EXHIBIT 10.23
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iPCS, Inc.
Warrants to Purchase
2,982,699 Shares of Common Stock
WARRANT AGREEMENT
Dated as of July 12, 2000
ChaseMellon Shareholder Services, L.L.C.,
as Warrant Agent
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TABLE OF CONTENTS
Page
SECTION 1. CERTAIN DEFINITIONS......................................................... 1
SECTION 2. APPOINTMENT OF WARRANT AGENT................................................ 6
SECTION 3. ISSUANCE OF WARRANTS; WARRANT CERTIFICATES.................................. 6
3.1 Form and Dating....................................................... 6
3.2 Execution............................................................. 7
3.3 Warrant Registrar..................................................... 8
3.4 Holder Lists.......................................................... 8
3.5 Transfer and Exchange................................................. 8
3.6 Replacement Warrants.................................................. 22
3.7 Temporary Warrants.................................................... 22
3.8 Cancellation.......................................................... 23
SECTION 4. SEPARATION OF WARRANTS; TERMS OF WARRANTS; EXERCISE OF WARRANTS............ 23
SECTION 5. PAYMENT OF TAXES........................................................... 25
SECTION 6. RESERVATION OF WARRANT SHARES.............................................. 25
SECTION 7. OBTAINING STOCK EXCHANGE LISTINGS.......................................... 26
SECTION 8. ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES ISSUABLE......... 26
SECTION 9. FRACTIONAL INTERESTS....................................................... 36
SECTION 10. NOTICES TO WARRANT HOLDERS................................................. 37
SECTION 11. MERGER, CONSOLIDATION OR CHANGE OF NAME OF WARRANT AGENT................... 38
SECTION 12. WARRANT AGENT.............................................................. 39
SECTION 13. CHANGE OF WARRANT AGENT.................................................... 42
SECTION 14. REPORTS.................................................................... 42
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SECTION 15. NOTICES TO COMPANY AND WARRANT AGENT....................................... 43
SECTION 16. SUPPLEMENTS AND AMENDMENTS................................................. 43
SECTION 17. SUCCESSORS................................................................. 44
SECTION 18. TERMINATION................................................................ 44
SECTION 19. GOVERNING LAW.............................................................. 44
SECTION 20. BENEFITS OF THIS AGREEMENT................................................. 44
SECTION 21. COUNTERPARTS............................................................... 45
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WARRANT AGREEMENT, dated as of July 12, 2000, by and among iPCS,
Inc., a Delaware corporation ("iPCS" or the "Company"), and ChaseMellon
Shareholder Services, L.L.C., a New Jersey limited liability company, as warrant
agent (the "Warrant Agent").
WHEREAS, the Company proposes to issue warrants (the "Warrants") to
initially purchase up to an aggregate of 2,982,699 shares of Common Stock, par
value $.01 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").
WHEREAS, the Warrants are being issued in connection with the
offering (the "Offering") by iPCS, of 300,000 Units (the "Units"), each
consisting of $1,000 principal amount at maturity of iPCS's 14% Senior Discount
Notes due 2010 (the "Notes") and one Warrant, each Warrant initially
representing the right to purchase 9.94233 Warrant Shares at an exercise price
of $5.50 per Warrant Share.
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. CERTAIN DEFINITIONS.
As used in this Agreement, the following terms shall have the
following respective meanings:
"144A Global Warrant" means a global Warrant substantially in the
form of Exhibit A hereto bearing the Global Warrant Legend and the Private
Placement Legend and deposited with or on behalf of, and registered in the name
of, the Depositary or its nominee.
"Accreted Value" of any outstanding Note as of or to any date of
determination means an amount equal to the sum of (1) the issue price of such
Note as determined in accordance with Section 1273 of the Internal Revenue Code
plus (2) the aggregate of the portions of the original issue discount, i.e., the
excess of the amounts considered as part of the "stated redemption price at
maturity" of such Note within the meaning of Section 1273(a)(2) of the Internal
Revenue Code or any successor provisions, whether denominated as principal or
interest, over the issue price of such Note, that shall theretofore have accrued
pursuant to Section 1272 of the Internal Revenue Code, without regard to Section
1272(a)(7) of the Internal Revenue Code, from the date of issue of such Note (a)
for each six-month or shorter period ending January 15 or July 15 prior to the
date of determination and (b) for the shorter period, if any, from the end of
the immediately preceding six-month or shorter period, as the case may be, to
the date of determination plus (3) accrued and unpaid interest to the date such
Accreted Value is paid (without duplication of any amount set forth
in (2) above), minus all amounts theretofore paid in respect of such Note, which
amounts are considered as part of the "stated redemption price at maturity" of
such Note within the meaning of Section 1273(a)(2) of the Internal Revenue Code
or any successor provisions whether such amounts paid were denominated principal
or interest.
