EXHIBIT 3
SERIES A WARRANT AGREEMENT
Dated as of January 10, 2003
by and between
NTL INCORPORATED
and
CONTINENTAL STOCK TRANSFER & TRUST COMPANY
as Warrant Agent
SERIES A WARRANT AGREEMENT
TABLE OF CONTENTS1
Page
SECTION 1. Appointment of Warrant Agent......................................2
SECTION 2. Warrant Certificates..............................................2
SECTION 3. Issuance of Warrants..............................................2
SECTION 4. Execution of Warrant Certificates.................................3
SECTION 5. Registration and Countersignature.................................3
SECTION 6. Registration of Transfers and Exchanges...........................4
SECTION 7. Terms of Warrants; Exercise of Warrants...........................4
SECTION 8. Payment of Taxes...................................................6
SECTION 9. Mutilated or Missing Warrant Certificates.........................7
SECTION 10. Reservation of Warrant Shares....................................7
SECTION 11. Obtaining Stock Exchange Listings................................8
SECTION 12. Adjustment of Exercise Price and Number
of Warrant Shares Issuable.................................8
(a) Adjustment for Change in Capital Stock.............8
(b) Adjustment for Rights Issue........................9
(c) Adjustment for Other Distributions................10
(d) Current Market Price..............................11
(e) When De Minimis Adjustment May Be Deferred........12
(f) When No Adjustment Required.......................12
(g) Notice of Adjustment..............................13
(h) Consolidation, Merger, Sale, Recapitalization or
Reorganization of the Company.....................13
(i) The Company Determination Final...................19
(j) Warrant Agent's Disclaimer........................19
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1 This Table of Contents does not constitute a part of this Warrant
Agreement or have any bearing upon the interpretation of any of its
terms or provisions.
i
Page
(k) When Issuance or Payment May Be Deferred ..............19
(l) Adjustment in Number of Shares.........................20
(m) Form of Warrants.......................................20
SECTION 13. No Dilution or Impairment.......................................20
SECTION 14. Fractional Interests............................................21
SECTION 15. Notices to Warrant Holders......................................21
SECTION 16. Merger, Consolidation or Change of Name of Warrant Agent........23
SECTION 17. Warrant Agent...................................................23
SECTION 18. Expenses........................................................26
SECTION 19. Change of Warrant Agent.........................................26
SECTION 20. Notices to the Company and Warrant Agent........................26
SECTION 21. Supplements and Amendments......................................27
SECTION 22. Successors......................................................28
SECTION 24. Governing Law; Jurisdiction.....................................28
SECTION 25. Benefits of this Warrant Agreement..............................28
SECTION 26. Counterparts....................................................28
SECTION 27. Further Assurances..............................................28
SECTION 28. Entire Agreement................................................28
EXHIBIT A - Form of Warrant Certificate.....................................A-1
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ii
SERIES A WARRANT AGREEMENT (this "Warrant Agreement") dated
as of January 10, 2003, between NTL INCORPORATED, a Delaware corporation (the
"Company"), and CONTINENTAL STOCK TRANSFER & TRUST COMPANY, a New York banking
corporation, as Warrant Agent (the "Warrant Agent").
WHEREAS, pursuant to the terms and conditions of the Second
Amended Joint Reorganization Plan Of NTL Incorporated and Certain
Subsidiaries, dated July 15, 2002 and confirmed on September 5, 2002, as may
be further amended and restated from time to time (the "Plan") relating to the
reorganization under Chapter 11 of the Bankruptcy Reform Act of 1978, as
codified in Title 11 of the United States Code, 11 U.S.C. xx.xx. 101-1330 (the
"Bankruptcy Code") of NTL Incorporated, a Delaware corporation ("Old NTL") and
certain of its subsidiaries, including the Company, (i) the holders of (a) 13%
Senior Redeemable Exchangeable Preferred Stock of Old NTL, (b) 13% Series B
Senior Redeemable Exchangeable Preferred Stock of Old NTL, (c) 5% Cumulative
Participating Convertible Preferred Stock, Series A (and dividend shares,
Series C through Series K) of Old NTL, (d) 5% Cumulative Participating
Convertible Preferred Stock, Series B (and dividend shares, Series B-1 through
Series B-6) of Old NTL, (e) Cumulative Convertible Preferred Stock, Series A
of Old NTL (the Old NTL preferred stock described in clauses (a), (b), (c),
(d) and (e) above, shall be referred to herein as "Old NTL Eligible Preferred
Stock"), (f) 6.5% Fixed Coupon Redeemable Preferred Stock, Series A of Old
NTL, (g) Variable Coupon Redeemable Preferred Stock, Series A of Old NTL and
(h) common stock of Old NTL ("Old NTL Common Stock"), will receive (subject to
allocation pursuant to the Plan), among other consideration, an aggregate
number of 8,750,000 of the Series A warrants of the Company hereinafter
described (the "Warrants") to purchase shares of common stock, par value $0.01
per share, together with associated preferred stock purchase rights (the
"Common Stock"), of the Company (the Common Stock issuable upon exercise of
the Warrants being referred to herein as the "Warrant Shares"); (ii) holders
of (a) Old NTL Eligible Preferred Stock and (b) Old NTL Common Stock (and
their permitted transferees) were offered (subject to allocation pursuant to
the Plan) rights to purchase up to 3,750,000 detachable units (the "Units")
composed of one share of Common Stock and one Warrant each pursuant to the
Equity Rights Offering conducted pursuant to the Plan; and (iii) holders of
(a) 7% Convertible Subordinated Notes due 2008 issued by NTL Communications
Corp. (and a subordinated co-obligation of NTL (Delaware), Inc. and former NTL
Incorporated (currently named NTL Europe, Inc.)), (b) 5 3/4% Convertible
Subordinated Notes due 2009 issued by NTL (Delaware), Inc. (and a subordinated
co-obligation of former NTL Incorporated (currently named NTL Europe, Inc.))
other than France Telecom, and (c) 5 3/4% Convertible Subordinated Notes due
2011 co-issued on a subordinated basis by NTL (Delaware), Inc. and former NTL
Incorporated (currently named NTL Europe, Inc.) were offered the right to
purchase any Units that were not purchased in the Equity Rights Offering
pursuant to the Noteholder Election Option conducted pursuant to the Plan;
1
WHEREAS, a Warrant entitles the holder of the Warrant, upon
proper exercise, to receive from the Company, as adjusted as provided herein,
one fully paid and nonassessable share of Common Stock at the Exercise Price
(as defined herein) and, accordingly, a maximum of 12,500,000 Warrants are
being offered pursuant to, and upon the terms and conditions set forth in, the
Plan in an offering in reliance on the exemption afforded by section 1145 of
the Bankruptcy Code from the registration requirements of the Securities Act
of 1933, as amended (the "Securities Act"), and of any applicable state
securities or "blue sky" laws;
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 of Warrant certificates and other matters as
provided herein; and
WHEREAS, for purposes of this Warrant Agreement, "person"
shall be interpreted broadly to include an individual, corporation,
partnership, joint venture, association, joint stock company, limited
liability company, limited liability partnership, trust, trustee, estate,
unincorporated organization, government, governmental unit, agency, or
political subdivision thereof, or other entity.
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth, the parties hereto agree as follows:
SECTION 1. Appointment of Warrant Agent. The Company hereby
appoints the Warrant Agent to act as agent for the Company in accordance with
the instructions set forth hereinafter in this Warrant Agreement, and the
Warrant Agent hereby accepts such appointment.
SECTION 2. Warrant Certificates. The certificates evidencing
the Warrants to be delivered pursuant to this Warrant Agreement shall be in
registered form only and shall be substantially in the form set forth in
Exhibit A attached hereto ("Warrant Certificates") and may have such letters,
numbers, or other marks of identification or designation and such legends or
endorsements printed, lithographed or engraved thereon as the officers of the
Company executing the same may approve (with execution thereof to be
conclusive evidence of such approval) and as are not inconsistent with the
provisions of this Warrant Agreement, or as may be required to comply with any
applicable law or with any rule or regulation made pursuant thereto or with
any rule or regulation of any exchange, inter-dealer quotation system or
regulated quotation service on which the Warrants may be listed or quoted, as
the case may be.
SECTION 3. Issuance of Warrants. Upon issuance in accordance
with Section 5, each Warrant Certificate shall evidence one or more Warrants.
Each Warrant evidenced thereby entitles the holder, upon proper exercise to
receive from the Company, as adjusted as provided herein, one fully paid and
nonassessable share of Common Stock at the Exercise Price.
2
SECTION 4. Execution of Warrant Certificates. Warrant
Certificates shall be signed on behalf of the Company by its Chairman of the
Board, Chief Executive Officer, President or Vice President and Secretary or
an Assistant Secretary under its corporate seal. The seal of the Company may
be in the form of a facsimile thereof and may be impressed, affixed, imprinted
or otherwise reproduced on the Warrant Certificates. Each such signature upon
any Warrant Certificate may be in the form of a facsimile signature of the
present or any future Chairman of the Board, Chief Executive Officer,
President or Vice President and Secretary or Assistant Secretary and may be
imprinted or otherwise reproduced on the Warrant Certificates and for that
purpose the Company may adopt and use the facsimile signature of any person
who shall have been Chairman of the Board, Chief Executive Officer, President
or Vice President and Secretary or Assistant Secretary at the time of entering
into this Warrant Agreement, notwithstanding the fact that at the time any
Warrant Certificate shall be countersigned by the Warrant Agent and delivered
or disposed of by the Company he shall have ceased to hold such office, so
long as, and the Company hereby represents that, under the Company's charter
and by-laws, any Warrants or Warrant Shares so issued would be validly issued.
