Exhibit 4.1
THE SECURITIES REPRESENTED BY THIS
INSTRUMENT HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR 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.
THE SECURITIES REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO TRANSFER AND OTHER RESTRICTIONS SET
FORTH IN AN INVESTMENT AGREEMENT, DATED AS OF JULY 22, 2008, COPIES
OF WHICH ARE ON FILE WITH THE WARRANT AGENT.
WARRANT
to purchase
[
]
Shares of Common Stock
of
BOSTON PRIVATE FINANCIAL
HOLDINGS, INC.
a Massachusetts
Corporation
** Exercisable only if countersigned
by the Warrant Agent as Provided Herein**
1. Definitions . Unless the
context otherwise requires, when used herein the following terms
shall have the meanings indicated.
“ Affiliate ” has
the meaning set forth in Section 6.9(a) of the Investment
Agreement.
“ Appraisal Procedure
” means a procedure whereby two independent appraisers, one
chosen by the Company and one by the Warrantholder (or if there is
more than one Warrantholder, a majority in interest of
Warrantholders), 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
or, if such first two appraisers fail to agree upon the appointment
of a third appraiser, such appointment shall be made by the
American Arbitration Association, or any organization successor
thereto, from a panel of arbitrators having experience in the
appraisal of the subject matter to be appraised. 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 on the Company and the Warrantholder;
otherwise, the average of all three determinations shall be binding
and conclusive on the Company and the Warrantholder. The costs of
conducting any Appraisal Procedure shall be borne by the
Warrantholder requesting such Appraisal Procedure, except
(A) the fees and expenses of the appraiser appointed by the
Company and any other costs incurred by the Company shall be borne
by the Company and (B) if such Appraisal Procedure shall
result in a determination that is disparate by 5% or more from the
Company’s initial determination, all costs of conducting such
Appraisal Procedure shall be borne by the Company.
“ Beneficially Own
” or “ Beneficial Owner ” has the meaning
set forth in Section 4.1(f) of the Investment
Agreement.
“ BHC Act ” means
the Bank Holding Company Act of 1956, as amended, or any successor
statute.
“ Board of Directors
” has the meaning set forth in Section 2.2(a)(1) of the
Investment Agreement.
“ Board Representative
” has the meaning set forth in Section 4.3(a) of the
Investment Agreement.
“ Business Combination
” means a merger, consolidation, statutory share exchange or
similar transaction that requires adoption by the Company’s
stockholders.
“ business day ”
means any day except Saturday, Sunday and any day which shall be a
legal holiday or a day on which banking institutions in the State
of New York or in the Commonwealth of Massachusetts 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.
“ CIBC Act ”
means the Change in Bank Control Act of 1978, as amended, or any
successor statute.
“ Common Stock ”
has the meaning set forth in Section 2.
“ Company ” has
the meaning set forth in the preamble of the Investment
Agreement.
“ Company Subsidiary
” has the meaning set forth in Section 2.2(a)(2) of the
Investment Agreement.
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“ 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 $6.62; provided , that the foregoing shall be
subject to adjustment or limitation as set forth herein.
“ 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. If the
Warrantholder does not accept the Board of Director’s
calculation of fair market value and the Warrantholder and the
Company are unable to agree on fair market value, the Appraisal
Procedure shall be used to determine Fair Market Value.
“ Fundamental Change
” means the occurrence of one of the following:
(i) a “person” or
“group” within the meaning of Section 13(d) of the
Exchange Act files a Schedule TO or any schedule, form or report
under the Exchange Act disclosing that such person or group has
become the direct or indirect ultimate Beneficial Owner of common
equity of the Company representing more than 50% of the voting
power of the outstanding Common Stock;
(ii) consummation of any
consolidation or merger of the Company or similar transaction or
any sale, lease or other transfer in one transaction or a series of
transactions of all or substantially all of the consolidated assets
of the Company and its Subsidiaries, taken as a whole, to any
person other than one of the Company’s Subsidiaries, in each
case pursuant to which the Common Stock will be converted into
cash, securities or other property, other than pursuant to a
transaction in which the persons that Beneficially Owned, directly
or indirectly, voting shares of the Company immediately prior to
such transaction Beneficially Own, directly or indirectly, voting
shares representing a majority of the total voting power of all
outstanding classes of voting shares of the continuing or surviving
person immediately after the transaction; or
(iii) the Company’s
stockholders approve and adopt a plan of liquidation or dissolution
of the Company or a sale of all or substantially all of the
Company’s assets.