"Affiliate" of any Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such specified Person, whether
through the ownership of voting securities, by agreement or otherwise; provided
that beneficial ownership of 10% or more of the voting securities of a Person
shall be deemed to be control.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Warrant, the rules and
procedures of the Depositary, Euroclear and Cedel Bank that apply to such
transfer or exchange.
"Business Day" means any day other than a Legal Holiday.
"Cedel Bank" means Cedel Bank, SA.
"Closing Date" means the date hereof.
"Commission" means the Securities and Exchange Commission.
"Depositary" means, with respect to the Warrants issuable or issued in
whole or in part in global form, the Person specified in Section 3.3 hereof as
the Depositary with respect to the Warrants, and any and all successors thereto
appointed as Depositary hereunder and having become such pursuant to the
applicable provision of the Indenture.
"Euroclear" means Xxxxxx Guaranty Trust Company of New York, Brussels
office, and all successors thereto, as operator of the Euroclear system.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exercise Date" means July 15, 2001.
"Exercise Price" means the purchase price per share of Common Stock to
be paid upon the exercise of each Warrant in accordance with the terms hereof,
which price shall initially be $5.50 per share, subject to adjustment from time
to time pursuant to Section 8 hereof.
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"Global Warrants" means, individually and collectively, each of the
Global Warrants substantially in the form of Exhibit A hereto issued in
accordance with Section 3.1(b) and Section 3.5 hereof.
"Global Warrant Legend" means the legend set forth in Section
3.5(g)(ii), which is required to be placed on all Global Warrants issued under
this Warrant Agreement.
"Holder" means a Person who is listed as the record owner of Warrants,
Warrant Shares and any other securities issued or issuable with respect to the
Warrants or the Warrant Shares by way of a stock dividend or stock split or in
connection with a combination of shares, recapitalization, merger, consolidation
or other reorganization.
"Indenture" means the indenture, dated the date hereof, by and among
the Company, the Guarantors (as set forth in the Indenture) and ChaseMellon
Shareholder Services, L.L.C., as trustee relating to the Notes.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Warrant through a Participant.
"Initial Purchasers" means Xxxxxxxxx, Lufkin & Xxxxxxxx Securities
Corporation and TD Securities (USA) Inc.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act, which is not also a QIB.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or the city in which the office of the
Warrant Agent is located or at a place of payment are authorized by law,
regulation or executive order to remain closed. If a payment date is a Legal
Holiday at a place of payment, payment shall be made at that place on the next
succeeding day that is not a Legal Holiday, and no interest shall accrue on such
payment for the intervening period.
"Non-U.S. Person" means a person who is not a U.S. Person.
"Offering" means the offering by the Company of the Units.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person.
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"One-Year Restricted Period" means the one-year "distribution
compliance period" as defined in Rule 902(f) of Regulation S.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Warrant Agent in form and substance reasonably
acceptable to the Warrant Agent. The counsel may be an employee of or counsel to
the Company, any subsidiary of the Company or the Warrant Agent.
"Participant" means, with respect to the Depositary, Euroclear or
Cedel, a Person who has an account with the Depositary, Euroclear or Cedel,
respectively (and, with respect to The Depository Trust Company, shall include
Euroclear and Cedel).
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof, including any subdivision or ongoing business of any such entity or
substantially all of the assets of any such entity, subdivision or business.
"Prospectus" means the prospectus included in a Registration Statement
at the time such Registration Statement is declared effective, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments and all material incorporated by reference
into such Prospectus.
"Private Placement Legend" means the legend set forth in Section
3.5(g)(i) to be placed on all Warrants issued under this Warrant Agreement
except where otherwise permitted by the provisions of this Warrant Agreement.
