THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON
EXERCISE OF THIS WARRANT HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
LAWS AND MAY NOT BE TRANSFERRED, PLEDGED, HYPOTHECATED, SOLD
OR OTHERWISE DISPOSED OF OR OFFERED FOR SALE EXCEPT PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT AS TO THIS WARRANT AND
THE SHARES OF COMMON STOCK ISSUABLE UPON EXERCISE OF THIS
WARRANT UNDER SAID ACT AND ANY APPLICABLE STATE SECURITIES
LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED.
VOID AFTER 5:00 P.M., NEW YORK TIME, ON MARCH 31, 2007, OR IF
NOT A BUSINESS DAY, AS DEFINED HEREIN, AT 5:00 P.M., NEW YORK
TIME, ON THE NEXT FOLLOWING BUSINESS DAY.
Warrant to Purchase
__________ Shares of Common Stock
WARRANT TO PURCHASE COMMON STOCK
OF
HUNGARIAN TELEPHONE AND CABLE CORP.
--------------------------
This certifies that, for value received, ____________ or
registered assigns ("Warrantholder"), is entitled to purchase from Hungarian
Telephone & Cable Corp., a Delaware corporation (the "Company"), subject to the
terms set forth below, at any time on or after the Commencement Date and prior
to the Expiration Date, after which time this Warrant shall become void,
________ Warrant Shares at the Warrant Price. The Warrant Price and the number
of Warrant Shares purchasable hereunder are subject to adjustment from time to
time as provided herein.
This Warrant is one of the Warrants evidencing the right to
purchase shares of Common Stock of the Company issued pursuant to a certain
Securities Purchase Agreement (the "Securities Purchase Agreement"), dated as of
May 12, 1999, by and between the Company and the persons named therein, a copy
of which agreement is on file at the principal office of the Company, and the
holder of this Warrant shall be entitled to all of the benefits of and be bound
by all of the applicable obligations of the Securities Purchase Agreement, as
provided therein.
ARTICLE I
DEFINED TERMS
Section 1.1. Definition of Terms. As used in this Warrant,
the following capitalized terms shall have the following respective meanings:
(a) "Business Day" shall mean a day other than a Saturday,
Sunday or other day on which banks in the State of New York are authorized by
law to remain closed.
(b) "Commencement Date" shall mean January 1, 2004.
(c) "Common Stock" shall mean the Common Stock, par value
$0.001 per share, of the Company.
(d) "Closing Price" shall mean, with respect to any day, the
last reported sales price of the Common Stock, regular way, or in case no sale
takes place on such day, the average of the reported closing bid and asked
prices of the Common Stock, regular way, in either case as reported on the
principal national securities exchange on which the Common Stock is listed or
admitted to trading or, if the Common Stock is not listed or admitted to trading
on any national securities exchange, but is traded in the over-the-counter
market, the closing sale price of the Common Stock or in case no sale is
publicly reported, the average of the representative closing bid and asked
quotations for the Common Stock on the over-the-counter market, or, if bid and
asked prices for such day shall not have been reported on the over-the-counter
market, the average of the bid and asked prices for the Common Stock as
furnished by any New York Stock Exchange, Inc. member firm regularly making a
market in the Common Stock and selected for such purpose by the Board of
Directors of the Company.
(e) "Expiration Date" shall mean March 31, 2007, or if such
day is not a Business Day, the next succeeding day which is a Business Day.
(f) "Fair Market Value" with respect to the date of any
exercise by the Warrantholder of all or a portion of this Warrant, shall mean
the average daily Closing Price of the Common Stock for thirty (30) consecutive
trading days commencing forty-five (45) calendar days before the date of such
exercise by the Warrantholder of all or a portion of this Warrant, provided,
however, that where no public market exists for the Common Stock at the time of
the exercise of all or a portion of this Warrant, the fair market value per
share of Common Stock shall be determined by the Company's Board of Directors in
good faith.
(g) "Notes" shall mean the Company's Floating Rate Unsecured
Notes due 2007 issued pursuant to the Agreement.
(h) "Person" shall mean any individual, corporation,
association, company, business trust, partnership, limited liability company,
joint venture, joint-stock company, trust, unincorporated organization,
association or any other entity or government or any agency or political
subdivision thereof.
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(i) "Securities Act" shall mean the Securities Act of 1933, as
amended.
