiration Date, Delisting
Date or Early Extended Expiration Date,
whichever has given rise to the payment of
the Alternative Settlement Amount;
T = U.S. $__________, the maximum initial
offering price per Warrant, less U.S.
$________, the Cash Settlement Value per
Warrant on October , 1995;
A = the total number of days from but excluding
the Cancellation Date, Expiration Date, or
Delisting Date, whichever has given rise to
the payment of the Alternative Settlement
Amount for such Warrants, to and including
the Expiration Date; and
B = the total number of days from, but excluding
the date on which sales of the Warrants were
initially confirmed, to and including the
Expiration Date.
For the purposes of determining "Intrinsic Value" in
the above formula, in the event that the Determination Agent and
the Company are required, but have not, after good faith
consultation with each other and within five days following the
first day on which such Alternative Settlement Amount may be
calculated in accordance with the above formula, agreed upon a
Spot Nikkei 225 Index which fairly reflects the value of the
Underlying Stocks on the Cancellation Date, Expiration Date,
Delisting Date or Early Extended Expiration Date, whichever gives
rise to the payment of the Alternative Settlement Amount, then
the Determination Agent shall promptly nominate a third party,
subject to approval by the Company (such approval not to be
unreasonably withheld), to determine such figure and calculate
the Alternative Settlement Amount in accordance with the above
formula. Such party shall act as an independent expert and not
as an agent of the Company or the Determination Agent, and its
calculation and determination of the Alternative Settlement
Amount shall, absent manifest error, be final and binding on the
Company, the Warrant Agent, the Determination Agent and the
Warrantholders. Any such calculations will be made available to
a Warrantholder for inspection at the Warrant Agent's Office.
Neither the Company nor such third party shall have any
<PAGE>
<PAGE>
responsibility for good faith errors or omissions in calculating
the Alternative Settlement Amount.
(e) With respect to all Warrants as to which the
Valuation Date has been postponed (other than Warrants that have
been deemed worthless following an Extensive Event) or which have
been cancelled as described above, the Company shall make
available to the Warrant Agent in a timely manner, which shall in
no event be later than 3:00 P.M., New York City time, on the
third New York Business Day following the date on which the Cash
Settlement Value or Alternative Settlement Amount, as the case
may be, has been calculated (the "Alternative Funding Date"), New
York Clearing House Funds or next day funds in an amount equal
to, and for the payment of, the aggregate Cash Settlement Value
or Alternative Settlement Amount, as applicable, of such
Warrants. Subject to such funds having been made available as
provided in the preceding sentence, the Warrant Agent will
thereafter be responsible for making its payment available in the
manner set forth in Section 2.03(a), (i) in the case of Defini-
tive Warrants, to each Registered Holder that submitted a Warrant
Certificate for exercise (and in the case of cancellation as
described above, to each Registered Holder) or (ii) in the case
of Book-entry Warrants, to the Depository, prior to the close of
business on the Alternative Funding Date, in an amount equal to
the aggregate Cash Settlement Value or Alternative Settlement
Amount (as applicable) of such exercised Warrants (and in the
case of cancellation as described above, of all previously
unexercised Warrants).
SECTION 2.04. Limitation of Number of Exercisable
-----------------------------------
Warrants. All exercises of Warrants (other than on automatic
--------
exercise or following an Extension Event) are subject, at the
Company's option, to the limitation that not more than 750,000
Warrants in total may be exercised on any Exercise Date and not
more than 250,000 Warrants may be exercised by or on behalf of
any beneficial owner, either individually or in concert with any
other beneficial owner, on any Exercise Date. If any New York
Business Day would otherwise, under the terms hereof, be the
Exercise Date in respect of more than 750,000 Warrants, then at
the Company's election (by giving notice thereof to the Warrant
Agent not later than 11:00 a.m., New York City time, on the New
York Business Day immediately following such Exercise Date),
750,000 of such Warrants shall be deemed exercised on such
Exercise Date (selected by the Warrant Agent on a pro rata basis,
but if, as a result of such pro rata selection, any Registered
Holders would be deemed to have exercised less than 500 Warrants,
then the Warrant Agent shall first select an additional amount of
such holders' Warrants so that no holder shall be deemed to have
<PAGE>
<PAGE>
exercised less than 500 Warrants), and the remainder of such
Warrants (the "Remaining Warrants") shall be deemed exercised on
the following New York Business Day (notwithstanding the
provisions of Section 2.01(b) and subject to successive
applications of this Section 2.04); provided that any Remaining
Warrants for which an Exercise Notice was delivered on a given
Exercise Date shall be deemed exercised before any other Warrants
in respect of which an Exercise Notice was delivered on a later
Exercise Date. If any beneficial owner of Warrants attempts to
exercise more than 250,000 Warrants on any New York Business Day
individually or in concert, then at the Company's election (as
notified to the Warrant Agent by giving notice thereof to the
Warrant Agent not later than 11:00 a.m., New York City time, on
the New York Business Day following such New York Business Day)
250,000 of such Warrants shall be deemed exercised on such New
York Business Day and the remainder shall be deemed exercised on
the following New York Business Day (notwithstanding the
provisions of Section 2.01(b) and subject to successive
applications of this Section 2.04). The date on which any
Warrant is deemed exercised under the preceding two sentences
shall for all purposes of this Agreement be the "Exercise Date"
in respect of such Warrants.
SECTION 2.05. Covenant of the Company. The Company
-----------------------
covenants, for the benefit of the Warrantholders, that it will
not seek the delisting of the Warrants from, or suspension of
their trading on, the AMEX unless the Company has, at the same
time, arranged for the Warrants to be traded pursuant to the
rules of another SRO that are filed with the Securities and
Exchange Commission under the Exchange Act. The Company further
covenants that it will use reasonable efforts to obtain any
license necessary for the use and reference of a Substitute Index
in connection with the Warrants.
SECTION 2.06. Return of Money Held Unclaimed for Two
--------------------------------------
Years. Except as otherwise provided herein, any money deposited
-----
with or paid to the Warrant Agent for the payment of the Cash
Settlement Value or Alternative Settlement Amount of any Warrants
and not applied but remaining unclaimed for two years after the
date upon which such Cash Settlement Value or Alternative
Settlement Amount shall have become due and payable shall be
repaid by the Warrant Agent to the Company, at the Company's
request, and the holders of such Warrants shall thereafter look
only to the Company for any payment which such holders may be
entitled to collect and all liability of the Warrant Agent with
respect to such money shall thereupon cease; provided that the
Warrant Agent, before making any such repayment, may at the
expense of the Company notify (i) in the case of Definitive
<PAGE>
<PAGE>
Warrants, the Registered Holders or (ii) in the case of Book-
entry Warrants, the Participants concerned, that said money has
not been so applied and remains unclaimed and that after a date
named in the notification any unclaimed balance of said money
then remaining will be returned to the Company.
SECTION 2.07. Return of Global Warrant Certificate.
------------------------------------
In the event a Global Warrant Certificate is issued, at such time
as all of the Warrants evidenced by such Certificate have been
exercised (including pursuant to an automatic exercise) or other-
wise cancelled and all payments to the Participants made as
provided herein, the Warrant Agent shall dispose of the cancelled
Global Warrant Certificate in accordance with its customary
procedures (unless instructed by the Company to deliver the
Global Warrant Certificate to the Company) and shall provide a
certificate of disposition to the Company.
ARTICLE III
OTHER PROVISIONS RELATING TO
RIGHTS OF WARRANTHOLDERS
SECTION 3.01. Warrantholder May Enforce Rights.
--------------------------------
Notwithstanding any of the provisions of this Agreement, any
Warrantholder, without the consent of the Warrant Agent, may, in
and for its own behalf, enforce, and may institute and maintain,
any suit, action or proceeding against the Company suitable to
enforce, or otherwise in respect of, its right to exercise, and
to receive payment for, its Warrants as provided in this
Agreement.
ARTICLE IV
WARRANTS ACQUIRED BY THE COMPANY;
PAYMENT OF TAXES
SECTION 4.01. Warrants Acquired by the Company. In
--------------------------------
the event the Company shall purchase or otherwise acquire
Warrants, such Warrants may, at the option of the Company, be
(i) in the case of Definitive Warrants, delivered to the Warrant
Agent, and if so delivered, the Warrant Agent shall promptly
cancel such Warrants on the records of the Warrant Agent or
(ii) in the case of Book-entry Warrants, surrendered free through
a Participant to the Depository for credit to the account of the
Warrant Agent maintained at the Depository, and if so credited,
the Warrant Agent shall promptly note the cancellation of such
<PAGE>
<PAGE>
Warrants by notation on the records of the Warrant Agent and the
Warrant Agent shall cause its records to be marked to reflect the
reduction in the number of Warrants represented by the Global
Warrant Certificate by the number of Warrants so cancelled
promptly after such account is credited. In the case of Book-
entry Warrants, such Warrants may also, at the option of the
Company, be resold by the Company directly or to or through any
of its affiliates in lieu of being surrendered to the Depository.
No Warrant Certificate shall be countersigned in lieu of or in
exchange for any Warrant which is cancelled as provided herein,
except as otherwise expressly permitted by this Agreement.
Any cancelled Warrant Certificate held by the Warrant
Agent under this Agreement shall be disposed of by the Warrant
Agent in accordance with its customary procedures unless
otherwise directed by the Company, and the Warrant Agent shall
deliver a certificate of disposition to the Company evidencing
the same.
SECTION 4.02. Payment of Taxes. The Company will pay
----------------
all stamp, withholding and other duties, if any, attributable to
the initial issuance of Warrants; provided, however, that,
anything in this Agreement to the contrary notwithstanding, the
Company shall not be required to pay any tax or other
governmental charge which may be payable in respect of any
transfer involving any beneficial or record interest in, or
ownership interest of, any Warrants, Warrant Certificates or
Global Warrant Certificate.
ARTICLE V
CONCERNING THE WARRANT AGENT
SECTION 5.01. Warrant Agent. (a) The Company hereby
-------------
appoints Chemical Bank as Warrant Agent of the Company in respect
of the Warrants upon the terms and subject to the conditions set
forth herein; and ChemicaL Bank hereby accepts such appointment.
The Warrant Agent shall have the powers and authority granted to
and conferred upon it in this Agreement and such further powers
and authority to act on behalf of the Company as the Company may
hereafter grant to or confer upon it with its consent. All of
the terms and provisions with respect to such powers and
authority contained in any Warrant Certificates or the Global
Warrant Certificate are subject to and governed by the terms and
provisions hereof.
<PAGE>
<PAGE>
(b) Chemical covenants and agrees to maintain an
office staffed by qualified personnel, with adequate facilities
for the discharge of its responsibilities under this Agreement,
including, without limitation, the computation of the Cash
Settlement Value and the timely settlement of the Warrants upon
exercise thereof.
SECTION 5.02. Conditions of Warrant Agent's
-----------------------------
Obligations. The Warrant Agent accepts its obligations herein
-----------
set forth upon the terms and conditions hereof, including the
following, to all of which the Company agrees and to all of which
the rights hereunder of the holders from time to time of the
Warrants shall be subject:
(a) The Company agrees promptly to pay the Warrant
Agent the compensation to be agreed upon with the Company
for all services rendered by the Warrant Agent and to
reimburse the Warrant Agent for its reasonable out-of-pocket
expenses (including attorneys' fees and expenses) incurred
by the Warrant Agent without negligence, bad faith or breach
of this Agreement on its part in connection with the
services rendered by it hereunder. The Company also agrees
to indemnify the Warrant Agent for, and to hold it harmless
against, any loss, liability or expense (including reason-
able attorneys' fees and expenses) incurred without
negligence, bad faith or breach of this Agreement on the
part of the Warrant Agent, arising out of or in connection
with its acting as such Warrant Agent hereunder, as well as
the reasonable costs and expenses of defending against any
claim of liability in the premises.
(b) In acting under this Agreement, the Warrant Agent
is acting solely as agent of the Company and does not assume
any obligation or relationship of agency or trust for or
with any of the owners or holders of the Warrants.
(c) The Warrant Agent may consult with counsel
satisfactory to it (including counsel to the Company), and
the opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith and in
accordance with the opinion of such counsel.
(d) The Warrant Agent shall be protected and shall
incur no liability for or in respect of any action taken or
thing suffered by it in reliance upon any notice, direction,
consent, certificate, affidavit, statement or other paper or
document reasonably believed by it to be genuine and to have
been presented or signed by the proper parties.
<PAGE>
<PAGE>
(e) The Warrant Agent, and its officers, directors and
employees, may become the owner of, or acquire any interest
in, any Warrants or other obligations of the Company, with
the same rights that it or they would have if it were not
the Warrant Agent hereunder and, to the extent permitted by
applicable law, it or they may engage or be interested in
any financial or other transaction with the Company and may
act on behalf of, or as depository, trustee or agent for,
any committee or body of owners or holders of Warrants or
other obligations of the Company as freely as if it were not
the Warrant Agent hereunder.
(f) The Warrant Agent shall not be under any liability
for interest on any monies at any time received by it
pursuant to any of the provisions of this Agreement nor
shall it be obligated to segregate such monies from other
monies held by it, except as required by law. The Warrant
Agent shall not be responsible for advancing funds on behalf
of the Company.
(g) The Warrant Agent shall not be under any
responsibility with respect to the validity or sufficiency
of this Agreement or the execution and delivery hereof
(except the due authorization, execution and delivery hereof
by the Warrant Agent) or with respect to the validity or
execution of the Warrant Certificates or the Global Warrant
Certificate (except its countersignature thereof).
(h) The recitals contained herein and in the Warrant
Certificates or the Global Warrant Certificate (except as to
the Warrant Agent's countersignature thereon) shall be taken
as the statements of the Company, and the Warrant Agent
assumes no responsibility for the correctness of the same.
(i) The Warrant Agent shall be obligated to perform
such duties as are herein specifically set forth, and no
implied duties or obligations shall be read into this
Agreement against the Warrant Agent. The Warrant Agent
shall not be under any obligation to take any action
hereunder likely to involve it in any expense or liability,
the payment of which is not, in its reasonable opinion,
assured to it. The Warrant Agent shall not be accountable
or under any duty or responsibility for the application by
the Company of any proceeds. The Warrant Agent shall have
no duty or responsibility in case of any default by the
Company in the performance of its covenants or agreements
contained in this Agreement or in any Warrant Certificate or
the Global Warrant Certificate or in the case of the receipt
<PAGE>
<PAGE>
of any written demand from a holder of a Warrant with
respect to such default, including, without limiting the
generality of the foregoing, any duty or responsibility to
initiate or attempt to initiate any proceedings at law or
otherwise or, except as provided in Section 6.02 hereof, to
make any demand upon the Company.
SECTION 5.03. Resignation and Appointment of
------------------------------
Successor. (a) The Company agrees, for the benefit of the
---------
holders from time to time of the Warrants, that there shall at
all times be a Warrant Agent hereunder until all the Warrants are
no longer outstanding or until monies for the payment of all
outstanding Warrants, if any, shall have been paid to the Warrant
Agent and shall have been returned to the Company as provided in
Section 2.06, whichever occurs earlier.
(b) The Warrant Agent may at any time resign as such
agent by giving written notice to the Company of such intention
on its part, specifying the date on which its desired resignation
shall become effective, subject to the appointment of a successor
Warrant Agent and acceptance of such appointment by such
successor Warrant Agent as hereinafter provided. The Warrant
Agent hereunder may be removed at any time by the filing with it
of an instrument in writing signed by or on behalf of the Company
and specifying such removal and the date when it shall become
effective. Such resignation or removal shall take effect upon
the appointment by the Company, as hereinafter provided, of a
successor Warrant Agent (which shall be a banking institution
organized under the laws of the United States of America or one
of the states thereof, have a combined capital and surplus of at
least $100,000,000 (as set forth in its most recent reports of
condition published pursuant to law or to the requirements of any
United States federal or state regulatory or supervisory
authority) and having an office in the Borough of Manhattan, The
City of New York) and the acceptance of such appointment by such
successor Warrant Agent. In the event a successor Warrant Agent
has not been appointed and accepted its duties within 90 days of
the Warrant Agent's notice of resignation, the Warrant Agent may
apply to any court of competent jurisdiction for the designation
of a successor Warrant Agent. The obligation of the Company
under Section 5.02(a) shall continue to the extent set forth
therein notwithstanding the resignation or removal of the Warrant
Agent.