"Purchase Agreement" means that certain purchase agreement, dated as
of June 29, 2000, by and among the Company, the Guarantors (as set forth in the
Purchase Agreement) and the Initial Purchasers pursuant to which the Company
agrees to sell units, of which the Warrants form a part, to the Initial
Purchasers.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Registrable Securities" shall mean the Warrants, the Warrant Shares
and any other securities issued or issuable with respect to the Warrants or the
Warrant Shares by way of a stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization; provided that a security ceases to be a Registrable Security
when it is no longer a Transfer Restricted Security.
"Registration Statement" means "registration statement," as such term
is defined in Section 2(a)(8) of the Securities Act.
"Regulation S" means Regulation S promulgated under the Securities
Act.
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"Regulation S Global Warrant" means a global Warrant in the form of
Exhibit A hereto bearing the Global Warrant Legend, the Private Placement Legend
and the Regulation S Legend and deposited with or on behalf of and registered in
the name of the Depositary or its nominee.
"Regulation S Legend" means the legend set forth in Section 3.5(g)(iv)
to be placed on all Registrable Securities issued pursuant to Regulation S.
"Restricted Definitive Warrant" means a Definitive Warrant bearing the
Private Placement Legend.
"Restricted Global Warrant" means a Global Warrant bearing the Private
Placement Legend.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended.
"Separation Date" means the earliest of (i) 180 days after the closing
of the Offering, (ii) the date on which a registration statement with respect to
a registered exchange offer for the Notes is declared effective under the
Securities Act, (iii) the date a shelf registration statement with respect to
the Notes is declared effective under the Securities Act, (iv) the occurrence of
a Change of Control or an Event of Default (each as defined in the Indenture)
and (v) such date as Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation in its
sole discretion shall determine, upon notice to the Company.
"Shelf Registration" means a shelf Registration Statement filed
pursuant to Rule 415 under the Securities Act relating to the Transfer
Restricted Securities.
"Trustee" means the trustee under the Indenture.
"Transfer Restricted Securities" shall mean (a) each Warrant and
Warrant Share held by an Affiliate of the Issuer and (b) each other Warrant and
Warrant Share until the earlier to occur of (i) the date on which such Warrant
or Warrant Share (other than any Warrant Share issued upon exercise of a Warrant
in accordance with a Registration Statement) has been disposed of in accordance
with a Registration Statement and (ii) the date on which such Warrant or Warrant
Share (or the related Warrant) is distributed to the public pursuant to Rule 144
under the Act.
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"Trustee" means the trustee under the Indenture.
"Unrestricted Global Warrant" means a global Warrant substantially in
the form of Exhibit A attached hereto that bears the Global Warrant Legend and
that has the "Schedule of Exchanges of Interests in the Global Warrant" attached
thereto, and that is deposited with or on behalf of and registered in the name
of the Depositary, representing a series of Warrants that do not bear the
Private Placement Legend.
"Unrestricted Definitive Warrant" means one or more Definitive
Warrants that do not bear and are not required to bear the Private Placement
Legend.
"U.S. Person" means a U.S. person as defined in Rule 902(o) under the
Securities Act.
SECTION 2. APPOINTMENT OF WARRANT AGENT.
The Company hereby appoints the Warrant Agent to act as agent for the
Company in accordance with the express instructions set forth hereinafter in
this Agreement and the Warrant Agent hereby accepts such appointment.
SECTION 3. ISSUANCE OF WARRANTS; WARRANT CERTIFICATES.
3.1 Form and Dating.
(a) General.
The Warrants shall be substantially in the form of Exhibit A hereto
(the "Warrant Certificates") and shall be issued initially, together with Notes,
as Units, substantially in the form of Exhibit B hereto. The Warrants may have
notations, legends or endorsements required by law, stock exchange rule or
usage. Each Warrant shall be dated the date of the countersignature.
The terms and provisions contained in the Warrants shall constitute,
and are hereby expressly made, a part of this Warrant Agreement. The Company
and the Warrant Agent, by their execution and delivery of this Warrant
Agreement, expressly agree to such terms and provisions and to be bound thereby.
However, to the extent any provision of any Warrant conflicts with the express
provisions of this Warrant Agreement, the provisions of this Warrant Agreement
shall govern and be controlling.