“ Governmental Entities
” has the meaning set forth in Section 1.2(b)(1)(A) of
the Investment Agreement.
“ Group ” means a
group as contemplated by Section 13(d)(3) of the Exchange
Act.
“ Investment Agreement
” means the Investment Agreement, dated as of July 22,
2008, as may be amended from time to time, between the Company and
Purchaser.
“ 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, (A) the closing
sale price for such day reported by The Nasdaq Global Select Market
if such security is traded over-the-counter
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and quoted in The Nasdaq Global Select Market,
or (B) if such security is so traded, but not so quoted, the
average of the closing reported bid and ask prices of such security
as reported by The Nasdaq Global Select Market or any comparable
system, or (C) if such security is not listed on The Nasdaq
Global Select Market or any comparable system, the average of the
closing bid and ask prices as furnished by two members of the
National Association of Securities Dealers, Inc. selected from time
to time by the Company for that purpose. 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 the fair value per
share of such security as determined in good faith by the Board of
Directors.
“ Ordinary Cash
Dividends ” means a regular quarterly cash dividend out
of surplus or net profits legally available therefor (determined in
accordance with generally accepted accounting principles,
consistently applied) and consistent with past practice.
“ 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.
“ Preferred Stock
” shall have the meaning set forth in the recitals of the
Investment Agreement.
“ Preliminary Fundamental
Change ” means, with respect to the Company, (A) the
execution of definitive documentation for a transaction or
(B) the recommendation that stockholders tender in response to
a tender or exchange offer, that could reasonably be expected to
result in a Fundamental Change upon consummation.
“ Pro Rata Repurchases
” means any purchase of shares of Common Stock by the Company
or any Affiliate thereof pursuant to any tender offer or exchange
offer subject to Section 13(e) or 14(e) of the Exchange Act or
Regulation 14E thereunder, or pursuant to any other offer available
to substantially all holders of Common Stock, 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 Company Subsidiary), or any combination thereof, effected while
this Warrant is outstanding; provided , however ,
that “Pro Rata Repurchase” shall not include any
purchase of shares by the Company or any Affiliate thereof made in
accordance with the requirements of Rule 10b-18 as in effect under
the Exchange Act. The “ Effective Date ” of a
Pro Rata Repurchase shall mean the date of acceptance of shares for
purchase or exchange 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.
“Purchaser” has the meaning set forth in the preamble of the
Investment Agreement.
“ SEC ” means the
U.S. Securities and Exchange Commission.
“ Securities ”
has the meaning set forth in the recitals of the Investment
Agreement.
“ Securities Act
” means the Securities Act of 1933, as amended, or any
successor statute, and the rules and regulations promulgated
thereunder.
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“ Shares ” has
the meaning set forth in Section 2.
“ Stockholder Approvals
” means all stockholder approvals necessary to
(A) approve the exercise of this Warrant for the Shares and
the issuance of any Shares which may be issued pursuant to the
terms of this Warrant for purposes of Rule 4350(i) of the NASDAQ
Marketplace Rules, and (B) amend the Restated Articles of
Organization of the Company, as amended, to increase the number of
authorized shares of Common Stock to at least such number as shall
be sufficient to permit the exercise of this Warrant for the
Shares. For the avoidance of doubt, the Stockholder Approvals shall
be deemed to be obtained for the purposes of this Warrant only if
all of the foregoing approvals shall have been obtained.
“ Subsidiary ”
has the meaning set forth in Section 2.2(a)(2) of the
Investment Agreement.
“ Underlying Security
Price ” has the meaning set forth in Annex 1
.
“ Voting
Securities” has the meaning set forth in the BHC Act and
any rules or regulations promulgated thereunder.
“ Warrant Agent”
has the meaning set forth in Section 3.
“Warrant
Agreement” means
the Warrant Agreement, dated as of [
], 2008, between the Company and
the Warrant Agent.
“Warrant
Certificate” means
this certificate evidencing the Warrant.
“ Warrantholder ”
has the meaning set forth in Section 2.
“ Warrant ” means
the Warrant issued pursuant to the Warrant Agreement and subject to
the Investment Agreement.
