Exhibit 4-3(a)
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Advanced Radio Telecom Corp.
135,000 Units Consisting of
$135,000,000 Aggregate Principal Amount of
___% Senior Notes due 2007 and Warrants to
Purchase 2,731,725 Shares of Common Stock
WARRANT AGREEMENT
Dated as of February 6, 1997
Continental Stock Transfer and Trust Company
Warrant Agent
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WARRANT AGREEMENT dated as of February 6, 1997 between Advanced Radio
Telecom Corp., a Delaware corporation (the "Company"), and Continental Stock
Transfer and Trust Company, a New York limited purpose trust company, as warrant
agent (the "Warrant Agent").
WHEREAS, the Company proposes to issue warrants (the "Warrants") to
initially purchase up to an aggregate of 2,731,725 shares of Common Stock, par
value $.001 per share (the "Common Stock"), of the Company (the Common Stock
issuable on exercise of the Warrants being referred to herein as the "Warrant
Shares"), in connection with the offering (the "Offering") by the Company of
135,000 Units (the "Units"), each consisting of $1,000 principal amount of the
Company's ___% Senior Notes due 2007 (the "Notes") and 15 Warrants, each Warrant
representing the right to purchase 1.349 Warrant Shares.
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 (as defined) and other matters as provided
herein;
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 Agreement, and the Warrant Agent
hereby accepts such appointment.
SECTION 2. Warrant Certificates. The certificates evidencing the
Warrants (the "Warrant Certificates") to be delivered pursuant to this Agreement
shall be in registered form only and shall be substantially in the form set
forth in Exhibit A attached hereto and shall, prior to the Separation Date (as
defined), bear the legend set forth in Exhibit B attached hereto.
SECTION 3. Execution of Warrant Certificates. (a) Warrant Certificates
shall be signed on behalf of the Company by its Chairman of the Board, Chief
Executive Officer, its President or a Vice President and by its Secretary or an
Assistant Secretary under its corporate seal. Each such signature upon the
Warrant Certificates may be in the form of a facsimile signature of the present
or any future Chairman of the Board, Chief Executive Officer, President, Vice
President, 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, Vice President, Secretary or
Assistant Secretary, notwithstanding the fact that at the time the Warrant
Certificates shall be countersigned and delivered or disposed of he shall have
ceased to hold such office. 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.
(b) In case any officer of the Company who shall have signed any of the
Warrant Certificates shall cease to be such officer before the Warrant
Certificates so signed shall have been countersigned by the Warrant Agent, or
disposed of by the Company, such Warrant Certificates nevertheless may be
countersigned and delivered or disposed of as though such person had not ceased
to be such officer of the Company; and 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.
(c) Warrant Certificates shall be dated the date of countersignature by
the Warrant Agent.
SECTION 4. Registration and Countersignature. (a) 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.
(b) 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, the
Chief Executive Officer, the President, a Vice President, the Treasurer or the
Controller of the Company, initially countersign, issue and deliver Warrants
entitling the holders thereof to purchase not more than the number of Warrant
Shares referred to above in the first recital hereof and shall countersign and
deliver Warrants as otherwise provided in this Agreement.
(c) 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.
SECTION 5. Registration of Transfers and Exchanges. (a) The Warrant
Agent shall from time to time, subject to the limitations of Section 6 hereof,
register the transfer of any outstanding Warrant Certificates upon the records
to be maintained by it for that purpose, upon surrender thereof accompanied (if
so required by it) 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 and subject to
Section 8 hereof, 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 in a manner
satisfactory to the Company.
(b) Warrant Certificates may be exchanged at the option of the holder(s)
thereof, when surrendered to the Warrant Agent at its office 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 such Warrant Agent in a manner
satisfactory to the Company.
(c) The Warrant Agent is hereby authorized to countersign, in accordance
with the provisions of this Section 5 and of Section 4 hereof, the new Warrant
Certificates required pursuant to the provisions of this Section 5.
(d) No service charge shall be made for registration of transfer or
exchange upon surrender of any Warrant Certificate at the office of the Warrant
Agent maintained for that purpose. The Company may require payment of a sum
sufficient to cover any tax or other
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governmental charge that may be imposed in connection with any registration,
transfer or exchange of Warrant Certificates.
SECTION 6. Separation of Warrants; Terms of Warrants; Exercise of
Warrants.(a) The Notes and Warrants will not be separately transferable prior
to the close of business of the earlier of (i) ____________, 1997, (ii) a
Change in Control (as defined in the indenture relating to the Notes) of the
Company and (iii) such date as the underwriters in the Offering may, in their
discretion, deem appropriate (the "Separation Date"), at which time such
Warrants shall become separately transferable. Subject to the terms of this
Agreement, each Warrant holder shall have the right, which may be exercised
during the period commencing at the opening of business on ________, 1997 and
until 5:00 p.m., New York City time on _______, 2007 (the "Exercise Period"),
to 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 exercise price (the "Exercise
Price") then in effect for such Warrant Shares; provided that holders shall
be able to exercise their Warrants only if a registration statement relating
to the Warrant Shares is then if effect, or the exercise of such Warrants is
exempt from the registration requirements of the Securities Act of 1933, as
amended (the "Securities Act"), and such securities are qualified for sale or
exempt from qualification under the applicable securities laws of the states
in which the various holders of the Warrants or other persons to whom it is
proposed that the Warrant Shares be issued on exercise of the Warrants
reside. Each holder may exercise its right, during the Exercise Period, to
receive Warrant Shares on a net basis, such that, without the exchange of any
funds, the holder receives that number of Warrant Shares otherwise issuable
(or payable) upon exercise of its Warrants less that number of Warrant Shares
having an aggregate fair market value (as defined) at the time of exercise
equal to the aggregate Exercise Price that would otherwise have been paid by
the holder of the Warrant Shares. For purposes of the foregoing sentence,
"fair market value" of the Warrant Shares will be determined in good faith by
the Board of Directors of the Company as of the date of any such exercise.