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(b) Global Warrants.
Warrants issued in global form shall be substantially in the form of
Exhibit A attached hereto (including the Global Warrant Legend thereon and the
"Schedule of Exchanges of Interests in the Global Warrant" attached thereto).
Warrants issued in definitive form shall be substantially in the form of Exhibit
A attached hereto (but without the Global Warrant Legend thereon and without the
"Schedule of Exchanges of Interests in the Global Warrant" attached thereto).
Each Global Warrant shall represent such of the outstanding Warrants as shall be
specified therein and each shall provide that it shall represent the number of
outstanding Warrants from time to time endorsed thereon and that the number of
outstanding Warrants represented thereby may from time to time be reduced or
increased, as appropriate, to reflect exchanges and redemptions. Any
endorsement of a Global Warrant to reflect the amount of any increase or
decrease in the number of outstanding Warrants represented thereby shall be made
by the Warrant Agent in accordance with written instructions given by the Holder
thereof as required by Section 3.5 hereof.
(c) Euroclear and Cedel Procedures Applicable, if Necessary.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Cedel Bank" and "Customer Handbook" of Cedel Bank shall be
applicable to transfers of beneficial interests, if any, in the Global Warrant
that are held by Participants through Euroclear or Cedel Bank.
3.2 Execution.
An Officer shall sign the Warrants for the Company by manual or
facsimile signature.
If the Officer whose signature is on a Warrant no longer holds that
office at the time a Warrant is countersigned, the Warrant shall nevertheless be
valid.
A Warrant shall not be valid until countersigned by the manual
signature of the Warrant Agent. The signature shall be conclusive evidence that
the Warrant has been properly issued under this Warrant Agreement.
The Warrant Agent shall, upon a written order of the Company signed by
an Officer (a "Warrant Countersignature Order"), countersign Warrants for
original issue up to the number stated in the preamble hereto.
The Warrant Agent may appoint an agent acceptable to the Company to
countersign Warrants. Such an agent may countersign Warrants whenever the
Warrant Agent may do so. Each reference in this Warrant Agreement to a
countersignature by the Warrant Agent includes a countersignature by such agent.
Such an agent has the same rights as the Warrant Agent to deal with the Company
or an Affiliate of the Company.
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3.3 Warrant Registrar.
The Company shall maintain an office or agency where Warrants may be
presented for registration of transfer or for exchange ("Warrant Registrar").
The Warrant Registrar shall keep a register of the Warrants and of their
transfer and exchange. The Company may appoint one or more co-Warrant
Registrars. The Warrant Agent and the Warrant Registrar shall have no duty to
supervise and will not be liable for the acts or omissions of any such co-
Warrant Registrar. The term "Warrant Registrar" includes any co-Warrant
Registrar. The Company may change any Warrant Registrar without notice to any
Holder. The Company shall notify the Warrant Agent in writing of the name and
address of any agent not a party to this Warrant Agreement. If the Company
fails to appoint or maintain another entity as Warrant Registrar, the Warrant
Agent shall act as such. The Company or any of its subsidiaries may act as
Warrant Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Warrants.
The Company initially appoints the Warrant Agent to act as the Warrant
Registrar with respect to the Global Warrants.
3.4 Holder Lists.
The Warrant Agent shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders. If the Warrant Agent is not the Warrant Registrar, the Company
shall promptly furnish to the Warrant Agent at such times as the Warrant Agent
may request in writing, a list in such form and as of such date as the Warrant
Agent may reasonably require of the names and addresses of the Holders.
3.5 Transfer and Exchange.
(a) Transfer and Exchange of Global Warrants.