(c) In case at any time the Warrant Agent shall give
notice of its intent to resign, or shall be removed, or shall
become incapable of acting, or shall be adjudged a bankrupt or
insolvent, or make an assignment for the benefit of its
<PAGE>
<PAGE>
creditors, or consent to the appointment of a receiver or
custodian of all or any substantial part of its property, or
shall admit in writing its inability to pay or meet its debts as
they mature, or if a receiver or custodian of it or of all or any
substantial part of its property shall be appointed, or if any
public officer shall have taken charge or control of the Warrant
Agent or of its property or affairs, for the purpose of
rehabilitation, conservation or liquidation, a successor Warrant
Agent, qualified as aforesaid, shall be promptly appointed by the
Company by an instrument in writing, filed with the successor
Warrant Agent. Upon the appointment as aforesaid of a successor
Warrant Agent and acceptance by the latter of such appointment,
the Warrant Agent so superseded shall cease to be Warrant Agent
hereunder.
(d) Any successor Warrant Agent appointed hereunder
shall execute, acknowledge and deliver to its predecessor and to
the Company an instrument accepting such appointment hereunder,
and thereupon such successor Warrant Agent, without any further
act, deed or conveyance, shall become vested with all the
authority, rights, powers, trusts, immunities, duties and
obligations of such predecessor with like effect as if originally
named as Warrant Agent hereunder, and such predecessor, upon
payment of its charges and disbursements then unpaid, shall
thereupon become obligated to transfer, deliver and pay over, and
such successor Warrant Agent shall be entitled to receive, all
monies, securities and other property on deposit with or held by
such predecessor (including, without limitation, the Warrant
Register), as the Warrant Agent hereunder.
(e) Any corporation into which the Warrant Agent
hereunder may be merged or converted or any corporation with
which the Warrant Agent may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which
the Warrant Agent shall be a party or any corporation to which
the Warrant Agent shall sell or otherwise transfer all or
substantially all the corporate agency assets and business of the
Warrant Agent, provided that it shall be qualified as aforesaid,
shall be the successor Warrant Agent under this Agreement without
the execution or filing of any paper or any further act on the
part of any of the parties hereto.
<PAGE>
<PAGE>
ARTICLE VI
MISCELLANEOUS
SECTION 6.01. Amendment. (a) This Agreement and the
---------
terms of the Warrants may be amended by the Company, the Warrant
Agent and the Determination Agent, without the consent of the
Warrantholders, for the purpose of curing any ambiguity, or of
curing, correcting or supplementing any defective or inconsistent
provision contained herein or therein or in any other manner
which the Company may deem necessary or desirable and which will
not materially and adversely affect the interests of the owners
or holders of the Warrants. Notwithstanding anything in this
Section 6.01 to the contrary, this Agreement may not be amended
to provide for the countersigning by the Warrant Agent or Warrant
Certificates evidencing in the aggregate in excess of 1,150,000
Warrants unless and until the Warrant Agent has received notice
from the AMEX or any successor United States national securities
exchange that the additional Warrants in excess of 1,150,000 have
been approved for listing on such exchange.
(b) The Company, the Warrant Agent and the Determina-
tion Agent may modify or amend this Agreement, with the consent
of Warrantholders (by vote of Registered Holders or, in the case
of Warrants held through the Depository, acting through a
Participant or the Depository) holding not less than a majority
in number of the then outstanding Warrants affected by such
modification or amendment, for any purpose; provided, however,
that no such modification or amendment that increases the Strike
Level, shortens the period of time during which the Warrants may
be exercised, or otherwise materially and adversely affects the
exercise rights of the Warrantholders or reduces the percentage
of the number of outstanding Warrants, the consent of whose
holders is required for modification or amendment of this
Agreement, may be made without the consent of each Warrantholder
affected thereby. In the case of Warrants evidenced by a Global
Warrant Certificate, the Company and the Warrant Agent shall be
entitled to rely upon certification in form satisfactory to each
of them that any requisite consent has been obtained from holders
of beneficial ownership interests in the relevant Global Warrant
Certificate. Such certification may be provided by Participants
acting on behalf of such beneficial owners of Warrants, provided
that any such certification is accompanied by a certification
from the Depository as to the Warrant holdings of such
Participants.
SECTION 6.02. Notices and Demands to the Company, the
---------------------------------------
Warrant Agent and the Determination Agent. If the Warrant Agent
-----------------------------------------
<PAGE>
<PAGE>
or the Determination Agent shall receive any notice or demand
addressed to the Company by any Registered Holder or Participant
pursuant to the provisions of this Agreement, the Warrant Agent
or the Determination Agent, as the case may be, shall promptly
forward such notice or demand to the Company.
SECTION 6.03. Addresses for Notices. Any
---------------------
communications to the Warrant Agent with respect to this
Agreement shall be addressed to 450 West 33rd Street, New York,
New York 10001, Attention: Corporate and Municipal Agency
Department (the "Warrant Agent's Office") and any communications
to the Company with respect to this Agreement shall be addressed
to The Bear Stearns Companies Inc., 245 Park Avenue, New York,
New York 10167, Attention: Secretary, and any communications to
the Determination Agent with respect to this Agreement shall be
addressed to Bear, Stearns & Co. Inc., 245 Park Avenue, New York,
New York 10167 (or such other address as shall be specified in
writing by the Warrant Agent, the Company or the Determination
Agent, respectively).
SECTION 6.04. Notices to Holders. The Company may
------------------
cause to have notice given to the holders of Warrants by
providing the Warrant Agent with a form of notice to be
distributed by (i) in the case of Definitive Warrants, the
Warrant Agent to Registered Holders or (ii) in the case of Book-
entry Warrants, the Depository to be distributed by the
Depository to Participants in accordance with the custom and
practices of the Depository.
SECTION 6.05. Obtaining of Approvals. The Company
----------------------
will from time to time take all action which may be necessary to
obtain and keep effective (a) any and all permits, consents and
approvals of governmental agencies and authorities and the AMEX
or any successor SRO and (b) any and all filings or notices under
United States Federal and State securities laws, which may be or
become required in connection with the issuance, sale, trading,
transfer or delivery of the Warrant Certificates, the Global
Warrant Certificate or the exercise of the Warrants.
SECTION 6.06. Persons Having Rights Under This
--------------------------------
Agreement. Nothing in this Agreement expressed or implied and
---------
nothing that may be inferred from any of the provisions hereof is
intended, or shall be construed, to confer upon, or give to, any
person or corporation other than the Company, the Warrant Agent,
the Registered Holder of the Global Warrant Certificate and the
Warrantholders any right, remedy or claim under or by reason of
this Agreement or of any covenant, condition, stipulation,
promise or agreement hereof; and all covenants, conditions,
<PAGE>
<PAGE>
stipulations, promises and agreements contained in this Agreement
shall be for the sole and exclusive benefit of the Company, the
Warrant Agent, and their respective successors, the Registered
Holder of the Global Warrant Certificate and the Warrantholders.
SECTION 6.07. Inspection of Agreement. A copy of this
-----------------------
Agreement shall be available at all reasonable times at the
Warrant Agent's office for inspection by the Warrantholders,
Participants or any person certified by any Participant to be an
indirect participant of the Depository or any person certified by
any Participant to be a Warrantholder, in each case, on behalf of
whom such Participant holds Warrants.
SECTION 6.08. Headings. The descriptive headings of
--------
the several Articles and Sections of this Agreement are inserted
for convenience only and shall not control or affect the meaning
or construction of any of the provisions hereof.
SECTION 6.09. Counterparts. This Agreement may be
------------
executed in any number of counterparts, each of which so executed
shall be deemed to be an original; but such counterparts shall
together constitute but one and the same instrument.
SECTION 6.10. Applicable Law. This Agreement and each
--------------
Warrant shall be deemed to be a contract under the laws of the
State of New York, and for all purposes shall be construed in
accordance with the laws of said State, excluding choice of law
provisions.
<PAGE>
<PAGE>
IN WITNESS WHEREOF, this Agreement has been duly
executed by the parties hereto as of the day and year first above
written.
THE BEAR STEARNS COMPANIES INC.
By
------------------------
Name:
Title:
CHEMICAL BANK
By
------------------------
Name:
Title:
BEAR, STEARNS & CO. INC.
By
------------------------
Name:
Title:
<PAGE>
<PAGE>
EXHIBIT A
FORM OF WARRANT CERTIFICATE
[FACE]
NO. C- CUSIP
------
THE BEAR STEARNS COMPANIES INC.
Nikkei 225 Index Strike Reset Call Warrants
Expiring October __, 1997
This Warrant Certificate certifies that ___________, or
registered assigns, is the Registered Holder of __________ Nikkei
225 Index Strike Reset Call Warrants Expiring October __, 1997
(the "Warrants"). Upon receipt by the Warrant Agent of this
Warrant Certificate and the Exercise Notice on the reverse hereof
(or an Exercise Notice in substantially identical form delivered
herewith), duly completed and executed, at the Warrant Agent's
Window, Attention: Tender Department, in the Borough of
Manhattan, The City of New York, each Warrant evidenced hereby
entitles the registered owner hereof (each a "Warrantholder") to
receive, subject to the terms and conditions set forth herein and
in the Warrant Agreement, from The Bear Stearns Companies Inc.
(the "Company") the Cash Settlement Value of such Warrant, except
that, under the circumstances described below, such Warrantholder
may instead receive the Alternative Settlement Amount for such
Warrant or, in certain circumstances following an Extension
Event, the Warrants will be deemed to be worthless. Except in
the case of the substitution of a Substitute Index for the Nikkei
225 Index, the Cash Settlement Value of an Exercised Warrant will
be an amount in U.S. Dollars (the "Cash Settlement Value") equal
to the quotient (rounded down to the nearest cent) of (A) the
amount, if any, by which the Spot Nikkei 225 Index for the
applicable Valuation Date (as defined herein) for such Warrant
exceeds the Strike Level, divided by (B) the product of 6.0 and
the fixed Japanese Yen/U.S. Dollar exchange rate of Yen ____ per
U.S. $1.00.
The Cash Settlement Value is calculated using the following
formula:
Cash Settlement Value = the greater of
(i) $0 and (ii) $1 x (Spot Nikkei 225 Index -- Strike level)
-------------------------------------
6 x (Yen _____ / U.S. $1.00)
<PAGE>
<PAGE>
The "Strike Level" is _________, which was determined by the
Determination Agent and was the closing value (afternoon session)
of the Nikkei 225 Index on October __, 1995 multiplied by .90 but
is subject to adjustment on the Reset Date as provided below.
If the closing value (afternoon) session) (the "Reset
Date Closing Value") of The Nikkei 225 Index on January , 1996,
unless extended as described herein (the "Reset Date") is lower
than the closing value (afternoon session) on October , 1995
(the "Initial Closing Value"), the Strike Level shall be reduced
by the full amount, if any, by which the Initial Closing Value is
greater than the Reset Date Closing Value. If the Company
determines that an Extraordinary Event or Exercise Limitation
Event has occurred and is continuing on the Reset Date, then the
Reset Date Closing Value shall be calculated on the basis that
the Reset Date shall be the next Index Calculation Day following
an Applicable Tokyo Business Day on which there is no
Extraordinary Event or Exercise Limitation Event. Within 30 days
following the Reset Date, the Company will notify the Warrant
Agent in writing if there has been an adjustment to the Strike
Level and will either make a public announcement regarding the
amount of such adjustment and the new Strike Level or publish
such information in a United States newspaper with a national
circulation (currently expected to be The Wall Street Journal).
In the event that a Substitute Index is substituted (as
provided in Section 2.02(h)) for the Nikkei 225 Index, the Strike
Level will be adjusted as follows:
Strike Level
---------------------------------- x Current Value of Substitute Index
Current Value of Nikkei 225 Index
and the Cash Settlement Value of an Exercised Warrant shall be
the amount in U.S. Dollars equal to the quotient (rounded down to
the nearest cent) of the amount, if any, by which the Spot Nikkei
225 Index for the applicable Valuation Date for such Warrant
exceeds the Strike Level (adjusted pursuant to the formula
above), divided by the Adjusted Divisor. The "Adjusted Divisor"
shall be an amount equal to 6 multiplied by the fixed Japanese
Yen/U.S. Dollar exchange rate of Yen _____ / U.S. $1.00
multiplied by a fraction, the numerator of which will be the
Current Value of the Substitute Index and the denominator of
which will be the Current Value of the Nikkei 225 Index.
The "Current Value" of the Nikkei 225 Index and of the
Substitute Index shall equal their respective levels reported by
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the relevant exchange at the close of business on the day that
the Determination Agent substitutes the Substitute Index for the
Nikkei 225 Index or, if such day is not a Tokyo Business Day, the
Tokyo Business Day immediately preceding such day. In the event
of such substitution, the Determination Agent shall promptly
notify the Warrant Agent of the new Strike Level and of said
Current Values.
A Warrant will not require or entitle a Warrantholder
to sell or deliver to the Company any shares of any component
stocks of the Nikkei 225 Index or, in the case of the substitu-
tion of a Substitute Index for the Nikkei 225 Index, the
Substitute Index or any Successor Index to either the Nikkei 225
Index or the Substitute Index, as the case may be (the "Under-
lying Stocks"), or any other securities. Upon exercise of a
Warrant, the Company will make only a U.S. Dollar cash payment in
the amount of the Cash Settlement Value or Alternative Settlement
Amount, if any and as applicable, of such Warrant. The Company
is under no obligation to, nor will it, purchase or take delivery
from any Warrantholder of any shares of any of the Underlying
Stocks or any other securities in connection with the exercise of
any Warrants. Warrantholders will not receive any interest on
any Cash Settlement Value, and the Warrants will not entitle the
Warrantholders to any of the rights of holders of any of the
Underlying Stocks or other securities.
Subject to the terms and conditions set forth herein
and in the Warrant Agreement, each Warrant may be exercised, on
any New York Business Day during the period from its date of
issuance until 3:00 P.M., New York City time, on the earlier of
(i) the New York Business Day immediately preceding the
Expiration Date (as defined below) and (ii) any Delisting Date.
The "Expiration Date" shall be October __, 1997. Except under
certain circumstances following an Extension Event, any Warrant
not exercised (including by reason of any postponed exercise as
described on the reverse hereof or in the Warrant Agreement) at
or before 3:00 P.M., New York City time, on the earlier of
(i) the New York Business Day immediately preceding the
Expiration Date and (ii) any Delisting Date, will be
automatically exercised.
Reference is hereby made to the further provisions of
this Warrant Certificate set forth on the reverse hereof and such
further provisions shall for all purposes have the same effect as
though fully set forth in this place.
This Warrant Certificate shall not be valid unless
countersigned by the Warrant Agent.
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IN WITNESS WHEREOF, The Bear Stearns Companies Inc. has
caused this instrument to be duly executed.
Dated:_________________ THE BEAR STEARNS COMPANIES INC.
By________________________
Name:
Title:
Attest:
By_____________________
Secretary
Countersigned as of the
date above written:
CHEMICAL BANK
as Warrant Agent
By_____________________
Authorized Officer
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[REVERSE]
THE BEAR STEARNS COMPANIES INC.
The Warrants evidenced by this Warrant Certificate are
part of a duty authorized issue of Warrants issued by the Company
pursuant to a Warrant Agreement, dated as of October __, 1995
(the "Warrant Agreement"), among the Company, Chemical Bank (the
"Warrant Agent") and Bear, Stearns & Co. Inc. (the "Determination
Agent") and are subject to the terms and provisions contained in
the Warrant Agreement, to all of which terms and provisions each
Warrantholder consents by acceptance of this Warrant Certificate
and which Warrant Agreement is hereby incorporated by reference
in and made a part of this Warrant Certificate. A copy of the
Warrant Agreement is on file at the Warrant Agent's Office.