Each Warrant not exercised prior to 5:00 p.m., New York City time, on
_______, 2007 (the "Expiration Date") shall become void and all rights
thereunder and all rights in respect thereof under this agreement shall cease
as of such time. No adjustments as to dividends will be made upon exercise
of the Warrants.
(b) A Warrant may be exercised upon surrender to the Company at the
principal office of the Warrant Agent of the certificate or certificates
evidencing the Warrants to be exercised with the form of election to purchase on
the reverse thereof duly filled in and signed, which signature shall be
medallion guaranteed by an institution which is a member of a Securities
Transfer Association recognized signature guarantee program, and upon payment to
the Warrant Agent for the account of the Company of the Exercise Price, which is
set forth in the form of Warrant Certificate attached hereto as Exhibit A, as
adjusted as herein provided, for the number of Warrant Shares in respect of
which such Warrants are then exercised. Payment of the aggregate Exercise Price
shall be made (i) in cash or by certified or official bank check payable to the
order of the Company or (ii) in the manner provided in Section 6(a) hereof.
(c) Subject to the provisions of Section 7 hereof, upon such surrender of
Warrants and payment of the Exercise Price, the Warrant Agent shall deliver or
cause to be delivered with all reasonable dispatch, to or upon the written order
of the holder and in such name or names as the
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Warrant holder may designate, a certificate or certificates for the number of
whole Warrant Shares issuable upon the exercise of such Warrants or other
securities or property to which such holder is entitled hereunder, together
with cash as provided in Section 12 hereof; provided that if any consolidation,
merger or lease or sale of assets is proposed to be effected by the Company as
described in Section 11(m) hereof, or a tender offer or an exchange offer for
shares of Common Stock of the Company shall be made, upon such surrender of
Warrants and payment of the Exercise Price as aforesaid, the Warrant Agent
shall, as soon as possible, but in any event not later than two business
days thereafter, deliver or cause to be delivered the full number of Warrant
Shares issuable upon the exercise of such Warrants in the manner described in
this sentence or other securities or property to which such holder is entitled
hereunder, together with cash as provided in Section 12 hereof. 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 Exercise Price.
(d) The Warrants shall be exercisable, at the election of the holders
thereof, either in full or from time to time in part 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 date of
expiration of the Warrants, a new certificate evidencing the remaining Warrant
or Warrants will be 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 and of Section 3 hereof,
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.
(e) 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 Warrant Agent in a manner satisfactory to the
Company. The Warrant Agent shall account promptly to the Company with respect to
Warrants exercised and concurrently pay to the Company all monies received by
the Warrant Agent for the purchase of the Warrant Shares through the exercise of
such Warrants.
(f) The Warrant Agent shall keep copies of this Agreement and any notices
given or received hereunder available for inspection by the holders 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 Agreement as the Warrant
Agent may request.
SECTION 7. Payment of Taxes. The Company will pay all documentary
stamp taxes attributable to the initial issuance of Warrant Shares upon the
exercise of Warrants; provided 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
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the Company the amount of such tax or shall have established to the satisfaction
of the Company that such tax has been paid.
SECTION 8. Mutilated or Missing Warrant Certificates. In case any of
the Warrant Certificates shall be mutilated, lost, stolen or destroyed, the
Company may in its discretion issue and the Warrant Agent may countersign, in
exchange and substitution for and 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 indemnity, if requested, also satisfactory to them.
Applicants for such substitute Warrant Certificates shall also comply with such
other reasonable regulations and pay such other reasonable charges as the
Company or the Warrant Agent may prescribe.
SECTION 9. Reservation of Warrant Shares. (a) The Company will at all
times reserve and keep available, free from preemptive rights, out of the
aggregate of its authorized but unissued Common Stock or its authorized and
issued Common Stock held in its treasury, 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.
(b) The Company or, if appointed, the transfer agent for the Common Stock
(the "Transfer Agent") 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 aforesaid 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 Agreement on file with the Transfer Agent
and with every subsequent 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 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 12 hereof. 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 14
hereof.
(c) Before taking any action which would cause an adjustment pursuant to
Section 11 hereof to reduce the Exercise Price below the then par value (if any)
of the Warrant Shares, the Company will take any corporate action which may, in
the opinion of its counsel (which may be counsel employed by the Company), be
necessary in order that the Company may validly and legally issue fully paid and
nonassessable Warrant Shares at the Exercise Price as so adjusted.