A Global Warrant may not be transferred as a whole except by the
Depositary to a nominee of the Depositary, by a nominee of the Depositary to the
Depositary or to another nominee of the Depositary, or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor
Depositary. All Global Warrants will be exchanged by the Company for Definitive
Warrants if (i) the Company delivers to the Warrant Agent written notice from
the Depositary that it is unwilling or unable to continue to act as Depositary
or that it is no longer a clearing agency registered under the Exchange Act and,
in either case, a successor Depositary is not appointed by the Company within
120 days after the date of such notice from the Depositary, (ii) the Company in
its sole discretion determines that the Global Warrants (in whole but not in
part) should be exchanged for Definitive Warrants which the Company will provide
to the Warrant Agent and delivers a written notice to such effect to the Warrant
Agent or (iii) an event of default under the Indenture of which an officer of
the Warrant Agent has actual notice has occurred and is continuing and the
Warrant
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Registrar has received a request from DTC to issue Definitive Warrants. Upon the
occurrence of either of the preceding events in (i), (ii) or (iii) above,
Definitive Warrants shall be issued in such names as the Depositary shall
instruct the Warrant Agent in writing. Global Warrants also may be exchanged or
replaced, in whole or in part, as provided in Sections 3.6 and 3.7 hereof. A
Global Warrant may not be exchanged for another Warrant other than as provided
in this Section 3.5(a), however, beneficial interests in a Global Warrant may be
transferred and exchanged as provided in Section 3.5(b) or (c) hereof.
(b) Transfer and Exchange of Beneficial Interests in the Global
Warrants.
The transfer and exchange of beneficial interests in the Global
Warrants shall be effected through the Depositary, in accordance with the
provisions of this Warrant Agreement and the Applicable Procedures. Beneficial
interests in the Restricted Global Warrants shall be subject to restrictions on
transfer comparable to those set forth herein to the extent required by the
Securities Act. Transfers of beneficial interests in the Global Warrants also
shall require compliance with either subparagraph (i) or (ii) below, as
applicable, as well as one or more of the other following subparagraphs, as
applicable:
(i) Transfer of Beneficial Interests in the Same Global Warrant.
Beneficial interests in any Restricted Global Warrant may be transferred to
Persons who take delivery thereof in the form of a beneficial interest in
the same Restricted Global Warrant in accordance with the transfer
restrictions set forth in the Private Placement Legend. Beneficial
interests in any Unrestricted Global Warrant may be delivered to persons
who take delivery thereof in the form of a beneficial interest in an
Unrestricted Global Warrant. No written orders or instructions shall be
required to be delivered to the Warrant Registrar to effect the transfers
described in this Section 3.5(b)(i).
(ii) All Other Transfers and Exchanges of Beneficial Interests in
Global Warrants. In connection with all transfers and exchanges of
beneficial interests that are not subject to Section 3.5(b)(i) above, the
transferor of such beneficial interest must deliver to the Warrant
Registrar either (A) (1) a written order from a Participant or an Indirect
Participant given to the Depositary in accordance with the Applicable
Procedures directing the Depositary to credit or cause to be credited a
beneficial interest in another Global Warrant in an amount equal to the
beneficial interest to be transferred or exchanged and (2) instructions
given in accordance with the Applicable Procedures containing information
regarding the Participant account to be credited with such increase or (B)
(1) a written order from a Participant or an Indirect Participant given to
the Depositary in accordance with the Applicable Procedures directing the
Depositary to cause to be issued a Definitive Warrant in an amount equal to
the beneficial interest to be transferred or exchanged and (2) instructions
given by the Depositary to the Warrant Registrar containing information
regarding the Person in whose name such Definitive Warrant shall be
registered. Upon effectiveness of the Registration Statement by the
Company in accordance with Section 3.5(f) hereof, the requirements of this
Section 3.5(b)(ii) shall be deemed to have been
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satisfied upon receipt by the Warrant Registrar of a certification required
by the Company in connection with such Registration Statement delivered by
the Holder of such beneficial interests in the Restricted Global Warrants.
Upon satisfaction of all of the requirements for transfer or exchange of
beneficial interests in Global Warrants contained in this Agreement and the
Warrants or otherwise applicable under the Securities Act, the Warrant
Agent shall adjust the principal amount of the relevant Global Warrant(s)
pursuant to Section 3.5(g) hereof.
(iii) Transfer of Beneficial Interests to Another Restricted
Global Warrant. A beneficial interest in any Restricted Global Warrant may
be transferred to a Person who takes delivery thereof in the form of a
beneficial interest in another Restricted Global Warrant if the transfer
complies with the requirements of Section 3.5(b)(ii) above and the Warrant
Registrar receives the following:
(A) if the transferee will take delivery in the form of a
beneficial interest in the 000X Xxxxxx Xxxxxxx, then the transferor
must deliver a certificate in the form of Exhibit B hereto, including
the certifications in item (1) thereof; and
(B) if the transferee will take delivery in the form of a
beneficial interest in the Regulation S Global Warrant, then the
transferor must deliver a certificate in the form of Exhibit B hereto,
including the certifications in item (2) thereof.