The Warrants are unsecured contractual 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 provisions hereof and the Warrant
Agreement, each Warrant may be exercised during the period from
its date of issuance until 3:00 P.M., New York City time, on the
earlier of (i) the New York Business Day immediately preceding
the Expiration Date and (ii) any Delisting Date by delivering or
causing to be delivered this Warrant Certificate and attached
Exercise Notice (or an Exercise Notice in substantially identical
form), duty completed and executed, to the Warrant Agent's
Window, in the Borough of Manhattan, The City of New York (the
"Warrant Agent's Window"), which is, on the date hereof (unless
otherwise specified herein), Chemical Bank/Geoserve, Corporate
Trust Securities Window, 55 Water Street, Room 234, North
Building, New York, New York 10041, Attention: Tender
Department, or at such other address as the Warrant Agent may
specify from time to time.
Each Warrant entitles the Warrantholder to receive,
upon exercise (including automatic exercise), the Cash Settlement
Value of such Warrant, except that, under the circumstances
described below, such Warrantholder may instead receive the
Alternative Settlement Amount for such Warrant or, in certain
circumstances following an Extension Event, the Warrants will be
deemed to be worthless. Except in the case of the substitution
of a Substitute Index for the Nikkei 225 Index, the "Cash
Settlement Value" of an Exercised Warrant will be an amount in
U.S. Dollars equal to the quotient (rounded down to the nearest
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cent) of (A) the amount, if any, by which the Spot Japan Index
for the applicable Valuation Date for such Warrant exceeds the
Strike Level (as defined herein), divided by (B) the product of
6.0 and the fixed Japanese Yen/U.S. Dollar exchange rate of Yen
_____ per U.S. $1.00.
If the Reset Date Closing Value of The Nikkei 225 Index
on the Reset Date is lower than the Initial Closing Value, the
Strike Level shall be reduced by the full amount, if any, by
which the Initial Closing Value is greater than the Reset Date
Closing Value. If the Company determines that an Extraordinary
Event or Exercise Limitation Event has occurred and is continuing
on the Reset Date, then the Reset Date Closing Value shall be
calculated on the basis that the Reset Date shall be the next
Index Calculation Day following an Applicable Tokyo Business Day
on which there is no Extraordinary Event or Exercise Limitation
Event. Within 30 days following the Reset Date, the Company will
notify the Warrant Agent in writing if there has been an
adjustment to the Strike Level and will either make a public
announcement regarding the amount of such adjustment and the new
Strike Level or publish such information in a United States
newspaper with a national circulation (currently expected to be
The Wall Street Journal).
The Company has appointed Bear, Stearns & Co. Inc. to
be its Determination Agent to determine the Spot Nikkei 225 Index
as provided in the Warrant Agreement and herein and to make such
calculations as may be required upon the occurrence of certain
circumstances, as described in the Warrant Agreement and herein.
The Determination Agent shall act as an independent expert and
not as an agent of the Company, and, unless otherwise provided by
the Warrant Agreement, its calculations and determinations under
the Warrant Agreement and this Warrant Certificate shall, absent
manifest error, be final and binding on the Company, the Warrant
Agent and the Warrantholders. Any such calculations will be made
available to a Warrantholder for inspection at the Warrant
Agent's office. The Determination Agent will have no
responsibility for good faith errors or omissions in calculating
or disseminating information regarding the Nikkei 225 Index, any
Substitute Index or any Successor Index, adjustments or
calculations by the Determination Agent in order to arrive at a
calculation of a stock index comparable to the Nikkei 225 Index,
any Substitute Index or any Successor Index, the Cash Settlement
Value or the Alternative Settlement Amount, as applicable.
In the event that the Nikkei 225 Index (or if a
Substitute Index has been substituted for the Nikkei 225 Index,
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such Substitute Index) is not published by NKS but is published
by another person not affiliated with the Company and acceptable
to the Company (the "Third Party"), then the Spot Nikkei 225
Index for any date thereafter will be determined based on the
closing value (afternoon session) of the Nikkei 225 Index (or
such Substitute Index, as the case may be) as published by such
Third Party. If NKS or any Third Party discontinues publication
of the Nikkei 225 Index (or if a Substitute Index has been
substituted for the Nikkei 225 Index, such Substitute Index) and
publishes a successor or substitute index that the Company
determines, in its sole discretion, to be comparable to the
Nikkei 225 Index (or such Substitute Index, as the case may be)
(any such index being a "Successor Index"), then the Spot Nikkei
225 Index for any date thereafter will be determined by the
Determination Agent on behalf of the Company based on the closing
level of the Successor Index on such date. If NKS or any Third
Party makes a material change in the formula for, or the method
of calculating, the Nikkei 225 Index, any Substitute Index or any
Successor Index, the Determination Agent shall make such
calculations as may be required to determine the applicable Cash
Settlement Value using the formula and method of calculating the
Nikkei 225 Index, any Substitute Index or any Successor Index as
in effect prior to such change or modification. If NKS and/or
any Third Party discontinues publication of the Nikkei 225 Index,
any Substitute Index and/or any Successor Index, the
Determination Agent will determine the applicable Cash Settlement
Value based on the formula and method used in calculating the
Nikkei 225 Index, any Substitute Index or any Successor Index as
in effect on the date the Nikkei 225 Index, such Substitute Index
or such Successor Index was last published.
Upon the occurrence of a Substitution Event, the
Company shall promptly give notice to the Warrantholders, by
publication in a United States newspaper with a national
circulation (currently expected to be the Wall Street Journal),
specifying: (i) the date on which the Substitution Event was
deemed to occur pursuant to Section 2.02(h) of the Warrant
Agreement, (ii) that a Substitute Index will be substituted for
the Nikkei 225 Index on the Substitution Date (as defined
herein), (iii) the name of the Substitute Index, (iv) the
Substitution Date, (v) the Strike Level as adjusted pursuant to
Section 2.02(e) of the Warrant Agreement and (vi) the Adjusted
Divisor. The Warrant Agent at the request and expense of the
Company and on behalf of the Company shall mail such notice to
each Warrantholder. On the Substitution Date, the Substitute
Index will be substituted for the Nikkei 225 Index. From and
after the Substitution Date, the index used to determine the Spot
Nikkei 225 Index used to calculate the Cash Settlement Value or
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Alternative Settlement Amount, as the case may be, of the
Warrants will be such Substitute Index. The "Substitution Date"
shall be the thirtieth calendar day (or, if such day is not a New
York Business Day, the next succeeding New York Business Day)
following such giving of notice of the Substitution Event.
A "Substitution Event" will occur if, as determined by
the Determination Agent (whose opinion shall be conclusive and
binding on the Company and on the holders of the Warrants) the
following conditions are fulfilled:
(i) Either of the following has occurred:
(A) The AMEX or another United States securities
exchange publishes (on a basis not less regularly than
each day on which such exchange and the TSE are open
for trading) an index (the "New Japan Index") which:
for a period of 90 days immediately preceding the date
of the Substitution Event has a correlation based on
daily, closing value to closing value, percentage
changes of not less than 90% with the Nikkei 300 Index
(as defined in the Prospectus Supplement dated October
__, 1995 relating to the Warrants (the "Prospectus
Supplement")); and warrants with payments determined by
reference to the New Japan Index have been approved to
be listed on the AMEX or such other exchange by the
Securities and Exchange Commission; or
(B) Warrants with payments determined by
reference to the Nikkei 300 Index have been approved to
be listed on the AMEX or such other exchange by the
Securities and Exchange Commission; and
(ii) Either of the following has occurred:
(A) the Nikkei 225 Index (as defined in the
Prospectus Supplement) is no longer published and/or
the Nikkei 225 Futures Contracts (as defined in the
Prospectus Supplement) have been delisted from trading
on the OSE; or
(B) the Adjusted Trading Volume and the Adjusted
Open Interest (in each case, as defined herein) for the
two Nikkei 300 Futures Contracts (as defined in the
Prospectus Supplement) with expiration dates closest in
time to the Substitution Event exceed the Adjusted
Trading Volume and the Adjusted Open Interest, respec-
tively, for the two Nikkei 225 Futures Contracts with
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expiration dates closest in time to the Substitution
Event, each for any three-month period prior to the
date of any Substitution Event; and
(iii) To the extent required, the Company, the AMEX
and/or such exchange shall have obtained any license
necessary to use the New Japan Index or the Nikkei 300
Index.
Notwithstanding the above, unless the Nikkei 225 Index
is no longer published and/or the Nikkei 225 Futures Contracts
shall have been delisted from trading on the OSE, a Substitution
Event will not be deemed to have occurred on any of the 60
calendar days immediately preceding the Expiration Date.
A "Substitute Index" means, in the event that the
circumstances described in (i)(A) above have occurred, a New
Japan Index or, in the event that the circumstances described in
clause (i)(B) above have occurred, the Nikkei 300 Index.
"Adjusted Trading Volume" for the Nikkei 300 Futures
Contracts or the Nikkei 225 Futures Contracts means the
arithmetic mean, for any period, of the amounts on each trading
day equal to the product of: (x) the number of such futures
contracts traded on such day and (y) the closing level on such
day of the index to which such futures contracts relate,
multiplied by Yen 10,000, in the case of the Nikkei 300 Futures
Contracts, or Yen 1,000, in the case of the Nikkei 225 Futures
Contracts (the "Contract Multiplier"). "Adjusted Open Interest"
for the Nikkei 300 Futures Contracts or the Nikkei 225 Futures
Contracts means the arithmetic mean, for any period, of the
amounts on each trading day equal to the product of: (x) the
open interest in such futures contracts on such day and (y) the
closing level on such day of the index to which such futures
contracts relate, multiplied by the Contract Multiplier.
Subject to the Warrant Agreement and this Warrant
Certificate, the "Valuation Date" for a Warrant shall be the
first Index Calculation Day following the applicable Exercise
Date, subject to postponement upon the occurrence of an
Extraordinary Event or Exercise Limitation Event or as a result
of the exercise of a number of Warrants exceeding the limits on
exercise, all as described below. Except for Warrants subject to
automatic exercise, or Warrants subject to the Limit Option or
following an Extension Event, the "Exercise Date" for a Warrant
will be (A) in the case of Warrants other than those held through
the facilities of Cedel Societe Anonyme ("CEDEL") or Euroclear
System ("Euroclear") (i) the New York Business Day on which the
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Warrant Agent receives at the Warrant Agent's Window, Attention:
Tender Department, the Warrant (or transfer of such Warrant
through the Depository in the case of Book-entry Warrants) and
Exercise Notice (by facsimile transmission in accordance with the
Warrant Agreement in the case of Exercise Notices for Book-entry
Warrants) 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
Certificate (or transfer of such Warrant through the Depository
in the case of Book-entry Warrants) or Exercise Notice after 3:00
P.M., New York City time, on a New York Business Day, then the
New York Business Day next succeeding the New York Business Day
on which such Warrant or Exercise Notice is received (B) in the
case of Warrants held through the facilities of CEDEL or
Euroclear, (i) the New York 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 Certificate (or transfer of such Warrant through the
Depository in the case of Book-entry Warrants) is received by the
Warrant Agent by 3:00 P.M., New York City time, on the Valuation
Date, or (ii) if the Warrant Agent receives such Exercise Notice
after 3:00 P.M., New York City time, on a New York Business Day,
then the New York Business Day next succeeding such New York
Business Day, provided that the Warrant Certificate (or transfer
of such Warrant through the Depository in the case of Book-entry
Warrants) is received by 3:00 P.M., New York City time, on the
Valuation Date relating to exercises of Warrants on such
succeeding New York Business Day. In the event that the Warrant
Certificate (or transfer of such Warrant through the Depository
in the case of Book-entry Warrants) 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
Certificate (or transfer of such Warrant through the Depository
in the case of Book-entry Warrants) is received or, if such day
is not a New York Business Day, the next succeeding New York
Business Day; provided, further, however, in the case of
exercises by Euroclear Participants, Euroclear must by facsimile
to the Warrant Agent by 9:00 a.m., New York City time, on the
Valuation Date confirm that the Warrants will be received by the
Warrant Agent on such date, provided, that if such facsimile 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 notice of exercise or waive the requirement
for timely delivery of such facsimile.
Subject to the provisions of the Warrant Agreement
relating to Extension Events, all Warrants for which the Warrant
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Agent has not received a valid Exercise Notice in proper form at
or prior to 3:00 P.M., New York City time, on (i) the New York
Business Day immediately preceding the Expiration Date or
(ii) any Delisting Date prior to the Expiration Date, as the case
may be, or for which the Warrant Agent has received a valid
Exercise Notice but with respect to which timely delivery of the
relevant Warrants has not been made, together with any Warrants
the Valuation Date for which has as of such time been postponed
as described below, will be automatically exercised as of such
date; without any requirement of delivery of an Exercise Notice
to the Warrant Agent. However, if the Company first receives
notice of the delisting or suspension of the Warrants on the same
day on which such Warrants are delisted or suspended, such day
will be deemed a Delisting Date. The Exercise Date for such
Warrants will be the Expiration Date or any Delisting Date, as
the case may be, or, if such date is not a New York Business Day,
the next succeeding New York Business Day. The Warrant Agent
will obtain the Spot Nikkei 225 Index (determined as of the first
index Calculation Day following such date, which will be the
Valuation Date for such Warrants except in the case of a
postponed exercise following the occurrence of an Extraordinary
Event or an Exercise Limitation Event) and will determine the
Cash Settlement Value, if any, of such Warrants.
No fewer than 500 Warrants may be exercised by or on
behalf of any one Warrantholder at any one time, except that no
such minimum exercise amount shall apply in the case of automatic
exercise on or following the Expiration Date or on any Delisting
Date or in the case of cancellation of the Warrants as a result
of an Extraordinary Event. With the exception of the Limit
Option, an Exercise Notice shall be unconditional. Except as
provided in the Warrant Agreement, the Warrant Agent shall be
entitled, with no duty of inquiry, to rely conclusively on any
Exercise Notice received by it and on any representation of the
exercising Warrantholder contained therein. A Warrantholder
shall not combine Definitive Warrants and Book-entry Warrants or
Book-entry Warrants held through more than one Participant to
meet the 500 Warrant minimum exercise requirement provided in the
Warrant Agreement and herein.
If the Exercise Notice is not rejected as provided in
the Warrant Agreement, then the Warrant Agent or the Determi-
nation Agent, as the case may be, will determine the Cash
Settlement Value of the exercised Warrants in accordance with the
terms of the Warrant Agreement. Except in the case of Warrants
subject to automatic exercise, Warrants that upon exercise
entitle the holder thereof to receive an Alternative Settlement
Amount in lieu of the Cash Settlement Value and Warrants deemed
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worthless following an Extension Event, if on any Valuation Date
the Cash Settlement Value for any Warrants then exercised would
be zero, then the attempted exercise of any such Warrants shall
be void and of no effect and the Warrant Certificate evidencing
such Warrants will be returned to the Registered Holder of the
Warrant by first class mail at the Company's expense and such
holder shall be permitted to re-exercise such Warrants prior to
the Expiration Date or any Delisting Date, as the case may be.
Except in the case of Warrants subject to automatic
exercise, Warrants that upon exercise entitle the holder thereof
to receive an Alternative Settlement Amount and Warrants deemed
worthless following an Exercise Event, if the Company has made
adequate New York Clearing House or next day funds available to
the Warrant Agent in a timely manner, which shall in no event be
later than 3:00 P.M., New York City time on the fourth New York
Business Day following the Valuation Date (or, if the Valuation
Date is not a New York Business Day, on the fourth New York
Business Day following the New York Business Day succeeding the
Valuation Date) (the "Funding Date"), the Warrant Agent will be
responsible for making its payment available to each Registered
Holder of an Exercised Warrant in the form of a cashier's check
or an official bank check, or (in the case of payments of at
least $100,000) by wire transfer to a U.S. Dollar account
maintained by such Registered Holder in the United States (at the
Registered Holder's election as specified in the applicable
Exercise Notice) prior to the close of business on the first New
York Business Day immediately succeeding such Funding Date (the
"Settlement Date") against receipt by the Warrant Agent at the
Warrant Agent's Window, of such Registered Holder's Warrant
Certificates. Such payment shall be in an amount equal to the
aggregate Cash Settlement Value of such holder's exercised
Warrants.