Any 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, so long as, and the Company hereby represents that, under the
Company's charter and by-laws, any Warrants or Warrant Shares so issued would
be validly issued.
Warrant Certificates shall be dated the date of
countersignature by the Warrant Agent and shall represent one or more whole
Warrants.
SECTION 5. Registration and Countersignature. The Warrant
Agent, on behalf of the Company, shall number and register the Warrant
Certificates in a register as they are issued by the Company.
Warrant Certificates shall be manually countersigned by the
Warrant Agent and shall not be valid for any purpose unless so countersigned.
The Warrant Agent shall, upon written instructions of the Chairman of the
Board, Chief Executive Officer, President, Vice President and Secretary or
Assistant Secretary of the Company, initially countersign and deliver Warrants
entitling the holders thereof to purchase not more, nor less, than the number
of Warrant Shares referred to above in the second recital hereof (but subject
to adjustment as hereinafter provided) and shall countersign and deliver
Warrants as otherwise provided in this Warrant Agreement.
The Company and the Warrant Agent may deem and treat the
registered holder(s) of the Warrant Certificates as the absolute owner(s)
thereof (notwithstanding any notation of ownership or other writing thereon
made by anyone), for all purposes, and neither the Company nor the Warrant
Agent shall be affected by any notice to the contrary.
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SECTION 6. Registration of Transfers and Exchanges. 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,
upon surrender thereof accompanied by a written instrument or instruments of
transfer in form satisfactory to the Warrant Agent, duly executed by the
registered holder or holders thereof or by the duly appointed legal
representative thereof or by a duly authorized attorney. 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. Cancelled Warrant Certificates shall thereafter be disposed
of by the Company in accordance with applicable law.
Warrant Certificates may be exchanged at the option of the
registered holder(s) thereof, when surrendered to the Warrant Agent at its
office during normal business hours for another Warrant Certificate or other
Warrant Certificates of like tenor and representing in the aggregate a like
number of Warrants. Warrant Certificates surrendered for exchange shall be
cancelled by the Warrant Agent. Such cancelled Warrant Certificates shall then
be disposed of by the Company in accordance with applicable law.
The Warrant Agent is hereby authorized to countersign, in
accordance with the provisions of this Section 6, the new Warrant Certificates
issued pursuant to the provisions of this Section 6.
SECTION 7. Terms of Warrants; Exercise of Warrants. Subject
to the terms of this Warrant Agreement, each Warrant holder shall have the
right, which may be exercised from the date of original issuance of the
Warrant Certificates pursuant to the terms of this Warrant Agreement and prior
to 5:00 p.m. New York City Time, on January 10, 2011 (the "Expiration Date"), to
exercise each Warrant and receive from the Company the number of fully paid
and nonassessable Warrant Shares which the holder may at the time be entitled
to receive on exercise of such Warrants and payment of the aggregate Exercise
Price then in effect for such Warrant Shares; provided, however, that if the
Company or a holder of Warrants reasonably believes (as evidenced by notice to
the Warrant Agent of such belief) that the exercise of any Warrant requires
prior compliance with the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended, and the rules and regulations thereunder, any such exercise
shall be contingent upon such prior compliance as evidenced by notice from the
Company to the Warrant Agent of such compliance. In addition, prior to the
delivery of any Warrant Shares that the Company shall be obligated to deliver
upon proper exercise of the Warrants, the Company shall comply with all
applicable federal and state laws, rules and regulations which require action
to be taken by the Company. Each Warrant, when exercised, will, as adjusted as
provided herein, entitle the holder thereof to purchase one fully paid and
nonassessable share of Common Stock at the Exercise Price. Each Warrant not
exercised prior to the Expiration Date shall become void and all rights
thereunder
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and all rights in respect thereof under this Warrant Agreement shall cease as
of such time.
A Warrant may be exercised upon surrender to the Company at
the principal corporate trust office of the Warrant Agent referred to in
Section 20 (the "Warrant Agent Office") of the Warrant Certificate or Warrant
Certificates evidencing the Warrants to be exercised with the form of election
to purchase on the reverse thereof duly completed and signed, which signature
shall be guaranteed by an "Eligible Guarantor Institution" as defined in Rule
17Ad-15(2) promulgated under the Securities and Exchange Act of 1934, as
amended (the "Exchange Act"), and upon payment to the Warrant Agent for the
account of the Company of the exercise price of $309.88 (the "Exercise
Price"), as adjusted from time to time as herein provided, for each Warrant
Share then exercised. Payment of the aggregate Exercise Price for all Warrant
Shares being exercised in respect of a Warrant shall be made (a) in United
States Dollars or (b) by certified or official bank check for United States
Dollars made payable to the order of "NTL Incorporated". In lieu of payment of
the aggregate Exercise Price as aforesaid and subject to applicable law, the
holder of a Warrant may request the payment by the Company of the "Spread",
which shall, subject to Section 14, be delivered by the Company by delivering
to such Warrant holder a number of shares of Common Stock equal to (a)(i) the
product of (x) the current market price per share of Common Stock (as of the
date of receipt of the request to the Company), multiplied by (y) the number
of Warrant Shares underlying the Warrants being exercised, minus (ii) the
product of (x) the Exercise Price, multiplied by (y) the number of Warrant
Shares underlying the Warrants being exercised, divided by (b) the current
market price per share of Common Stock (as of the date of receipt of the
request to the Company).
Subject to the provisions of Section 8, upon such surrender
of Warrants and payment of the aggregate Exercise Price, the Company shall
issue and cause to be delivered promptly to or upon the written order of the
holder and in such name or names, as the Warrant holder may designate, a
certificate or certificates for the number of full Warrant Shares issuable
upon the exercise of such Warrants together with cash as provided in Section
14; provided, however, that if any Fundamental Transaction (as defined in
Section 12(h)(1)) is proposed to be effected by the Company or a tender offer
or an exchange offer for shares of Common Stock shall be made, upon such
surrender of Warrants and payment of the Exercise Price as aforesaid, the
Company shall, as soon as possible, but in any event not later than two
business days thereafter, issue and cause to be delivered the full number of
Warrant Shares issuable upon the exercise of such Warrants in the manner
described in this sentence together with cash as provided in Section 14. Such
certificate or certificates shall be deemed to have been issued and any person
so designated to be named therein shall be deemed to have become a holder of
record of such Warrant Shares as of the date of the surrender of such Warrants
and payment of the aggregate Exercise Price. No fractional shares shall be
issued upon exercise of any Warrants in accordance with Section 14.
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The Warrants shall be exercisable, at the election of the
holders thereof, either in full or from time to time in part (in whole Warrant
Shares) and, in the event that a Certificate evidencing Warrants is exercised
in respect of fewer than all of the Warrant Shares issuable on such exercise
at any time prior to the Expiration Date, a new Certificate evidencing the
remaining Warrant or Warrants will be promptly issued, and the Warrant Agent
is hereby irrevocably authorized to countersign and to deliver the required
new Warrant Certificate or Certificates pursuant to the provisions of this
Section 7 and of Section 5, and the Company, whenever required by the Warrant
Agent, will supply the Warrant Agent with Warrant Certificates duly executed
on behalf of the Company for such purpose.
All Warrant Certificates surrendered upon exercise of
Warrants shall be cancelled by the Warrant Agent. Such cancelled Warrant
Certificates shall then be disposed of by the Company in accordance with
applicable law. The Warrant Agent shall (x) advise an authorized
representative of the Company as directed by the Company at the end of each
day on which Warrants were exercised (i) the number of Warrant Shares issued
upon exercise of a Warrant, (ii) delivery of Warrant Certificates evidencing
the balance, if any, of the Warrant Shares issuable after such exercise of the
Warrant and (iii) such other information as the Company shall reasonably
require and (y) concurrently pay to the Company all funds received by it in
payment of the aggregate Exercise Price. The Warrant Agent shall promptly
confirm such information to the Company in writing.
The Warrant Agent shall keep copies of this Warrant
Agreement and any notices given or received hereunder available for inspection
by the holders of the Warrants during normal business hours at its office. The
Company shall supply the Warrant Agent from time to time with such numbers of
copies of this Warrant Agreement as the Warrant Agent may request.
SECTION 8. Payment of Taxes. No service charge shall be made
to any holder of a Warrant for any exercise, exchange or registration of
transfer of Warrant Certificates, and the Company will pay all documentary
stamp taxes attributable to the initial issuance of Warrant Shares upon the
exercise of Warrants; provided, however, that the Company shall not be
required to pay any tax or taxes which may be payable in respect of any
transfer involved in the issue of any Warrant Certificates or any certificates
for Warrant Shares in a name other than that of the registered holder of a
Warrant Certificate surrendered upon the exercise of a Warrant, and the
Company shall not be required to issue or deliver such Warrant Certificates
unless or until the person or persons requesting the issuance thereof shall
have paid to the Company the amount of such tax or shall have established to
the satisfaction of the Company that such tax has been paid.
SECTION 9. Mutilated or Missing Warrant Certificates. If any
of the Warrant Certificates shall be mutilated, lost, stolen or destroyed, the
Company shall issue and the Warrant Agent shall countersign, in exchange and
substitution for and
6
upon cancellation of the mutilated Warrant Certificate, or in lieu of and
substitution for the Warrant Certificate lost, stolen or destroyed, a new
Warrant Certificate of like tenor and representing an equivalent number of
Warrants, but only upon receipt of evidence satisfactory to the Company and
the Warrant Agent of such loss, theft or destruction of such Warrant
Certificate and such indemnity and security therefor as is customary and
reasonably satisfactory to the Company and the Warrant Agent, if requested.