(iv) Transfer and Exchange of Beneficial Interests in a
Restricted Global Warrant for Beneficial Interests in the Unrestricted
Global Warrant. A beneficial interest in any Restricted Global Warrant may
be exchanged by any holder thereof for a beneficial interest in an
Unrestricted Global Warrant or transferred to a Person who takes delivery
thereof in the form of a beneficial interest in an Unrestricted Global
Warrant if the exchange or transfer complies with the requirements of
Section 3.5(b)(ii) above and:
(A) such transfer is effected pursuant to a Registration
Statement in accordance with this Agreement; or
(B) the Warrant Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Warrant proposes to exchange such beneficial
interest for a beneficial interest in an Unrestricted Global
Warrant, a certificate from such holder in the form of Exhibit C
hereto, including the certifications in item (1)(a) thereof; or
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(2) if the holder of such beneficial interest in a
Restricted Global Warrant proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Warrant, a
certificate from such holder in the form of Exhibit B hereto,
including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (B), if the Warrant
Registrar so requests or if the Applicable Procedures so require, an
Opinion of Counsel in form reasonably acceptable to the Warrant Registrar
to the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and
in the Private Placement Legend are no longer required in order to maintain
compliance with the Securities Act.
If any such transfer is effected pursuant to subparagraph (B) above at a
time when an Unrestricted Global Warrant has not yet been issued, the Company
shall issue and, upon receipt of an Warrant Countersignature Order in accordance
with Section 3.2 hereof, the Warrant Agent shall countersign one or more
Unrestricted Global Warrants in the number equal to the number of beneficial
interests transferred pursuant to subparagraph (B) above.
(c) Transfer and Exchange of Beneficial Interests for Definitive
Warrants.
(i) Beneficial Interests in Restricted Global Warrants to
Restricted Definitive Warrants. If any holder of a beneficial interest in
a Restricted Global Warrant proposes to exchange such beneficial interest
for a Restricted Definitive Warrant or to transfer such beneficial interest
to a Person who takes delivery thereof in the form of a Restricted
Definitive Warrant, then, upon receipt by the Warrant Registrar of the
following documentation:
(A) if the holder of such beneficial interest in a
Restricted Global Warrant proposes to exchange such beneficial
interest for a Restricted Definitive Warrant, a certificate from such
holder in the form of Exhibit C hereto, including the certifications
in item (2)(a) thereof;
(B) if such beneficial interest is being transferred to a
QIB in accordance with Rule 144A under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (1) thereof;
(C) if such beneficial interest is being transferred to a
Non-U.S. Person in an offshore transaction in accordance with Rule 903
or Rule 904 under the Securities Act, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (2)
thereof;
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(D) if such beneficial interest is being transferred
pursuant to an exemption from the registration requirements of the
Securities Act in accordance with Rule 144 under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(a) thereof;
(E) if such beneficial interest is being transferred to an
Institutional Accredited Investor in reliance on an exemption from the
registration requirements of the Securities Act other than those
listed in subparagraphs (B) through (D) above, a certificate to the
effect set forth in Exhibit B hereto, including the certifications,
certificates and Opinion of Counsel required by item (3) thereof, if
applicable;
(F) if such beneficial interest is being transferred to the
Company or any of its Subsidiaries, a certificate to the effect set
forth in Exhibit B hereto, including the certifications in item (3)(b)
thereof; or
(G) if such beneficial interest is being transferred
pursuant to an effective registration statement under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (3)(c) thereof,
and written notice of such receipt is given to the Warrant Agent shall cause, in
accordance with the standing instructions and procedures existing between the
Depositary and the Warrant Agent, the number of Warrants represented by the
Global Warrant to be reduced by the number of Warrants to be represented by the
Definitive Warrant pursuant to Section 3.5(h) hereof, and the Company shall
execute and the Warrant Agent pursuant to Section 3.2 hereof shall countersign
and deliver to the Person designated in the instructions a Definitive Warrant in
the appropriate amount. Any Definitive Warrant issued in exchange for a
beneficial interest in a Restricted Global Warrant pursuant to this Section
3.5(c) shall be registered in such name or names as the holder of such
beneficial interest shall instruct the Warrant Registrar through written
instructions from the Depositary and the Participant or Indirect Participant.