(j) "Warrant Price" shall mean ten dollars ($10.00) per
Warrant Share, as such price may be adjusted from time to time pursuant to
Article III hereof.
(k) "Warrant Shares" shall mean the shares of Common Stock
purchasable upon exercise of this Warrant.
ARTICLE II
DURATION AND EXERCISE OF WARRANT
Section 2.1. Exercise of Warrant. This Warrant may be
exercised at any time after January 1, 2004 and prior to the Expiration Date.
The Warrantholder may exercise this Warrant, in whole or in part, by
presentation and surrender of this Warrant at the address of the Company set
forth in Section 4.10 hereof or at such other address as the Company may
designate by notice in writing to the Warrantholder with the Subscription Form
annexed hereto duly executed, accompanied by payment of the Warrant Price in
effect on the date of such exercise multiplied by the number of Warrant Shares
to be purchased. Upon receipt thereof, the Company shall cause to be issued
certificates for the Warrant Shares so purchased in such denominations as are
requested for delivery to the Warrantholder. Such certificates shall be
delivered as promptly as practicable to the Warrantholder. Upon any partial
exercise of this Warrant, the Company shall execute and deliver a new Warrant of
like tenor and date for the balance of the Warrant Shares purchasable hereunder.
Upon exercise, the Warrantholder shall be deemed to be the holder of record of
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be actually delivered to
the Warrantholder. If at the time this Warrant is exercised, a registration
statement is not in effect to register under the Securities Act the Warrant
Shares issuable upon exercise of this Warrant, the Company may require the
Warrantholder to make such representations, and may place such legends on
certificates representing the Warrant Shares, as may be reasonably required to
permit the Warrant Shares to be issued without such registration. The Company
shall pay any and all stock transfer and similar taxes which may be payable in
respect of the issue of the Warrant or in respect of the issue of any of the
Warrant Shares, except the Company shall not pay such transfer taxes if the
Warrant Shares are issued to a Person other than the Warrantholder.
-3-
Section 2.2. Reservation of Shares. The Company hereby agrees
that at all times there shall be reserved for issuance and delivery upon
exercise of this Warrant such number of shares of Common Stock or other shares
of capital stock of the Company as may be from time to time issuable upon
exercise of this Warrant. All such shares shall be duly authorized, and when
issued upon such exercise, shall be validly issued, fully paid and
nonassessable, free and clear of all liens, security interests, charges and
other encumbrances or restrictions, other than those restrictions imposed by the
Securities Act of 1933, and free and clear of all preemptive and similar rights.
Section 2.3. Fractional Shares. The Company shall not be
required to issue any fraction of a share of its capital stock in connection
with the exercise of this Warrant, and in any case where the Warrantholder
would, except for the provisions of this Section 2.3, be entitled under the
terms of this Warrant to receive a fraction of a share upon the exercise of this
Warrant, the Company shall, upon the exercise of this Warrant and receipt of the
Warrant Price (as adjusted to cover the balance of the share), issue the largest
number of whole shares purchasable upon exercise of this Warrant, but in no
event shall the Company issue more than such number of shares of Common Stock as
are issuable pursuant to the exercise of this Warrant. The Company shall not be
required to make any cash or other adjustment in respect of such fraction of a
share to which the Warrantholder would otherwise be entitled.
Section 2.4. Payment for Warrant Shares.
(a) Payment of the aggregate Warrant Price for Warrant Shares
to be purchased upon exercise of all or a portion of this Warrant shall be made
in full by delivery to the Company, at its address set forth in Section 4.10
hereof or at such other address as the Company may designate by notice in
writing to the Warrantholder, of a certified or bank cashier's check or by wire
transfer to an account in the United States designated by the Company.
(b) Payment of the aggregate Warrant Price may also be made in
full by delivery to the Company of Notes plus accrued interest thereon, in an
aggregate principal amount equal to the aggregate Warrant Price or a combination
of cash (payable by wire transfer or certified or bank check) and Notes
beneficially owned by such Warrantholder and such accumulated dividends or
accrued interest, as the case may be, in an aggregate principal amount equal to
the aggregate Warrant Price. Any Notes surrendered for exchange hereunder shall
be, if so required by the Company, accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company duly delivered by
the Warrantholder.
-4-
ARTICLE III
ADJUSTMENT OF WARRANT PRICE OR WARRANT SHARES
Section 3.1. Adjustment of Warrant Price.