Applicants for such substitute Warrant shall also comply with such other
reasonable regulations and pay such other reasonable charges as the Company or
the Warrant Agent may prescribe.
SECTION 10. Reservation of Warrant Shares. The Company will
at all times reserve and keep available, free from preemptive rights, out of
the aggregate of its authorized but unissued shares of Common Stock, for the
purpose of enabling it to satisfy any obligation to issue Warrant Shares upon
exercise of Warrants, the maximum number of shares of Common Stock which may
then be deliverable upon the exercise of all outstanding Warrants.
The Company or the transfer agent for the Common Stock and
every subsequent transfer agent for any shares of the Company's capital stock
issuable upon the exercise of any of the rights of purchase represented by the
Warrants as aforesaid (the "Transfer Agent") will be irrevocably authorized
and directed at all times to reserve such number of authorized shares as shall
be required for such purpose. The Company will keep a copy of this Warrant
Agreement on file with the Transfer Agent for any shares of the Company's
capital stock issuable upon the exercise of the rights of purchase represented
by the Warrants. The Warrant Agent is hereby irrevocably authorized to
requisition from time to time from such Transfer Agent the stock certificates
required to honor outstanding Warrants upon exercise thereof in accordance
with the terms of this Warrant Agreement. The Company will supply such
Transfer Agent with duly executed certificates for such purposes and will
provide or otherwise make available any cash which may be payable as provided
in Section 14. The Company will furnish such Transfer Agent a copy of all
notices of adjustments and certificates related thereto, transmitted to each
holder pursuant to Section 15.
Before taking any action which would cause an adjustment
pursuant to Section 12 to reduce the Exercise Price below the then par value
per share (if any) of a Warrant Share, the Company will take all corporate
action necessary, in the opinion of its counsel (which may be counsel employed
by the Company), in order that the Company may validly and legally issue fully
paid and nonassessable Warrant Shares at the Exercise Price as so adjusted.
The Company covenants that all Warrant Shares which may be
issued upon exercise of Warrants will be, upon payment of the aggregate
Exercise Price and issuance thereof, fully paid, nonassessable, free of
preemptive rights and free from all taxes, liens, charges and security
interests with respect to the issue thereof.
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SECTION 11. Obtaining Stock Exchange Listings. The Company
shall also from time to time take all action reasonably necessary so that the
Warrant Shares, immediately upon their issuance upon the exercise of Warrants,
will be listed or quoted, as the case may be, on the primary exchange,
inter-dealer quotation system or regulated quotation service, if any, on which
shares of Common Stock are then listed or quoted, subject to the rules and
regulations thereof. If the shares of Common Stock are not so listed or
quoted, the Company shall not be obligated to obtain or maintain a listing or
quotation, as the case may be, of the shares of Common Stock or Warrant Shares
on any exchange, inter-dealer quotation system or regulated quotation service.
SECTION 12. Adjustment of Exercise Price and Number of
Warrant Shares Issuable. The Exercise Price and the number of Warrant Shares
issuable upon the exercise of each Warrant are subject to adjustment from time
to time upon the occurrence of the events enumerated in this Section 12. For
purposes of this Section 12, "Common Stock" means the Common Stock and any
other stock of the Company, however designated, for which the Warrants may be
exercisable from time to time.
(a) Adjustment for Change in Capital Stock.
If on or after the date of this Warrant Agreement and prior
to the Expiration Date, the Company:
(1) pays a dividend or makes a distribution on its
Common Stock in shares of its Common Stock;
(2) subdivides its outstanding shares of Common
Stock into a greater number of shares;
(3) combines its outstanding shares of Common Stock
into a smaller number of shares;
(4) makes a distribution on its Common Stock in
shares of its capital stock other than Common Stock; or
(5) issues by reclassification of its Common Stock
any shares of its capital stock,
then the Exercise Price and the number and kind of shares of capital stock of
the Company issuable upon the exercise of a Warrant shall be proportionately
adjusted so that the holder of any Warrant thereafter exercised may receive
the aggregate number and kind of shares of capital stock of the Company which
he would have owned immediately following such action if such Warrant had been
exercised immediately prior to such action.
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The adjustment shall become effective immediately after the
record date in the case of a dividend or distribution and immediately after
the effective date in the case of a subdivision, combination or
reclassification.
If after an adjustment a holder of a Warrant upon exercise
may receive shares of two or more classes or series of capital stock of the
Company, the Company shall determine the allocation of the adjusted Exercise
Price between the classes or series of capital stock based on the relative
fair market values (determined by the Board of Directors of the Company) of
such class or classes of capital stock. After such allocation, the exercise
privilege and the Exercise Price of each class or series of capital stock
shall thereafter again be subject to adjustment on the terms applicable to
Common Stock in this Section 12.
Such adjustment shall be made successively whenever any
event listed above shall occur.
(b) Adjustment for Rights Issue.
If on or after the date of this Warrant Agreement and prior
to the Expiration Date, the Company distributes any options, warrants or other
rights (however classified, except pursuant to its stockholder rights plan) to
all holders of its Common Stock entitling them for a period expiring within 45
days after the record date mentioned below to purchase shares of Common Stock
or securities convertible into, or exchangeable or exercisable for, Common
Stock at a price per share (or with an initial conversion, exchange or
exercise price) less than the current market price per share on that record
date, the Exercise Price shall be adjusted in accordance with the following
formula:
N x P
O + ------------
M
E'= E x ---------------------
O + N
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
O = the number of shares of Common Stock
outstanding on the record date.
N = the number of additional shares of Common Stock offered.
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P = the offering price per share of the additional shares.
M = the current market price per share of Common Stock on
the record date.
The adjustment shall be made successively whenever any such
options, warrants or other rights (however classified) are issued and shall
become effective immediately after the record date for the determination of
stockholders entitled to receive the options, warrants or other rights
(however classified). If at the end of the period during which such rights,
options or warrants are exercisable, not all options, warrants or other rights
(however classified) shall have been exercised, the Exercise Price shall be
immediately readjusted to what it would have been if "N" in the above formula
had been the number of shares actually issued.
(c) Adjustment for Other Distributions.
If on or after the date of this Warrant Agreement and prior
to the Expiration Date, the Company distributes to all holders of its Common
Stock any of its assets (other than cash dividends or distributions), debt
securities, preferred stock or any options, warrants or other rights to
purchase debt securities, assets or other securities of the Company, the
Exercise Price shall be adjusted in accordance with the following formula:
M - F
E' = E x ---------
M
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
M = the current market price per share of Common Stock on
the record date mentioned below.
F = the fair market value on the record date of the assets,
securities, rights or warrants to be distributed in
respect of one share of Common Stock. The Board of
Directors of the Company shall determine the fair market
value.
The adjustment shall be made successively whenever any such
record date is fixed and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the
distribution.
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This Section 12(c) does not apply to: (i) options, warrants
or other rights referred to in Section 12(b); or (ii) a dividend payable in
shares of Common Stock referred to in Section 12(a).
(d) Current Market Price.
All references in Section 12(b) or Section 12(c) and in
Section 7 and Section 14 to "the current market price per share of Common
Stock" on any date shall mean the last reported sale price for such security
on the principal exchange or quotation system on which such security is listed
or traded. If the security is not admitted for trading on any securities
exchange or the Nasdaq National or SmallCap Market, "current market price per
share of Common Stock" shall mean the average of the last reported closing bid
and asked prices reported by the Nasdaq Stock Market, Inc., the electronic
securities market regulated by the National Association of Securities Dealers,
Inc., as furnished by any member in good standing of the National Association
of Securities Dealers, Inc., selected from time to time by the Company for
that purpose or as quoted by the National Quotation Bureau Incorporated. In
the event that no such quotation is available for such day, the "current
market price per share of Common Stock" shall be the average of the quotations
for the last five trading days for which a quotation is available within the
last 30 trading days prior to such day. In the event that five such quotations
are not available within such 30-trading day period, the Board of Directors of
the Company shall be entitled to determine the "current market price per share
of Common Stock" on the basis of such quotations or other information as it in
good faith considers appropriate (without regard to any illiquidity or
minority discounts).
(e) When De Minimis Adjustment May Be Deferred.
No adjustment in the Exercise Price need be made unless the
adjustment would require an increase or decrease of at least l% in the
Exercise Price on the date an adjustment would otherwise be required to be
made. Any adjustments that are not made shall be carried forward and taken
into account in any subsequent adjustment.
All calculations under this Section 12 shall be made to the
nearest cent or to the nearest 1/100th of a share, as the case may be.
(f) When No Adjustment Required.
No adjustment need be made for a transaction referred to in
Section 12(a), Section 12(b) or Section 12(c) if all Warrant holders
participate in such transaction on a basis and with notice that the Board of
Directors of the Company determines to be fair and appropriate in light of the
basis and notice on which holders of Common Stock participate in the
transaction.
11
No adjustment need be made for rights to purchase Common
Stock purchased at the fair market value thereof (determined by the Board of
Directors of the Company) pursuant to any of the Company's plans for
reinvestment of dividends or interest.
No adjustment need be made for a change in the par value, or
from par value to no par value, or from no par value to par value, of the
Common Stock.
Notwithstanding any other provision of this Section 12, no
adjustment to the Exercise Price shall result in zero or in a negative number
or shall reduce the Exercise Price below the then par value per share of the
Common Stock, and any such purported adjustment shall instead reduce the
Exercise Price to such par value (unless the Common Stock then has no par
value in which case such purported adjustment shall instead reduce the
Exercise Price to $0.001 per share).