With respect to automatically exercised Warrants (other
than Warrants subject to postponed exercise following the
occurrence of an Extraordinary Event or an Exercise Limitation
Event) if the Company has made adequate New York Clearing House
or next day funds available to the Warrant Agent in a timely
manner, which shall in no event be later than 3:00 P.M., New York
City time on the fourth New York Business Day following the
Valuation Date for such automatically exercised Warrants (or if
such Valuation Date is not a New York Business Day, on the fourth
New York Business Day following the New York Business Day next
succeeding such Valuation Date) (the "Automatic Funding Date"),
the Warrant Agent will be responsible for making its payment
available to each Registered Holder of an Exercised Warrant in
the form of a cashier's check or an official bank check, or (in
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the case of payments of at least $100,000) by wire transfer to a
U.S. Dollar bank account maintained by such Registered Holder in
the United States (at such holder's election and upon proper
notice being given to the Company and the Warrant Agent) prior to
the close of business on such Automatic Funding Date (or in the
case of payments made by wire transfer, prior to the close of
business on the New York Business Day next succeeding the
Automatic Funding Date), against receipt by the Warrant Agent at
the Warrant Agent's Window of such Registered Holder's Warrant
Certificates. Such payment shall be in the amount equal to the
aggregate Cash Settlement Value in respect of the Warrants
evidenced by such Warrant Certificates. Warrant Certificates
delivered to the Warrant Agent shall thereafter be promptly
cancelled by the Warrant Agent.
Neither the Warrant Agent nor the Determination Agent
will be responsible for any losses resulting from a failure of a
brokerage firm or a Participant to properly exercise Warrants on
behalf of a Warrantholder.
Subject to the provisions of Section 2.03(b)(ii) of the
Warrant Agreement, if the Company determines that an Extra-
ordinary Event or an Exercise Limitation Event has occurred and
is continuing on the Tokyo Business Day with respect to which the
Spot Nikkei 225 Index on a Valuation Date is to be determined
(the "ApplicabLe Tokyo Business Day"), then the Cash Settlement
Value with respect to an exercise of Warrants shall be calculated
on the basis that the Valuation Date shall be the next Index
Calculation Day, following an Applicable Tokyo Business Day on
which there is no Extraordinary Event or Exercise Limitation
Event; provided that if the Valuation Date has not occurred on or
prior to the Expiration Date or any Delisting Date, then the
Warrantholders will receive the Alternative Settlement Amount in
lieu of the Cash Settlement Amount which shall be calculated as
if the Warrants had been cancelled on the Expiration Date or any
Delisting Date, as the case may be.
Upon the occurrence of an Extraordinary Event or an
Exercise Limitation Event, the Company shall use its best efforts
to notify the Warrant Agent and the Determination Agent promptly
that an Extraordinary Event or Exercise Limitation Event, as the
case may be, has occurred and shall promptly give notice to the
Warrantholders by publication in a United States newspaper with a
national circulation (currently expected to be the Wall Street
Journal), that an Extraordinary Event or an Exercise Limitation
Event has occurred.
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If the Company determines that an Extraordinary Event
or an Exercise Limitation Event has occurred and is continuing on
the Expiration Date or on any earlier Delisting Date, the Company
shall so notify the Warrant Agent and the Determination Agent,
and the Cash Settlement Value with respect to the exercised
Warrants shall be equal to, and be calculated in the same manner
as, an Alternative Settlement Amount, in accordance with the
Warrant Agreement (treating the Expiration Date or any Delisting
Date, as the case may be, as the date on which the Warrants were
cancelled).
If the Company determines that an Extraordinary Event
has occurred and is continuing, and if the Extraordinary Event is
expected by the Company to continue, the Company, prior to the
Expiration Date, may immediately cancel the Warrants by notifying
the Warrant Agent of such cancellation (the date such notice is
given being the "Cancellation Date"), and each Warrantholder's
rights under the Warrants and the Warrant Agreement shall
thereupon cease; provided, that, subject to an automatic
extension of the term of the Warrants or to a determination that
the Warrants are worthless, each Warrant shall be exercised (even
if such Warrant would not otherwise be exercisable on such date
because of the Limit Option) on the basis that the Valuation Date
for such Warrant shall be the Cancellation Date and the holder of
each such Warrant will receive the Alternative Settlement Amount
determined by the Determination Agent.
With respect to all Warrant Certificates as to which
the Valuation Date has been postponed (other than Warrants that
have been deemed worthless following an Extension Event) or which
have been cancelled as described above, the Company shall make
available to the Warrant Agent in a timely manner, which shall in
no event be later than 3:00 P.M., New York City time, on the
third New York Business Day following the date on which the Cash
Settlement Value or Alternative Settlement Amount, as the case
may be, has been calculated (the "Alternative Funding Date") New
York Clearing House Funds or next day funds in an amount equal
to, and for the payment of, the aggregate Cash Settlement Value
or Alternative Settlement Amount, as applicable, of such
Warrants. Subject to such funds having been made available as
provided in the preceding sentence, the Warrant Agent will
thereafter be responsible for making its payment available to
each Registered Holder of the Warrants that submitted a Warrant
Certificate (and in the case of cancellation to each Registered
Holder) in the form of a cashier's check or an official bank
check, or (in the case of payments of at least $100,000) by wire
transfer to a U.S. Dollar bank account maintained by the
Registered Holder in the United States (at such holder's election
and upon proper notice being given to the Company and the Warrant
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Agent) prior to the close of business on the Alternative Funding
Date (or, in the case of payments made by wire transfer, prior to
the close of business on the New York Business Day next
succeeding the Alternative Funding Date) against receipt by the
Warrant Agent at the Warrant Agent's Window, of such Registered
Holder's Warrant Certificates. Such payment shall be in the
amount equal to the aggregate Cash Settlement Value or
Alternative Settlement Amount, as the case may be, of the
Warrants evidenced by such Warrant Certificates.
If the Company determines that an event described in
clause (i) of the definition of Exercise Limitation Event below
has occurred and is continuing on the Expiration Date (an
"Extension Event") then the term of any outstanding Warrants
shall be automatically extended for a period of 30 days (the
thirtieth day following the Expiration Date being the "Extended
Expiration Date"), provided, however, that if the Cash Settlement
Value or the Intrinsic Value used in calculating the Alternative
Settlement Amount, as the case may be, of such Warrants would
have been zero if the Warrants had been exercised such that the
Valuation Date for such exercise was the Measurement Date (as
defined below), then the term of the Warrants shall not be
extended, the Warrants shall be deemed to be worthless and the
Company shall not be required to make any payments in respect
thereof. Any such automatic extension shall be deemed to have
been revoked and the Warrants shall expire on the earlier of (i)
the next Index Calculation Day following a Tokyo Trading Day on
which there is no Extension Event (the "Early Extended Expiration
Date") and (ii) any Delisting Date occurring after the Expiration
Date. The Company will give the Warrant Agent prompt notice by
telephone or facsimile transmission and will give prompt notice
to the Warrantholders by publication in a United States newspaper
with a national circulation (currently expected to be The Wall
Street Journal) of the occurrence of an Extension Event, any
Extended Expiration Date, any Index Calculation Day referred to
in clause (i) above and any Delisting Date referred to in clause
(ii) above, but in no event will such notice to the Warrant Agent
be given later than 9:30 A.M., New York City time, on the New
York Business Day following the Expiration Day, Index Calculation
Day or Delisting Date, as applicable.
Any Warrants that expire as described in clause (i) of
the preceding paragraph will be deemed to be exercised on the
Early Extended Expiration Date (even if such Warrants would not
otherwise be exercisable on such date because of the Limit
Option) on the basis that the Valuation Date for such exercise
shall be such Early Extended Expiration Date and the holder of
each such Warrant will receive an Alternative Settlement Amount,
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whether or not an Extraordinary Event or an Exercise Limitation
Event is continuing on such Early Extended Expiration Date.
If the term of the Warrants has been extended pursuant
to the second preceding paragraph but the Company determines that
an Extension Event is continuing (A) when the Warrants expire on
the Extended Expiration Date or (B) on any Delisting Date
occurring on or after the Expiration Date, the Warrants shall be
deemed to be worthless and the Company shall not be required to
make any payments in respect thereof. The Company shall give
prompt notice of any such determination to the Warrant Agent by
telephone or facsimile transmission and to the Warrantholders by
publication in a United States newspaper with a national
circulation (currently expected to be The Wall Street Journal).
"Measurement Date" means the Tokyo Trading Day
occurring most recently prior to the Expiration Date on which
none of the events described in clause (i) of the definition of
Exercise Limitation Event below had occurred or was continuing.
The "Alternative Settlement Amount" is the amount
calculated using the formula set forth below:
Alternative Settlement Amount = Intrinsic Value +
(T/2 x A/B)
where
Intrinsic the Cash Settlement Value of the
Value = Warrants determined as described above, but
calculated with a Spot Nikkei 225 Index
determined by the Determination Agent which,
subject to approval by the Company (such
approval not to be unreasonably withheld), in
the reasonable opinion of the Determination
Agent, fairly reflects the value of the
Underlying Stocks on the Cancellation Date,
Expiration Date, Delisting Date or Early
Extended Expiration Date, whichever has given
rise to the payment of the Alternative
Settlement Amount;
T = U.S. $____, the maximum initial offering
price per Warrant, less U.S. $_____, the Cash
Settlement Value per Warrant on October __,
1995;
A = the total number of days from but excluding
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the Cancellation Date, Expiration Date or
Delisting Date, whichever has given rise to
the payment of the Alternative Settlement
Amount for such Warrants, to and including
the Expiration Date; and
B = the total number of days from, but excluding
the date on which sales of the Warrants were
initially confirmed, to and including the
Expiration Date.
For the purposes of determining "Intrinsic Value" in
the above formula, in the event that the Determination Agent and
the Company are required, but have not, after good faith
consultation with each other and within five days following the
first day upon which such Alternative Settlement Amount may be
calculated in accordance with the above formula, agreed upon a
Spot Nikkei 225 Index which fairly reflects the value of the
Underlying Stocks on the Cancellation Date, Expiration Date,
Delisting Date or Early Extended Expiration Date, whichever gives
rise to the payment of the Alternative Settlement Amount then the
Determination Agent shall promptly nominate a third party,
subject to approval by the Company (such approval not to be
unreasonably withheld), to determine such figure and calculate
the Alternative Settlement Amount in accordance with the above
formula. Such party shall act as an independent expert and not
as an agent of the Company or the Determination Agent, and its
calculation and determination of the Alternative Settlement
Amount shall, absent manifest error, be final and binding on the
Company, the Warrant Agent, the Determination Agent and the
Warrantholders. Any such calculations will be made available to
a Warrantholder for inspection at the Warrant Agent's Office.
Neither the Company nor such third party shall have any respon-
sibility for good faith errors or omissions in calculating the
Alternative Settlement Amount.
An "Extraordinary Event" means any of the following
events:
(i) a suspension, material limitation or absence of
trading on the Tokyo Stock Exchange (the "TSE") of all of
the Underlying Stocks which then comprise the Nikkei 225
Index, any Substitute Index or a Successor Index;
(ii) the enactment, publication, decree or other
promulgation of any statute, regulation, rule or order of
any court of any jurisdiction, any administrative agency or
any other U.S. or non-U.S. governmental authority that would
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make it unlawful for the Company to perform any of its
obligations under the Warrant Agreement or the Warrants or
that has had or is reasonably expected to have a material
adverse effect on the ability of (A) the Company to perform
its obligations under the Warrants or to hedge or modify the
hedge of its position with respect to the Nikkei 225 Index,
any Substitute Index or a Successor Index; or (B) any
affiliate of the Company to hedge or modify the hedge of its
position with respect to any hedging transaction entered
into with the Company in connection with the Company's
obligations under the Warrants; or
(iii) any outbreak or escalation of hostilities or other
national or international calamity or crisis (including,
without limitation, natural calamities that in the opinion
of the Company may materially and adversely affect the
economy of Japan or the trading of securities generally on
the TSE) that has had or is reasonably expected to have a
material adverse effect on the ability of (A) the Company to
perform its obligations under the Warrants or to modify the
hedge of its position with respect to the Nikkei 225 Index,
any Substitute Index or a Successor Index or (B) any
affiliate of the Company to hedge or modify the hedge of its
position with respect to any hedging transaction entered
into with the Company in connection with the Company's
obligations under the Warrants.
For the purposes of determining whether an Extra-
ordinary Event has occurred: (1) a limitation on the hours or
number of days of trading will not constitute an Extraordinary
Event if it results from an announced change in the regular
business hours of the TSE and (2) an "absence of trading" on the
TSE will not include any time when the TSE is closed for trading
under ordinary circumstances.
"Exercise Limitation Event" means either of the follow-
ing events:
(i) a suspension, material limitation or absence of
trading on the TSE of 20% or more in number of the
Underlying Stocks; or
(ii) the suspension or material limitation on the
Singapore International Monetary Exchange (the "SIMEX"), the
Osaka Securities Exchange (the "OSE") or the AMEX or any
other major futures, options or securities market of trading
in futures or options contracts related to the Nikkei 225
Index (or, in the event of a substitution of a Substitute
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Index for the Nikkei 225 Index, the Nikkei 300 Index) or a
Successor Index.
For the purposes of determining whether an Exercise
Limitation Event has occurred: (1) a limitation on the hours or
number of days of trading will not constitute an Exercise
Limitation Event if it results from an announced change in the
regular business hours of the relevant exchange, (2) a decision
to permanently discontinue trading in the relevant futures or
options contract will not constitute an Exercise Limitation
Event, (3) a suspension of trading in an Underlying Stock or in a
futures or options contract referred to in clauses (i) and (ii)
above, by reason of (x) a price change violating limits set by
the TSE, SIMEX, OSE or AMEX or other futures or securities market
on which futures or options contracts related to the Nikkei 225
Index (or, in the event of a substitution of a Substitute Index
for the Nikkei 225 Index, the Nikkei 300 Index), the American
Stock Exchange Japan Index (the "Japan Index"), any New Japan
Index or a Successor Index are traded or such other futures or
securities market or (y) an imbalance of orders relating to an
Underlying Stock or such contracts will constitute a suspension
or material limitation of trading, (4) an "absence of trading" on
the TSE will not include any time when the TSE is closed for
trading under ordinary circumstances and (5) the occurrence of an
Extraordinary Event described in clause (i) of the definition of
Extraordinary Event will not constitute, and will supersede the
occurrence of, an Exercise Limitation Event.
All exercises of Warrants (other than on automatic
exercise or following an Extension Event) are subject, at the
Company's option, to the limitation that not more than 750,000
Warrants in total may be exercised on any Exercise Date and not
more than 250,000 Warrants may be exercised by or on behalf of
any beneficial owner, either individually or in concert with any
other beneficial owner, on any Exercise Date. If any New York
Business Day would otherwise, under the terms hereof, be the
Exercise Date in respect of more than 750,000 Warrants, then at
the Company's election (by giving notice thereof to the Warrant
Agent not later than by 11:00 A.M., New York City time on the New
York Business Day immediately following such Exercise Date),
750,000 of such Warrants shall be deemed exercised on such
Exercise Date (selected by the Warrant Agent on a pro rata basis,
but if, as a result of such pro rata selection, any Registered
Holders of Warrants would be deemed to have exercised less than
500 Warrants, then the Warrant Agent shall first select an
additional amount of such holders' Warrants so that no holder
shall be deemed to have exercised less than 500 Warrants), and
the remainder of such Warrants (the "Remaining Warrants") shall
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be deemed exercised on the following New York Business Day
(notwithstanding the minimum exercise requirement and subject to
successive applications of this paragraph); provided that any
Remaining Warrants for which an Exercise Notice was delivered on
a given Exercise Date shall be deemed exercised before any other
Warrants for which an Exercise Notice was delivered on a later
Exercise Date. If any beneficial owner of Warrants attempts to
exercise more than 250,000 Warrants on any New York Business Day
individually or in concert, then at the Company's election (as
notified to the Warrant Agent by giving notice thereof to the
Warrant Agent not later than 11:00 A.M., New York City time, on
the New York Business Day following such New York Business Day),
250,000 of such Warrants shall be deemed exercised on such New
York Business Day and the remainder shall be deemed exercised on
the following New York Business Day (notwithstanding the minimum
exercise requirements and subject to successive applications of
this paragraph). The date on which any Warrant is deemed
exercised under the preceding two sentences shall for all
purposes of this Warrant Certificate be deemed to be the
"Exercise Date" in respect of such Warrants.
