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Exhibit 4.1
WARRANT TO PURCHASE COMMON STOCK
THE SECURITIES REPRESENTED BY THIS INSTRUMENT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE TRANSFERRED, SOLD OR
OTHERWISE DISPOSED OF EXCEPT WHILE A REGISTRATION STATEMENT
RELATING THERETO IS IN EFFECT UNDER SUCH ACT AND APPLICABLE STATE
SECURITIES LAWS OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
SUCH ACT OR SUCH LAWS. THIS INSTRUMENT IS ISSUED SUBJECT
TO THE RESTRICTIONS ON TRANSFER AND OTHER PROVISIONS OF A
SECURITIES PURCHASE AGREEMENT BETWEEN THE ISSUER OF THESE
SECURITIES AND THE INVESTOR REFERRED TO THEREIN, A COPY OF WHICH IS
ON FILE WITH THE ISSUER. THE SECURITIES REPRESENTED BY
THIS INSTRUMENT MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT IN
COMPLIANCE WITH SAID AGREEMENT. ANY SALE OR OTHER
TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENT WILL BE VOID.
WARRANT to purchase 1,470,588 Shares of Common Stock
of National Penn Bancshares, Inc. Issue Date: December 12,
2008
1. Definitions. Unless
the context otherwise requires, when used herein the following
terms shall have the meanings indicated.
“Affiliate” has the meaning ascribed to it in the
Purchase Agreement. “Appraisal Procedure” means
a procedure whereby two independent appraisers, one chosen by the
Company and one by the Original Warrantholder, shall mutually agree
upon the determinations then the subject of
appraisal. Each party shall deliver a notice to the
other appointing its appraiser within 15 days after the Appraisal
Procedure is invoked. If within 30 days after
appointment of the two appraisers they are unable to agree upon the
amount in question, a third independent appraiser shall be chosen
within 10 days thereafter by the mutual consent of such first two
appraisers. The decision of the third appraiser so
appointed and chosen shall be given within 30 days after the
selection of such third appraiser. If three appraisers
shall be appointed and the determination of one appraiser is
disparate from the middle determination by more than twice the
amount by which the other determination is disparate from the
middle determination, then the determination of such appraiser
shall be excluded, the remaining two determinations shall be
averaged and such average shall be binding and conclusive upon the
Company and the Original Warrantholder; otherwise, the average of
all three determinations shall be binding upon the Company and the
Original Warrantholder. The costs of conducting any
Appraisal Procedure shall be borne by the Company. UST
Sequence Number: 189
“Board of Directors” means the board of directors of
the Company, including any duly authorized committee thereof.
“Business Combination” means a merger,
consolidation, statutory share exchange or similar transaction that
requires the approval of the Company’s stockholders.
“Business day” means any day except Saturday, Sunday
and any day on which banking institutions in the State of New York
generally are authorized or required by law or other governmental
actions to close. “Capital Stock” means (A) with
respect to any Person that is a corporation or company, any and all
shares, interests, participations or other equivalents (however
designated) of capital or capital stock of such Person and (B) with
respect to any Person that is not a corporation or company, any and
all partnership or other equity interests of such Person.
“Charter” means, with respect to any Person, its
certificate or articles of incorporation, articles of association,
or similar organizational document. “Common
Stock” has the meaning ascribed to it in the Purchase
Agreement. “Company” means the Person whose
name, corporate or other organizational form and jurisdiction of
organization is set forth in Item 1 of Schedule A hereto.
“Conversion” has the meaning set forth in Section
13(B). “Convertible Securities” has the meaning
set forth in Section 13(B). “CPP” has the
meaning ascribed to it in the Purchase Agreement.