(a) Except as provided in Section 3.1(c), in case the Company
shall at any time after the date hereof issue or sell any shares of Common
Stock, for a consideration per share less than the then Fair Market Value of the
Common Stock, or without consideration, then, and thereafter successively upon
each issuance or sale, the Warrant Price in effect immediately prior to each
such issuance or sale shall forthwith be reduced to a price determined by
dividing (i) an amount equal to (X) the total number of shares of Common Stock
outstanding immediately prior to such issuance or sale multiplied by the Warrant
Price in effect immediately prior to such issuance or sale, plus (Y) the
consideration, if any, received by the Company upon such issuance or sale, by
(ii) the total number of shares of Common Stock outstanding immediately after
such issuance or sale.
For the purposes of any computation to be made in
accordance with the provisions of this paragraph (a), the following shall be
applicable:
(i) In case of the issuance or sale of shares of
Common Stock for a consideration part or all of which shall be cash,
the amount of the cash consideration therefor shall be deemed to be the
amount of cash received by the Company for such shares (or, if such
shares of Common Stock are offered by the Company for subscription, the
subscription price, or, if shares of Common Stock shall be sold to
underwriters or dealers for public offering without a subscription
offering, the public offering price) before deducting therefrom any
commissions or other expenses paid or incurred by the Company for any
underwriting of, or otherwise in connection with the issuance of such
shares;
(ii) In case of the issuance or sale of shares of
Common Stock for a consideration part or all of which shall be other
than cash (otherwise than as a dividend or other distribution on any
shares of Common Stock of the Company or on conversion, exercise or
exchange of other securities of the Company or upon acquisition of the
assets or securities of another company or upon merger or consolidation
with another entity), the amount of consideration therefor other than
cash shall be the value of such consideration as of the date of the
issuance or sale of the shares of Common Stock, irrespective of
accounting treatment, but as determined by the Board of Directors of
the Company in good faith. The reclassification of securities other
than Common Stock into Common Stock shall be deemed to involve the
issuance for a consideration other than cash of such Common Stock
immediately prior to the close of business on the date fixed for the
determination of security holders entitled to receive such Common
Stock;
(iii) In case of the issuance of shares of Common
Stock upon conversion or exchange of any obligations or of any
securities of the Company that shall be convertible into or
exchangeable for shares of Common Stock or upon the exercise of rights
or options to subscribe for or to purchase shares of Common Stock
-5-
(other than upon exercise of this Warrant), the amount of consideration
received by the Company for such shares of Common Stock shall be deemed
to be the sum of (A) the amount of the consideration received by the
Company upon the original issuance of such obligations, shares, rights
or options, as the case may be, plus (B) the consideration, if any,
other than such obligations, shares, rights or options, received by the
Company upon such conversion, exchange, or exercise except in
adjustment of interest and dividends. The amount of the consideration
received by the Company upon the original issuance of the obligations,
shares, rights or options so converted, exchanged or exercised and the
amount of the consideration, if any, other than such obligations,
shares, rights or options, received by the Company upon such
conversion, exchange or exercise shall be determined in the same manner
provided in subparagraphs (i) and (ii) above with respect to the
consideration received by the Company in case of the issuance of shares
of Common Stock; if such obligations, shares, rights or options shall
have been issued as a dividend upon any securities of the Company, the
amount of the consideration received by the Company upon the original
issuance thereof shall be deemed to be zero. In case of the issuance of
Warrant Shares upon exercise of this Warrant, the Company shall be
deemed to have received the Warrant Price then in effect as the
consideration for each share of Common Stock so issued;
(iv) Shares of Common Stock issuable by way of
dividend or other distribution on any securities of the Company shall
be deemed to have been issued and to be outstanding at the close of
business on the record date fixed for the determination of security
holders entitled to receive such dividend or other distribution and
shall be deemed to have been issued without consideration. Shares of
Common Stock issued otherwise than as a dividend, shall be deemed to
have been issued and to be outstanding at the close of business on the
date of issue;
(v) The number of shares of Common Stock at any time
outstanding shall not include any shares then owned or held by or for
the account of the Company, but shall include the aggregate number of
shares deliverable in respect of options, rights and exercisable,
convertible and exchangeable securities at all times while such
options, rights or securities remain outstanding and unexercised,
unconverted or unexchanged, as the case may be; and
(vi) No adjustment shall be made to the Warrant Price
in effect upon conversion or exchange of (i) securities convertible or
exercisable or exchangeable for Common Stock or for other securities
that are subsequently exercisable for Common Stock that are outstanding
as of the date of the Securities Purchase Agreement, or (ii) any
obligations or any securities of the Company that shall be convertible
into or exercisable or exchangeable for shares of Common Stock or upon
the exercise of rights or options to subscribe for or to purchase
shares of Common Stock for which an adjustment in the Warrant Price has
previously been made in accordance with paragraph (b) of this Section
3.1.