To the extent the Warrants become convertible into cash, no
adjustment need be made thereafter as to the cash. Interest will not accrue on
the cash.
(g) Notice of Adjustment.
Whenever the Exercise Price is adjusted, the Company shall
provide the notices required by Section 15.
(h) Consolidation, Merger, Sale, Recapitalization or
Reorganization of the Company.
(1) If on or after the date of this Warrant
Agreement and prior to the Expiration Date, any transaction or event
or series of transactions or events shall occur (including, without
limitation, (w) any recapitalization or reclassification of shares of
Common Stock (other than a change in par value, or from par value to
no par value, or from no par value to par value, or as a result of a
subdivision or combination of Common Stock), (x) any consolidation or
merger of the Company with or into another person or any merger of
another person into the Company (other than a merger that does not
result in a reclassification, conversion, exchange or cancellation of
Common Stock or a holding company merger in which the ultimate direct
or indirect beneficial ownership of the Company is substantially the
same immediately after such transaction as it was immediately prior
to such transaction), (y) any sale or transfer of all or
substantially all of the assets of the Company or (z) any compulsory
share exchange pursuant to which either shares of Common Stock shall
be converted into the right to receive other securities, cash or
other property, or, in the case of a sale or transfer of all or
substantially all of the assets of the Company, the holders of Common
Stock shall be entitled to receive other securities, cash or other
property (each a "Fundamental
12
Transaction") and the consideration payable to holders of Common
Stock consists solely of cash and/or loan notes ("loan notes") which
are capable of repayment at the option of the holder at any time on
or after the date of issuance and are settled in cash ("cash
consideration") (a "Cash Transaction") the following shall apply:
(i) if the Cash Transaction is entered
into or publicly announced on or prior to January 10, 2004 and
the amount of cash consideration payable to a holder of one
share of Common Stock exceeds $133.49 ("Year 1 Threshold");
or
(ii) if the Cash Transaction is entered
into or publicly announced on or prior to January 10, 2005 and
the amount of cash consideration payable to a holder of one
share of Common Stock exceeds $162.09 ("Year 2 Threshold");
or
(iii) if the Cash Transaction is entered
into or publicly announced on or prior to January 10, 2006 and
the amount of cash consideration payable to a holder of one
share of Common Stock exceeds $190.70 ("Year 3 Threshold");
and
(iv) the acquiring person (the "Acquiring
Person"), or any direct or indirect shareholder that would
constitute an affiliate of such Acquiring Person (an
"Affiliated Person") is a person that has a class of voting
stock, however designated, having ordinary voting power for
the election of a majority of the board of directors of a
corporation or members of the governing body if other than a
corporation, other than stock having voting power only by
reason of the happening of a contingency ("Voting Stock");
provided that if there is more than one class of Voting
Stock, the class of Voting Stock that for purposes of this
Warrant Agreement shall be deemed "Voting Stock" shall be
the class of Voting Stock with the highest vote per share
for the election of a majority of the board of directors of
a corporation or members of the governing body if other than
a corporation, that is listed or quoted on any securities
exchange, inter- dealer quotation system or regulated
quotation system (x) at the time of entering into or public
announcement of the Cash Transaction (an "Existing
Listing"), or (y) has been admitted for listing or quotation
or admitted for listing or quotation subject to official
notice of issuance and will be listed or quoted on any
securities exchange, inter-dealer quotation system or
regulated quotation system upon consummation of the Cash
Transaction (a "New Listing"); provided that (A) if each of
the Acquiring Person and the Affiliated Person (or if none
of such persons) is maintaining an Existing Listing in good
standing, or has secured a New Listing effective, upon
consummation of the Cash
13
Transaction, for Voting Stock of such person (the "Listed
Voting Stock"), the Warrants shall become warrants of the
Acquiring Person or (B) if the Acquiring Person is not
maintaining an Existing Listing in good standing, or has not
secured a New Listing effective, upon consummation of the
Cash Transaction, for its Voting Stock, and the Affiliated
Person is maintaining an Existing Listing in good standing,
or has secured a New Listing effective, upon consummation of
the Cash Transaction, for its Voting Stock, the Warrants
shall become warrants of the Affiliated Person.
If one or more of the criteria set forth in subsections (i),
(ii), and (iii) above is satisfied, the warrants issued by the Acquiring
Person or the Affiliated Person, as the case may be, in the Cash Transaction
to holders of Warrants shall be referred to as "Acquiror Warrants" and the
person issuing the Acquiror Warrants shall be referred to as the "Acquiror".
The Acquiror Warrants shall (a) have an expiration date
identical to the Expiration Date, (b) have an exercise price equal to the
Adjustment Multiple (as hereinafter defined), multiplied by (i) in the event
of an Existing Listing, the 25-Day Average Market Price (as defined below) of
the Acquiror's Listed Voting Stock determined on the date the Cash Transaction
is entered into or publicly announced, whichever is lower or (ii) in the event
of a New Listing, the Fifteen-Day Average Market Price (as defined below) of
the Acquiror's Listed Voting Stock determined as of the close of trading on
the fifteenth consecutive Trading Day post-consummation of the Cash
Transaction and (c) be exercisable for a number of shares of the Acquiror's
Listed Voting Stock equal to the aggregate Exercise Price of the Warrants
divided by the aggregate exercise price of the Acquiror Warrants.
In the event of a Cash Transaction, the "Adjustment
Multiple" shall equal (i) the Exercise Price, divided by (ii) the cash
consideration payable in respect of one share of Common Stock in the Cash
Transaction. In the event of a Mixed Consideration Transaction (as defined
below) to which this Section 12(h)(1) applies, the "Adjustment Multiple" shall
equal (i) the Exercise Price, divided by (ii) the cash consideration payable
in respect of one share of Common Stock in the Mixed Consideration Transaction
plus (x) the Acquiror's Listed Voting Stock portion of the other consideration
offered per share of Common Stock valued based on (1) in the event of an
Existing Listing, the 25-Day Average Market Price of the Acquiror's Listed
Voting Stock determined on the date the Cash Transaction is entered into or
publicly announced, whichever is lower or (2) in the event of a New Listing,
the Fifteen-Day Average Market Price of the Acquiror's Listed Voting Stock
determined as of the close of trading on the fifteenth consecutive Trading Day
post- consummation of the Cash Transaction and (y) the Acquiror's non-Listed
Voting Stock portion of the other consideration offered per share of Common
Stock as determined by the Board of Directors of the Company. Concurrently
with the consummation of the Cash Transaction or the Mixed Consideration
Transaction if
14
this Section 12(h)(1) shall apply to the treatment of the Warrants as
determined pursuant to Section 12(h)(3), (I) the person formed by or surviving
any such Cash Transaction (any such person, the "Cash Transaction Successor"),
shall enter into a supplemental warrant agreement providing for adjustment
which shall be as nearly equivalent as may be practical to the adjustments
provided for in this Section 12 and (II) the Cash Transaction Successor shall
mail to Warrant holders a notice describing the supplemental warrant
agreement.
If any of the criteria set forth in subsections (i), (ii), and (iii)
above are not met and a Cash Transaction is entered into or publicly announced
on or prior to January 10, 2006 (the "Non-Qualifying Cash Transaction"), subject
to consummation of the Non-Qualifying Cash Transaction, the Exercise Price
shall be automatically adjusted in accordance with the following formula:
E' = 0.9 x C
where:
E' = the adjusted Exercise Price.
C = the cash consideration per share of Common Stock
payable in the Cash Transaction.
The Non-Qualifying Cash Transaction shall not be consummated unless
and until a notice setting forth such adjustment has been mailed to all
registered holders of Warrants (the record date for such mailing shall be two
Business Days prior to the first mailing of such adjustment), and a period of
at least 20 Business Days (the "20- Business Day Period") has expired from the
date of first mailing of such adjustment notice. On the later to occur of (x)
the expiration of the 20-Business Day Period and (y) consummation of the
Non-Qualifying Cash Transaction, any Warrant not previously exercised shall at
such time expire and no longer entitle its holder to exercise such Warrant for
Warrant Shares or any other consideration.
For purposes of this Section 12(h)(1), (v) "Business Day" shall mean
any day other than a Saturday, Sunday or a day on which state or federally
charted banking institutions in New York, New York are not required to be
open, (w) "25-Day Average Market Price" shall mean, for any security, the
volume-weighted average of the current market prices of that security for the
twenty-five Trading Days immediately preceding the date of determination, (x)
Fifteen-Day Average Market Price" shall mean, for any security, the
volume-weighted average of the current market prices of that security for the
fifteen Trading Days immediately preceding the date of determination, (y) "the
current market price per share of the Acquiror's Listed
15
Voting Stock" on any date shall mean the last reported sale price for such
security on the principal exchange or quotation system on which such security
is listed or traded; if the security is not admitted for trading on any
securities exchange or the Nasdaq National or SmallCap Market, "current market
price per share of the Acquiror's Listed Voting Stock" shall mean the average
of the last reported closing bid and asked prices reported by the Nasdaq Stock
Market, Inc., the electronic securities market regulated by the National
Association of Securities Dealers, Inc., as furnished by any member in good
standing of the National Association of Securities Dealers, Inc., selected
from time to time by the Company for that purpose or as quoted by the National
Quotation Bureau Incorporated; in the event that no such quotation is
available for such day, the "current market price per share of Common Stock"
shall be the average of the quotations for the last five Trading Days for
which a quotation is available within the last 30 trading days prior to such
day and (z) "Trading Day" shall mean any day on which the securities in
question are traded on the New York Stock Exchange or, if such securities are
not listed or admitted for trading on the New York Stock Exchange, on the
principal securities exchange on which such securities are listed or admitted
or, if not listed or admitted for trading on any securities exchange, on the
Nasdaq National or SmallCap Market or, if such securities are not quoted
thereon, in the applicable securities market in which the securities are
traded; provided that any day during which there shall be a halt or suspension
of trading or quotations in the securities in question exceeding 15 minutes in
the aggregate shall not be considered a Trading Day.