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 (notwith-
standing 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 will, in accordance with the Warrant
Agreement, from time to time register the transfer of this
Warrant Certificate upon surrender hereof at the Warrant Agent's
Window, Attention: Transfer Department, accompanied by a written
instrument or instruments of transfer in form satisfactory to the
Warrant Agent and the Company duly executed by the Registered
Holder(s) hereof, a duly appointed legal representative thereof
or by its duly authorized attorney. Such signature shall be
guaranteed by a bank or trust company having a correspondent
office in The City of New York or by a broker or dealer which is
a member of the National Association of Securities Dealers, Inc.
(the "NASD") or by a member of a national securities exchange. A
new Warrant Certificate shall be issued to the transferee(s) upon
any such registration of transfer, and this Warrant Certificate
shall be cancelled by the Warrant Agent.
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Commencing on the one hundred eightieth calendar day
following October , 1995 each Warrantholder will have the option
(the "Conversion Option") to convert the form in which such
Warrantholder holds his Warrants from definitive to book-entry
form. The Conversion Option will be available for 45 calendar
days (the "Conversion Option Period").
In order to be exchanged for a Warrant in book-entry
form, a Warrant Certificate must be delivered to the Depository
Trust Company (the "Depository"), in proper form for deposit, by
a Participant. Accordingly, unless Warrants are purchased in
book-entry form, a Warrantholder who is not a Participant (other
than a Warrantholder holding Warrants through CEDEL or Euroclear)
must deliver his Warrant Certificate, in proper form for deposit,
to a Participant, either directly or through an indirect
participant (such as a bank, brokerage firm, dealer or trust
company that clears through, or maintains a custodial
relationship with, a Participant) or brokerage firm which
maintains an account with a Participant, in order to have its
Warrant Certificate exchanged for a Warrant in book-entry form.
Warrant Certificates received by the Depository for
exchange during the Conversion Option Period will be exchanged
for Warrants in book-entry form by the close of business on the
New York Business Day that such Certificates are received by the
Depository (if received by the Depository by its then applicable
cut-off time for same day credit) or on the following New York
Business Day (if received by the Depository by its then appli-
cable cut-off time for next day credit). Warrants surrendered at
any time for exchange for book-entry Warrants may not be
exercised or delivered for settlement or transfer until such
exchange has been effected. Once a Warrantholder has elected the
Conversion Option, such Warrantholder may hold his Warrants only
in book-entry form and will not be able to change his election or
withdraw from the book-entry system during the Conversion Option
Period or thereafter.
Except for Warrants subject to automatic exercise,
Warrants with respect to which payments of any Alternative
Settlement Amount are made and Warrants deemed worthless
following an Extension Event, each Warrantholder, in connection
with any exercise of Warrants (including a postponed exercise
following an Extraordinary Event or an Exercise Limitation
Event), shall have the option (the "Limit Option") to specify in
the related Exercise Notice that such Warrants are not to be
exercised if the Spot Nikkei 225 Index that would otherwise be
used to determine the Cash Settlement Value of such Warrants is
five hundred (500) or more points (such number of points subject
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to adjustment in accordance with the Warrant Agreement) lower
than the closing value (afternoon session) of the Nikkei 225
Index for the day specified below (such closing value, the "Limit
Option Reference Index"). A Warrantholder's election of the
Limit Option must be specified in the applicable Exercise Notice
delivered to the Warrant Agent. The Limit Option Reference Index
will be the closing value (afternoon session) of the Nikkei 225
Index (or a Substitute Index, as the case may be) on the relevant
Exercise Date (or if such day is not an Index Calculation Day, on
the immediately preceding Index Calculation Day). If an Exercise
Notice and the related Warrants are received after 3:00 P.M., New
York City time, on a given day, the applicable Limit Option
Reference Index will be determined as of the next day that is
also a New York Business Day (or, if such day is not an Index
Calculation Day, as of the immediately preceding Index
Calculation Day).
Following receipt of an Exercise Notice and the related
Warrants subject to the Limit Option, the Warrant Agent shall
obtain from the Determination Agent the applicable Limit Option
Reference Index and will determine whether such Warrants will not
be exercised because of the Limit Option. Warrants that are not
exercised will be treated as not having been tendered for
exercise and the Warrant Certificate evidencing such Warrants
will be returned to the Registered Holder by first class mail at
the Company's expense. To exercise such Warrants, a Warrant-
holder will be required to cause an Exercise Notice and the
related Warrants to be submitted again to the Warrant Agent. In
the case of a postponed Valuation Date, the Limit Option will
continue to apply once elected by a Warrantholder in connection
with an exercise of Warrants on the basis of the Limit Option
Reference Index as initially determined for such Warrants, except
when such Valuation Date is postponed until the Expiration Date,
any Delisting Date or the Cancellation Date or following an
Extension Event. Such Warrants will either (i) be exercised on a
delayed basis if the applicable Spot Nikkei 225 Index on the
postponed Valuation Date is not five hundred (500) or more points
(such number of points subject to adjustment in accordance with
the Warrant Agreement) less than the Limit Option Reference Index
or (ii) be excluded from being exercised if, on any applicable
postponed Valuation Date, the applicable Spot Nikkei 225 Index is
five hundred (500) or more points (such number of points subject
to adjustment in accordance with the Warrant Agreement) less than
the Limit Option Reference Index. In connection with any exer-
cise of 1,000 or more Warrants, a Warrantholder may elect to
subject the exercise of only a portion of such Warrants to the
Limit Option; provided that the number of Warrants subject to the
Limit Option and the number of Warrants not subject to the Limit
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Option shall in each case not be less than 500.
As provided in the Warrant Agreement and subject to
certain limitations, this Warrant Certificate may be exchanged
for other Warrant Certificates, representing a like number of
Warrants, upon surrender to the Warrant Agent at the Warrant
Agent's Window, Attention: Transfer Department, of this Warrant
Certificate. The Company will thereupon execute, and the Warrant
Agent will countersign and deliver, one or more new Warrant
Certificates representing such like number of Warrants. Upon
surrender of this Warrant Certificate for exchange, the Warrant
Agent shall cancel this Warrant Certificate.
No service charge will be made for any registration of
transfer or exchange of this Warrant Certificate, but the Company
may require the payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in relation thereto,
other than exchanges not involving any transfer.
Capitalized terms included herein but not defined
herein have the meanings assigned thereto in the Warrant
Agreement.
The "Nikkei 225 Index" means the Nikkei 225 Index
designed, developed, maintained and operated by the Nihon Keizai
Shimbun, Inc. The "Spot Nikkei 225 Index" for any date means the
closing value (afternoon session) on such date of the Nikkei 225
Index or, in the event of a substitution of a Substitute Index or
a Successor Index for the Nikkei 225 Index, the closing value
(afternoon session) on such date of such Substitute Index or
Successor Index. As used herein, "New York Business Day" means
any day other than a Saturday, Sunday or a day on which either
the American Stock Exchange, Inc. or the New York Stock Exchange
is not open for securities trading or commercial banks in New
York City are required or authorized by law or executive order to
remain closed, and "Tokyo Business Day" means any day other than
(i) a Saturday, Sunday or a day on which banks are not open for a
full day of business in Japan or (ii) a day on which the TSE,
SIMEX or OSE are not open for business. "Tokyo Trading Day"
means any day on which the TSE is open for business. References
in this Certificate to "U.S. Dollar", "U.S.$" or "$" are to the
lawful currency of the United States of America. References to
"Japanese Yen" or "Yen" are to the lawful currency of Japan. As
used herein, "Index Calculation Day" means any day the Nikkei 225
Index (or if a Substitute Index has been substituted for the
Nikkei 225 Index, such Substitute Index) or any Successor Index
is calculated and published.
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The Warrant Agreement and the terms of the Warrants are
subject to amendment, as provided in the Warrant Agreement.
This Warrant Certificate shall be governed by, and
interpreted in accordance with, the laws of the State of New
York.
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Exercise Notice
Chemical Bank/Geoserve
Corporate Trust Securities Window
55 Water Street, Room 234
North Building
New York, New York 10041
Attention: Tender Department
1. This Notice DOES / DOES NOT relate to
"Contingently Tendered Warrants" subject to a Limit Option, as
provided for in the Warrant Agreement. If this Exercise Notice
relates to any Contingently Tendered Warrants, ______ of such
Warrants are Contingently Tendered Warrants and ______ are not.
If the Spot Nikkei 225 Index used to determine the Cash
Settlement Value of Contingently Tendered Warrants is less than
the Limit Option Reference Index by five hundred (500) points or
more, an Exercise Notice with respect to such Contingently
Tendered Warrants shall be void and of no effect (and shall be
disregarded for all purposes of the Warrant Agreement).
2. Subject to paragraph 1, the undersigned (the
"Owner") hereby irrevocably exercises Warrants (the "Exercised
Warrants") and delivers to you herewith a Warrant Certificate or
Certificates, registered in the Owner's name, representing a
number of Warrants at least equal to the number of Exercised
Warrants. Each beneficial owner of Warrants that is exercising
Warrants pursuant to this Exercise Notice is exercising no fewer
than 500 Warrants and no beneficial owner is acting in concert
with any other beneficial owner in relation to the exercise of
the Exercised Warrants.
3. Each beneficial owner of Warrants that is
exercising Warrants pursuant to this Exercise Notice is
exercising no more than 250,000 Warrants on the date of this
Exercise Notice individually or in concert.
4. Each beneficial owner that is exercising Warrants
pursuant to this Exercise Notice certifies that the number of
Contingently Tendered Warrants and the number of Warrants not
subject to the Limit Option shall in each case be not less than
500; provided that, such beneficial owner has not combined
Definitive Warrants and Book-entry Warrants or Book-entry
Warrants held through more than one Participant to meet such
requirement.
5. The Owner hereby directs the Warrant Agent (a) to
pay the Cash Settlement Value, if any, with respect to the
Exercised Warrants:
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By cashier's check or an official bank check:
or
By wire transfer to the following U.S. dollar bank
account in the United States:
(Minimum payments of $100,000 only)
Bank: _________________________________
ABA Routing No.: ______________________
Account No.: ______________ Reference: ________
and (b) if the number of Exercised Warrants is less than the
number of Warrants represented by the enclosed Warrant
Certificate, to deliver a Warrant Certificate representing the
unexercised Warrants to
Dated: , 19
___________________________
(Owner)
by _______________________
Authorized Signature
Address:
Telephone ( )
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EXHIBIT A-1
FORM OF GLOBAL WARRANT CERTIFICATE
No. _____-1
CUSIP No.
Unless this Global Warrant Certificate is presented by
an authorized representative of The Depository Trust Company
(55 Water Street, New York, New York) to the Company or its agent
for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or
such other name as requested by an authorized representative of
The Depository Trust Company and any payment is made to Cede &
Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered
owner hereof, Cede & Co., has an interest herein.
THE BEAR STEARNS COMPANIES INC.
Global Warrant Certificate Representing
Nikkei 225 Index Strike Reset Call Warrants
Expiring October __, 1997
This certifies that CEDE & CO., or registered assigns,
is the Registered Holder of the number of Nikkei 225 Index Strike
Reset Call Warrants Expiring October __, 1997 (the "Warrants")
set forth from time to time on Schedule A hereto. Each Warrant
entitles the beneficial owner thereof (each a "Warrantholder") to
receive, subject to the conditions set forth herein and in the
Warrant Agreement referred to below, from The Bear Stearns
Companies Inc. (the "Company") the Cash Settlement Value of such
Warrant, except that, under the circumstances described below,
such Warrantholder may instead receive the Alternative Settlement
Amount for such Warrant or, in certain circumstances following an
Extension Event, the Warrants will be deemed to be worthless.
Except in the case of the substitution of a Substitute Index for
the Nikkei 225 Index, the Cash Settlement Value of an Exercised
Warrant will be an amount in U.S. Dollars (the "Cash Settlement
Value") equal to the greater of (i) zero and (ii) the quotient
(rounded down to the nearest cent) of (A) the amount, if any, by
which the Spot Nikkei 225 Index on the applicable Valuation Date
(as defined herein) for such Warrant exceeds the Strike Level,
divided by (B) the product of 6.0 and the fixed Japanese Yen/U.S.
Dollar exchange rate of Yen _____ per U.S. $1.00. The Cash
Settlement Value is calculated using the following formula:
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Cash Settlement Value = the greater of
(i) $0 and (ii) $1 x (Spot Nikkei 225 Index -- Strike Level)
-------------------------------------
6 x (Yen _____/U.S. $1.00)
The "Strike Level" is _________ which was determined by the
Determination Agent and was the closing value (afternoon session)
of the Nikkei 225 Index on October __, 1995, but is subject to
adjustment on January , 1996, unless extended as described
herein (the "Reset Date").
If the closing value (afternoon session) (the "Reset
Date Closing Date") of The Nikkei 225 Index on the Reset Date is
lower than the closing value (afternoon session) on October ,
1995 (the "Initial Closing Value"), the Strike Level shall be
reduced by the full amount, if any, by which the Initial Closing
Value is greater than the Reset Date Closing Value. If the
Company determines that an Extraordinary Event or Exercise
Limitation Event has occurred and is continuing on the Reset
Date, then the Reset Date Closing Value shall be calculated on
the basis that the Reset Date shall be the next Index Calculation
Day following an Applicable Tokyo Business Day on which there is
no Extraordinary Event or Exercise Limitation Event. Within 30
days following the Reset Date, the Company will notify the
Warrant Agent in writing if there has been an adjustment to the
Strike Level and will either make a public announcement regarding
the amount of such adjustment and the new Strike Level or publish
such information in a United States newspaper with a national
circulation (currently expected to be The Wall Street Journal).
In the event that a Substitute Index is substituted (as
provided in Section 2.02(h)) for the Nikkei 225 Index, the Strike
Level will be adjusted as follows:
Strike Level
--------------------------------- x Current Value of Substitute Index
Current Value of Nikkei 225 Index
and the Cash Settlement Value of an Exercised Warrant shall be
the amount in U.S. Dollars equal to the quotient (rounded down to
the nearest cent) of the amount, if any, by which the Spot Nikkei
225 Index for the applicable Valuation Date for such Warrant
exceeds the Strike Level (as adjusted pursuant to the formula
above), divided by the Adjusted Divisor. The "Adjusted Divisor"
shall be an amount equal to 6 multiplied by the fixed Japanese
Yen/U.S. Dollar exchange rate of Yen _____/U.S. $1.00 multiplied
by a fraction, the numerator of which shall be the Current Value
of the Substitute Index and the denominator of which shall be the
Current Value of the Nikkei 225 Index.
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The "Current Value" of the Nikkei 225 Index and of the
Substitute Index will equal their respective levels reported by
the relevant exchange at the close of business on the day that
the Determination Agent substitutes the Substitute Index for the
Nikkei 225 Index or, if such day is not a Tokyo Business Day, the
Tokyo Business Day immediately preceding such day. In the event
of such substitution, the Determination Agent shall promptly
notify the Warrant Agent of the new Strike Level and of said
Current Values.
A Warrant will not require or entitle a Warrantholder
to sell or deliver to the Company any shares of any component
stocks of the Nikkei 225 Index or, in the case of the substitu-
tion of a Substitute Index for the Nikkei 225 Index, the
Substitute Index or any Successor Index to either the Nikkei 225
Index or the Substitute Index, as the case may be (the
"Underlying Stocks"), or any other securities. Upon exercise of
a Warrant, the Company will make only a U.S. Dollar cash payment
in the amount of the Cash Settlement Value or Alternative
Settlement Amount, if any and as applicable, of such Warrant.
