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| 8-K - TWO HARBORS INVESTMENT CORP. | v205213_8k.htm |
SECOND AMENDMENT TO WARRANT
AGREEMENT
This
Second Amendment (this “Amendment”), executed and effective as of December 13,
2010, by and between Two Harbors Investment Corp., a Maryland corporation (“Two
Harbors” or the “Company”) and Mellon Investor Services LLC, a New Jersey
limited liability company (“Mellon”), hereby amends the Warrant Agreement, dated
as of November 8 2007, by and between Capitol Acquisition Corp., a Delaware
corporation (“Capitol Acquisition”), and Continental Stock Transfer & Trust
Company, a New York corporation (“Continental”), as amended by the Supplement
and Amendment to Warrant Agreement, dated as of October 28, 2009, by and among
Capitol Acquisition, Two Harbors and Continental (collectively, the “Warrant
Agreement”).
W
I T N E S S E T H
WHEREAS, Capitol Acquisition
and Continental previously entered into the Warrant Agreement, pursuant to which
Continental was appointed to serve as agent of the Company with respect to the
Warrants;
WHEREAS, on October 28, 2009,
Capitol Acquisition and Two Harbors consummated a business combination, with Two
Harbors as the surviving entity, and Two Harbors assumed all of the rights and
all of the obligations of Capitol Acquisition under the Warrant
Agreement;
WHEREAS, Continental will
resign or otherwise be discharged from all further duties as agent of the
Company with respect to the Warrants as of December 13, 2010;
WHEREAS, the Company desires
to appoint Mellon as the successor to Continental as agent of the Company with
respect to the Warrants as of and after December 13, 2010, and Mellon desires to
accept such appointment subject to the express terms and conditions of the
Warrant Agreement and this Amendment (and no implied terms or conditions);
and
WHEREAS, in connection with
the appointment of Mellon as the successor to Continental, as agent of the
Company with respect to the Warrants, the Company and Mellon desire to amend the
Warrant Agreement in certain respects.
NOW, THEREFORE, in
consideration of the promises and the mutual agreements herein set forth, the
parties agree as follows:
Section
1. Appointment of the Successor
Warrant Agent. The Company hereby appoints Mellon as successor
Warrant Agent under the Warrant Agreement and Mellon hereby accepts such
appointment subject to the express terms and conditions of the Warrant Agreement
and this Amendment (and no implied terms or conditions).
Section
2. Waiver of Prior Written
Notice. The Company and Mellon each waive any requirements of
prior written notice of a change of the Warrant Agent under the Warrant
Agreement.
Section
3. Amendment of Warrant
Agreement. The Warrant Agreement shall be further amended as
follows:
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(a) “Mellon
Investor Services LLC” shall be substituted throughout the Warrant Agreement,
Exhibits and other attachments for any and all references to “Continental Stock
Transfer & Trust Company” including substituting for all abbreviations
therein. All references in the Warrant Agreement to the Warrant Agent
shall be deemed references to Mellon Investor Services LLC as the Warrant
Agent.
(b) References
throughout the Warrant Agreement to any “person” shall include any individual,
firm, corporation, limited liability company, partnership, trust or other
entity, and shall include any successor (by merger or otherwise) thereof or
thereto.
(c) References
throughout the Warrant Agreement to any “notice,” “direction,” “instruction,”
“consent,” “statement” or “order” to be delivered to the Warrant Agent shall
mean a “written notice,” “written instruction,” “written consent,” “written
statement,” or “written order.”
(d) Section
3.1 of the Warrant Agreement is hereby amended by adding the following after the
last sentence in Section 3.1:
“The Company shall promptly notify the
Warrant Agent in writing upon any lowering of the Warrant Price and, if such
notification is given orally, the Company shall confirm the same in writing on
or prior to the Business Day next following. Until such written
notice is received by the Warrant Agent, the Warrant Agent may presume
conclusively for all purposes that the Warrant Price has not been
lowered.”
(e) Section
3.2 of the Warrant Agreement is hereby amended by adding the following after the
last sentence in Section 3.2:
“The Company shall promptly notify the
Warrant Agent in writing upon the occurrence or any extension of the Expiration
Date and, if such notification is given orally, the Company shall confirm the
same in writing on or prior to the Business Day next following. Until
such written notice is received by the Warrant Agent, the Warrant Agent may
presume conclusively for all purposes that the Expiration Date has not
occurred.”