The Year 1 Threshold, Year 2 Threshold and Year 3 Threshold shall be
subject to adjustments provided for in Section 12 as fully as if each such
amount were for purposes of this Section 12 considered the "Exercise Price".
(2) If on or after the date of this Warrant
Agreement and prior to the Expiration Date, a Fundamental Transaction
is consummated and the consideration payable to holders of Common
Stock consists solely of consideration other than cash consideration
("other consideration") (an "Other Transaction"), (a) the Warrants
shall automatically become exercisable for the kind and amount of
stock, securities or other property or assets (excluding cash
consideration, except solely in the case of fractional shares) which
the holder of a Warrant would have owned or had the right to acquire
immediately after consummation of the Other Transaction if the holder
had exercised the Warrant immediately prior to the consummation of
the Other Transaction, (b) concurrently with the consummation of the
Other Transaction or the Mixed Consideration Transaction if this
Section12(h)(2) shall apply to the treatment of the Warrants as
determined pursuant to Section 12(h)(3), the person formed by or
surviving any such Other Transaction (any such person, the "Other
Transaction Successor"), shall enter into a supplemental warrant
agreement providing for adjustment which shall be as nearly
equivalent as may be practical to the adjustments provided for in
this
16
Section 12 and (c) the Other Transaction Successor shall mail to
Warrant holders a notice describing the supplemental warrant
agreement.
(3) If on or after the date of this Warrant
Agreement and prior to the Expiration Date, a Fundamental Transaction
is consummated and the consideration payable to holders of Common
Stock consists partly of cash consideration and partly of other
consideration (a "Mixed Consideration Transaction", which shall
include any transaction pursuant to the terms of which a person has
the right to elect the cash consideration or other consideration
received in such transaction (subject to proration, if applicable)):
(a) if the cash consideration payable in the Mixed Consideration
Transaction, exceeds 90% of the total consideration payable in the
Mixed Consideration Transaction, Section 12(h)(1) shall apply to the
treatment of the Warrants in such Mixed Consideration Transaction and
(b) if the cash consideration payable in the Mixed Consideration
Transaction is less than or equal to 90% of the total consideration
payable in the Mixed Consideration Transaction, Section 12(h)(2)
shall apply to the treatment of the Warrants in such Mixed
Consideration Transaction. If Section 12(h)(1) applies to the
treatment of the Warrants in such Mixed Consideration Transaction,
the Year 1 Threshold, Year 2 Threshold and Year 3 Threshold (as may
have been previously adjusted pursuant to this Section 12) will be
reduced by (x) the Acquiror's Listed Voting Stock portion of other
consideration offered per share of Common Stock valued based on (1)
in the event of an Existing Listing, the 25-Day Average Market Price
of the Acquiror's Listed Voting Stock determined on the date the Cash
Transaction is entered into or publicly announced, whichever is lower
or (2) in the event of a New Listing, the Fifteen-Day Average Market
Price of the Acquiror's Listed Voting Stock determined as of the
close of trading on the fifteenth consecutive Trading Day
post-consummation of the Cash Transaction and (y) the Acquiror's
non-Listed Voting Stock portion of the other consideration offered
per share of Common Stock as determined by the Board of Directors of
the Company. If Section 12(h)(2) applies to the treatment of the
Warrants in such Mixed Consideration Transaction, (a) the Warrants
shall automatically become exercisable for the kind and amount of
Acquiror's Listed Voting Stock, securities or other property or
assets (excluding cash consideration) which the holder of a Warrant
would have owned or had the right to acquire immediately after
consummation of the Other Transaction if the holder had exercised the
Warrant immediately prior to the consummation of the Other
Transaction and (b) any cash consideration that such Warrant holder
would have been entitled to receive in the Mixed Consideration
Transaction will be valued at the amount of such cash and face amount
in the case of loan notes and in lieu of payment of such cash
consideration, the following form(s) of consideration shall be paid
to the Warrant holders on a pro rata basis until the full amount of
the portion of the cash consideration that would have otherwise been
payable to the Warrant holders in the Mixed Consideration
17
Transaction is paid (i) first, in Acquiror's Listed Voting Stock and
(ii) second, in securities or other property or assets (excluding
cash consideration, except solely in the case of fractional shares).
If the cash consideration payable in the Mixed Consideration
Transaction is not the same for each share of Common Stock in respect
of which rights of election are permitted to be exercised either
because of persons not electing cash consideration or through the
application of proration provisions, if any, or otherwise, then for
the purposes of this Section 12(h)(3), the cash consideration payable
in the Mixed Consideration Transaction shall be deemed to be the
amount so payable upon consummation of the Mixed Consideration
Transaction as determined promptly after the expiration of the
election period and the application of the proration provisions, if
any. Any cash payable as part of or arising out of the Mixed
Consideration Transaction relating to (v) any appraisal or other
similar proceeding triggered by the Mixed Consideration Transaction,
(w) any mandatory redemption, put/call, settlement or other similar
provision (which shall include any requirement to pay cash into
escrow) in any security of the Company or the Acquiror (or any other
applicable third party) or any arrangement or understanding involving
such parties, (x) any earnout or other similar payments, including
contingent value rights, (y) any payments for non-compete, retention
or signing bonuses and (z) the Acquiring Person or the Company paying
cash for fractional shares of Common Stock, shall not be considered
for purposes of this Section 12(h)(3) in determining the percentage
of the cash consideration out of the total consideration payable in
the Mixed Consideration Transaction.
(4) If this Section 12(h) applies, Section 12(a),
Section 12(b) and Section 12(c) do not apply.
(i) The Company Determination Final.
Any determination that the Company or the Board of Directors
of the Company must make pursuant to this Section 12 is (absent manifest
error) conclusive if such determination is made in good faith.
(j) Warrant Agent's Disclaimer.
The Warrant Agent has no duty to determine when an
adjustment under this Section 12 or Section 13 should be made (if at all), how
it should be made or what it should be. The Warrant Agent has no duty to
determine whether any provisions of a supplemental Warrant Agreement under
Section 12(h) are correct. The Warrant Agent makes no representation as to the
validity or value of any securities or assets issued upon exercise of
Warrants. The Warrant Agent shall not be responsible for the Company's failure
to comply with this Section 12 or Section 13.
18
(k) When Issuance or Payment May Be Deferred.
In any case in which this Section 12 shall require that an
adjustment in the Exercise Price be made effective as of a record date for a
specified event, the Company may elect to defer until the occurrence of such
event (i) issuing to the holder of any Warrant exercised after such record
date the Warrant Shares and other capital stock of the Company, if any,
issuable upon such exercise over and above the Warrant Shares and other
capital stock of the Company, if any, issuable upon such exercise on the basis
of the Exercise Price and (ii) paying to such holder any amount in cash in
lieu of a fractional share pursuant to Section 14; provided, however, that the
Company shall deliver to such holder a due xxxx or other appropriate
instrument evidencing such holder's right to receive such additional Warrant
Shares, other capital stock and cash (if any) upon the occurrence of the event
requiring such adjustment.
(l) Adjustment in Number of Shares.
Upon each adjustment of the Exercise Price pursuant to this
Section 12, each Warrant outstanding prior to the making of the adjustment in
the Exercise Price shall thereafter evidence the right to receive upon payment
of the adjusted aggregate Exercise Price that number of shares of Common Stock
(calculated to the nearest hundredth) obtained from the following formula:
E
N' = N x --------
E
where:
N' = the adjusted number of Warrant Shares issuable upon
exercise of a Warrant by payment of the adjusted aggregate
Exercise Price.
N = the number of Warrant Shares previously issuable upon
exercise of a Warrant by payment of the aggregate Exercise
Price prior to adjustment.
E' = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
19
(m) Form of Warrants.
Irrespective of any adjustments in the Exercise Price or the
number or kind of shares purchasable upon the exercise of the Warrants,
Warrants theretofore or thereafter issued may continue to express the same
price and number and kind of shares as are stated in the Warrants initially
issuable pursuant to this Warrant Agreement.
SECTION 13. No Dilution or Impairment. (a) If any event
shall occur as to which the provisions of Section 12 are not strictly
applicable but the failure to make any adjustment would adversely affect the
purchase rights represented by the Warrants in a manner inconsistent with the
essential intent and principles of Section 12, then, in each such case, the
Company shall appoint a firm of independent certified public accountants of
recognized national standing, which shall give their opinion upon the
adjustment, if any, on a basis consistent with the essential intent and
principles established in Section 12, necessary to preserve, without dilution
or impairment, the purchase rights, represented by this Warrant. Upon receipt
of such opinion, the Company will promptly mail a copy thereof to the Warrant
Agent and the holders of the Warrants and shall make the adjustments described
therein. Notwithstanding the foregoing, if any single action would require
adjustment of the Exercise Price pursuant to more than one subsection of this
Section 12, only one adjustment shall be made and such adjustment shall be the
amount of adjustment that has the highest absolute value.