2. Number of Shares; Exercise
Price . This certifies that, for value received, [NAME OF
HOLDER], its affiliates or its registered assigns (the “
Warrantholder ”) is entitled, upon the terms and
subject to the conditions hereinafter set forth, to acquire from
the Company, in whole at any time or in part from time to time,
after the receipt of Stockholder Approvals, [
] fully paid and nonassessable shares of common stock, $1.00 par
value per share, of the Company (the “ Common Stock
”), 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. This Warrant is issued pursuant to and in accordance
with the Warrant Agreement, and will be subject to the additional
terms and conditions set forth in the Warrant Agreement.
3. Exercise of Warrant; Term
. Subject to the terms and conditions hereof, 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 9:00 a.m., New York City time, on the date hereof, but in no
event later than 5:00 p.m., New York City time, on the fifth
anniversary of the date of issuance of the Warrant (the “
Expiration Time ”), by (A) the surrender of this
Warrant and Notice of Exercise annexed hereto,
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duly completed and executed on behalf of the
Warrantholder, at the corporate trust office of [
], or his successor as warrant agent (the “ Warrant
Agent ”), at Boston Private Financial Holdings, Inc., Ten
Post Office Square, Boston, MA 02109 (or such other office or
agency of the Warrant Agent in the United States as it or the
Company 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 at the election of the Warrantholder in one of
the following manners:
(i) by tendering to the Warrant
Agent in cash, by certified or cashier’s check or by wire
transfer payable to the order of the Company, or
(ii) by having the Warrant Agent
withhold shares of Common Stock issuable upon exercise of this
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 immediately prior to the date on
which this Warrant is exercised and the Notice of Exercise is
delivered to the Warrant Agent.
If the Warrantholder does not
exercise this Warrant in its entirety, the Warrantholder will be
entitled to receive from the Warrant Agent, on behalf of the
Company, within a reasonable time, and in any event not exceeding
three business days, a new Warrant Certificate in substantially
identical form for the purchase of that number of Shares equal to
the difference between the number of Shares issuable pursuant to
the Warrant evidenced by the Warrant Certificate and the number of
Shares as to which the Warrant is so exercised. Notwithstanding
anything in the Warrant Certificate to the contrary, the
Warrantholder hereby acknowledges and agrees that its exercise of
this Warrant for the Shares is subject to the following conditions
and limitations:
(A) this Warrant shall only be
exercisable if the Company shall have first received the
Stockholder Approvals;
(B) a Warrantholder shall not be
entitled to exercise this Warrant for a number of Shares that would
cause such Warrantholder and its Affiliates, collectively, to be
deemed to own, control or have the power to vote, for purposes of
the BHC Act or the CIBC Act and any rules or regulations
promulgated thereunder, 10% or more of any class of Voting
Securities of the Company outstanding at such time (excluding for
purposes of this calculation any reductions in the percentage of
Voting Securities such Warrantholder and its Affiliates so owns,
controls or has the power to vote resulting from transfers by
Purchaser and its Affiliates of Securities purchased by Purchaser
pursuant to the Investment Agreement; it being understood, for the
avoidance of doubt, that no Security shall be included in any such
percentage calculation to the extent it cannot by its terms be
converted into or exercisable for Voting Securities by a
Warrantholder or its Affiliates at the time of such measurement or
transfer).
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
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any Shares issued upon the exercise of this
Warrant in accordance with the provisions of Section 3 will,
upon receipt of the Stockholder Approvals, be duly and 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 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 the Warrant
Certificate and payment of the Exercise Price are delivered to the
Warrant Agent in accordance with the terms hereof, 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. Subject to receipt of the Stockholder Approvals, 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 issuable upon exercise of this Warrant. The
Company will (A) procure, at its sole expense, the listing of
the Shares and other securities issuable upon exercise of this
Warrant, subject to issuance or notice of issuance on all stock
exchanges on which the Common Stock is then listed or traded and
(B) maintain the listing of such Shares 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. Before taking any action which would
cause an adjustment pursuant to Section 12 to reduce the
Exercise Price below the then par value (if any) of the Common
Stock, the Company shall take any and all corporate action which
may, in the opinion of its counsel, be necessary in order that the
Company may validly and legally issue fully paid and non-assessable
shares of Common Stock at the Exercise Price as so
adjusted.
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 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 issue or transfer tax
or other incidental expense in respect of the issuance of such
certificates, all of which taxes and expenses shall be paid by the
Company.
8. Tra