(d) The Company covenants that all Warrant Shares which may be issued upon
exercise of Warrants will, upon issue, be fully paid, nonassessable, free of
preemptive rights and free from all taxes, liens, charges and security interests
with respect to the issuance thereof.
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SECTION 10. Obtaining Stock Exchange Listings. The Company will from
time to time take all action which may be necessary so that the Warrant Shares,
immediately upon their issuance upon the exercise of Warrants, will be listed on
the principal securities exchanges and markets within the United States of
America, if any, on which other shares of Common Stock are then listed.
SECTION 11. 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 11. For purposes of this
Section 11, "Common Stock" means shares now or hereafter authorized of any class
of common stock of the Company and any other stock of the Company, however
designated, that has the right (subject to any prior rights of any class or
series of preferred stock) to participate in any distribution of the assets or
earnings of the Company without limit as to per share amount.
(a) Adjustment for Change in Capital Stock. If the Company (i) pays a
dividend or makes a distribution on its Common Stock in shares of its Common
Stock,(ii) subdivides its outstanding shares of Common Stock into a greater
number of shares,(iii) combines its outstanding shares of Common Stock into a
smaller number of shares,(iv) makes a distribution on its Common Stock in shares
of its capital stock other than Common Stock or (v) issues by reclassification
of its Common Stock any shares of its capital stock; then the Exercise Price in
effect immediately prior to such action 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.
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 of it may receive shares of two
or more classes of capital stock of the Company, the Company shall determine the
allocation of the adjusted Exercise Price between the classes of capital stock.
After such allocation, the exercise privilege and the Exercise Price of each
class of capital stock shall thereafter be subject to adjustment on terms
comparable to those applicable to Common Stock in this Section 11. Such
adjustment shall be made successively whenever any event listed above shall
occur.
(b) Adjustment for Rights Issue. If the Company distributes any
rights, options or warrants to all holders of its Common Stock entitling them
for a period expiring within 60 days after the record date mentioned below to
purchase shares of Common Stock at a price per share less than the current
market price per share on that record date, the Exercise Price shall be adjusted
in accordance with the formula:
O + N x P
-----
E' = E x M
--------------------
O + N
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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.
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 rights, options
or warrants are issued and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the rights,
options or warrants. If at the end of the period during which such rights,
options or warrants are exercisable, not all rights, options or warrants 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 the Company distributes to all
holders of its Common Stock any of its assets or debt securities or any rights
or warrants to purchase debt securities, assets or other securities of the
Company, the Exercise Price shall be adjusted in accordance with the formula:
E' = E x M - F
-----------
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 to
one share of Common Stock. The Board of Directors shall
determine the fair market value.
The adjustment shall be made successively whenever any such distribution is
made 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 11(c) does not apply to cash dividends or cash distributions
paid out of consolidated current or retained earnings as shown on the books of
the Company prepared in accordance with generally accepted accounting
principles. Also, this Section 11(c) does not apply to rights, options or
warrants referred to in Section 11(b) hereof.
(d) Self-Tenders. In case of the consummation of an issuer bid or a
tender or exchange offer (other than an odd-lot tender offer or a normal
course issuer bid) made by the Company or any subsidiary of the Company for
all or any portion of the Common Stock to the extent that the cash and value
of any other consideration included in such payment per share of Common Stock
exceeds the first reported sales price per share of Common Stock on the
trading day next succeeding the Expiration Time (as defined below), the
Exercise Price shall be reduced so that the same shall equal the price
determined by multiplying the Exercise Price in effect immediately prior to
the last time tenders or exchanges made pursuant to such issuer bid or tender
or exchange offer (the "Expiration Time") by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding
(including any tendered or exchanged shares) on the Expiration Time
multiplied by the first reported sales price of the shares of Common Stock on
the trading day next succeeding the Expiration Time, and the denominator
shall be the sum of (A) the fair market value (determined by the board of
directors of the Company (the "Board of Directors"), whose determination
shall be conclusive and described in a resolution of the Board of Directors)
of the aggregate consideration payable to stockholders based on the
acceptance (up to any maximum specified in the terms of the issuer bid or
tender or exchange offer) of all shares validly tendered or exchanged and not
withdrawn as of the Expiration Time (the shares deemed so accepted, up to any
such maximum, being referred to as the "Purchased Shares") and (B) the
product of the number of shares of Common Stock outstanding (less any
Purchased Shares) on the Expiration Time and the first reported sales price
of the shares of Common Stock on the trading day next succeeding the
Expiration Time, such reduction to become effective immediately prior to the
opening of business on the day following the Expiration Time.
(e) [INTENTIONALLY OMITTED]
(f) Current Market Price. In Sections 11(b) and (c) hereof, the current
market price per share of Common Stock on any date is the average of the
Quoted Prices of the Common Stock for 30 consecutive trading days commencing
45 trading days prior to the date in question. The "Quoted Price" of the
Common Stock is the last reported sales price of the Common Stock as reported
by the Nasdaq National Market or, if the Common Stock is listed on a
securities exchange, the last reported sales price of the Common Stock on
such exchange which shall be for consolidated trading if applicable to such
exchange, or, if neither so reported or listed, the last reported bid price
of the Common Stock. In the absence of one or more such quotations, the
Board of Directors of the Company shall determine the current market price on
the basis of such quotations as it in good faith considers appropriate.