“Exchange Act” means the Securities Exchange Act of
1934, as amended, or any successor statute, and the rules and
regulations promulgated thereunder. “Exercise
Price” means the amount set forth in Item 2 of Schedule A
hereto. “Expiration Time” has the meaning set
forth in Section 3. “Fair Market Value” means,
with respect to any security or other property, the fair market
value of such security or other property as determined by the Board
of Directors, acting in good faith or, with respect to Section 14,
as determined by the Original Warrantholder acting in good
faith. For so long as the Original Warrantholder holds
this Warrant or any portion thereof, it may object in writing to
the Board of Director’s calculation of fair market value
within 10 days of receipt of written notice thereof. If
the Original Warrantholder and the Company are unable to agree on
fair market value during the 10-day period following the delivery
of the Original Warrantholder’s objection, the Appraisal
Procedure may be invoked by either party to determine Fair Market
Value by delivering written notification thereof not later than the
30th day after delivery of the Original Warrantholder’s
objection. “Governmental Entities” has the
meaning ascribed to it in the Purchase Agreement.
“Initial Number” has the meaning set forth in Section
13(B). UST Sequence Number: 189
“Issue Date” means the date set forth in Item 3 of
Schedule A hereto. “Market Price” means, with
respect to a particular security, on any given day, the last
reported sale price regular way or, in case no such reported sale
takes place on such day, the average of the last closing bid and
ask prices regular way, in either case on the principal national
securities exchange on which the applicable securities are listed
or admitted to trading, or if not listed or admitted to trading on
any national securities exchange, the average of the closing bid
and ask prices as furnished by two members of the Financial
Industry Regulatory Authority, Inc. selected from time to time by
the Company for that purpose. “Market Price”
shall be determined without reference to after hours or extended
hours trading. If such security is not listed and traded
in a manner that the quotations referred to above are available for
the period required hereunder, the Market Price per share of Common
Stock shall be deemed to be (i) in the event that any portion of
the Warrant is held by the Original Warrantholder, the fair market
value per share of such security as determined in good faith by the
Original Warrantholder or (ii) in all other circumstances, the fair
market value per share of such security as determined in good faith
by the Board of Directors in reliance on an opinion of a nationally
recognized independent investment banking corporation retained by
the Company for this purpose and certified in a resolution to the
Warrantholder. For the purposes of determining the
Market Price of the Common Stock on the "trading day" preceding, on
or following the occurrence of an event, (i) that trading day shall
be deemed to commence immediately after the regular scheduled
closing time of trading on the New York Stock Exchange or, if
trading is closed at an earlier time, such earlier time and (ii)
that trading day shall end at the next regular scheduled closing
time, or if trading is closed at an earlier time, such earlier time
(for the avoidance of doubt, and as an example, if the Market Price
is to be determined as of the last trading day preceding a
specified event and the closing time of trading on a particular day
is 4:00 p.m. and the specified event occurs at 5:00 p.m. on that
day, the Market Price would be determined by reference to such 4:00
p.m. closing price). “Ordinary Cash Dividends”
means a regular quarterly cash dividend on shares of Common Stock
out of surplus or net profits legally available therefor
(determined in accordance with generally accepted accounting
principles in effect from time to time), provided that Ordinary
Cash Dividends shall not include any cash dividends paid subsequent
to the Issue Date to the extent the aggregate per share dividends
paid on the outstanding Common Stock in any quarter exceed the
amount set forth in Item 4 of Schedule A hereto, as adjusted for
any stock split, stock dividend, reverse stock split,
reclassification or similar transaction. “Original
Warrantholder” means the United States Department of the
Treasury. Any actions specified to be taken by the
Original Warrantholder hereunder may only be taken by such Person
and not by any other Warrantholder. “Permitted
Transactions” has the meaning set forth in Section 13(B).
“Person” has the meaning given to it in Section
3(a)(9) of the Exchange Act and as used in Sections 13(d)(3) and
14(d)(2) of the Exchange Act. “Per Share Fair Market
Value” has the meaning set forth in Section 13(C).