(b) In case the Company shall at any time after the date
hereof issue options or rights to subscribe for shares of Common Stock, or issue
any obligations or securities convertible into or exchangeable for shares of
Common Stock, otherwise than as contemplated by Section 3.1(a)(vi) or pursuant
to Section 3.3 hereof, for a consideration per share less than the then Fair
Market Value of the Common Stock, or without consideration, the Warrant Price in
effect immediately prior to the issuance of such options or rights or securities
shall be reduced to a price determined by making a computation in accordance
with the provisions of paragraph (a) of this Section 3.1, provided that:
-6-
(i) the aggregate maximum number of shares of Common
Stock deliverable under such options or rights shall be considered to
have been delivered at the time such options or rights were issued, and
for a consideration equal to the minimum purchase price per share of
Common Stock provided for in such options or rights, plus the
consideration (determined in the same manner as consideration received
on the issue or sale of Common Stock), if any, received by the Company
for such options or rights;
(ii) the aggregate maximum number of shares of Common
Stock deliverable upon conversion of or exchange for any such
obligations or securities shall be considered to have been delivered at
the time of issuance of such securities, and for a consideration equal
to the consideration (determined in the same manner as consideration
received on the issue or sale of Common Stock) received by the Company
for such securities, plus the consideration, if any, to be received by
the Company upon the exchange or conversion thereof; and
(iii) on the expiration of such options or rights, or
an increase in the minimum exercise price thereof, or a decrease in the
maximum number of shares of Common Stock deliverable upon exercise or
conversion of such options, rights or convertible or exchangeable
securities pursuant to the terms thereof (and not as a result of
exercise or conversion), or the termination of such right to convert or
exchange, the Warrant Price in effect shall forthwith be readjusted to
such Warrant Price as would have obtained (A) in the case of the
expiration or termination of options or rights or the termination of
the right to convert or exchange convertible or exchangeable
securities, had no adjustments been made upon the issuance of such
options, rights or convertible or exchangeable securities, or (B) in
the case of an increase in the minimum exercise price thereof, or a
decrease in the maximum number of shares deliverable thereunder, had
the adjustments made upon the issuance of such options, rights or
convertible or exchangeable securities been made upon the basis of the
delivery of only the number of shares of Common Stock (A) actually
deliverable upon the exercise of such options or rights or upon
conversion or exchange of such securities, or (B) deliverable by reason
of such increase in price or decrease in number of shares.
(c) No adjustment to the Warrant Price shall be made in
connection with the issuance of
(i) shares of Common Stock issuable pursuant to the
options, agreements and or warrants outstanding as of the date of the
Securities Purchase Agreement and listed on Schedule 3.1(c)(i); and
-7-
(ii) up to 100,000 shares per calendar year of Common
Stock or rights, options or warrants to acquire Common Stock issued to
directors, employees or consultants of the Company pursuant to a stock
option plan or agreement (and, in the case of rights, options, or
warrants, the Common Stock issued or issuable upon exercise thereof)
and approved by the Board of Directors.
(d) In case the Company shall at any time after the date
hereof subdivide or combine the outstanding shares of Common Stock, the Warrant
Price in effect shall forthwith be proportionately decreased in the case of the
subdivision or proportionately increased in the case of combination to the
nearest one cent. Any such adjustment shall become effective at the close of
business on the date that such subdivision or combination shall become
effective.
Section 3.2. Adjustment of Warrant Shares. In the event of an
adjustment of the Warrant Price, the number of shares of Common Stock (or
reclassified or recapitalized stock) issuable upon exercise of this Warrant
after such adjustment shall be equal to the number determined by multiplying the
number of shares of Common Stock issuable upon exercise of this Warrant
immediately prior to such adjustment by a fraction, of which the numerator is
the Warrant Price in effect immediately prior to such adjustments, and the
denominator is the Warrant Price in effect immediately after such adjustment.