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(g) [INTENTIONALLY OMITTED]
(h) 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 1% in the Exercise Price. Any adjustments that are not
made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Section 11 shall be made to the nearest
cent or to the nearest 1/100th of a share, as the case may be.
(i) When No Adjustment Required. No adjustment need be made for a
transaction referred to Section 11(a), (b), (c) or (d) hereof, if Warrant
holders are to participate in the transaction on a basis and with notice that
the Board of Directors determines to be fair and appropriate in light of the
basis and notice on which holders of Common Stock participate in the
transaction. No adjustment need be made for (i) rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest, (ii) a
change in the par value or no par value of the Common Stock, (iii) the issuance
by the Company of 6,000,000 shares of Common Stock to CommcoCCC, Inc. in
connection with the acquisition of certain assets therefrom, or (iv) the
issuance by the Company of warrants to purchase Common Stock in accordance with
CIBC Agreements (as defined in the Purchase Agreement relating to the Offering).
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.
(j) Notice of Adjustment. Whenever the Exercise Price is adjusted, the
Company shall provide the notices required by Section 13 hereof.
(k) Voluntary Reduction. The Company from time to time may reduce the
Exercise Price by any amount for any period of time, if the period is at least
20 days and if the reduction is irrevocable during the period; provided that in
no event may the Exercise Price be less than the par value of a share of Common
Stock. Whenever the Exercise Price is reduced, the Company shall mail to
Warrant holders a notice of the reduction. The Company shall mail the notice at
least 15 days before the date the reduced Exercise Price takes effect. The
notice shall state the reduced Exercise Price and the period in which it will be
in effect. A reduction of the Exercise Price does not change or adjust the
Exercise Price otherwise in effect for purposes of Sections 11(a), (b), (c) and
(d) hereof.
(l) Notice of Certain Transactions. If (i) the Company takes any action
that would require an adjustment in the Exercise Price pursuant to Section
11(a), (b), (c) or (d) hereof and if the Company does not arrange for Warrant
holders to participate pursuant to Section 11(i) hereof,(ii) the Company takes
any action that would require a supplemental Warrant Agreement pursuant to
Section 11(m) hereof or (iii) there is a liquidation or dissolution of the
Company, then the Company shall mail to Warrant holders a notice stating the
proposed record date for a dividend or distribution or the proposed effective
date of a subdivision, combination, reclassification, consolidation, merger,
transfer, lease, liquidation or dissolution. The Company shall mail the notice
at least 15 days before such date. Failure to mail the notice or any defect in
it shall not affect the validity of the transaction.
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(m) Reorganization of Company. If the Company consolidates or merges with
or into, or transfers or leases all or substantially all its assets to, any
person, upon consummation of such transaction the Warrants shall automatically
become exercisable for the kind and amount of securities, cash or other assets
which the holder of a Warrant would have owned immediately after the
consolidation, merger, transfer or lease if the holder had exercised the Warrant
immediately before the effective date of the transaction. Concurrently with the
consummation of such transaction, the corporation formed by or surviving any
such consolidation or merger if other than the Company, or the person to which
such sale or conveyance shall have been made, shall enter into a supplemental
Warrant Agreement so providing and further providing for adjustments which shall
be as nearly equivalent as may be practical to the adjustments provided for in
this Section 11(m). The successor Company shall mail to Warrant holders a
notice describing the supplemental Warrant Agreement. If the issuer of
securities deliverable upon exercise of Warrants under the supplemental Warrant
Agreement is an affiliate of the formed, surviving, transferee or lessee
corporation, that issuer shall join in the supplemental Warrant Agreement. If
this Section 11(m) applies, Sections 11(a), (b), (c) and (d) hereof do not
apply.
(n) Company Determination Final. Any determination that the Company or
the Board of Directors must make pursuant to Section 11(a), (c), (d), (f) or (i)
hereof is conclusive.
(o) Warrant Agent's Disclaimer. The Warrant Agent has no duty to
determine when an adjustment under this Section 11 should be made, 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 11(m)
hereof 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 11.
(p) When Issuance or Payment May Be Deferred. In any case in which this
Section 11 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 12 hereof;
provided 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 upon the occurrence of the event
requiring such adjustment.
(q) Adjustment in Number of Shares. Upon each adjustment of the Exercise
Price pursuant to this Section 11, 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 Exercise Price that number of shares of
Common Stock (calculated to the nearest hundredth) obtained from the following
formula:
10
N' = N x E
------
E'
where:
N' = the adjusted number of Warrant Shares issuable upon exercise of a
Warrant by payment of the adjusted Exercise Price.
N = the number or Warrant Shares previously issuable upon exercise of
a Warrant by payment of the Exercise Price prior to adjustment.
E' = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
(r) 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 Agreement.
SECTION 12. 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
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 12,
be issuable on the exercise of any Warrants (or specified portion thereof), the
Company shall pay an amount in cash equal to the current market price per
Warrant Share, as determined on the day immediately preceding the date the
Warrant is presented for exercise, multiplied by such fraction, computed to the
nearest whole U.S. cent.