“Preferred Shares” means the perpetual preferred stock
issued to the Original Warrantholder on the Issue Date pursuant to
the Purchase Agreement. UST Sequence Number: 189
“Pro Rata Repurchases” means any purchase of shares
of Common Stock by the Company or any Affiliate thereof pursuant to
(A) any tender offer or exchange offer subject to Section 13(e) or
14(e) of the Exchange Act or Regulation 14E promulgated thereunder
or (B) any other offer available to substantially all holders of
Common Stock, in the case of both (A) or (B), whether for cash,
shares of Capital Stock of the Company, other securities of the
Company, evidences of indebtedness of the Company or any other
Person or any other property (including, without limitation, shares
of Capital Stock, other securities or evidences of indebtedness of
a subsidiary), or any combination thereof, effected while this
Warrant is outstanding. The “Effective Date”
of a Pro Rata Repurchase shall mean the date of acceptance of
shares for purchase or exchange by the Company under any tender or
exchange offer which is a Pro Rata Repurchase or the date of
purchase with respect to any Pro Rata Repurchase that is not a
tender or exchange offer. “Purchase Agreement”
means the Securities Purchase Agreement – Standard Terms
incorporated into the Letter Agreement, dated as of the date set
forth in Item 5 of Schedule A hereto, as amended from time to time,
between the Company and the United States Department of the
Treasury (the “Letter Agreement”), including all
annexes and schedules thereto. “Qualified Equity
Offering” has the meaning ascribed to it in the Purchase
Agreement. “Regulatory Approvals” with respect
to the Warrantholder, means, to the extent applicable and required
to permit the Warrantholder to exercise this Warrant for shares of
Common Stock and to own such Common Stock without the Warrantholder
being in violation of applicable law, rule or regulation, the
receipt of any necessary approvals and authorizations of, filings
and registrations with, notifications to, or expiration or
termination of any applicable waiting period under, the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
and the rules and regulations thereunder. “SEC”
means the U.S. Securities and Exchange Commission.
“Securities Act” means the Securities Act of 1933, as
amended, or any successor statute, and the rules and regulations
promulgated thereunder. “Shares” has the meaning
set forth in Section 2. “Trading day” means (A)
if the shares of Common Stock are not traded on any national or
regional securities exchange or association or over-the-counter
market, a business day or (B) if the shares of Common Stock are
traded on any national or regional securities exchange or
association or over-the-counter market, a business day on which
such relevant exchange or quotation system is scheduled to be open
for business and on which the shares of Common Stock (i) are not
suspended from trading on any national or regional securities
exchange or association or over-the-counter market for any period
or periods aggregating one half hour or longer; and (ii) have
traded at least once on the national or regional securities
exchange or association or over-the-counter market that is the
primary market for the trading of the shares of Common Stock.
“U.S. GAAP” means United States generally
accepted accounting principles. “Warrantholder”
has the meaning set forth in Section 2.
“Warrant” means this Warrant, issued pursuant to the
Purchase Agreement. UST Sequence Number: 189
2. Number
of Shares; Exercise Price. This certifies that, for
value received, the United States Department of the Treasury or its
permitted assigns (the “Warrantholder”) is entitled,
upon the terms and subject to the conditions hereinafter set forth,
to acquire from the Company, in whole or in part, after the receipt
of all applicable Regulatory Approvals, if any, up to an aggregate
of the number of fully paid and nonassessable shares of Common
Stock set forth in Item 6 of Schedule A hereto, at a purchase price
per share of Common Stock equal to the Exercise
Price. The number of shares of Common Stock (the
“Shares”) and the Exercise Price are subject to
adjustment as provided herein, and all references to “Common
Stock,” “Shares” and “Exercise Price”
herein shall be deemed to include any such adjustment or series of
adjustments.
