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Exhibit 4.5
(FACE OF WARRANT)
Rights
Certificate No.: _______________ No.of Rights:_____________
Cusip No. ________________
ALL RIGHTS WILL EXPIRE AT 12:00 NOON NEW YORK
TIME ON AUGUST 30, 2000.
WARRANT REPRESENTING THE RIGHT TO
PURCHASE AMERICAN DEPOSITARY SHARES
OF
PEARSON PLC
Pursuant to the Rights Agency Agreement, dated _________, 2000, between
Pearson plc and The Bank of New York, as ADS Subscription Agent (the
"Agreement"), Pearson is offering to the holders of its American Depositary
Shares (ADSs) (representing one Ordinary Share of the Company, 25 pence
each), for every eleven ADSs owned by each such holder as of the close of
business (New York City time) July 28, 2000, three rights ("ADS Rights"), each
entitling the holder thereof to purchase one additional ADS (the "ADS Rights
Offer"), at the dollar subscription price of $16.50 (currently equivalent to
110% of the Sterling Subscription Price of (pound)10 per share) which
includes a 1.5% UK stamp duty reserve tax, which you must pay with your
subscription, as described below (the "Dollar Subscription Price") until
12:00 noon (New York City time) on August 30, 2000 (the "Expiration Date"). No
fractional ADS Rights will be issued.
ONE ADS RIGHT AND THE DOLLAR SUBSCRIPTION PRICE OF
$16.50 ARE NEEDED TO SUBSCRIBE FOR EACH NEW ADS
THIS WARRANT IS TRANSFERABLE AND MAY
BE COMBINED OR DIVIDED AT THE OFFICE
OF THE ADS SUBSCRIPTION AGENT.
This Warrant is subject to all of the terms, provisions and conditions for
the ADS Rights Offer set forth in the Prospectus dated _________, 2000 (the
"Prospectus") delivered concurrently herewith and of the Agreement, which terms,
provisions and conditions are incorporated herein by reference and made a part
hereof and to which Prospectus and Agreement reference is hereby made for a full
description of the ADS Rights, limitations of rights, obligations, duties and
immunities hereunder of the ADS Subscription Agent, the Company and the holder
of the Warrant. Copies of the Agreement are on file at the office of the ADS
Subscription Agent at 101 Barclay Street, 12th Floor, New York, New York 10286.
The Bank of New York, as agent for Pearson, has agreed to arrange to
convert U.S. dollars into pounds sterling and pay the appropriate
subscription amounts in pounds sterling to the Company. Holders of ADSs are
required to tender to The Bank of New York US$16.50 per ADS in order to make
it likely that the ADS Subscription Agent will have
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sufficient funds to pay the Subscription Price plus the 1.5% UK stamp duty
reserve tax in light of possible exchange rate fluctuations. The ADS
Subscription Agent will make the conversion from U.S. dollars into pounds
sterling at a commercially reasonable rate as soon as practicable after 12:00
noon (New York City time) on August 30, 2000. If US$16.50, when converted to
pounds sterling on or about August 30, 2000, is less than the Sterling
Subscription Price and the 1.5% UK stamp duty reserve tax, The Bank of New
York will pay such shortfall to the Company on behalf of the subscriber, who
will then be required promptly to pay such shortfall (including interest and
expenses) to the ADS Subscription Agent. The ADS Subscription Agent will not
send any New ADSs subscribed for by a holder prior to the receipt by the ADS
Subscription Agent of such payment. If payment of the amount of any
deficiency is not received from a subscriber by the ADS Subscription Agent by
September 20, 2000, the ADS Subscription Agent may sell the new ADSs
subscribed for by such subscriber at a public or private sale, at such place
or places and upon such terms as it may deem proper, and the ADS Subscription
Agent may allocate the net proceeds of such sales for the account of the
subscriber upon an averaged or other practicable basis without regard to any
distinctions among such subscribers because of exchange restrictions, or
otherwise in an amount sufficient to cover such deficiency. In such event,
the ADS Subscription Agent will then send the remaining new ADSs to such
holder together with a check in the amount of the excess proceeds, if any,
from such sale; PROVIDED THAT, if the amount of such excess proceeds realized
upon the sale of such holder's new ADSs is less than $5.00, such excess
proceeds will not be distributed but will be aggregated and remitted to the
Company and retained for its benefit. Subject to the preceding sentence, any
excess will be refunded promptly without interest.
In order to subscribe for the ADSs provided above, the appropriate form on
the reverse side of this Warrant must be completed and signed. Please read the
instructions contained in the Letter of Transmittal accompanying this Warrant
before completing any form.