(f) Section
3.3.1 of the Warrant Agreement is hereby amended by deleting the introductory
sentence in Section 3.3.1 and substituting in lieu therefor the
following:
“Subject
to the provisions of the Warrant and this Warrant Agreement, a Warrant, when
countersigned by the Warrant Agent, may be exercised by the registered holder
thereof by surrendering it, at the designated office of the Warrant Agent, or at
the office of its successor as Warrant Agent, with the subscription form, as set
forth in the Warrant, properly completed and duly executed, and by paying in
full the Warrant Price for each full share of Common Stock as to which the
Warrant is exercised and any and all applicable taxes due in connection with the
exercise of the Warrant, as follows:”
(g) Section
7.1 of the Warrant Agreement is hereby amended by adding the following after the
last sentence in Section 7.1:
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“In any
such case, the Company and the Warrant Agent shall not be required to issue or
deliver any Warrants or shares of Common Stock until all such taxes or charges
shall have been paid or it is established to the Company’s and the Warrant
Agent’s satisfaction that no such tax or charge is due.”
(h) Section
7.2.6 of the Warrant Agreement is hereby amended by deleting the fourth sentence
in Section 7.2.6 and substituting in lieu therefor the following:
“Any
successor Warrant Agent, whether appointed by the Company or by such court,
shall be a person organized and existing under the laws of any state or of the
United States of America, in good standing, and authorized under such laws to
exercise shareowner services powers and subject to supervision or examination by
federal or state authority.”
(i) Section
7.2.8 of the Warrant Agreement is hereby amended by deleting the section in its
entirety and substituting in lieu therefor the following:
“Merger, Consolidation or
Name Change of Warrant Agent. Any person into which the Warrant Agent may
be merged or converted or with which it may be consolidated or any person
resulting from any merger, conversion or consolidation to which the Warrant
Agent shall be a party or any person succeeding to the shareowner services
business of the Warrant Agent or any successor Warrant Agent shall be the
successor Warrant Agent under this Agreement, without any further act or
deed.”
(j) Section
7.3.1 of the Warrant Agreement is hereby amended by deleting the section in its
entirety and substituting in lieu therefor the following:
“Remuneration. The
Company agrees to pay the Warrant Agent reasonable remuneration to be agreed
upon between the Warrant Agent and the Company for its services as Warrant Agent
hereunder and will reimburse the Warrant Agent upon demand for all expenditures
(including reasonable counsel fees and expenses) that the Warrant Agent may
reasonably incur in the preparation, delivery, administration, execution and
amendment of this Agreement and the exercise and performance of its duties
hereunder.”
(k) Section
7.4.1 of the Warrant Agreement is hereby amended by deleting the last sentence
in Section 7.4.1 and substituting in lieu therefor the following:
“Such certificate will be full
authorization to the Warrant Agent for any action taken, suffered or omitted to
be taken by it under the provisions of this Agreement in reliance upon such
certificate. The Warrant Agent is hereby authorized and directed to
accept instructions with respect to the performance of its duties hereunder from
any one of the President or the Chairman of the Board of the Company, and to
apply to such officers for advice or instructions in connection with its duties,
and it may rely upon such statement and will not be liable for any action taken,
suffered or omitted to be taken by it, in the absence of bad faith, in
accordance with any such instructions or pursuant to the provisions of this
Agreement.”
(l) Section
7.4.2 of the Warrant Agreement is hereby amended by deleting the section in its
entirety and substituting in lieu therefor the following:
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“Indemnity. The
Warrant Agent shall be liable hereunder only for its own gross negligence,
willful misconduct or bad faith (each as determined by a final, non-appealable
judgment of a court of competent jurisdiction). The Company agrees to
indemnify the Warrant Agent for, and to hold it harmless against, any loss,
liability, suit, action, proceeding, judgment, claim, settlement, cost or
expense (including reasonable counsel fees and expenses), incurred without gross
negligence, willful misconduct or bad faith on the part of the Warrant Agent
(each as determined by a final, non-appealable judgment of a court of competent
jurisdiction), for any action taken, suffered or omitted to be taken by the
Warrant Agent in connection with the preparation, delivery, acceptance,
administration, execution and amendment of this Agreement and the exercise and
performance of its duties hereunder, including the costs and expenses of
defending against any claim of liability arising therefrom, directly or
indirectly. The Warrant Agent shall not be obligated to expend or
risk its own funds or to take any action that it believes would expose it to
expense or liability or to a risk of incurring expense or liability, unless it
has been furnished with assurances of repayment or indemnity satisfactory to
it.”