SECTION 13. Notices to Warrant holders. (a) Upon any adjustment of the
Exercise Price pursuant to Section 11 hereof, the Company shall promptly
thereafter (i) cause to be filed with the Warrant Agent a certificate of a firm
of independent public accountants of recognized standing selected by the Board
of Directors of the Company (who may be the regular auditors 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 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
Warrants at his 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 13.
11
(b) In case:
(i) the Company shall authorize the issuance to all holders of shares
of Common Stock of rights, options or warrants to subscribe for or purchase
shares of Common Stock or of any other subscription rights or warrants;
(ii) 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 11(a) hereof);
(iii) of any consolidation or merger to which the Company is a
party and for which approval of any stockholders of the Company is
required, or of the conveyance or transfer of the properties and assets of
the Company substantially as an entirety, or of any reclassification or
change of Common Stock issuable upon exercise of the Warrants (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 a
tender offer or exchange offer for shares of Common Stock;
(iv) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
(v) the Company proposes to take any action (other than actions of
the character described in Section 11(a) hereof) which would require an
adjustment of the Exercise Price pursuant to Section 11 hereof;
then the Company shall cause to be filed with the Warrant Agent and shall cause
to be given to each of the registered holders of Warrants at his address
appearing on the Warrant register, at least 20 days (or 10 days in any case
specified in clauses (i) or (ii) 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 (x)
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, (y) the initial expiration date set forth in any tender offer or
exchange offer for shares of Common Stock, or (z) 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 13 or any defect therein shall not affect the legality or
validity of any distribution, right, option, warrant, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up, or the vote upon
any action.
(c) Nothing contained in this Agreement or in any of the Warrant
Certificates shall be construed as conferring upon the holders of Warrants the
right to vote or to consent or to receive
12
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 14. Merger, Consolidation or Change of Name of Warrant Agent.
(a) Any corporation into which the Warrant Agent may be merged or with which it
may be consolidated, or any corporation resulting from any merger or
consolidation to which the Warrant Agent shall be a party, or any corporation
succeeding to the 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, provided that such
corporation would be eligible for appointment as a successor warrant agent under
the provisions of Section 16 hereof. In case at the time such successor to the
Warrant Agent shall succeed to the agency created by this Agreement, and in case
at that time 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 in case at that time any of
the Warrant Certificates shall not have been countersigned, any 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 and in this Agreement.
(b) In case at any time the name of the Warrant Agent shall be changed and
at such time any of the Warrant Certificates shall have been countersigned but
not delivered, the Warrant Agent whose name has been changed may adopt the
countersignature under its prior name, and in case at that time any of the
Warrant Certificates shall not have been countersigned, the Warrant Agent may
countersign such Warrant Certificates either in its prior name or in its changed
name, and in all such cases such Warrant Certificates shall have the full force
and effect provided in the Warrant Certificates and in this Agreement.
SECTION 15. Warrant Agent. The Warrant Agent undertakes the duties and
obligations imposed by this 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 and 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 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
13
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.
(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
Agreement, to reimburse the Warrant Agent for all expenses, taxes and
governmental charges and other charges of any kind and nature incurred by the
Warrant Agent in the execution of this 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 of this Agreement except as a result of its negligence or bad faith.
(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 Warrants 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 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) The Warrant Agent, and any stockholder, director, officer or employee
of it, 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
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 provisions hereof. The Warrant
Agent shall not be liable for anything which it may do or refrain from doing in
connection with this Agreement except for its own negligence or bad faith.
(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
made any adjustment of the Exercise Price or number of the Warrant Shares or
other securities or property deliverable as provided in this Agreement, or to
determine whether any facts exist which may require any of such
14
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 16. Change of Warrant Agent. If the Warrant Agent shall become
incapable of acting as Warrant Agent, 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 incapacity by
the Warrant Agent or by the registered holder of a Warrant Certificate, then the
registered holder of any Warrant 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 holders of a majority of the unexercised Warrants shall be
entitled at any time to remove the Warrant Agent 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; provided that 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 16, however, or any defect therein, shall not affect the legality or
validity of the appointment of a successor to the Warrant Agent.
SECTION 17. Registration. Holders shall be able to exercise their
Warrants only if a registration statement relating to the Warrant Shares is then
if effect, or the exercise of such Warrants is exempt from the registration
requirements of the Securities Act, and such securities are qualified for sale
or exempt from qualification under the applicable securities laws of the states
in which the various holders of the Warrants or other persons to whom it is
proposed that the Warrant Shares be issued on exercise of the Warrants reside.
(a) The Company shall prepare and cause to be filed with the Securities and
Exchange Commission (the "Commission") pursuant to Rule 415 under the Securities
Act a shelf registration statement on the appropriate form relating to the offer
and sale by the Company of the Warrant Shares to the holders of Warrants upon
exercise of the Warrants and resales of the Warrant Shares by the holders
thereof (the "Registration Statement").
(b) The Company shall use its best efforts to cause such Registration
Statement to be declared effective by the Commission no later than ____________,
1997.