This Warrant and ADS Rights represented hereby will become void
immediately at the expiration date, unless properly tendered for exercise on
or prior to such time; however, you may receive proceeds from the sale of the
new Ordinary Shares attributable to your unexercised ADS Rights, as described
in the Prospectus under "The US Rights Offering - Unexercised ADS Rights." As
soon as practicable after October 2, 2000, the depositary for the ADS will
distribute ADRs to subscribers who have properly exercised ADS Rights.
This Warrant is only evidence of the existence of ADS Rights and does not
grant any rights or impose any obligations not granted or imposed pursuant to
the express terms of the Agreement.
This Warrant will not be valid or obligatory for any purpose
until it has been countersigned by the ADS Subscription Agent.
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Name(s) and Address(es) of Registered Holders of ADS Rights
(label to be affixed)
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WITNESS the facsimile signatures of the proper authorized signatories of
Pearson and the ADS Subscription Agent.
PEARSON plc
By:___________________________
Authorized Signatory
THE BANK OF NEW YORK,
as ADS Subscription Agent
By:___________________________
Authorized Signatory
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(REVERSE OF WARRANT)
READ INSTRUCTIONS CONTAINED IN THE LETTER OF
TRANSMITTAL AND INSTRUCTIONS BOOKLET AND ACCOMPANYING
THIS WARRANT BEFORE COMPLETING
RETURN TO ADS SUBSCRIPTION AGENT
YOUR EXERCISE OF ADS RIGHT IS IRREVOCABLE AND MAY NOT BE CANCELLED OR
MODIFIED.
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PLEASE FILL IN APPROPRIATE INFORMATION
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No. of Amount |_| Sell
ADSs Paid excess
Subscribed ADS
for Rights
and send
check for
amount of
proceeds
less
fees.
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ADSs $
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ADS Rights Warrant Number
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Expiration Date: One ADS Right
August 30, 2000 required to
Pearson plc subscribe for
each ADS
FORM 1 - TO SUBSCRIBE: I hereby irrevocably subscribe for the number of New ADSs
indicated above, pursuant to the Prospectus, dated August __, 2000, receipt of
which is acknowledged.
Signature of Purchaser _______________________________________
Telephone Number (include area code)___________________________
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(Print full address)
ADDRESS FOR DELIVERY OF AMERICAN DEPOSITARY RECEIPTS EVIDENCING AMERICAN
DEPOSITARY SHARES IF OTHER THAN AS SHOWN HEREON:
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FORM 2- TO SELL ADS RIGHTS THROUGH AGENT: As my Agent, you are authorized to
sell the ADS Rights represented by this Warrant and remit the net proceeds to
me. Under the penalty of perjury, I certify that the Taxpayer Identification
Number provided in the box is true, correct and complete.
Signature:____________________________________________
FORM 3- TO SELL ADS RIGHTS THROUGH HOLDER'S COMMERCIAL BANK OR BROKER OR TO
TRANSFER WARRANT: For value received, the ADS Rights represented by this Warrant
are assigned to:
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(Print full name of assignee)
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(Print full address)
Signature_____________________________________________
(Signature must correspond with name as shown hereon)
Signature guaranteed by______________________________
SUBSTITUTE FORM W-9
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PLEASE PROVIDE YOUR SOCIAL SECURITY NUMBER
OR TAXPAYER IDENTIFICATION NUMBER IN THE
BOX AT RIGHT AND CERTIFY BY SIGNING AND
DATING BELOW. ALSO INDICATE "EXEMPT" IF AN
EXEMPT RECIPIENT.
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W-9 CERTIFICATION - Under penalty of perjury, I certify that (i) the Social
Security Number or Taxpayer Identification Number is current and (ii) I am NOT
(delete "NOT" if inapplicable) subject to backup withholding either because I
have not been notified that I am subject to backup withholding as a result of
the failure to report all interest or dividends, or because the IRS has notified
me that I am no longer subject to backup withholding.
SIGNATURE: DATE:
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Note: Failure to complete and return the information will result in
backup withholding of payments due to you. See the accompanying
instructions for further information.
THIS WARRANT MAY BE USED TO PURCHASE NEW ADSs OR MAY BE ASSIGNED OR
SOLD. FULL INSTRUCTIONS APPEAR IN THE LETTER ACCOMPANYING THIS
WARRANT. FOR PRICE PER ADS - SEE PROSPECTUS DELIVERED HEREWITH.