Section 3.3. Certain Dividends. In case the Company shall
declare a dividend upon the Common Stock payable otherwise than out of
consolidated earnings or consolidated earned surplus, determined in accordance
with generally accepted accounting principles, including the making of
appropriate deductions for minority interests, if any, in subsidiaries (except
in Common Stock or convertible securities or rights or options or warrants to
purchase Common Stock or convertible securities, but including other
securities), the Warrant Price in effect immediately prior to the declaration of
such dividend shall be reduced (to the extent payable otherwise than out of
consolidated earnings or consolidated earned surplus) by an amount equal, in the
case of a dividend in cash, to the amount thereof payable per share of the
Common Stock, or in the case of any other dividend, to the fair value thereof
per share of the Common Stock as determined by the Board of Directors of the
Company. For the purpose of the foregoing a dividend other than in cash shall be
considered payable out of earnings or surplus (other than revaluation or
paid-in-surplus) only to the extent that such earnings or surplus are charged an
amount equal to the fair value of such dividend as determined by the Board of
Directors of the Company. Such reductions shall take effect as of the date on
which a record is taken for the purpose of such dividend, or, if a record is not
taken, the date as of which the holders of Common Stock of record entitled to
such dividend are to be determined.
Section 3.4. Mergers, Consolidations, Reclassifications. In
the case of any reorganization or reclassification of the outstanding 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) or in the case of any consolidation of the Company into, or merger
of the Company with another corporation in which it is not the surviving entity
(or it is the surviving entity, but its shares of Common Stock become shares of
another corporation), or in the case of any sale, lease or conveyance of all, or
substantially all, of the property, assets, business and goodwill of the Company
as an entirety, the Warrantholder shall thereafter until the Expiration Date
have the right upon exercise of this Warrant to receive the kind and amount of
-8-
shares of stock and other securities, cash and property receivable upon such
reorganization, reclassification, consolidation, merger or disposition by a
holder of the number of shares of Common Stock which the Warrantholder would
have received had it exercised this Warrant immediately prior to such
reorganization, reclassification, consolidation, merger or disposition, at a
price equal to the aggregate Warrant Price then in effect for exercising this
Warrant in full (the kind, amount and price of such stock and other securities
to be subject to adjustment as herein provided). The foregoing provisions of
this Section 3.4 shall similarly apply to successive reorganizations,
reclassifications, consolidations, mergers and dispositions.
Section 3.5. Notice of Adjustment. Whenever the Warrant Price
or the number of Warrant Shares shall be adjusted pursuant to the provisions of
Article III, the Company shall prepare and deliver forthwith to the
Warrantholder a certificate signed by the President of the Company and by its
Chief Financial Officer, setting forth the adjusted number of Warrant Shares
purchasable upon the exercise of this Warrant and the Warrant Price calculated
to the nearest cent and setting forth in reasonable detail the method of
calculation and the facts requiring such adjustment and upon which such
calculation is based.
Section 3.6. Notice of Certain Corporate Action. In case at
any time:
(A) the Company shall declare any
dividend (or any other distribu-
tions) on shares of Common Stock; or
(B) the Company shall authorize the
granting to all holders of its
Common Stock of rights to subscribe
for or purchase any shares of stock
of any class or of any other rights;
or
(C) there shall be any reclassification
of the capital stock of the Company;
or
(D) there shall be any capital reorgan-
ization by the Company; or
(E) there shall be any (i) consolidation
or merger involving the Company or
(ii) sale, transfer or other
disposition of all or substantially
all of the Company's property,
assets or business (except a merger
or other reorganization in which the
Company shall be the surviving
corporation and its shares of
capital stock shall continue to be
outstanding and unchanged and except
a consolidation, merger, sale,
transfer or other disposition
involving a wholly-owned
subsidiary); or
(F) there shall be a voluntary or
involuntary dissolution, liquidation
or winding-up of the Company or any
partial liquidation of the Company
or distribution to holders of Common
Stock;
-9-
then, in each of such cases, the Company shall give written notice to the
Warrantholder of the date on which (i) the books of the Company shall close or a
record date shall be fixed for such dividend, distribution or subscription
rights or (ii) such reorganization, reclassification, consolidation, merger,
disposition, dissolution, liquidation or winding-up, as the case may be, shall
take place. Such notice also shall specify the date as of which the holders of
Common Stock of record shall participate in such dividend, distribution or
subscription rights, or shall be entitled to exchange their certificates for
Common Stock for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, disposition,
dissolution, liquidation or winding-up, as the case may be. Such notice shall be
given at least twenty (20) days prior to the action in question and not less
than twenty (20) days prior to the record date or the date on which the
Company's transfer books are closed in respect thereto.