The Company is under no obligation to, nor will it, purchase or
take delivery from any Warrantholder of any shares of any of the
Underlying Stocks or any other securities in connection with the
exercise of any Warrants. Warrantholders will not receive any
interest on any Cash Settlement Value, and the Warrants will not
entitle the Warrantholders to any of the rights of holders of any
of the Underlying Stocks or other securities.
Subject to the terms and conditions set forth herein
and in the Warrant Agreement, each Warrant may be exercised, on
any New York Business Day during the period from its date of
issuance until 3:00 P.M., New York City time, on the earlier of
(i) the New York Business Day immediately preceding the
Expiration Date (as defined below) and (ii) any Delisting Date.
Except under certain circumstances following an Extension Event,
any Warrant not exercised (including by reason of any postponed
exercise as described herein and in the Warrant Agreement) at or
before 3:00 P.M., New York City time, on the earlier of (i) the
New York Business Day immediately preceding the Expiration Date
and (ii) any Delisting Date, shall be automatically exercised.
The "Expiration Date" shall be October __, 1997.
This Global Warrant Certificate shall not be valid
unless countersigned by the Warrant Agent.
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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 October __, 1997 (the "Warrant Agreement") among the Company,
Chemical Bank (the "Warrant Agent") and Bear, Stearns & Co. 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.
The Warrants are unsecured contractual 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 provisions hereof and the Warrant
Agreement, each Warrant represented by this Global Warrant
Certificate (each a "Book-entry Warrant") may be exercised on any
New York Business Day during the period from the Initial
Conversion Date until 3:00 P.M., New York City time, on the
earlier of (i) the New York Business Day immediately preceding
the Expiration Date and (ii) any Delisting Date, by causing
(x) such Warrant to be transferred free to the Warrant Agent on
the records of the Depository in accordance with the Depository's
Deposit/Withdrawal at Custodian procedures, as provided in the
Representations Letter, and (y) a duty completed and executed
Exercise Notice to be received by the Warrant Agent from a
Participant, in the case of Book-entry Warrants held through the
Depository, or a Cedel Societe Anonyme ("CEDEL") or Euroclear
System ("Euroclear") Participant, in the case of such Warrants
held through CEDEL or Euroclear, 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 and in the Warrant Agreement.
Bear, Stearns & Co. Inc., as Determination Agent, shall
determine the Spot Nikkei 225 Index as provided in the Warrant
Agreement and herein and shall make such calculations as may be
required upon the occurrence of certain circumstances, as
described in the Warrant Agreement and herein. The Determination
Agent shall act as an independent expert and not as an agent of
the Company, and, unless otherwise provided by the Warrant
Agreement, its calculations and determinations under the Warrant
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Agreement and this Global Warrant Certificate shall, absent
manifest error, be final and binding on the Company, the Warrant
Agent and the Warrantholders. Any such calculations will be made
available to a Warrantholder for inspection at the Warrant
Agent's Office. The Determination Agent will have no
responsibility for good faith errors or omissions in calculating
or disseminating information regarding the Nikkei 225 Index, any
Substitute Index or any Successor Index, adjustments or
calculations by the Determination Agent in order to arrive at a
calculation of a stock index comparable to the Nikkei 225 Index
or any Substitute Index or any Successor Index, or the Cash
Settlement Value or the Alternative Settlement Amount, as
applicable.
In the event that the Nikkei 225 Index (or if a
Substitute Index has been substituted for the Nikkei 225 Index,
such Substitute Index) is not published by NKS but is published
by another person not affiliated with the Company and acceptable
to the Company (a "Third Party"), then the Spot Nikkei 225 Index
for any date thereafter will be determined based on the closing
value (afternoon session) of the Nikkei 225 Index (or such
Substitute Index, as the case may be) as published by such Third
Party. If NKS or any Third Party discontinues publication of the
Nikkei 225 Index (or if a Substitute Index has been substituted
for the Nikkei 225 Index, such Substitute Index) and publishes a
successor or substitute index that the Company determines, in its
sole discretion, to be comparable to the Nikkei 225 Index (or
such Substitute Index, as the case may be) (any such index being
a "Successor Index"), then the Spot Nikkei 225 Index for any date
thereafter will be determined by the Determination Agent on
behalf of the Company based on the closing level of the Successor
Index on such date. If NKS or any Third Party makes a material
change in the formula for, or the method of calculating, the
Nikkei 225 Index, any Substitute Index or any Successor Index,
the Determination Agent shall make such calculations as may be
required to determine the applicable Cash Settlement Value using
the formula and method of calculating the Nikkei 225 Index, any
Substitute Index or any Successor Index as in effect prior to
such change or modification. If NKS and/or any Third Party
discontinues publication of the Nikkei 225 Index, any Substitute
Index and/or any Successor Index, the Determination Agent will
determine the applicable Cash Settlement Value based on the
formula and method used in calculating the Nikkei 225 Index, any
Substitute Index or any Successor Index as in effect on the date
the Nikkei 225 Index, such Substitute Index or such Successor
Index was last published.
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Upon the occurrence of a Substitution Event, the
Company shall promptly give notice to the Warrantholders, by
publication in a United States newspaper with a national
circulation (currently expected to be the Wall Street Journal),
specifying: (i) the date on which the Substitution Event was
deemed to occur pursuant to Section 2.02(h) of the Warrant
Agreement, (ii) that a Substitute Index will be substituted for
the Nikkei 225 Index on the Substitution Date (as defined
herein), (iii) the name of the Substitute Index, (iv) the
Substitution Date, (v) the Strike Level as adjusted pursuant to
Section 2.02(e) of the Warrant Agreement and (vi) the Adjusted
Divisor. The Warrant Agent at the request and expense of the
Company and on behalf of the Company shall mail such notice to
each Warrantholder. On the Substitution Date, the Substitute
Index will be substituted for the Nikkei 225 Index. From and
after the Substitution Date, the index used to determine the Spot
Japan Index used to calculate the Cash Settlement Value or
Alternative Settlement Amount, as the case may be, of the
Warrants will be such Substitute Index. The "Substitution Date"
shall be the thirtieth calendar day (or, if such day is not a New
York Business Day, the next succeeding New York Business Day)
following such giving of notice of the Substitution Event.
A "Substitution Event" will occur if, as determined by
the Determination Agent (whose opinion shall be conclusive and
binding on the Company and on the holders of the Warrants) the
following conditions are fulfilled:
(i) Either of the following has occurred:
(A) The AMEX or another United States securities
exchange publishes (on a basis not less regularly than
each day on which such exchange and the TSE are open
for trading) an index (the "New Japan Index") which:
for a period of 90 days immediately preceding the date
of the Substitution Event has a correlation based on
daily, closing value to closing value, percentage
changes of not less than 90% with the Nikkei 300 Index
(as defined in the Prospectus Supplement dated August
16, 1995 relating to the Warrants (the "Prospectus
Supplement")); and warrants with payments determined by
reference to the New Japan Index have been approved to
be listed on the AMEX or such other exchange by the
Securities and Exchange Commission; or
(B) Warrants with payments determined by
reference to the Nikkei 300 Index have been approved to
be listed on the AMEX or such other exchange by the
Securities and Exchange Commission; and
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(ii) Either of the following has occurred:
(A) the Nikkei 225 Index as defined in the
Prospectus Supplement is no longer published and/or the
Nikkei 225 Futures Contracts (as defined in the
Prospectus Supplement) have been delisted from trading
on the OSE; or
(B) the Adjusted Trading Volume and the Adjusted
Open Interest (in each case, as defined herein) for the
two Nikkei 300 Futures Contracts (as defined in the
Prospectus Supplement) with expiration dates closest in
time to the Substitution Event exceed the Adjusted
Trading Volume and the Adjusted Open Interest,
respectively, for the two Nikkei 225 Futures Contracts
with expiration dates closest in time to the
Substitution Event, each for any three-month period
prior to the date of any Substitution Event; and
(iii) To the extent required, the Company, the AMEX
and/or such exchange shall have obtained any license
necessary to use the New Japan Index or the Nikkei 300
Index.
Notwithstanding the above, unless the Nikkei 225 Index
is no longer published and/or the Nikkei 225 Futures Contracts
shall have been delisted from trading on the OSE, a Substitution
Event will not be deemed to have occurred on any of the 60
calendar days immediately preceding the Expiration Date.
A "Substitute Index" means, in the event that the
circumstances described in clause (i)(A) above have occurred, a
New Japan Index or, in the event that the circumstances described
in clause (i)(B) above have occurred, the Nikkei 300 Index.
"Adjusted Trading Volume" for the Nikkei 300 Futures
Contracts or the Nikkei 225 Futures Contracts means the
arithmetic mean, for any period, of the amounts on each trading
day equal to the product of: (x) the number of such futures
contracts traded on such day and (y) the closing level on such
day of the index to which such futures contracts relate,
multiplied by Yen 10,000, in the case of the Nikkei 300 Futures
Contracts, or Yen 1,000, in the case of the Nikkei 225 Futures
Contracts (the "Contract Multiplier"). "Adjusted Open Interest"
for the Nikkei 300 Futures Contracts or the Nikkei 225 Futures
Contracts means the arithmetic mean, for any period, of the
amounts on each trading day equal to the product of: (x) the
open interest in such futures contracts on such day and (y) the
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closing level on such day of the index to which such futures
contracts relate, multiplied by the Contract Multiplier.
Subject to the Warrant Agreement and this Warrant
Certificate, the "Valuation Date" for a Warrant shall be the
first Index Calculation Day following the applicable Exercise
Date (subject to postponement upon the occurrence of an
Extraordinary Event or Exercise Limitation Event or as a result
of the exercise of a number of Warrants exceeding the limits on
exercise set forth herein).
Except for Warrants subject to automatic exercise, or
Warrants subject to the Limit Option and except following an
Extension Event, the "Exercise Date" for a Warrant will be (A) in
the case of Warrants other than those held through the facilities
of CEDEL or Euroclear (i) the New York Business Day on which the
Warrant Agent receives at the Warrant Agent's Window, Attention:
Tender Department, the Warrant (or transfer of such Warrant
through the Depository in the case of Book-entry Warrants) and
Exercise Notice (by facsimile transmission in accordance with
Section 2.01(a)(B)(y) in the case of Exercise Notices for Book-
entry Warrants) 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
Certificate (or transfer of such Warrant through the Depository
in the case of Book-entry Warrants) or Exercise Notice after 3:00
P.M., New York City time, on a New York Business Day, then the
New York Business Day next succeeding the New York Business Day
on which such Warrant or Exercise Notice is received (B) in the
case of Warrants held through the facilities of CEDEL or
Euroclear, (i) the New York 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 Certificate (or transfer of such Warrant through the
Depository in the case of Book-entry Warrants) is received by the
Warrant Agent by 3:00 P.M., New York City time, on the Valuation
Date, or (ii) if the Warrant Agent receives such Exercise Notice
after 3:00 P.M., New York City time, on a New York Business Day,
then the New York Business Day next succeeding such New York
Business Day, provided that the Warrant Certificate (or transfer
of such Warrant through the Depository in the case of Book-entry
Warrants) is received by 3:00 P.M., New York City time, on the
Valuation Date relating to exercises of Warrants on such
succeeding New York Business Day. In the event that the Warrant
Certificate (or transfer of such Warrant through the Depository
in the case of Book-entry Warrants) is received after 3:00 P.M.,
New York City time, on the Valuation Date, then the Exercise Date
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for such Warrant will be the day on which such Warrant
Certificate (or transfer of such Warrant through the Depository
in the case of Book-entry Warrants) is received or, if such day
is not a New York Business Day, the next succeeding New York
Business Day; provided, further, however, in the case of
exercises by Euroclear Participants, Euroclear must by facsimile
to the Warrant Agent by 9:00 a.m., New York City time, on the
Valuation Date confirm that the Warrants will be received by the
Warrant Agent on such date, provided, that if such facsimile 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 notice of exercise or waive the requirement
for timely delivery of such facsimile.
Subject to the provisions of the Warrant Agreement
relating to Extension Events, all Warrants for which the Warrant
Agent has not received a valid Exercise Notice at or prior to
3:00 P.M., New York City time, on (i) the New York Business Day
immediately preceding the Expiration Date or (ii) any Delisting
Date prior to the Expiration Date or for which the Warrant Agent
has received a valid Exercise Notice but with respect to which
timely delivery of the relevant Warrants has not been made,
together with any Warrants the Valuation Date for which has as of
such time been postponed as described below, shall be auto-
matically exercised as of such date; without any requirement of
delivery of an Exercise Notice to the Warrant Agent. However, if
the Company first receives notice of the delisting or suspension
of the Warrants on the same day on which such Warrants are
delisted or suspended, such day will be deemed a Delisting Date.
For purposes of this Global Warrant Certificate, "Index
Calculation Day" means any day the Nikkei 225 Index or if a
Substitute Index has been substituted for the Nikkei 225 Index,
such Substitute Index or any Successor Index is calculated and
published. The Exercise Date for such Warrants will be the
Expiration Date or any Delisting Date, as the case may be, or, if
such date is not a New York Business Day, the next succeeding New
York Business Day. The Warrant Agent will obtain the Spot Nikkei
225 Index (determined as of the first Index Calculation Day
following such date, which will be the Valuation Date for such
Warrants except in the case of a postponed exercise following the
occurrence of an Extraordinary Event or an Exercise Limitation
Event) and will determine the Cash Settlement Value, if any, of
such Warrants.
No fewer than 500 Warrants may be exercised by or on
behalf of any one Warrantholder at any one time, except that no
such minimum exercise amount shall apply in the case of automatic
exercise on or following the Expiration Date or on any Delisting
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Date or in the case of cancellation of the Warrants as a result
of an Extraordinary Event. A Warrantholder shall not combine
Definitive Warrants and Book-entry Warrants or Book-entry
Warrants held through more than one Participant to meet the 500
Warrant minimum exercise requirement. With the exception of the
Limit Option, an Exercise Notice shall be unconditional. Except
as provided in the Warrant Agreement, the Warrant Agent shall be
entitled, with no duty of inquiry, to rely conclusively on any
Exercise Notice received by it and on any representation of the
exercising Warrantholder contained therein.
If the Exercise Notice is not rejected as provided in
the Warrant Agreement, then the Warrant Agent or the Determi-
nation Agent, as the case may be, will determine the Cash
Settlement value of the exercised Warrants in accordance with the
terms of the Warrant Agreement. Except in the case of Warrants
subject to automatic exercise, Warrants that upon exercise
entitle the holder thereof to receive an Alternative Settlement
Amount in lieu of the Cash Settlement Value and Warrants deemed
worthless following an Extension Event, if on any Valuation Date
the Cash Settlement Value for any Warrants then exercised would
be zero, then in such case, the attempted exercise of such
Warrants shall be void and of no effect and the Warrants will be
transferred by the Warrant Agent back to the Participant that
submitted them free on the records of the Depository and, in
either case such Warrantholder shall be permitted to re-exercise
such Warrants prior to the Expiration Date or any Delisting Date,
as the case may be.
Except in the case of Warrants subject to automatic
exercise, for Warrants that upon exercise entitle the holder
thereof to receive an Alternative Settlement Amount and Warrants
deemed worthless following an Extension Event, if the Company has
made adequate New York Clearing House or next day funds available
to the Warrant Agent in a timely manner which shall in no event
be later than 3:00 P.M., New York City time, on the fourth New
York Business Day following a Valuation Date (or, if the
Valuation Date is not a New York Business Day, on the fourth New
York Business Day following the New York Business Day next
succeeding the Valuation Date) (the "Funding Date"), the Warrant
Agent will be responsible for making its payment available to
each appropriate Participant in the form of a cashier's check or
an official bank check, or (in the case of payments of at least
$100,000) by wire transfer to a U.S. Dollar account maintained by
such Participant in the United States (at the Participant's
election as specified in the Exercise Notice) prior to the close
of business, on the first New York Business Day immediately
succeeding such Funding Date (the "Settlement Date"). Such
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payment shall be in an amount equal to the aggregate Cash
Settlement Value of such holder's exercised Warrants.