The Warrant Agent shall deliver such Definitive Warrants to the Persons in whose
names such Warrants are so registered. Any Definitive Warrant issued in
exchange for a beneficial interest in a Restricted Global Warrant pursuant to
this Section 3.5(c)(i) shall bear the Private Placement Legend and shall be
subject to all restrictions on transfer contained therein.
(ii) Beneficial Interests in Restricted Global Warrants to
Unrestricted Definitive Warrants. A Holder of a beneficial interest in a
Restricted Global Warrant may exchange such beneficial interest for an
Unrestricted Definitive Warrant or may transfer such beneficial interest to
a Person who takes delivery thereof in the form of an Unrestricted
Definitive Warrant only if:
12
(A) such transfer is effected pursuant to the Registration
Statement in accordance with the Warrant Registration Rights
Agreement; or
(B) the Warrant Registrar receives the following:
(1) if the holder of such beneficial interest in a
Restricted Global Warrant proposes to exchange such beneficial
interest for a Definitive Warrant that does not bear the Private
Placement Legend, a certificate from such holder in the form of
Exhibit C hereto, including the certifications in item (1)(b)
thereof; or
(2) if the holder of such beneficial interest in a
Restricted Global Warrant proposes to transfer such beneficial
interest to a Person who shall take delivery thereof in the form
of a Definitive Warrant that does not bear the Private Placement
Legend, a certificate from such holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (B), if the
Warrant Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to the
Warrant Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the Securities
Act.
(iii) Beneficial Interests in Unrestricted Global Warrants to
Unrestricted Definitive Warrants. If any Holder of a beneficial interest
in an Unrestricted Global Warrant proposes to exchange such beneficial
interest for a Definitive Warrant or to transfer such beneficial interest
to a Person who takes delivery thereof in the form of a Definitive Warrant,
then, upon satisfaction of the conditions set forth in Section 3.5(b)(ii)
hereof, the Warrant Agent shall cause the amount of the applicable Global
Warrant to be reduced accordingly pursuant to Section 3.5(h) hereof, and
the Company shall execute and the Warrant Agent shall countersign and
deliver to the Person designated in the instructions a Definitive Warrant
in the appropriate principal amount. Any Definitive Warrant issued in
exchange for a beneficial interest pursuant to this Section 3.5(c)(iii)
shall be registered in such name or names and in such authorized
denomination or denominations as the holder of such beneficial interest
shall instruct the Warrant Registrar through written instructions from the
Depositary and the Participant or Indirect Participant. The Warrant Agent
shall deliver such Definitive Warrants to the Persons in whose names such
Warrants are so registered. Any Definitive Warrant issued in exchange for
a beneficial interest pursuant to this Section 3.5(c)(iii) shall not bear
the Private Placement Legend.
(d) Transfer and Exchange of Definitive Warrants for Beneficial
Interests.
13
(i) Restricted Definitive Warrants to Beneficial Interests in
Restricted Global Warrants. If any Holder of a Restricted Definitive
Warrant proposes to exchange such Warrant for a beneficial interest in a
Restricted Global Warrant or to transfer such Restricted Definitive
Warrants to a Person who takes delivery thereof in the form of a beneficial
interest in a Restricted Global Warrant, then, upon receipt by the Warrant
Registrar of the following documentation:
(A) if the Holder of such Restricted Definitive Warrant
proposes to exchange such Warrant for a beneficial interest in a
Restricted Global Warrant, a certificate from such Holder in the form
of Exhibit C hereto, including the certifications in item (2)(b)
thereof;
(B) if such Restricted Definitive Warrant is being
transferred to a QIB in accordance with Rule 144A under the Securities
Act, a certificate to the effect set forth in Exhibit B hereto,
including the certifications in item (1) thereof;
(C) if such Restricted Definitive Warrant is being
transferred to a Non-U.S. Person in an offshore transaction in
accordance with Rule 903 or Rule 904 under the Securities Act, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications in item (2) thereof;
(D) if such Restricted Definitive Warrant is being
transferred pursuant to an exemption from the registration
requirements of the Securities Act in accordance with Rule 144 under
the Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(a) thereof;
(E) if such Restricted Definitive Warrant is being
transferred to an Institutional Accredited Investor in reliance on an
exemption from the registration requirements of the Securities Act
other than those listed in subparagraphs (B) through (D) above, a
certificate to the effect set forth in Exhibit B hereto, including the
certifications, certificates and Opinion of Counsel required by item
(3) thereof, if applicable;
(F) if such Restricted Definitive Warrant is being
transferred to the Company or any of its Subsidiaries, a certificate
to the effect set forth in Exhibit B hereto, including the
certifications in item (3)(b) thereof; or
(G) if such Restricted Definitive Warrant is being
transferred pursuant to an effective registration statement under the
Securities Act, a certificate to the effect set forth in Exhibit B
hereto, including the certifications in item (3)(c) thereof,
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and written notice of such receipt is given to the Warrant Agent, the
Warrant Agent shall cancel the Restricted Definitive Warrant, increase or
cause to be increased the amount of the appropriate Restricted Global
Warrant.