Section 3.7. Form of Warrant after Adjustments. The form of
this Warrant need not be changed because of any adjustments in the Warrant Price
or the number or kind of the Warrant Shares.
Section 3.8. Certain Limitations. The Company shall not issue
or grant warrants, options, rights or other obligations or securities
convertible into or exchangeable for shares of Common Stock having an exercise
price, conversion price or exchange price per share less than the Warrant Price
in effect immediately prior to the issuance of such warrants, options, rights or
other obligations or securities convertible into or exchangeable for shares of
Common Stock, except to the extent contemplated by Section 3.1(c)(ii).
ARTICLE IV
MISCELLANEOUS
Section 4.1. Cancellation of the Warrant.
(a) The Company may cancel this Warrant in whole or in part at
any time and from time to time before the Commencement Date, subject to the
following conditions:
(i) any partial cancellation of this Warrant shall be
such that thereafter the number of Warrant Shares shall be a whole
number;
(ii) concurrently with any such cancellation, the
Company shall repay the principal of the Notes in an amount equal to (i)
the then outstanding aggregate principal amount of the Notes multiplied
by (ii) a fraction, the numerator of which is the reduction in the number
of Warrant Shares under all outstanding Warrants attributable to such
cancellation and the denominator of which is 2,500,000;
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(iii) concurrently with such calculation, the Company
shall pay to the Warrantholders, per rata in accordance with the number
of Warrant Shares immediately preceding such cancellation, an amount
equal to seven and one-half percent (7.5%) of the amount of the
principal of the Notes repaid pursuant to Section 4.2(a)(ii); provided,
however, that such amount shall equal five percent (5.0%) of the amount
of the principal of the Notes repaid pursuant to Section 4.2(a)(ii) if
such repayment is made before September 30, 1999.
(b) The Company shall deliver to each Warrantholder an
irrevocable cancellation notice in the form annexed hereto of each proposed
cancellation of all or a portion of the Warrants not later than twenty (20) days
prior to the proposed date of cancellation. Such notice shall state (i) the
amount of the Warrant of such Warrantholder to be canceled, expressed in terms
of Warrant Shares, (ii) the aggregate principal amount of the Notes to be repaid
pursuant to Section 4.1(a)(ii) and (iii) the amount of the payment to be made to
such Warrantholder pursuant to Section 4.1(a)(iii). On the date set forth for
cancellation in such notice, the Warrants shall be canceled as provided in such
notice and the amounts payable to the Warrantholders shall be due and payable in
immediately available funds. Upon any partial cancellation of the Warrants, the
Company shall execute and deliver a new Warrant of like terms and date for the
balance of the Warrant Shares purchasable hereunder promptly upon receipt of the
Warrant subject to cancellation; provided, however, that the issuance of a new
Warrant as aforesaid shall not be necessary in order for a Warrantholder to
exercise a Warrant which has been partially canceled for the balance of Warrant
Shares purchasable thereunder.
Section 4.2. Transfer.
(a) Subject to the provisions of paragraph (f) below and
Article XI of the Securities Purchase Agreement, this Warrant and all rights
hereunder are transferable by the Warrantholder, at any time, and from time to
time, on or after January 1, 2004, in whole or in part, with the consent of the
Company, which consent shall not be unreasonably withheld or delayed, upon
surrender of this Warrant with a properly executed assignment at the principal
office of the Company at any time on or after the Commencement Date.
(b) Any transferee to whom rights hereunder are transferred
shall, as a condition to such transfer, deliver to the Company a written
instrument by which such transferee agrees to be bound by the obligations
imposed upon the Warrantholder under this Warrant to the same extent as if such
transferee was the Warrantholder.
(c) The Company will maintain a register containing the names
and addresses of the Warrantholders of the Warrants. Any Warrantholder may
change its or his address as shown on the warrant register by written notice to
the Company requesting such change.
(d) Until any transfer of this Warrant is made in the warrant
register, the Company may treat the Warrantholder as the absolute owner hereof
for all purposes; provided, however, that if and when this Warrant is properly
assigned in blank, the Company may (but shall not be obligated to) treat the
bearer hereof as the absolute owner hereof for all purposes, notwithstanding any
notice to the contrary.