With respect to automatically exercised Warrants (other
than Warrants subject to postponed exercise following the
occurrence of an Extraordinary Event or an Exercise Limitation
Event), if the Company has made adequate New York Clearing House
or next day funds available to the Warrant Agent in a timely
manner, which shall in no event be later than 3:00 P.M., New York
City time, on the Automatic Funding Date, the Warrant Agent will
be responsible for making funds available to the Depository,
against receipt of the Global Warrant Certificate, prior to the
close of business, on the Automatic Funding Date. Such funds are
to be in an amount equal to the aggregate Cash Settlement Value
of the Warrants subject to such automatic exercise.
Neither the Warrant Agent nor the Determination Agent
will be responsible for any losses resulting from a failure of a
brokerage firm or a Participant to properly exercise Warrants on
behalf of a Warrantholder.
Subject to the provisions of Section 2.03(b)(ii) of the
Warrant Agreement, if the Company determines that an
Extraordinary Event or Exercise Limitation Event has occurred and
is continuing on the Tokyo Business Day with respect to which the
Spot Nikkei 225 Index on a Valuation Date is to be determined
(the "Applicable Tokyo Business Day"), then the Cash Settlement
Value with respect to an exercise of Warrants shall be calculated
on the basis that the Valuation Date shall be the next Index
Calculation Day following an Applicable Tokyo Business Day on
which there is no Extraordinary Event or Exercise Limitation
Event; provided, that if the Valuation Date has not occurred on
or prior to the Expiration Date or any Delisting Date, then the
Warrantholders will receive the Alternative Settlement Amount in
lieu of the Cash Settlement Amount, which shall be calculated as
if the Warrants had been cancelled on the Expiration Date or any
Delisting Date, as the case may be.
Upon the occurrence of an Extraordinary Event or an
Exercise Limitation Event, the Company shall use its best efforts
to notify the Warrant Agent and the Determination Agent promptly
that an Extraordinary Event or Exercise Limitation Event, as the
case may be, has occurred and shall promptly give notice to the
Warrantholders by publication in a United States newspaper with a
national circulation (currently expected to be the Wall Street
Journal), that an Extraordinary Event or an Exercise Limitation
Event has occurred.
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If the Company determines that an Extraordinary Event
or an Exercise Limitation Event has occurred and is continuing on
the Expiration Date or on any earlier Delisting Date, the Company
shall so notify the Warrant Agent and the Determination Agent,
and the Cash Settlement Value with respect to the exercised
Warrants shall be equal to, and be calculated in the same manner
as, an Alternative Settlement Amount, in accordance with the
Warrant Agreement (treating the Expiration Date or any Delisting
Date, as the case may be, as the date on which the Warrants were
cancelled).
If the Company determines that an Extraordinary Event
has occurred and is continuing, and if that Extraordinary Event
is expected by the Company, prior to the Expiration Date to
continue, the Company may immediately cancel the Warrants by
notifying the Warrant Agent of such cancellation (the date such
notice is given being the "Cancellation Date"), and each Warrant-
holder's rights with respect to the Warrants and under the
Warrant Agreement shall thereupon cease; provided, that, subject
to an automatic extension of the term of the Warrants or to a
determination that the Warrants are worthless, each Warrant shall
be exercised (even if such Warrant would not otherwise be
exercisable on such date because of the Limit Option) on the
basis that the Valuation Date for such Warrant shall be the
Cancellation Date and each Warrantholder shall have the right to
receive, in lieu of the Cash Settlement Value of such Warrant,
the Alternative Settlement Amount, determined by the
Determination Agent.
An "Extraordinary Event" means any of the following
events:
(i) a suspension, material limitation or absence of
trading on the Tokyo Stock Exchange (the "TSE") of all the
Underlying Stocks which then comprise the Nikkei 225 Index,
any Substitute Index or a Successor Index;
(ii) the enactment, publication, decree or other
promulgation of any statute, regulation, rule or order of
any court of any jurisdiction, any administrative agency or
any other U.S. or non-U.S. governmental authority that would
make it unlawful for the Company to perform any of its
obligations under the Warrant Agreement or the Warrants or
that has had or is reasonably expected to have a material
adverse effect on the ability of (A) the Company to perform
its obligations under the Warrants or to hedge or modify the
hedge of its position with respect to the Nikkei 225 Index,
any Substitute Index or a Successor Index; or (B) any
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affiliate of the Company to hedge or modify the hedge of its
position with respect to any hedging transaction entered
into with the Company in connection with the Company's
obligations under the Warrants; or
(iii) any outbreak or escalation of hostilities or other
national or international calamity or crises (including,
without limitation, natural calamities that in the opinion
of the Company may materially and adversely affect the
economy of Japan or the trading of securities generally on
the TSE) that had or is reasonably expected to have a
material adverse effect on the ability of (A) the Company to
perform its obligations under the Warrants or to modify the
hedge of its position with respect to the Nikkei 225 Index,
any Substitute Index or a Successor Index; or (B) any
affiliate of the Company to hedge or modify the hedge of its
position with respect to any hedging transaction entered
into with the Company in connection with the Company's
obligations under the Warrants.
For the purpose of determining whether an Extraordinary
Event has occurred: (1) a limitation on the hours or number of
days of trading will not constitute an Extraordinary Event if it
results from an announced change in the regular business hours of
the TSE and (2) an "absence of trading" on the TSE will not
include any time when the TSE is closed for trading under
ordinary circumstances.
An "Exercise Limitation Event" means either of the
following events:
(i) a suspension, material limitation or absence of
trading on the TSE of 20% or more in number of the
Underlying Stocks; or
(ii) the suspension or material limitation on The
Singapore International Monetary Exchange (the "SIMEX"),
Osaka Stock Exchange ("OSE") or the AMEX or any other major
futures, options or securities market of trading in futures
or options contracts related to the Nikkei 225 Index (or, in
the event of a substitution of a Substitute index for the
Nikkei 225 Index, the Nikkei 300 Index) or a Successor
Index.
For the purposes of determining whether an Exercise
Limitation Event has occurred: (1) a limitation on the hours or
number of days of trading will not constitute an Exercise
Limitation Event if it results from an announced change in the
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regular business hours of the relevant exchange, (2) a decision
to permanently discontinue trading in the relevant futures or
options contract will not constitute an Exercise Limitation
Event, (3) a suspension of trading in an Underlying Stock or in a
futures or options contract referred to in clauses (i) and (ii)
above, by reason of (x) a price change violating limits set by
the TSE, SIMEX, OSE or AMEX or other futures or securities market
on which futures or options contracts related to the Nikkei 225
Index (or, in the event of a substitution of a Substitute Index
for the Nikkei 225 Index, the Nikkei 300 Index), the Japan Index,
any New Japan Index or a Successor Index are traded or such other
futures or securities market or (y) an imbalance of orders
relating to an Underlying Stock or such contracts will constitute
a suspension or material limitation of trading, (4) an "absence
of trading" on the TSE will not include any time when the TSE is
closed for trading under ordinary circumstances and (5) the
occurrence of an Extraordinary Event described in clause (i) of
the definition of Extraordinary Event will not constitute, and
will supersede the occurrence of, an Exercise Limitation Event.
The "Alternative Settlement Amount" is the amount
calculated using the formula set forth below:
Alternative Settlement Amount = Intrinsic Value +
(T/2 x A/B)
where
Intrinsic Value = the Cash Settlement Value of the Warrants
determined as described above but calculated
with a Spot Nikkei 225 Index determined by
the Determination Agent which, subject to
approval by the Company (such approval not to
be unreasonably withheld), in the reasonable
opinion of the Determination Agent, fairly
reflects the value of the Underlying Stocks
on the Cancellation Date, Expiration Date,
Delisting Date or Early Extended Expiration
Date, whichever has given rise to the payment
of the Alternative Settlement Amount;
T = U.S. $____, the maximum initial offering
price per Warrant, less U.S. $____, the Cash
Settlement Value per Warrant on October __,
1995;
A = the total number of days from but excluding
the Cancellation Date, Expiration Date, or
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Delisting Date, whichever has given rise to
the payment of the Alternative Settlement
Amount for such Warrants, to and including
the Expiration Date; and
B = the total number of days from, but excluding
the date on which sales of the Warrants were
initially confirmed, to and including the
Expiration Date.
For the purposes of determining "Intrinsic Value" in
the above formula, in the event that the Determination Agent and
the Company are required, but have not, after good faith
consultation with each other and within five days following the
first day on which such Alternative Settlement Amount may be
calculated in accordance with the above formula, agreed upon a
Spot Nikkei 225 Index which fairly reflects the value of the
Underlying Stocks on the Cancellation Date, Expiration Date,
Delisting Date or Early Extended Expiration Date, whichever gives
rise to the payment of the Alternative Settlement Amount, then
the Determination Agent shall promptly nominate a third party,
subject to approval by the Company (such approval not to be
unreasonably withheld), to determine such figure and calculate
the Alternative Settlement Amount in accordance with the above
formula. Such party shall act as an independent expert and not
as an agent of the Company or the Determination Agent, and its
calculation and determination of the Alternative Settlement
Amount shall, absent manifest error, be final and binding on the
Company, the Warrant Agent, the Determination Agent and the
Warrantholders. Any such calculations will be made available to
a Warrantholder for inspection at the Warrant Agent's Office.
Neither the Company nor such third party shall have any
responsibility for good faith errors or omissions in calculating
the Alternative Settlement Amount.
If the Company determines that an event described in
clause (i) of the definition of Exercise Limitation Event below
has occurred and is continuing on the Expiration Date (an
"Extension Event") then the term of any outstanding Warrants
shall be automatically extended for a period of 30 days (the
thirtieth day following the Expiration Date being the "Extended
Expiration Date"), provided, however, that if the Cash Settlement
Value or the Intrinsic Value used in calculating the Alternative
Settlement Amount, as the case may be, of such Warrants would
have been zero if the Warrants had been exercised such that the
Valuation Date for such exercise was the Measurement Date (as
defined below), then the term of the Warrants shall not be
extended, the Warrants shall be deemed to be worthless and the
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Company shall not be required to make any payments in respect
thereof. Any such automatic extension shall be deemed to have
been revoked and the Warrants shall expire on the earlier of
(i) the next Index Calculation Day following a Tokyo Trading Day
on which there is no Extension Event (the "Early Extended
Expiration Date") and (ii) any Delisting Date occurring after the
Expiration Date. The Company will give the Warrant Agent prompt
notice by telephone or facsimile transmission and will give
prompt notice to the Warrantholders by publication in a United
States newspaper with a national circulation (currently expected
to be The Wall Street Journal) of the occurrence of an Extension
Event, any Extended Expiration Date, any Index Calculation Day
referred to in clause (i) above and any Delisting Date referred
to in clause (ii) above, but in no event will such notice to the
Warrant Agent be given later than 9:30 A.M., New York City time,
on the New York Business Day following the Expiration Day, Index
Calculation Day or Delisting Date, as applicable.
Any Warrants that expire as described in clause (i) of
the preceding paragraph will be deemed to be exercised on the
Early Extended Expiration Date (even if such Warrants would not
otherwise be exercisable on such date because of the Limit
Option) on the basis that the Valuation Date for such exercise
shall be such Early Extended Expiration Date and the holder of
each such Warrant will receive an Alternative Settlement Amount,
whether or not an Extraordinary Event or an Exercise Limitation
Event is continuing on such Early Extended Expiration Date.
If the term of the Warrants has been extended pursuant
to the second preceding paragraph but the Company determines that
an Extension Event is continuing (A) when the Warrants expire on
the Extended Expiration Date or (B) on any Delisting Date
occurring on or after the Expiration Date, the Warrants shall be
deemed to be worthless and the Company shall not be required to
make any payments in respect thereof. The Company shall give
prompt notice of any such determination to the Warrant Agent by
telephone or facsimile transmission and to the Warrantholders by
publication in a United States newspaper with a national
circulation (currently expected to be The Wall Street Journal).
"Measurement Date" means the Tokyo Trading Day
occurring most recently prior to the Expiration Date on which
none of the events described in clause (i) of the definition of
Exercise Limitation Event below had occurred or was continuing.
With respect to all Warrants as to which the Valuation
Date has been postponed (other than Warrants that have been
deemed worthless following an Extension Event) or which have been
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cancelled as described above, the Company shall make available to
the Warrant Agent in a timely manner, which shall in no event be
later than 3:00 P.M., New York City time, on the third New York
Business Day following the date on which the Cash Settlement
Value or Alternative Settlement Amount, as the case may be, has
been calculated (the "Alternative Funding Date") New York
Clearing House or next day funds in an amount equal to, and for
the payment of, the aggregate Cash Settlement Value or
Alternative Settlement Amount, as applicable, of such Warrants.
Subject to such funds having been made available as provided in
the preceding sentence, the Warrant Agent will thereafter be
responsible for making its payment to the Depository prior to the
close of business on, the Alternative Funding Date, in an amount
equal to the aggregate Cash Settlement Value or Alternative
Settlement Amount (as applicable) of such exercised Warrants (and
in the case of cancellation as described above, of all previously
unexercised Warrants).
All exercises of Warrants (other than on automatic
exercise or following an Extension Event) are subject, at the
Company's option, to the limitation that not more than 750,000
Warrants in total may be exercised on any Exercise Date and not
more than 250,000 Warrants may be exercised by or on behalf of
any beneficial owner, either individually or in concert with any
other beneficial owner, on any Exercise Date. If any New York
Business Day would otherwise, under the terms hereof, be the
Exercise Date in respect of more than 750,000 Warrants, then at
the Company's election (by giving notice thereof to the Warrant
Agent not later than 11:00 A.M., New York City time, on the New
York Business Day immediately following such Exercise Date),
750,000 of such Warrants shall be deemed exercised on such
Exercise Date (selected by the Warrant Agent on a pro rata basis,
but if, as a result of such pro rata selection, any Registered
Holders would be deemed to have exercised less than 500 Warrants,
then the Warrant Agent shall first select additional amounts of
such holders' Warrants so that no holder shall be deemed to have
exercised less than 500 Warrants), and the remainder of such
Warrants (the "Remaining Warrants") shall be deemed exercised on
the following New York Business Day (notwithstanding the minimum
exercise requirement and subject to successive applications of
this paragraph); provided that any Remaining Warrants for which
an Exercise Notice was delivered on a given Exercise Date shall
be deemed exercised before any other Warrants in respect of which
an Exercise Notice was delivered on a later Exercise Date. If
any beneficial owner of Warrants attempts to exercise more than
250,000 Warrants on any New York Business Day individually or in
concert, then at the Company's election (as notified to the
Warrant Agent by giving notice thereof to the Warrant Agent not
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later than 11:00 A.M., New York City time, on the New York
Business Day following such New York Business Day), 250,000 of
such Warrants shall be deemed exercised on such New York Business
Day and the remainder shall be deemed exercised on the following
New York Business Day (notwithstanding the minimum exercise
requirement and subject to successive applications of this
paragraph). The date on which any Warrant is deemed exercised
under the preceding two sentences shall for all purposes of this
Global Warrant Certificate be the "Exercise Date" in respect of
such Warrants.
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 (notwith-
standing 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 will, 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) subject to such reasonable regulations as the
Company or the Warrant Agent may prescribe, only to the
Depository, to another nominee of the Depository, to a successor
Depository or to a nominee of a successor Depository, upon
surrender of such Global Warrant Certificate, duly endorsed, or
accompanied by a written instrument or instruments of transfer in
form satisfactory to the Warrant Agent and the Company, duly
executed by the Registered Holder thereof or by the duly
appointed legal representative thereof, or by its duly authorized
attorney. Such signature shall be guaranteed by a bank or trust
company with a correspondent office in The City of New York or by
a broker or a dealer, which is a member of the National
Association of Securities Dealers, Inc. (the "NASD") 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 and the surrendered Global Warrant
Certificate shall be cancelled by the Warrant Agent.
