WARRANT
To Purchase Common Stock
of
Mesaba Holdings, Inc.
This warrant, dated as of June 2, 1998, certifies that for value
received Northwest Airlines, Inc., a Minnesota corporation
("Northwest"), or permitted assigns, is entitled to purchase from Mesaba
Holdings, Inc., a Minnesota corporation (the "Company"), 1,435,230
shares (subject to adjustment as herein provided) of common stock of the
Company (herein referred to as the "Common Shares") at the price
determined as provided herein, and in all respects subject to the terms
contained herein.
This Warrant has been issued to Northwest in consideration of an
amendment, dated June 2, 1998 to that certain Regional Jet Services
Agreement dated as of October 25, 1996 between Northwest, the Company and
Mesaba Aviation, Inc. (the "Jetlink Agreement").
This Warrant is subject to the following provisions, terms, and
conditions:
2. The exercise price is $21.25 per share, subject to adjustment
as hereinafter provided (the "Exercise Price").
3. This Warrant shall become exercisable in installments
cumulatively with respect to 1/18th of the Common Shares, as adjusted
(initially 79,735 shares), on each date on which an Additional Aircraft
enters scheduled passenger service under the Jetlink Agreement. As used
herein, Additional Aircraft means the nineteenth through thirty-sixth RJ
85 aircraft to enter service under the Jetlink Agreement. This Warrant
will expire at 5:00 p.m. Minneapolis time, on
October 25, 2006, unless terminated earlier pursuant to the terms
hereof. Subject to the last sentence of this Section 2, the rights
represented by this Warrant may be exercised by Northwest, in whole or
in part, by written notice of exercise delivered to the Company
accompanied by the surrender of this Warrant (properly endorsed if
required) at the principal office of the Company together with payment
by check payable in Minneapolis Clearing House funds to the order of the
Company of the purchase price for such shares. The Company agrees that
the shares so purchased shall be deemed to be issued as of the close of
business on the date on which this Warrant shall have been surrendered
and payment made for such shares as aforesaid. Certificates for the
Common Shares so purchased shall be delivered to Northwest as soon as
practicable after the purchase rights represented by this Warrant shall
have been so exercised. This Warrant may not be exercised in part for
the purchase of any number of Common Shares less than 50,000, unless
such number represents the total number of Common Shares then remaining
subject to purchase pursuant to this Warrant.
4. The Company covenants and agrees that all Common Shares issued
upon the exercise of the purchase rights represented by this Warrant
will, upon issuance, be validly issued, fully paid, nonassessable, and
free from all taxes, liens and charges with respect to the issue
thereof. The Company further covenants and agrees that until the
expiration of this Warrant it will at all times have authorized and
reserved for the purpose of issue or transfer upon exercise of the
purchase rights evidenced by this Warrant a sufficient number of shares
of its common stock to provide for the exercise of the purchase rights
represented by this Warrant.
5. This Warrant shall not be transferable or assignable by
Northwest and may be exercised only by Northwest; provided, however,
that Northwest may transfer or assign this Warrant to any affiliate (as
such term is defined in Rule 405 promulgated under the Securities Act of
1933, as amended) of Northwest and any successor corporation (or other
entity) resulting from its merger, consolidation, or other
reorganization or the sale of all or substantially all of its assets.
6. In case the Company shall declare a stock dividend or other
distribution upon its common stock payable in common stock of the
Company, then the total maximum number of Common Shares issuable upon
the exercise of this Warrant shall be increased by an amount equal to
the number of shares of common stock which would have been issued to
Northwest as a result of the issuance of such dividend or other
distribution if, immediately prior to the record date relating to such
dividend or other distribution, Northwest had exercised its purchase
rights under this Warrant with respect to the total number of Common
Shares then remaining subject to purchase. The Exercise Price in effect
immediately prior to such dividend or other distribution shall be
proportionately reduced.
7. In case the Company shall at any time subdivide or split its
outstanding shares of common stock into a greater number of shares, the
Exercise Price in effect immediately prior to such subdivision or split
shall be proportionately reduced, and conversely, in case the
outstanding shares of common stock of the Company shall be combined into
a smaller number of shares, the Exercise Price in effect immediately
prior to such combination shall be proportionately increased. Upon each
adjustment of the Exercise Price pursuant to this Section 6, Northwest
shall thereafter be entitled to purchase, at the then applicable
Exercise Price, the number of shares obtained by multiplying the
Exercise Price in effect immediately prior to such adjustment by the
number of shares purchasable pursuant hereto immediately prior to such
adjustment and dividing the product thereof by the applicable Exercise
Price resulting from such adjustment.