(c) The Company shall use its best efforts to keep the Registration
Statement continuously effective under the Securities Act in order to permit the
prospectus included therein to be lawfully delivered by the Company to the
holders exercising the Warrants until the Expiration
15
Date or such shorter period that will terminate when all the Warrants have been
exercised; provided that, except as provided below with respect to any Black
Out Period (as defined), the Company shall be deemed not to have used its
best efforts to keep the Registration Statement effective during the requisite
period if it voluntarily takes any action that would result in it not being
able to offer and sell the Warrant Shares upon exercise of the Warrants during
that period, unless such action is required by applicable law. Notwithstanding
the foregoing, the Company shall not be required to amend or supplement the
Registration Statement, any related prospectus or any document incorporated
therein by reference, for a period (a "Black Out Period") not to exceed, for
so long as this Agreement is in effect, an aggregate of 90 days in any calendar
year, in the event that (i) an event occurs and is continuing as a result of
which the Registration Statement, any related prospectus or any document
incorporated therein by reference as then amended or supplemented would, in
the Company's good faith judgment, contain an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, and (ii)(A) the Company determines in its good faith judgment that
the disclosure of such event at such time would have a material adverse effect
on the business, operations or prospects of the Company or (B) the disclosure
otherwise relates to a material business transaction which has not yet been
publicly disclosed; provided that no Black Out Period may be in effect during
the six months prior to the Expiration Date.
(d) The Company shall cause the Registration Statement and the related
prospectus and any amendment or supplement thereto, as of the effective date of
the Registration Statement, amendment or supplement, (i) to comply in all
material respects with the applicable requirements of the Securities Act and the
rules and regulations of the Commission and (ii) not to contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(e) The Company shall give prompt written notice to the holders of the
Warrants and the Warrant Agent of (i) the effectiveness of the Registration
Statement or any post-effective amendment thereto,(ii) the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the initiation or threatening of any proceedings for that
purpose,(iii) the receipt by the Company or its legal counsel of any
notification with respect to the suspension of the qualification of the Warrant
Shares for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose,(iv) the happening of any event that requires the
Company to make changes in the Registration Statement or the prospectus in order
to make the statements therein not misleading and (v) the commencement and
termination of any Black Out Period.
(f) The Company shall use its best efforts to prevent the issuance or
obtain the withdrawal of any order suspending the effectiveness of the
Registration Statement at the earliest possible time.
(g) Upon the occurrence of any event contemplated by Section 17(e)(iv) or
(v) hereof (subject to the last sentence of Section 17(c) hereof) the Company
shall promptly prepare a post-
16
effective amendment to the Registration Statement or a supplement to the related
prospectus or file any other required document so that, as thereafter delivered
to holders of the Warrants, the prospectus will not contain an untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading and will contain the current information required by the
Securities Act.
(h) Not later than the effective date of the Registration Statement, the
Company will provide a CUSIP number for the Warrant Shares and provide the
Warrant Agent with printed certificates for the Warrant Shares in a form
eligible for deposit with the Depository Trust Company.
(i) The Company will comply with all rules and regulations of the
Commission to the extent and so long as they are applicable to the Registration
Statement and will make generally available to its securities holders (or
otherwise provide in accordance with Section 11(a) of the Securities Act) an
earnings statement satisfying the provisions of Section 11(a) of the Securities
Act, no later than 45 days (plus any extension permitted by Rule 12b-25 under
the Exchange Act) after the end of a 12-month period (or 90 days, if such period
is a fiscal year (plus any extension permitted by Rule 12b-25 under the Exchange
Act)) beginning with the first month of the Company's first fiscal quarter
commencing after the effective date of the Registration Statement, which
statement shall cover shall 12-month period.
(j) The Company shall register or qualify or cooperate with the holders
in connection with the registration or qualification of the Warrant Shares
for offer and sale by the Company upon exercise of the Warrants under the
securities or blue sky laws of such states of the United States as any holder
reasonably requests and do any and all other acts or things necessary or
advisable to enable such offer and sale in such jurisdictions; provided that
the Company shall not be required to (i) qualify to do business in any
jurisdiction in which it is not then so qualified or (ii) take any action
which would subject it to general service of process or to taxation in any
jurisdiction in which it is not then so subject.
(k) The Company shall bear all expenses incurred by it in connection with
the performance of its obligations under this Section 17.
(l) The Company acknowledges and agrees that any remedy at law for breach
of any provision of this Section 17 will be inadequate and that, in addition to
any other remedies that the holder may have, the holders shall be entitled to
the remedy of specific performance to ensure the Company performs its
obligations under this Section 17. The election of any one or more remedies by
the holders hereunder shall not constitute a waiver of the right to pursue other
available remedies.
(m) No person is entitled to include any securities of the Company held by
such person in, or to have such securities registered under, the Registration
Statement.
17
SECTION 18. Reports.
(a) Whether or not required by the rules and regulations of the Securities
and Exchange Commission (the "Commission"), so long as any Warrants are
outstanding, the Company shall furnish to the holders of Warrants (i) all
quarterly and annual financial information that would be required to be
contained in a filing with the Commission on Forms 10-Q and 10-K if the Company
were required to file such Forms, including a "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and, with respect to
the annual information only, a report thereon by the Company's certified
independent accountants and (ii) all current reports that would be required to
be filed with the Commission on Form 8-K if the Company were required to file
such reports. In addition, whether or not required by the rules and regulations
of the Commission, the Company shall file a copy of all such information and
reports with the Commission for public availability (unless the Commission shall
not accept such a filing) and make such information available to securities
analysts and prospective investors upon request.