The Global Warrant Certificate may be transferred as
provided above when surrendered to the Warrant Agent's Window,
Attention: Transfer Department, or at the location of any
successor Warrant Agent for another Global Warrant Certificate of
like tenor and representing a like number of unexercised
Warrants.
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<PAGE>
Except for Warrants subject to automatic exercise,
Warrants with respect to which payments of any Alternative
Settlement Amount are made and Warrants deemed worthless
following an Extension Event, each Warrantholder, in connection
with any exercise of Warrants (including a postponed exercise
following an Extraordinary Event or an Exercise Limitation
Event), will have the option (the "Limit Option") to specify that
such Warrants are not to be exercised if the Spot Nikkei 225
Index that would otherwise be used to determine the Cash
Settlement Value of such Warrants is five hundred (500) or more
points (such number of points subject to adjustment in accordance
with the Warrant Agreement) lower than the closing value
(afternoon session) of the Nikkei 225 Index (or any Successor
Index or any Substitute Index, as the case may be) for the day
specified below (such closing value, the "Limit Option Reference
Index"). A Warrantholder's election of the Limit Option must be
specified in the applicable Exercise Notice delivered to the
Warrant Agent. The Limit Option Reference index will be the
closing value (afternoon session) of the Nikkei 225 Index (or a
Substitute Index, as the case may be) on the relevant Exercise
Date (or if such day is not an Index Calculation Day, on the
immediately preceding Index Calculation Day). If an Exercise
Notice and the related Warrants are received after 3:00 P.M., New
York City time, on a given day, the applicable Limit Option
Reference Index will be determined as of the next day that is
also a New York Business Day (or, if such day is not an Index
Calculation Day, as of the immediately preceding Index
Calculation Day).
Following receipt of an Exercise Notice and the related
Warrants subject to the Limit Option, the Warrant Agent shall
obtain from the Determination Agent the applicable Limit Option
Reference Index and will determine whether such Warrants will not
be exercised because of the Limit Option. Warrants that are not
exercised will be treated as not having been tendered for
exercise and the Warrant Certificate evidencing such Warrants
will be returned to the Registered Holder by first class mail at
the Company's expense. To exercise such Warrants, a Warrant-
holder will be required to cause an Exercise Notice and the
related Warrants to be submitted again to the Warrant Agent. In
the case of a postponed Valuation Date, the Limit Option will
continue to apply once elected by a Warrantholder in connection
with an exercise of Warrants on the basis of the Limit Option
Reference Index as initially determined for such Warrants, except
when such VaLuation Date is postponed until the Expiration Date,
any Delisting Date or the Cancellation Date or following an
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<PAGE>
Extension Event. Such Warrants will either (i) be exercised on a
delayed basis if the applicable Spot Nikkei 225 Index on the
postponed Valuation Date is not five hundred (500) or more points
(such number of points subject to adjustment in accordance with
the Warrant Agreement) less than the Limit Option Reference Index
or (ii) be excluded from being exercised if, on any applicable
postponed Valuation Date, the applicable Spot Nikkei 225 Index is
five hundred (500) or more points (such number of points subject
to adjustment in accordance with the Warrant Agreement) less than
the Limit Option Reference Index. In connection with any
exercise of 1,000 or more Warrants, a Warrantholder may elect to
subject the exercise of only a portion of such Warrants to the
Limit Option, provided that the number of Warrants subject to the
Limit Option and the number of Warrants not subject to the Limit
Option shall in each case not be less than 500.
Capitalized terms included herein but not defined
herein have the meanings assigned thereto in the Warrant
Agreement.
The "Nikkei 225 Index" means the Nikkei 225 Index
designed, developed, maintained and operated by the AMEX. The
"Spot Nikkei 225 Index" for any date means the closing value
(afternoon session) on such date of the Nikkei 225 Index or, in
the event of a substitution of a Substitute Index or a Successor
Index for the Nikkei 225 Index, the closing level on such date of
such Substitute Index or Successor Index. As used herein, "New
York Business Day" means any day other than a Saturday or a
Sunday or a day on which commercial banks in New York City are
required or authorized by law or executive order to remain
closed, and "Tokyo Business Day" means any day other than (i) a
Saturday, Sunday or day on which banks are not open for a full
day of business in Tokyo or (ii) a day on which the TSE, the
SIMEX or the OSE are not open for business. "Tokyo Trading Day"
means any day on which the TSE is open for business. References
in this Global Certificate to "U.S. Dollars", "U.S.$" or "$" are
to the lawful currency of the United States of America and
references to "Japanese Yen" or "Yen" are to the lawful currency
of Japan.
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.
<PAGE>
<PAGE>
IN WITNESS WHEREOF, The Bear Stearns Companies Inc. has
caused this instrument to be duly executed.
Dated: , 199_ THE BEAR STEARNS COMPANIES INC.
By_____________________
Name:
Title:
Attest:
By___________________
Name:
Title:
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<PAGE>
Countersigned as of the
date above written:
CHEMICAL BANK
as Warrant Agent
By_______________________
Authorized Officer
<PAGE>
<PAGE>
Schedule A
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Number of Warrants Represented by
Date this Global Warrant Certificate
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<PAGE>
<PAGE>
EXHIBIT A-2
EXERCISE NOTICE
For Warrants Represented by the Global Warrant Certificate
Chemical Bank/Geoserve
Corporate Trust Securities Windows
55 Water Street
Room 234
North Building
New York, New York 10041
Attention: Tender Department
1. We refer to the Warrant Agreement dated as of
October __, 1995 (the "Warrant Agreement"), among The Bear
Stearns Companies Inc. (the "Company"), Chemical Bank, as Warrant
Agent (the "Warrant Agent"), and Bear, Stearns & Co. Inc., as
Determination Agent (the "Determination Agent"). On behalf of
certain beneficial owners, each of whom we certify is exercising
no fewer than 500 Warrants that are covered by this Exercise
Notice and whose Warrants have been, or will be, transferred to
the Warrant Agent in accordance with the provisions of the
Representations Letter relating to the Warrants, we hereby
irrevocably exercise ______ Warrants (the "Tendered Warrants").
We hereby acknowledge that the Warrants being exercised and this
Exercise Notice must be received by you by 3:00 P.M., New York
City time, on a New York Business Day in order for the Valuation
Date for the Tendered Warrants to be the Index Calculation Day
following such New York Business Day and that, if the Warrants
being exercised and this Exercise Notice are received by you
after 3:00 P.M., New York City time, on a New York Business Day
(or, in the case of Warrants held through CEDEL or Euroclear, if
the Warrants are not received by 3:00 p.m., New York City time,
on the first Index Calculation Date following such New York
Business Day) the Valuation Date of the Tendered Warrants shall
be the Index Calculation Day next succeeding such New York
Business Day, in each case subject to certain provisions of the
Warrant Agreement.
2. If you determine that this Exercise Notice has not
been duly completed or is not in proper form, this Exercise
Notice will be void and of no effect and will be deemed not to
have been delivered.
3. We hereby direct you to make payment to us of
amounts payable to our clients as a result of the exercise of the
Warrants hereunder as follows:
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<PAGE>
By cashier's check or an official bank check;
By wire transfer to the following U.S.
Dollar bank account in the United States:
(Minimum payments of $100,000 only)
Bank: __________________________________
Account No.: ___________________________
ABA Routing No.: _______________________
Reference: _____________________________
4. [ALL/PART OF] the Tendered Warrants covered hereby
[ARE/ARE NOT] subject to the Limit Option:
Number of Warrants subject to the Limit Option
(the "Contingently Tendered Warrants"): ____________
5. Each client on whose behalf we are exercising
Warrants pursuant to this Exercise Notice has certified to us
that it is not exercising in excess of 250,000 Warrants on behalf
of any beneficial owner or in concert with any other beneficial
owner on the date of this Exercise Notice.
6. Each client on whose behalf we are exercising
Warrants pursuant to this Exercise Notice has certified that the
number of Contingency Tendered Warrants and the number of
Warrants not subject to the Limit Option shall in each case not
be less than 500; provided that, such client has not combined
Definitive Warrants and Book-entry Warrants to meet such
requirement.
FOR PARTICIPANTS ONLY 7. We hereby certify that we are
a Participant of The Depository Trust Company (the "Depository")
with the present right to use and receive its services.
<PAGE>
<PAGE>
Capitalized terms used but not defined herein have the
meanings assigned thereto in the Warrant Agreement.
Dated: , 19
NAME OF DEPOSITORY
PARTICIPANT
Participant Number
NAME OF EUROCLEAR
PARTICIPANT
Participant Number
NAME OF CEDEL
PARTICIPANT
Participant Number
By___________________________
Authorized Signature
Address:
Telephone: ( )
<PAGE>
<PAGE>
EXHIBIT B
CONFIRMATION OF EXERCISE
For Warrants Represented by Warrant Certificates
We hereby confirm receipt of your Exercise Notice with
respect to _____ Warrants (the "Exercised Warrants") and the
related Warrant Certificates, which we have found to be duly
completed and in proper form. The Valuation Date of the
Exercised Warrants was the close of business on ________________,
19__.
We hereby confirm that the aggregate Cash Settlement
Value of the Exercised Warrants is U.S.$_______ ($________ per
Warrant), which will be made available to you in the form of a
cashier's check or an official bank check, or (in the case of
payments of at least $100,000) by wire transfer to the U.S.
Dollar bank account specified in your irrevocable Exercise
Notice, for payment on the fourth New York Business Day following
the Valuation Date for such Warrants (or, if such Valuation Date
is not a New York Business Day, on the fourth New York Business
Day following the New York Business Day next succeeding the
Valuation Date for such Warrants).
Capitalized terms included herein but not defined have
the meanings assigned thereto in the Warrant Agreement, dated as
of October __, 1995, among The Bear Stearns Companies Inc.,
Chemical Bank, and Bear, Stearns & Co. Inc..
Dated: , 19
CHEMICAL BANK, as Warrant
Agent,
By______________________________
Authorized Signature
<PAGE>
<PAGE>
EXHIBIT B-1
NOTICE OF REJECTION
You are hereby notified that [the Exercise Notice
delivered by you was determined by us not to have been duly
completed in proper form] [we did not receive from Euroclear a
Euroclear confirmation that proper delivery of the Warrants to
which the Exercise Notice delivered by you relates would be made
on a timely basis, as set forth in the Warrant Agreement, dated
as of October , 1995 among The Bear Stearns Companies Inc.,
--
Chemical Bank and Bear, Stearns & Co., Inc.]. Accordingly, we
have rejected your Exercise Notice as being unsatisfactory as to
form.
Capitalized terms used but not defined herein have the
meanings assigned thereto in the Warrant Agreement.
Dated: , 19
CHEMICAL BANK, as Warrant
Agent
By_________________________
Authorized Signature
<PAGE>
<PAGE>
EXHIBIT B-2
CONFIRMATION OF EXERCISE
For Warrants Represented by the Global Warrant Certificate
Name of Depository Participant
Name of Euroclear Participant
Name of CEDEL Participant
Address
We hereby confirm receipt of your Exercise Notice with
respect to Warrants (the "Exercised Warrants") which were
transferred by you (or on your behalf) to our DTC Participant
Account No._____________. Such Notice we have found to be duly
completed and in proper form. The Valuation Date of the
Exercised Warrants was the close of business on ______________,
19__.
[As set forth in your Exercise Notice, none of the
Warrants covered thereby is subject to the Limit Option.
Accordingly, for purposes hereof, all such Warrants shall
constitute Exercised Warrants, which number we hereby confirm to
be _______________________.] [Your Exercise Notice stated that
the Warrants covered thereby are subject to the Limit Option.
The applicable Limit Option Reference Index for such Warrants is
___________________ and the Spot Nikkei 225 Index for the date
that would otherwise be the Valuation Date for such Warrants is
_______________. Such Spot Nikkei 225 Index is not lower than
such Limit Option Reference Index by five hundred (500) or more
points. Accordingly, for purposes hereof, all such Warrants
shall constitute Exercised Warrants. We hereby confirm the
number of such Exercised Warrants to be _______________.]
We hereby confirm that the aggregate Cash Settlement
Value of the Exercised Warrants is U.S.$____________ (U.S.$______
per Warrant), which will be made available to you in the form of
a cashier's check or an official bank check or by wire transfer
to the bank account designated in your irrevocable Exercise
Notice for payment on the fourth New York Business Day following
the Valuation Date for such Warrants (or, if such Valuation Date
is not a New York Business Day, on the fourth New York Business
Day following the New York Business Day next succeeding the
Valuation Date for such Warrants).
<PAGE>
<PAGE>
Capitalized terms included herein but not defined have
the meanings assigned thereto in the Warrant Agreement dated as
of August __, 1995, among The Bear Stearns Companies Inc.,
Chemical Bank, as Warrant Agent, and Bear, Stearns & Co. Inc., as
Determination Agent.
Dated: , 19
CHEMICAL BANK, as Warrant
Agent
By_________________________
Authorized Signature
<PAGE>
<PAGE>
EXHIBIT B-3
NOTICE OF REJECTION
Name of Depository Participant
Name of Euroclear Participant
Name of CEDEL Participant
Address
You are hereby notified that [the Exercise Notice
delivered by you was determined by us not to have been duly
completed in proper form]. [Such Warrants were not transferred
to our DTC Participant Account No. ___________.] [We did not
receive from Euroclear a Euroclear Confirmation that proper
delivery of the Warrants to which the Exercise Notice delivered
by you relates would be made on a timely basis, as set forth in
the Warrant Agreement, dated as of October __, 1995, among The
Bear Stearns Companies, Inc., Chemical Bank, as Warrant Agent,
and Bear, Stearns & Co. Inc.] Accordingly, we have rejected your
Exercise Notice as being unsatisfactory as to form.
Capitalized terms used but not defined herein have the
meanings assigned thereto in the Warrant Agreement.
Dated: , 19
CHEMICAL BANK, as Warrant
Agent
By_________________________
Authorized Signature
<PAGE>
<PAGE>
EXHIBIT C-1
NOTICE OF REJECTION
RELATING TO LIMIT OPTION
For Warrants Represented
by Warrant Certificates
We refer to your Exercise Notice dated _________, 199_,
with respect to Warrants that were subject to the Limit Option.
The applicable Limit Option Reference Index for such Warrants is
_________________ and the Spot Nikkei 225 Index for the date that
would otherwise be the Valuation Date for such Warrants is
______________. Such Spot Nikkei 225 Index is lower than the
Limit Option Reference Index on the Exercise Date (or if such
date was not an Index Calculation Day, on the Index Calculation
Day prior to the Exercise Date for such Warrants) by five hundred
(500) points or more. Accordingly, we have rejected such
Exercise Notice pursuant to your exercise of the Limit Option.
Capitalized terms included herein but not defined have
the meanings assigned thereto in the Warrant Agreement dated as
of August 21, 1995, among The Bear Stearns Companies Inc.,
Chemical Bank and Bear, Stearns & Co. Inc..
Dated: , 19
CHEMICAL BANK, as Warrant
Agent
By_________________________
Authorized Signature
<PAGE>
<PAGE>
EXHIBIT C-2
NOTICE OF REJECTION
RELATING TO LIMIT OPTION
For Warrants Represented
by the Global Warrant Certificate
Name of Depository Participant
Address
We refer to your Exercise Notice dated _________, 199_,
with respect to Warrants that were subject to the Limit Option.
The applicable Limit Option Reference Index for such Warrants is
____________ and the Spot Nikkei 225 Index for the date that
would otherwise be the Valuation Date for such Warrants is
_____________. Such Spot Nikkei 225 Index is lower than the
Limit Option Reference Index on the Exercise Date (or if such
date was not an Index Calculation Day, on the Index Calculation
Day prior to the Exercise Date for such Warrants) by five hundred
(500) points or more. Accordingly, we have rejected such
Exercise Notice pursuant to your exercise of the Limit Option.
Capitalized terms included herein but not defined have
the meanings assigned thereto in the Warrant Agreement dated as
of August 21, 1995, among The Bear Stearns Companies Inc.,
Chemical Bank, and Bear, Stearns & Co. Inc..
Dated: , 199_
CHEMICAL BANK, as Warrant
Agent
By_________________________
Authorized Signature