(b) The Company will not, by amendment of its charter or
through any consolidation, merger, reorganization, transfer of assets,
dissolution, issue or sale of securities or any other voluntary action, avoid
or seek to avoid the observance or performance of any of the terms of the
Warrants, but will at all times in good faith assist in the carrying out of
all such terms and in the taking of all such action as may be necessary or
appropriate in order to protect the rights of the holder of the Warrants
against dilution or other impairment. Without limiting the generality of the
foregoing, the Company (i) will take all such action as may be necessary or
appropriate in order that the Company may validly and legally issue fully paid
and nonassessable shares of Common Stock on the exercise of the Warrants from
time to time outstanding and (ii) will not take any action which results in
any adjustment of the Exercise Price if the total number of Warrant Shares
issuable after the action upon the exercise of all of the Warrants would
exceed the total number of shares of Common Stock then authorized by the
Company's charter and available for the purposes of issue upon such exercise.
A consolidation, merger, reorganization or transfer of assets involving the
Company covered by Section 12(h) shall not be prohibited by or require any
adjustment under this Section 13.
SECTION 14. Fractional Interests. The Company shall not be
required to issue fractional Warrant Shares on the exercise of Warrants. If
more than one Warrant shall be presented for exercise in full at the same time
by the same
20
holder, the number of full Warrant Shares which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
Warrant Shares purchasable on exercise of the Warrants so presented. If any
fraction of a Warrant Share would, except for the provisions of this Section
14, be issuable on the exercise of any Warrants (or specified portion
thereof), the Company shall notify the Warrant Agent in writing of the amount
to be paid in lieu of the fraction of a Warrant Share and concurrently pay or
provide to the Warrant Agent for repayment to the Warrant holder an amount in
cash equal to the product of (i) such fraction of a Warrant Share and (ii) the
difference of the current market price of a share of Common Stock for the day
the Warrant was presented for exercise minus the Exercise Price.
SECTION 15. Notices to Warrant Holders. Upon any adjustment
of the Exercise Price pursuant to Section 12, the Company shall within 25 days
thereafter (i) cause to be delivered to the Warrant Agent a certificate of a
firm of independent public accountants selected by the Board of Directors of
the Company or other knowledgeable expert selected by the Board of Directors
of the Company setting forth the Exercise Price after such adjustment and
setting forth in reasonable detail the method of calculation and the facts
upon which such calculations are based and setting forth the number of Warrant
Shares (or portion thereof) issuable after such adjustment in the Exercise
Price, upon exercise of a Warrant and payment of the adjusted aggregate
Exercise Price, which certificate shall be conclusive evidence of the
correctness of the matters set forth therein and (ii) cause to be given to
each of the registered holders of the Warrant Certificates at such registered
holder's address appearing on the Warrant register written notice of such
adjustments by first-class mail, postage prepaid. Where appropriate, such
notice may be given in advance and included as a part of the notice required
to be mailed under the other provisions of this Section 15.
In case:
(a) the Company shall authorize the issuance to all holders
of shares of Common Stock of options, warrants or other rights (howsoever
classified) to subscribe for or purchase shares of Common Stock or of any
other subscription rights or warrants; or
(b) the Company shall authorize the distribution to all
holders of shares of Common Stock of evidences of its indebtedness or assets
(other than cash dividends or cash distributions payable out of consolidated
earnings or earned surplus or dividends payable in shares of Common Stock or
distributions referred to in Section 12(a)); or
(c) of any Fundamental Transaction or a tender offer or
exchange offer for shares of Common Stock; or
21
(d) of the voluntary or involuntary dissolution, liquidation
or winding up of the Company; or
(e) the Company proposes to take any action (other than
actions of the character described in Section 12(a)) which would require an
adjustment of the Exercise Price pursuant to Section 12;
then, in each case, the Company shall cause to be delivered
to the Warrant Agent and shall cause to be given to each of the registered
holders of the Warrant Certificates at his address appearing on the Warrant
register, at least 20 days (or 10 days in any case specified in clauses (a) or
(b) above) prior to the applicable record date hereinafter specified, or
promptly in the case of events for which there is no record date, by
first-class mail, postage prepaid, a written notice stating (i) the date as of
which the holders of record of shares of Common Stock to be entitled to
receive any such rights, options, warrants or distribution are to be
determined or (ii) the initial expiration date set forth in any tender offer
or exchange offer for shares of Common Stock or (iii) the date on which any
such consolidation, merger, conveyance, transfer, dissolution, liquidation or
winding up is expected to become effective or consummated, and the date as of
which it is expected that holders of record of shares of Common Stock shall be
entitled to exchange such shares for securities or other property, if any,
deliverable upon such reclassification, consolidation, merger, conveyance,
transfer, dissolution, liquidation or winding up. The failure to give the
notice required by this Section 15 or any defect therein shall not affect the
legality or validity of any distribution, right, option, warrant,
consolidation, merger, conveyance, transfer, lease, dissolution, liquidation
or winding up, or the vote upon any action.
Nothing contained in this Warrant Agreement or in any of the
Warrant Certificates shall be construed as conferring upon the holders thereof
the right to vote or to consent or to receive notice as stockholders in
respect of the meetings of stockholders or the election of Directors of the
Company or any other matter, or any rights whatsoever as stockholders of the
Company.
SECTION 16. Merger, Consolidation or Change of Name 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 all or substantially all of the corporate
trust or agency business of the Warrant Agent, shall be the successor to the
Warrant Agent hereunder without the execution or filing of any paper or any
further act on the part of any of the parties hereto. If, at the time such
successor to the Warrant Agent by merger or consolidation succeeds to the
agency created by this Warrant Agreement, any of the Warrant Certificates
shall have been countersigned but not delivered, any such successor to the
Warrant Agent may adopt the countersignature of the original Warrant Agent;
and if, at that time any of the Warrant Certificates shall not have
22
been countersigned, any such successor to the Warrant Agent may countersign
such Warrant Certificates either in the name of the predecessor Warrant Agent
or in the name of the successor to the Warrant Agent; and in all such cases
such Warrant Certificates shall have the full force and effect provided in the
Warrant Certificates in this Warrant Agreement.
SECTION 17. Warrant Agent. The Warrant Agent undertakes the
duties and obligations imposed by this Warrant Agreement upon the following
terms and conditions, by all of which the Company and the holders of Warrants,
by their acceptance thereof, shall be bound:
(a) The statements contained herein and in the Warrant
Certificates shall be taken as statements of the Company. The Warrant
Agent assumes no responsibility for the correctness of any of the
same except such as describe the Warrant Agent or action taken or to
be taken by it. The Warrant Agent assumes no responsibility with
respect to the distribution of the Warrant Certificates except as
herein otherwise provided.
(b) The Warrant Agent shall not be responsible for any
failure of the Company to comply with any of the covenants contained
in this Warrant Agreement or in the Warrant Certificates to be
complied with by the Company.
(c) The Warrant Agent may consult at any time with counsel
satisfactory to it (who may be counsel for the Company) and the
Warrant Agent shall incur no liability or responsibility to the
Company or to any holder of any Warrant Certificate in respect of any
action taken, suffered or omitted by it hereunder in good faith and
in accordance with the opinion or the advice of such counsel.
(d) The Warrant Agent shall incur no liability or
responsibility to the Company or to any holder of any Warrant
Certificate for any action taken in reliance on any Warrant
Certificate, certificate of shares, notice, resolution, waiver,
consent, order, certificate, or other paper, document or instrument
believed by it to be genuine and to have been signed, sent or
presented by the proper party or parties. The Warrant Agent shall not
be bound by any notice or demand, or any waiver, modification,
termination or revision of this Warrant Agreement or any of the terms
hereof, unless evidenced by a writing between the Company and the
Warrant Agent.
(e) The Company agrees to pay to the Warrant Agent
reasonable compensation for all services rendered by the Warrant
Agent in the execution of this Warrant Agreement, to reimburse the
Warrant Agent for all expenses (including reasonable counsel fees),
taxes (including withholding taxes) and governmental charges and
other charges of any kind and nature actually
23
incurred by the Warrant Agent in the execution, delivery and
performance of its responsibilities under this Warrant Agreement and
to indemnify the Warrant Agent and save it harmless against any and
all liabilities, including judgments, costs and counsel fees, for
anything done or omitted by the Warrant Agent in the execution,
delivery and performance of its responsibilities under this Warrant
Agreement except as a result of its gross negligence, bad faith or
willful misconduct.
(f) The Warrant Agent, shall be under no obligation to
institute any action, suit or legal proceeding or to take any other
action likely to involve expense unless the Company or one or more
registered holders of Warrant Certificates shall furnish the Warrant
Agent with reasonable security and indemnity for any costs and
expenses which may be incurred, but this provision shall not affect
the power of the Warrant Agent to take such action as it may consider
proper, whether with or without any such security or indemnity. All
rights of action under this Warrant Agreement or under any of the
Warrants may be enforced by the Warrant Agent without the possession
of any of the Warrant Certificates or the production thereof at any
trial or other proceeding relative thereto, and any such action, suit
or proceeding instituted by the Warrant Agent shall be brought in its
name as Warrant Agent and any recovery of judgment shall be for the
ratable benefit of the registered holders of the Warrants, as their
respective rights or interests may appear.
(g) Except as required by applicable law, the Warrant Agent,
and any stockholder, director, officer or employee of the Warrant
Agent, may buy, sell or deal in any of the Warrants or other
securities of the Company or become pecuniarily interested in any
transaction in which the Company may be interested, or contract with
or lend money to the Company or otherwise act as fully and freely as
though it were not Warrant Agent under this Warrant Agreement.
Nothing herein shall preclude the Warrant Agent from acting in any
other capacity for the Company or for any other legal entity.