3. Exercise
of Warrant; Term. Subject to Section 2, to the extent
permitted by applicable laws and regulations, the right to purchase
the Shares represented by this Warrant is exercisable, in whole or
in part by the Warrantholder, at any time or from time to time
after the execution and delivery of this Warrant by the Company on
the date hereof, but in no event later than 5:00 p.m., New York
City time on the tenth anniversary of the Issue Date (the
“Expiration Time”), by (A) the surrender of this
Warrant and Notice of Exercise annexed hereto, duly completed and
executed on behalf of the Warrantholder, at the principal executive
office of the Company located at the address set forth in Item 7 of
Schedule A hereto (or such other office or agency of the Company in
the United States as it may designate by notice in writing to the
Warrantholder at the address of the Warrantholder appearing on the
books of the Company), and (B) payment of the Exercise Price for
the Shares thereby purchased:
(i) by
having the Company withhold, from the shares of Common Stock that
would otherwise be delivered to the Warrantholder upon such
exercise, shares of Common stock issuable upon exercise of the
Warrant equal in value to the aggregate Exercise Price as to which
this Warrant is so exercised based on the Market Price of the
Common Stock on the trading day on which this Warrant is exercised
and the Notice of Exercise is delivered to the Company pursuant to
this Section 3, or
(ii) with
the consent of both the Company and the Warrantholder, by tendering
in cash, by certified or cashier’s check payable to the order
of the Company, or by wire transfer of immediately available funds
to an account designated by the Company. If the
Warrantholder does not exercise this Warrant in its entirety, the
Warrantholder will be entitled to receive from the Company within a
reasonable time, and in any event not exceeding three business
days, a new warrant in substantially identical form for the
purchase of that number of Shares equal to the difference between
the number of Shares subject to this Warrant and the number of
Shares as to which this Warrant is so
exercised. Notwithstanding anything in this Warrant to
the contrary, the Warrantholder hereby acknowledges and agrees that
its exercise of this Warrant for Shares is subject to the condition
that the Warrantholder will have first received any applicable
Regulatory Approvals.
4. Issuance
of Shares; Authorization; Listing. Certificates for
Shares issued upon exercise of this Warrant will be issued in such
name or names as the Warrantholder may designate and will be
delivered to such named Person or Persons within a reasonable time,
not to exceed three business days after the date on which this
Warrant has been duly exercised in accordance with the terms of
this Warrant. The Company hereby represents and warrants
that any Shares issued upon the exercise of this Warrant in
accordance with the provisions of Section 3 will be duly and
UST Sequence Number: 189
validly authorized and issued, fully paid and nonassessable and
free from all taxes, liens and charges (other than liens or charges
created by the Warrantholder, income and franchise taxes incurred
in connection with the exercise of the Warrant or taxes in respect
of any transfer occurring contemporaneously
therewith). The Company agrees that the Shares so issued
will be deemed to have been issued to the Warrantholder as of the
close of business on the date on which this Warrant and payment of
the Exercise Price are delivered to the Company in accordance with
the terms of this Warrant, notwithstanding that the stock transfer
books of the Company may then be closed or certificates
representing such Shares may not be actually delivered on such
date. The Company will at all times reserve and keep
available, out of its authorized but unissued Common Stock, solely
for the purpose of providing for the exercise of this Warrant, the
aggregate number of shares of Common Stock then issuable upon
exercise of this Warrant at any time. The Company will
(A) procure, at its sole expense, the listing of the Shares
issuable upon exercise of this Warrant at any time, subject to
issuance or notice of issuance, on all principal stock exchanges on
which the Common Stock is then listed or traded and (B) maintain
such listings of such Shares at all times after
issuance. The Company will use reasonable best efforts
to ensure that the Shares may be issued without violation of any
applicable law or regulation or of any requirement of any
securities exchange on which the Shares are listed or traded.
5. No
Fractional Shares or Scrip. No fractional Shares or
scrip representing fractional Shares shall be issued upon any
exercise of this Warrant. In lieu of any fractional
Share to which the Warrantholder would otherwise be entitled, the
Warrantholder shall be entitled to receive a cash payment equal to
the Market Price of the Common Stock on the last trading day
preceding the date of exercise less the pro-rated Exercise Price
for such fractional share.
6. No
Rights as Stockholders; Transfer Books. This Warrant
does not entitle the Warrantholder to any voting rights or other
rights as a stockholder of the Company prior to the date of
exercise hereof. The Company will at no time close its
transfer books against transfer of this Warrant in any manner which
interferes with the timely exercise of this Warrant.
7. Charges,
Taxes and Expenses. Issuance of certificates for Shares
to the Warrantholder upon the exercise of this Warrant shall be
made without charge to the Warrantholder for any issu
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