(m) Section
7.4.3 of the Warrant Agreement is hereby amended by deleting the section in its
entirety and substituting in lieu therefor the following:
“Exclusions. The
Warrant Agent shall have no responsibility with respect to the validity of this
Agreement or with respect to the validity or execution of any Warrant (except
its countersignature thereof); nor shall it be responsible for any breach by the
Company of any covenant or condition contained in this Agreement or in any
Warrant; nor shall it be responsible or have any duty to make any calculation or
adjustment, or to determine when any calculation or adjustment required under
the provisions of this Agreement, including but not limited to Section 3.3.1(b),
Section 3.3.1(c) and Section 4 hereof, should be made, how it should be made or
what it should be, or have any responsibility or liability for the manner,
method or amount of any such calculation or adjustment or the ascertaining of
the existence of facts that would require any such calculation or adjustment,
including but not limited to any calculation or determination of “fair market
value” and any calculation or determination made in connection with an exercise
of Warrants on a “cashless basis;” nor shall it by any act hereunder be deemed
to make any representation or warranty as to the authorization or reservation of
any shares of Common Stock to be issued pursuant to this Agreement or any
Warrant or as to whether any securities will, when issued, be validly authorized
and issued, fully paid, nonassessable and free from all preemptive rights,
taxes, liens and charges; nor will the Warrant Agent be under any duty or
responsibility to ensure compliance with any applicable federal or state
securities laws in connection with the issuance, transfer or exchange of
Warrants or Warrant Certificates.”
(n) The
Warrant Agreement is hereby amended by adding the following as a new Section
7.6:
“Agent for the
Company. In acting in the capacity of Warrant Agent 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 with any of the owners or
holders of the Warrants.”
(o) The
Warrant Agreement is hereby amended by adding the following as a new Section
7.7:
“Counsel. The Warrant
Agent may consult with counsel satisfactory to it (which may be counsel to the
Company), and the advice of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
to be taken by it hereunder in accordance with the advice of such counsel, so
long as the Warrant Agent acts without gross negligence, willful misconduct or
bad faith (each as determined by a final, non-appealable judgment of a court of
competent jurisdiction).”
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(p) The
Warrant Agreement is hereby amended by adding the following as a new Section
7.8:
“Documents. The
Warrant Agent shall be protected and shall incur no liability for or in respect
of any action taken, suffered or omitted to be taken 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.”
(q) The
Warrant Agreement is hereby amended by adding the following as a new Section
7.9:
“Certain Transactions.
The Warrant Agent, and its officers, directors and employees, may become the
owner of, or acquire any interest in, any Warrant, with the same rights that it
or they would have were it 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, or as a
depositary, trustee or agent for, any committee or body of holders of Warrants,
or other securities or obligations of the Company as freely as if it were not
the Warrant Agent hereunder. Nothing in this Agreement shall be deemed to
prevent the Warrant Agent from acting as trustee under an
indenture.”
(r) The
Warrant Agreement is hereby amended by adding the following as a new Section
7.10:
“No Liability for
Interest. 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.”
(s) The
Warrant Agreement is hereby amended by adding the following as a new Section
7.11:
“No Implied
Obligations. The Warrant Agent shall be obligated to perform such duties
as are explicitly set forth herein 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 that may involve it in any
expense or liability, the payment of which within a reasonable time is not, in
its opinion, assured to it. The Warrant Agent shall not be accountable or under
any duty or responsibility for the use by the Company of any Warrant Certificate
authenticated by the Warrant Agent and delivered by it to the Company pursuant
to this Agreement or for the application by the Company of the proceeds of the
issue and sale, or exercise, of the Warrants. 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 herein or in any Warrant Certificate or
in the case of the receipt of any written demand from a holder of the Warrants
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, to make any demand upon the
Company.”
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(t) The
Warrant Agreement is hereby amended by adding the following as a new Section
7.12:
“Agents. The Warrant
Agent may execute any of the trusts or powers hereunder or perform any duties
hereunder either directly or by or through agents or attorneys-in-fact, and the
Warrant Agent shall not be responsible for any loss or expense arising out of,
or in connection with, the actions or omissions to act of its agents or
attorneys-in-fact, so long as the Warrant Agent acts without gross negligence,
willful misconduct or bad faith (each as determined by a final, non-appealable
judgment of a court of competent jurisdiction) in connection with the selection
of such agents or attorneys-in-fact.”
(u) The
Warrant Agreement is hereby amended by adding the following as a new Section
7.13:
“Liability.
Notwithstanding anything in this Agreement to the contrary, in no event shall
the Warrant Agent be liable for special, indirect, punitive, incidental or
consequential loss or damage of any kind whatsoever (including but not limited
to lost profits), even if the Warrant Agent has been advised of the likelihood
of the loss or damage and regardless of the form of the
action. Notwithstanding anything in this Agreement to the contrary,
any liability of the Warrant Agent under this Agreement shall be limited to the
amount of annual fees paid by the Company to the Warrant Agent.”