(h) The Warrant Agent shall act hereunder solely as agent
for the Company, and its duties shall be determined solely by the
express provisions hereof. The Warrant Agent shall not be liable for
anything which it may do or refrain from doing in connection with
this Warrant Agreement, except for its own gross negligence, bad
faith or willful misconduct; provided that in no event shall the
Warrant Agent be liable for special, indirect 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 such loss or damage and regardless of the form of
action.
(i) The Warrant Agent shall not at any time be under any
duty or responsibility to any holder of any Warrant Certificate to
make or cause to be
24
made any adjustment of the Exercise Price or number of the Warrant
Shares or other securities or property deliverable as provided in
this Warrant Agreement, or to determine whether any facts exist which
may require any of such adjustments, or with respect to the nature or
extent of any such adjustments, when made, or with respect to the
method employed in making the same. The Warrant Agent shall not be
accountable with respect to the validity or value or the kind or
amount of any Warrant Shares or of any securities or property which
may at any time be issued or delivered upon the exercise of any
Warrant or with respect to whether any such Warrant Shares or other
securities will when issued be validly issued and fully paid and
nonassessable, and makes no representation with respect thereto.
SECTION 18. Expenses. All expenses incident to the Company's
performance of or compliance with this Warrant Agreement will be borne by the
Company, including without limitation: (i) all expenses of printing Warrant
Certificates; (ii) messenger and delivery services and telephone calls; (iii)
all fees and disbursements of counsel for the Company; (iv) all fees and
disbursements of independent certified public accountants or knowledgeable
experts selected by the Company; and (v) the Company's internal expenses
(including, without limitation, all salaries and expenses of their officers
and employees performing legal or accounting duties).
SECTION 19. Change of Warrant Agent. If the Warrant Agent
shall become incapable of acting as Warrant Agent or shall resign as provided
below, the Company shall appoint a successor to such Warrant Agent. If the
Company shall fail to make such appointment within a period of 30 days after
it has been notified in writing of such resignation or incapacity by the
Warrant Agent, then the registered holder of any Warrant Certificate may apply
to any court of competent jurisdiction for the appointment of a successor to
the Warrant Agent. Pending appointment of a successor to such Warrant Agent,
either by the Company or by such a court, the duties of the Warrant Agent
shall be carried out by the Company. The registered holders of a majority of
the unexercised Warrants shall be entitled at any time to remove the Warrant
Agent for cause and appoint a successor to such Warrant Agent. Such successor
to the Warrant Agent need not be approved by the Company or the former Warrant
Agent. After appointment, the successor to the Warrant Agent shall be vested
with the same powers, rights, duties and responsibilities as if it had been
originally named as Warrant Agent without further act or deed; but the former
Warrant Agent shall deliver and transfer to the successor to the Warrant Agent
any property at the time held by it hereunder and execute and deliver any
further assurance, conveyance, act or deed necessary for the purpose. Failure
to give any notice provided for in this Section 19, however, or any defect
therein, shall not affect the legality or validity of the appointment of a
successor to the Warrant Agent.
The Warrant Agent may resign at any time and be discharged
from the obligations hereby created by so notifying the Company in writing at
least 30 days in
25
advance of the proposed effective date of its resignation. If no successor
Warrant Agent accepts the engagement hereunder by such time, the Company shall
act as Warrant Agent.
SECTION 20. Notices to the Company and Warrant Agent. Any
notice or demand authorized or permitted by this Warrant Agreement to be given
or made by the Warrant Agent or by the registered holder of any Warrant
Certificate to or on the Company shall be sufficiently given or made when and
if deposited in the mail, first class or registered, postage prepaid,
addressed (until another address is filed in writing by the Company with the
Warrant Agent), as follows:
NTL Incorporated
000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
with a copy to (which shall not constitute notice to the
Company):
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Xxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Any notice pursuant to this Warrant Agreement to be given by
the Company or by the registered holder(s) of any Warrant Certificate to the
Warrant Agent shall be sufficiently given when and if deposited in the mail,
first-class or registered, postage prepaid, addressed (until another address
is filed in writing by the Warrant Agent with the Company) to the Warrant
Agent at the Warrant Agent Office as follows:
Continental Stock Transfer & Trust Company
00 Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Compliance Department
SECTION 21. Supplements and Amendments. The Company and the
Warrant Agent may from time to time supplement or amend this Warrant Agreement
without the approval of any holders of Warrant Certificates in order to cure
any ambiguity or to correct or supplement any provision contained herein which
may be defective or inconsistent with any other provision herein, or to make
any
26
other provisions in regard to matters or questions arising hereunder which the
Company and the Warrant Agent may deem necessary or desirable and which shall
not in any way adversely affect the interests of the holders of Warrant
Certificates. Any amendment or supplement to this Warrant Agreement that has
an adverse effect on the interests of holders shall require the written
consent of registered holders of a majority of the then outstanding Warrants
(excluding Warrants held by the Company or any of its controlled affiliates).
The consent of each holder of a Warrant affected shall be required for any
amendment of this Warrant Agreement pursuant to which the Exercise Price would
be increased or the number of Warrant Shares purchasable upon exercise of
Warrants would be decreased.
SECTION 22. Successors. All the covenants and provisions of
this Warrant Agreement by or for the benefit of the Company or the Warrant
Agent shall bind and inure to the benefit of their respective successors and
assigns hereunder.
SECTION 23. Termination. This Warrant Agreement shall
terminate at 5:00 p.m., New York City time, on the Expiration Date.
Notwithstanding the foregoing, this Warrant Agreement will terminate on such
earlier date on which all outstanding Warrants have been exercised. The
provisions of Section 17 shall survive such termination.
SECTION 24. Governing Law; Jurisdiction. This Warrant
Agreement and each Warrant Certificate issued hereunder shall be deemed to be
a contract made under the laws of the State of New York and for all purposes
shall be governed by and construed in accordance with the internal laws of
said State. The parties hereto irrevocably consent to the jurisdiction of the
courts of the State of New York and any federal court located in such state in
connection with any action, suit or proceeding arising out of or relating to
this Warrant Agreement.
SECTION 25. Benefits of this Warrant Agreement. Nothing in
this Warrant Agreement shall be construed to give to any person other than the
Company, the Warrant Agent and the registered holders of the Warrant
Certificates any legal or equitable right, remedy or claim under this Warrant
Agreement; but this Warrant Agreement shall be for the sole and exclusive
benefit of the Company, the Warrant Agent and the registered holders of the
Warrant Certificates.
SECTION 26. Counterparts. This Warrant Agreement may be
executed in any number of 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 27. Further Assurances. From time to time on and
after the date hereof, the Company shall deliver or cause to be delivered to
the Warrant Agent such further documents and instruments and shall do and
cause to be done such further acts as the Warrant Agent shall reasonably
request (it being understood
27
that the Warrant Agent shall have no obligation to make such request) to carry
out more effectively the provisions and purposes of this Warrant Agreement, to
evidence compliance herewith or to assure itself that it is protected
hereunder.
SECTION 28. Entire Agreement. This Warrant Agreement and the
Warrant Certificate constitute the entire agreement of the Company, the
Warrant Agent and the registered holders of the Warrant Certificates with
respect to the subject matter hereof and supersedes all prior agreements and
undertakings, both written and oral, among the Company, the Warrant Agent and
the registered holders of the Warrant Certificates with respect to the subject
matter hereof.
28
IN WITNESS WHEREOF, the parties hereto have caused this
Warrant Agreement to be duly executed, as of the day and year first above
written.
NTL INCORPORATED, as the Company
/s/ Xxxxxxx X. Xxxxxxx
By:--------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Executive Vice President,
General Counsel and
Secretary
CONTINENTAL STOCK TRANSFER & TRUST
COMPANY, as Warrant Agent
/s/ Xxxxxxx X. Xxxxxxxxx
By:--------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title:Vice President
29
EXHIBIT A
Form of Warrant Certificate
[Face of Warrant Certificate]
EXERCISABLE ON OR AFTER THE DATE OF THIS CERTIFICATE AND
PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON JANUARY 10, 2011 AND
ONLY IF COUNTERSIGNED BY THE WARRANT AGENT
NTL INCORPORATED
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
No. NIW _____ CUSIP No. 62940M 13 8 __________ Warrants
SERIES A WARRANTS
This certifies that __________________________, or registered assigns, is
the registered holder of ____________ Series A warrants (the "Warrants"), to
purchase shares of common stock, par value $0.01 per share, together with
associated preferred stock purchase rights (the "Common Stock"), of NTL
Incorporated, a Delaware corporation (the "Company"). Each Warrant entitles the
holder upon exercise at any time on or after the date of this Warrant
Certificate and prior to 5:00 p.m., New York City Time, on January 10, 2011 to
receive from the Company one fully paid and nonassessable share of Common Stock
(each a "Warrant Share") for each Warrant at the initial exercise price (the
"Exercise Price") of $309.88 per share payable (i) in United States dollars or
(ii) by certified or official bank check for United States Dollars made payable
to the order of "NTL Incorporated". In lieu of payment of the aggregate Exercise
Price as aforesaid and subject to applicable law, the holder of a Warrant may
request the payment by the Company of the "Spread", which shall, subject to
Section 14 of the Series A Warrant Agreement, dated as of January 10, 2003, by
and between the Company and Continental Stock Transfer & Trust Company, as
Warrant Agent (the "Warrant Agreement"), be delivered by the Company by
delivering to such Warrant holder a number of shares of Common Stock equal to
(a)(i) the product of (x) the current market price per share of Common Stock (as
of the date of receipt of the request to the Company), multiplied by (y) the
number of Warrant Shares underlying the Warrants being exercised, minus (ii) the
product of (x) the Exercise Price, multiplied by (y) the number of Warrant
Shares underlying the Warrants being exercised, divided by (b) the current
market price per share of Common Stock (as of the date of receipt of the request
to the Company). The Exercise Price and number of Warrant Shares issuable upon
exercise of the Warrants are subject to adjustment upon the occurrence of
certain events set forth in the Warrant Agreement. No Warrant may be exercised
after 5:00 p.m., New York City Time, on January 10, 2011, and to the extent not
exercised by such time such Warrants shall become void. This Warrant Certificate
shall not be valid unless countersigned by the Warrant Agent, as such term is
used in the Warrant Agreement. Reference is made to the further provisions of
this Warrant Certificate set forth on the reverse hereof, which further
provisions shall for all purposes have the same effect as though fully set forth
at this place. This Warrant Certificate shall be governed and construed in
accordance with the internal laws of the State of New York.