8. If any capital reorganization or reclassification of the
capital stock of the Company or consolidation or merger of the Company
with another corporation, or the sale of all or substantially all of its
assets to another corporation shall be effected in such a way that
holders of shares of common stock of the Company shall be entitled to
receive stock, securities or assets with respect to or in exchange for
common stock, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate
provision shall be made whereby Northwest shall thereafter have the
right to receive upon the basis and upon the terms and conditions
specified in this Warrant and in lieu of the Common Shares of the
Company immediately theretofore receivable upon the exercise of this
Warrant, such shares of stock, securities or assets as may be issued or
payable with respect to or in exchange for a number of outstanding
shares of common stock of the Company equal to the number of Common
Shares immediately theretofore receivable upon the exercise of this
Warrant had such reorganization, reclassification, consolidation, merger
or sale not taken place, and in any such case appropriate provision
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shall be made with respect to the rights and interests of Northwest to
the end that the provisions hereof (including without limitation
provision for adjustments of the then applicable Exercise Price and of
the number of shares or other kinds of securities or other property
receivable upon the exercise of this Warrant) shall thereafter be
applicable, as nearly as may be, in relation to any shares of stock,
securities or assets thereafter receivable upon the exercise of this
Warrant. The Company shall not effect any such consolidation, merger or
sale, unless, prior to the consummation thereof, the surviving
corporation (if other than the Company) resulting from such
consolidation or merger or the corporation purchasing such assets shall
assume by written instrument executed and mailed to Northwest at the
last address of Northwest appearing on the books of the Company, the
obligation to deliver to Northwest such shares of stock, securities or
assets as, in accordance with the foregoing provisions, Northwest may be
entitled to receive.
9. Upon any adjustment of the Exercise Price or the number of
Common Shares or other kinds of securities or other property receivable
upon exercise of this Warrant, then and in each case the Company shall
give written notice thereof, by first-class mail, postage prepaid,
addressed to Northwest at the address as shown on the books of the
Company, which notice shall state the then applicable Exercise Price
resulting from such adjustment, and the increase or decrease, if any, in
the number of Common Shares or other kinds of securities or other
property receivable upon exercise of this Warrant, setting forth in
reasonable detail the method of calculation and the facts upon which
such calculation is based.
10. In case any time:
(i) the Company shall pay or make any stock dividend or other
distribution payable in stock upon its common stock or make any
distribution (other than regular cash dividends) to the holders of
its common stock;
(ii) the Company shall offer for subscription pro rata to the
holders of its common stock any additional shares of stock of any
class or other rights;
(iii) there shall be any capital reorganization,
reclassification of the capital stock of the Company, or
consolidation or merger of the corporation with, or sale of all or
substantially all of its assets to, another corporation; or
(iv) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in any one or more of said cases, at least 21 days prior to the
applicable date specified below, the Company shall give written notice,
by first-class mail, postage prepaid, addressed to Northwest at the
address as shown on the books of the Company, of the date on which (aa)
the books of the Company shall close or a record shall be taken for such
stock dividend, distribution or subscription rights, or (bb) such
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reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up shall take place, as the case may
be. Such notice shall also 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 shares of
common stock for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, sale,
dissolution, liquidation or winding up, as the case may be. Failure to
give such notice or any defect therein shall not affect the legality or
validity of any such proceeding or transaction and shall not affect the
right of the holder to participate in any said dividend, distribution,
subscription or exchange.
11. Any transfer of this Warrant permitted by Section 4 hereof may
be effected at the principal office of the Company by a duly authorized
officer or attorney of Northwest, upon surrender of this Warrant
properly endorsed. Northwest and each permitted transferee consents and
agrees that Northwest may be treated by the Company and all other
persons dealing with this Warrant as the absolute owner hereof for any
purpose and as the person entitled to exercise the rights represented by
this Warrant, or to the transfer hereof on the books of the Company, in
the absence of any actual written notice to the contrary.
12. This Warrant is exchangeable upon the surrender hereof by
Northwest at the principal office of the Company for new Warrants of
like tenor representing in the aggregate the right to subscribe for and
purchase the number of Common Shares which may be subscribed for and
purchased hereunder.
13. Notwithstanding any other provisions set forth in this Warrant
to the contrary, the rights of Northwest granted in this Warrant shall
terminate (i) immediately upon the termination of the Jetlink Agreement,
if the Jetlink Agreement is terminated by Northwest or (ii) 30 days
after Northwest's receipt of notice from the Company of the Company's
termination of the Jetlink Agreement, if the Jetlink Agreement is
terminated as the result of such notice.
14. Neither this Warrant nor any term hereof may be changed,
waived, discharged or terminated orally but only by an instrument in
writing signed by the party against which enforcement of the change,
waiver, discharge or termination is sought.
IN WITNESS WHEREOF, the Company has caused this Warrant to be
signed by its duly authorized officer this 2nd day of June, 1998.
MESABA HOLDINGS, INC.
By /s/__________________
Xxxx X. Xxxxxxxxxxxx
Vice President
Administration and General Counsel
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ELECTION TO PURCHASE
(To be executed by the registered holder
if such holder desires to exercise the Warrant.)
TO: Mesaba Holdings, Inc.
The undersigned hereby irrevocably elects to exercise this Warrant
to the extent of ___________ Common Shares and requests that
certificates for such shares be issued, and any payment in lieu of
fractional shares be made, in the name of:
________________________________________________________________________
(Print name, address and social security or other tax identification
number)
Dated:________________,____
______________________________
Signature
(Signature must conform in all
respects to name of holder as
specified on the face of this
Warrant.)
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FORM OF ASSIGNMENT
(To be executed by the registered holder
if such holder desires to transfer the Warrant.)
FOR VALUE RECEIVED,________________________________________________
hereby sells, assigns and transfers unto________________________________
__________________________________________________________________________
(Print name and address of transferee)
this Warrant, together with all right, title and interest therein, and
does hereby irrevocably constitute and appoint__________________________
Attorney, to transfer the within Warrant on the books of the Company,
with full power of substitution.
Dated:_______________,____
______________________________
Signature
(Signature must conform in all
respects to name of holder as
specified on the face of this
Warrant.)
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