(v) The
Warrant Agreement is hereby amended by adding the following as a new Section
7.14:
“Force Majeure. In no
event shall the Warrant Agent be responsible or liable for any failure or delay
in the performance of its obligations under this Agreement arising out of or
caused by, directly or indirectly, forces beyond its reasonable control,
including without limitation strikes, work stoppages, accidents, acts of war or
terrorism, civil or military disturbances, natural catastrophes or acts of God,
and interruptions, loss or malfunctions of utilities, communications or computer
(software or hardware) services.”
(w) Section
8.2 of the Warrant Agreement is hereby amended by deleting the address for
notice, statement or demand authorized to be given or made by the holder of any
Warrant or by the Company to or on the Warrant Agent and substituting in lieu
therefor the following:
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Mellon
Investor Services LLC
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Newport
Office Center VII
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480
Washington Blvd.
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Jersey
City, NJ 07310
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Attention: Relationship
Manager
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with
a copy to:
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Mellon
Investor Services LLC
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Newport
Office Center VII
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480
Washington Blvd.
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Jersey
City, NJ 07310
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Attention: Legal
Department
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(x) Section
8.5 of the Warrant Agreement is hereby amended by deleting the section in its
entirety and substituting in lieu therefor the following:
“Examination of the Warrant
Agreement. A copy of this Agreement shall be available at all reasonable
times at the office of the Warrant Agent designated for such purpose, for
inspection by the registered holder of any Warrant. Prior to such
inspection, the Warrant Agent may require any such holder to submit his Warrant
for inspection by it.”
(y) The
Warrant Agreement is hereby amended by adding the following as a new Section
9.10:
“Each
person that is a party hereto acknowledges that the Warrant Agent is subject to
the customer identification program (“Customer Identification Program”)
requirements under the USA PATRIOT Act and its implementing regulations, and
that the Warrant Agent must obtain, verify and record information that allows
the Warrant Agent to identify each such person. Accordingly, prior to
accepting an appointment hereunder, the Warrant Agent may request information
from any such person that will help the Warrant Agent to identify such person,
including without limitation, as applicable, such person’s physical address, tax
identification number, organizational documents, certificate of good standing or
license to do business. Each person that is a party hereto agrees
that the Warrant Agent cannot accept an appointment hereunder unless and until
the Warrant Agent verifies each such person’s identity in accordance with the
Customer Identification Program requirements.”
(z) The
Warrant Agreement is hereby amended by adding the following as a new Section
9.11:
“The Bank
of New York Mellon Corporation (“BNYM”) has adopted an incentive compensation
program designed (i) to facilitate clients gaining access to and being provided
with explanations about the full range of products and services offered by BNYM
and its subsidiaries and (ii) to expand and develop client relationships. This
program may lead to the payment of referral fees and/or bonuses to employees of
BNYM or its subsidiaries who may have been involved in a referral that resulted
in the execution of this Warrant Agreement, obtaining products or services
covered by this Warrant Agreement or products or services that may be ancillary
or supplemental to such products or services. Any such referral fees or bonuses
are funded solely out of fees and commissions paid under this Warrant Agreement
or with respect to such ancillary or supplemental products or
services.”
Section
4. Continued
Effectiveness. The parties hereto hereby acknowledge and agree
that, except as expressly provided herein, the provisions of the Warrant
Agreement, as previously amended to the date hereof, shall remain in full force
and effect in accordance with their terms and shall be unaffected by this
Amendment.
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Section
5. Applicable law. The
validity, interpretation, and performance of this Amendment shall be governed in
all respects by the laws of the State of New York, without giving effect to
conflicts of law principles that would result in the application of the
substantive laws of another jurisdiction.
Section
6. Severability. This
Amendment shall be deemed severable, and the invalidity or unenforceability of
any term or provision hereof shall not affect the validity or enforceability of
this Amendment or of any other term or provision hereof. Furthermore, in lieu of
any such invalid or unenforceable term or provision, the parties hereto intend
that there shall be added as a part of this Amendment a provision as similar in
terms to such invalid or unenforceable provision as may be possible and be valid
and enforceable.
Section
7. Execution in
Counterparts. This Amendment may be executed in any number of
original or facsimile counterparts and each of such counterparts shall for all
purposes be deemed to be an original, and all such counterparts shall together
constitute but one and the same instrument.
Section
8. Terms. Except
as otherwise expressly provided herein, or unless the context otherwise
requires, all terms used herein have the meanings assigned to them in the
Warrant Agreement.
[Signature
Page Follows]
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IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and effective as of the day and year above written.
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TWO
HARBORS INVESTMENT CORP.
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By:
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/s/ Jeffrey Stolt | |
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Name:
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Jeffrey Stolt | |
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Title:
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Chief Financial Officer | |
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MELLON
INVESTOR SERVICES LLC
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By:
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/s/ Christopher T. Coleman | |
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Name:
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Christopher T. Coleman | |
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Title:
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Vice President | |
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