IN WITNESS WHEREOF, NTL Incorporated has caused this Warrant
Certificate to be signed by the undersigned President and the undersigned
Secretary of the Company and has caused its corporate seal to be imprinted
hereon.
Dated:
NTL INCORPORATED
[Corporate Seal]
By:
---------------------------------- -------------------------------
President Secretary
Countersigned: (seal)
CONTINENTAL STOCK TRANSFER & TRUST COMPANY
JERSEY CITY, NJ
TRANSFER AGENT AND REGISTRAR
By:
----------------------------------
Authorized Officer
A-1
[Reverse of Warrant Certificate]
NTL INCORPORATED (SERIES A WARRANT)
By accepting a Warrant Certificate, each holder shall be
bound by all of the terms and provisions of the Warrant Agreement (a copy of
which is available on request to the Secretary of the Company) and any
amendments thereto as fully and effectively as if such holder had signed the
same.
The Warrants evidenced by this Warrant Certificate are part
of a duly authorized issue of Warrants by the Company expiring at 5:00 p.m.,
New York City Time, on January 10, 2011, entitling the holder upon proper
exercise to receive shares of Common Stock and are issued or to be issued
pursuant to the Warrant Agreement, which Warrant Agreement is hereby
incorporated by reference in and made a part of this instrument and is hereby
referred to for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Warrant Agent, the
Company and the holders (the words "holders" or "holder" meaning the
registered holders or registered holder) of the Warrants.
The holder of the Warrants evidenced by this Warrant
Certificate may exercise them by surrendering this Warrant Certificate, with
the form of election to purchase set forth below on this Warrant Certificate
properly completed and executed, together with payment of the aggregate
Exercise Price in accordance with the provisions set forth on the face of this
Warrant Certificate. In the event that upon any exercise of Warrants evidenced
hereby the number of Warrants exercised shall be less than the total number of
Warrants evidenced hereby, there shall be issued to the holder hereof or his
assignee a new Warrant Certificate evidencing the number of Warrants not
exercised.
The Warrant Agreement provides that upon the occurrence of
certain events the Exercise Price and the number of shares of Common Stock
issuable upon exercise of this Warrant, in each case, set forth on the face
hereof may, subject to certain conditions, be adjusted. If the Exercise Price
is adjusted, the Warrant Agreement provides that the number of shares of
Common Stock issuable upon the exercise of each Warrant may be adjusted. No
fractions of a share of Common Stock will be issued upon the exercise of any
Warrant, but the Company will pay the cash value in lieu thereof determined as
provided in the Warrant Agreement.
Warrant Certificates, when surrendered at the principal
corporate trust office of the Warrant Agent by the registered holder thereof
in person or by legal representative or attorney duly authorized in writing,
may be exchanged, in the manner and subject to the limitations provided in the
Warrant Agreement, but without payment of any service charge, for another
Warrant Certificate or Warrant Certificates of like tenor evidencing in the
aggregate a like number of Warrants.
Upon due presentation for registration of transfer of this
Warrant Certificate at the principal corporate trust office of the Warrant
Agent a new Warrant Certificate or Warrant Certificates of like tenor and
evidencing in the aggregate a like
A-2
number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided in the Warrant
Agreement, without charge except for any tax or other governmental charge
imposed in connection therewith.
The Company and the Warrant Agent may deem and treat the
registered holder(s) hereof as the absolute owner(s) of this Warrant
Certificate (notwithstanding any notation of ownership or other writing hereon
made by anyone), for the purpose of any exercise hereof, of any distribution
to the holder(s) hereof, and for all other purposes, and neither the Company
nor the Warrant Agent shall be affected by any notice to the contrary. Neither
the Warrants nor this Warrant Certificate entitles any holder hereof to any
rights of a stockholder of the Company.
The Warrant Agreement permits, with certain exceptions
therein provided, the supplementing or amendment thereof at any time by the
Company and the Warrant Agent with the written consent of registered holders
of a majority of the then outstanding Warrants (excluding Warrants held by the
Company or any of its controlled affiliates). Any such consent by or on behalf
of a holder of a Warrant shall be conclusive and binding upon such holder and
upon all future holders of this Warrant and any Warrant issued upon the
registration of transfer thereof or in exchange thereof whether or not
notation of such consent is made upon such Warrant or any other Warrant.
THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THE
WARRANTS REPRESENTED BY THIS CERTIFICATE ARE ACCOMPANIED BY CERTAIN RIGHTS AS
SET FORTH IN THE RIGHTS AGREEMENT BY AND BETWEEN THE COMPANY AND CONTINENTAL
STOCK TRANSFER & TRUST COMPANY (THE "RIGHTS AGENT"), DATED AS OF JANUARY 10,
2003 (THE "RIGHTS AGREEMENT"), THE TERMS OF WHICH ARE HEREBY INCORPORATED
HEREIN BY REFERENCE AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES OF
THE COMPANY. THE COMPANY WILL MAIL TO THE HOLDER OF THIS WARRANT CERTIFICATE A
COPY OF THE RIGHTS AGREEMENT, AS IN EFFECT ON THE DATE OF MAILING, WITHOUT
CHARGE, PROMPTLY AFTER RECEIPT OF A WRITTEN REQUEST THEREFOR TO THE SECRETARY
OF THE COMPANY. UNDER CERTAIN CIRCUMSTANCES SET FORTH IN THE RIGHTS AGREEMENT,
RIGHTS ISSUED TO, OR HELD BY, ANY PERSON WHO IS, WAS OR BECOMES AN ACQUIRING
PERSON OR ANY AFFILIATE OR ASSOCIATE THEREOF (AS SUCH TERMS ARE DEFINED IN THE
RIGHTS AGREEMENT), WHETHER CURRENTLY HELD BY OR ON BEHALF OF SUCH PERSON OR BY
ANY SUBSEQUENT HOLDER, MAY BECOME NULL AND VOID.
A-3
Form of Assignment
[Form of Assignment to be Executed if Holder
Desires to Transfer Warrants Evidenced Hereby]
ASSIGNMENT
(To Be Executed by the Registered Holder in Order to Assign Warrants)
FOR VALUE RECEIVED the undersigned hereby sell(s), assign(s) and transfer(s)
unto ------------------------------------------------------------------------
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER OF ASSIGNEE
------------------------------------------------------------------------
(PLEASE PRINT OR TYPE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE OF ASSIGNEE)
of the Warrants represented by this Warrant Certificate, and hereby
irrevocably constitutes and appoints
________________________________________________________________ Attorney to
transfer this Warrant Certificate on the books of the Company, with full power
of substitution in the premises.
Dated:__________, ____ ________________________________________________
Signature(s)*
------------------------------------------------
------------------------------------------------
(Social Security or Taxpayer Identification Number)
---------------------
Signature(s) Guaranteed*
A-4
Form of Election to Purchase
[To Be Executed Upon Exercise Of Warrant]
NOTICE OF EXERCISE
(To Be Executed by the Registered Holder in Order to Exercise Warrants)
The undersigned hereby irrevocably elects to exercise the
right, represented by this Warrant Certificate, to receive shares of Common
Stock and herewith tenders payment for such shares to the order of NTL
Incorporated in the amount of $309.88 per share of Common Stock (subject to
adjustment) in accordance with the terms of the Warrant Agreement, in cash or
by certified or official bank check made payable to the order of the Company.
REQUEST FOR PAYMENT OF SPREAD
o Please check if the undersigned, in lieu of tendering the cash
payment, as aforesaid, hereby requests the payment of the "Spread"
within the meaning of Section 7 of the Warrant Agreement.
------------------------------------------------------------------------
The undersigned requests that a certificate for such shares
be registered in the name of:
------------------------------------------------------------------------
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
and be delivered to: _______________________________________________________
(PLEASE PRINT OR TYPE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE)
________________________________________________________________________
and, if such number of Warrants shall not be all the Warrants
evidenced by this Warrant Certificate, that a new Warrant Certificate for the
balance of such Warrants be registered in the name of, and delivered to, the
Registered Holder at the address stated below:
------------------------------------------------------------------------
(PLEASE PRINT OR TYPE ADDRESS)
Dated:__________, ____ ________________________________________________
Signature(s)*
------------------------------------------------
------------------------------------------------
(Social Security or Taxpayer Identification Number)
---------------------
Signature(s) Guaranteed*
* THE SIGNATURE TO THE ASSIGNMENT OR THE SUBSCRIPTION FORM MUST CORRESPOND TO
THE NAME AS WRITTEN UPON THE FACE OF THIS WARRANT CERTIFICATE IN EVERY
PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATSOEVER, AND
MUST BEAR A SIGNATURE GUARANTEED BY AN "ELIGIBLE GUARANTOR INSTITUTION" AS
DEFINED IN RULE 17Ad-15(2) PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF
1934, AS AMENDED.
A-5