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(e) This Warrant and the Warrant Shares shall not be sold or
transferred unless either (i) they first shall have been registered under the
Securities Act or (ii) the Company first shall have been furnished with an
opinion of legal counsel, reasonably satisfactory to the Company, to the effect
that such sale or transfer is exempt from the registration requirements of the
Securities Act.
(f) Each certificate representing Warrant Shares shall bear a
legend substantially in the following form:
THE SHARES OF COMMON STOCK REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE
SECURITIES LAWS AND MAY NOT BE TRANSFERRED, PLEDGED
HYPOTECATED, SOLD OR OTHERWISE DISPOSED OF OR OFFERED
FOR SALE EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT AS TO THE SHARES OF COMMON STOCK
REPRESENTED BY THIS CERTIFICATE UNDER SAID ACT AND
ANY APPLICABLE STATE SECURITIES LAWS OR AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT
SUCH REGISTRATION IS NOT REQUIRED.
The foregoing legend shall be removed from the certificates
representing any Warrant Shares, at the request of the holder thereof, at such
time as they become eligible for resale pursuant to Rule 144(k) under the
Securities Act.
Section 4.3. Exchanges of Warrants. This Warrant is
exchangeable, upon the surrender hereof by the holder hereof at such office or
agency of the Company, for new Warrants of like tenor representing in the
aggregate the right to purchase the number of Warrant Shares which may be
purchased hereunder, each of such new Warrants to represent the right to
purchase such number of Warrant Shares as shall be designated by said holder
hereof at the time of such surrender.
Section 4.4. Remedies. The Company stipulates that the
remedies at law of the holder of this Warrant in the event of any default or
threatened default by the Company in the performance of or compliance with any
of the terms of this Warrant are not and will not be adequate, and that such
terms may be specifically enforced by a decree for the specific performance of
any agreement contained herein or by an injunction against a violation of any of
the terms hereof or otherwise.
Section 4.5. Successors and Assigns. The terms of this Warrant
shall be binding upon, inure to the benefit of and be enforceable by and against
any successors or assigns of the Company and of the Warrantholder; provided,
however, that the Company may not assign its rights or obligations hereunder.
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Section 4.6. Rights as Stockholder. Except as provided herein,
the Warrantholder, as such, shall not be entitled to vote or be deemed to be a
stockholder of the Company for any purpose, nor shall anything contained in this
Warrant be construed to confer upon the Warrantholder, as such, any rights of a
stockholder of the Company or any right to vote, give or withhold consent to any
corporate action or receive notice of meetings.
Section 4.7. Acceptance by Warrantholder. Receipt of this
Warrant by the Warrantholder shall constitute acceptance of an agreement to the
foregoing terms and conditions.
Section 4.8. Governing Law. This Warrant and the rights of the
parties hereunder shall be governed in all respects by the laws of the State of
New York, without giving effect to the provisions thereof relating to conflicts
of law.
Section 4.9. Severability. In case any provision of this
Warrant shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
Section 4.10. Notices. Any notices or certificates by the
Company to the Warrantholder and by the Warrantholder to the Company shall be
deemed delivered if in writing and delivered in person or by registered mail
(return receipt requested) to the Warrantholder, at its address in the registry
of Warrantholders maintained by the Company, and if to the Company, at 000 Xxxxx
Xxxxxxxx Xxxxx, Xxxxxxxx Xxxxxxxxxxx 00000, Attention: Chief Executive Officer.
The Company may change its address by written notice to the Warrantholder.
Section 4.11. Amendment. This Warrant may be amended or
modified (or any provision hereof waived) only if the Company and Warrantholders
holding at least fifty percent (50.0%) of the Warrant Shares (assuming exercise
of all the Warrants) shall approve such amendment, modification or waiver in
writing; provided, however, that no amendment that adversely affects the rights
of any Warrantholder in a manner different from the rights of the other
Warrantholders shall be effective against such Warrantholder unless approved in
writing by such Warrantholder. After an amendment, modification or waiver of a
provision the Warrants becomes effective, the Company shall mail to the
Warrantholders a notice briefly describing the amendment, modification or
waiver.
[Remainder of Page Intentionally Left Blank]
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IN WITNESS WHEREOF, this Warrant has been duly executed by the
Company as of the 12th day of May 1999.
HUNGARIAN TELEPHONE AND CABLE CORP.
By: /s/Xxx Xxxxxxx
Name: Xxx Xxxxxxx
Title: President and Chief Executive
Officer
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