(b) The Company shall provide the Warrant Agent with a sufficient number
of copies of all such reports that the Warrant Agent may be required to deliver
to the holders of the Warrants under this Section 18.
SECTION 19. Notices to Company and Warrant Agent. Any notice or demand
authorized by this Agreement to be given or made by the Warrant Agent or by the
registered holder of any Warrant 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:
Advanced Radio Telecom Corp.
000 000xx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Chief Financial Officer
In case the Company shall fail to maintain such office or agency or shall
fail to give such notice of the location or of any change in the location
thereof, presentations may be made and notices and demands may be served at the
principal office of the Warrant Agent.
Any notice pursuant to this Agreement to be given by the Company or by the
registered holder(s) of any Warrant 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 as follows:
Continental Stock Transfer and Trust Company
0 Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxx
18
SECTION 20. Supplements and Amendments. The Company and the Warrant
Agent may from time to time supplement or amend this Agreement without the
approval of any holders of Warrants 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 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 Warrants. Any amendment or
supplement to this Agreement that has a material adverse effect on the interests
of the holders of Warrants shall require the written consent of the holders of a
majority of the then outstanding Warrants (excluding Warrants held by the
Company or any of its affiliates). The consent of each holder of Warrants
affected shall be required for any amendment pursuant to which the Exercise
Price would be increased or the number of Warrant Shares purchasable upon
exercise of Warrants would be decreased (other than pursuant to adjustments
provided in this Agreement.
SECTION 21. Successors. All the covenants and provisions of this
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 22. Termination. This Agreement shall terminate at 5:00 p.m.,
New York City time on _________, 2007. Notwithstanding the foregoing, this
Agreement will terminate on any earlier date if all Warrants have been
exercised. The provisions of Section 15 shall survive such termination.
SECTION 23. Governing Law. This 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 construed in accordance with the
internal laws of said State.
SECTION 24. Benefits of This Agreement. Nothing in this Agreement shall
be construed to give to any person or corporation other than the Company, the
Warrant Agent and the registered holders of Warrants any legal or equitable
right, remedy or claim under this Agreement; but this Agreement shall be for the
sole and exclusive benefit of the Company, the Warrant Agent and the registered
holders of Warrants.
SECTION 25. Counterparts. This 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.
[Signature Page Follows]
19
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first above written.
ADVANCED RADIO TELECOM CORP.
By:_________________________________
Name:
Title:
[Seal]
Attest: ______________________
Secretary
CONTINENTAL STOCK TRANSFER AND TRUST COMPANY,
as Warrant Agent
By _________________________________
Name:
Title:
[Seal]
Attest: _______________________
Secretary
20
EXHIBIT A
FORM OF WARRANT
[Face of Warrant Certificate]
THE WARRANTS EVIDENCED BY THIS CERTIFICATE ARE NOT TRANSFERABLE SEPARATELY FROM
THE NOTES ORIGINALLY SOLD AS A UNIT WITH SUCH WARRANTS UNTIL THE EARLIER OF (I)
____________, 1997 (II) A CHANGE IN CONTROL (AS DEFINED IN THE INDENTURE
RELATING TO SUCH NOTES) AND (III) SUCH DATE AS THE UNDERWRITERS IN THE OFFERING
HEREOF MAY, IN THEIR DISCRETION, DEEM APPROPRIATE). PRIOR TO SUCH DATE, THE
WARRANTS EVIDENCED BY THIS CERTIFICATE MAY BE TRANSFERRED ONLY IN INTEGRAL
MULTIPLES OF 15 WARRANTS AND ONLY WITH THE SIMULTANEOUS TRANSFER TO THE
TRANSFEREE OF $1,000 PRINCIPAL AMOUNT OF NOTES FOR EACH 15 WARRANTS SO
TRANSFERRED.
EXERCISABLE ON OR AFTER _____________, 1997.
No. _____ __________Warrants
Warrant Certificate
ADVANCED RADIO TELECOM CORP.
This Warrant Certificate certifies that ______________, or registered
assigns, is the registered holder of Warrants expiring __________, 2007 (the
"Warrants") to purchase common stock, par value $.001 per share (the "Common
Stock"), of Advanced Radio Telecom Corp, a Delaware corporation (the "Company").
Each Warrant entitles the holder upon exercise to receive from the Company
commencing _____________, 1997 until 5:00 p.m. New York City Time on
_____________, 2007, 1.349 fully paid and nonassessable shares of Common Stock
(the "Warrant Shares") at the initial exercise price (the "Exercise Price") of
$______ payable in lawful money of the United States of America upon surrender
of this Warrant Certificate and payment of the Exercise Price at the office or
agency of the Warrant Agent, but only subject to the conditions set forth herein
and in the Warrant Agreement referred to on the reverse hereof. Notwithstanding
the foregoing, Warrants may be exercised without the exchange of funds pursuant
to the net exercise provisions of Section 6 of the Warrant Agreement. 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 _____________, 2007, and to the extent not exercised by
such time such Warrants shall become void. Reference is hereby made to the
further provisions of this Warrant Certificate set forth on the reverse hereof
and such further provisions shall for all purposes have the same effect as
though fully set forth at this place. This Warrant Certificate shall not be
valid
A-1
unless countersigned by the Warrant Agent, as such term is used in the Warrant
Agreement. This Warrant Certificate shall be governed and construed in
accordance with the internal laws of the State of New York.
IN WITNESS WHEREOF, Advanced Radio Telecom Corp. has caused this Warrant
Certificate to be signed by its Chief Executive Officer and by its Secretary and
has caused its corporate seal to be affixed hereunto or imprinted hereon.
Dated: ___________ , 1997
ADVANCED RADIO TELECOM CORP.
By:________________________________
Xxxxxx X. Xxxxxxxxxxxx
Chief Executive Officer
By:________________________________
W. Xxxxxxxx Xxxxxxx, Xx.
Secretary
Countersigned:
CONTINENTAL STOCK TRANSFER AND TRUST COMPANY
as Warrant Agent
By:________________________________
Name:
Title:
A-2
[Reverse of Warrant Certificate]
The Warrants evidenced by this Warrant Certificate are part of a
duly authorized issue of Warrants expiring ____________, 2007 entitling the
holder on exercise to receive shares of Common Stock, par value $.001 per
share, of the Company (the "Common Stock"), and are issued or to be issued
pursuant to a Warrant Agreement dated as of February 6, 1997 (the "Warrant
Agreement"), duly executed and delivered by the Company to Continental Stock
Transfer and Trust Company, a New York limited purpose trust company, as
warrant agent (the "Warrant Agent"), 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. A copy of the
Warrant Agreement may be obtained by the holder hereof upon written request
to the Company.
Warrants may be exercised at any time on or after __________, 1997 and on
or before _____________, 2007; provided that holders shall be able to exercise
their Warrants only if a registration statement relating to the Warrant Shares
is then in effect, or the exercise of such Warrants is exempt from the
registration requirements of the Securities Act, and such securities are
qualified for sale or exempt from qualification under the applicable securities
laws of the states in which the various holders of the Warrants or other persons
to whom it is proposed that the Warrant Shares be issued on exercise of the
Warrants reside. The holder of Warrants evidenced by this Warrant Certificate
may exercise them by surrendering this Warrant Certificate, with the form of
election to purchase set forth hereon properly completed and executed, together
with payment of the Exercise Price in cash at the office of the Warrant Agent.
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. No adjustment
shall be made for any dividends on any Common Stock issuable upon exercise of
this Warrant.
The Warrant Agreement provides that upon the occurrence of certain events
the Exercise Price 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 shall 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 thereof determined as provided in the Warrant Agreement.
The Company has agreed under the terms of the Warrant Agreement to file and
use its best efforts to make effective no later than ______________, 1997 and
(subject to Black Out Periods) maintain effective until expiration or exercise
of all Warrants a shelf registration statement (the "Registration Statement") on
an appropriate form under the Securities Act covering the issuance and sale of
Warrant Shares upon exercise of the Warrants.
A-3
Warrant Certificates, when surrendered at the 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 office of the Warrant Agent a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like 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) thereof 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.
A-4
Form of Election to Purchase
(To Be Executed Upon Exercise Of Warrant)
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 Advanced
Radio Telecom Corp. in the amount of $______ in accordance with the terms hereof
unless the holder is exercising Warrants pursuant to the net exercise provisions
of Section 6 of the Warrant Agreement. The undersigned requests that a
certificate for such shares be registered in the name of ________________, whose
address is _______________________________ and that such shares be delivered to
________________ whose address is ___________ ______________________. If said
number of shares is less than all of the shares of Common Stock purchasable
hereunder, the undersigned requests that a new Warrant Certificate representing
the remaining balance of such shares be registered in the name of
______________, whose address is _________________________, and that such
Warrant Certificate be delivered to _________________, whose address is
__________________.
Date: ______________, ____
__________________________
(Signature)
__________________________
(Signature Guaranteed)
A-5
EXHIBIT B
FORM OF TRANSFER LEGEND
Each Certificate evidencing Warrants originally issued as part of a Unit of
Notes and Warrants issued by the Company (and each Certificate evidencing
Warrants issued on registration of transfer thereof or in exchange or
substitution therefor prior to the close of business on the Separation Date (as
defined)) shall bear a legend, which may be affixed by stamp or sticker, in
substantially the following form:
The Warrants evidenced by this Certificate are not transferable
separately from the Notes originally sold as a Unit with such Warrants
until the earlier of (i) ____________, 1997 (ii) a Change in Control
(as defined in the indenture relating to such Notes) and (iii) such
date as the Underwriters in the Offering hereof may, in their
discretion, deem appropriate. Prior to such date, the Warrants
evidenced by this Certificate may be transferred only in integral
multiples of 15 Warrants and only with the simultaneous transfer to
the Transferee of $1,000 of principal amount of Notes for each 15
Warrants so transferred.
B-1