(ii) Restricted Definitive Warrants to Beneficial Interests in
Unrestricted Global Warrants. A Holder of a Restricted Definitive Warrant
may exchange such Warrant for a beneficial interest in an Unrestricted
Global Warrant or transfer such Restricted Definitive Warrant to a Person
who takes delivery thereof in the form of a beneficial interest in an
Unrestricted Global Warrant only if:
(A) such transfer is effected pursuant to the Registration
Statement in accordance with this Agreement; or
(B) the Warrant Registrar receives the following:
(1) if the Holder of such Definitive Warrants proposes
to exchange such Warrants for a beneficial interest in the
Unrestricted Global Warrant, a certificate from such Holder in
the form of Exhibit C hereto, including the certifications in
item (1)(c) thereof; or
(2) if the Holder of such Definitive Warrants proposes
to transfer such Warrants to a Person who shall take delivery
thereof in the form of a beneficial interest in the Unrestricted
Global Warrant, a certificate from such Holder in the form of
Exhibit B hereto, including the certifications in item (4)
thereof;
and, in each such case set forth in this subparagraph (D), if the
Warrant Registrar so requests or if the Applicable Procedures so
require, an Opinion of Counsel in form reasonably acceptable to the
Warrant Registrar to the effect that such exchange or transfer is in
compliance with the Securities Act and that the restrictions on
transfer contained herein and in the Private Placement Legend are no
longer required in order to maintain compliance with the Securities
Act.
Upon satisfaction of the conditions of any of the subparagraphs in this
Section 3.5(d)(ii), the Warrant Agent shall cancel the Definitive Warrants
and increase or cause to be increased the aggregate principal amount of the
Unrestricted Global Warrant.
(iii) Unrestricted Definitive Warrants to Beneficial
Interests in Unrestricted Global Warrants. A Holder of an Unrestricted
Definitive Warrant may exchange such Warrant for a beneficial interest in
an Unrestricted Global Warrant or transfer such Definitive Warrants to a
Person who takes delivery thereof in the form of a beneficial
15
interest in an Unrestricted Global Warrant at any time. Upon receipt of a
written request for such an exchange or transfer from the Holder, the
Warrant Agent shall cancel the applicable Unrestricted Definitive Warrant
and increase or cause to be increased the amount of one of the Unrestricted
Global Warrants.
If any such exchange or transfer from a Definitive Warrant to a beneficial
interest is effected pursuant to subparagraphs (ii)(B) or (iii) above at a
time when an Unrestricted Global Warrant has not yet been issued, the
Company shall issue and, upon receipt of an Warrant Countersignature Order
in accordance with Section 3.2 hereof, the Warrant Agent shall countersign
one or more Unrestricted Global Warrants in the number equal to the number
of beneficial interests of Definitive Warrants so transferred.
(e) Transfer and Exchange of Definitive Warrants for Definitive
Warrants.
Upon written request by a Holder of Definitive Warrants and such
Holder's compliance with the provisions of this Section 3.5(e), the Warrant
Registrar shall register the transfer or exchange of Definitive Warrants. Prior
to such registration of transfer or exchange, the requesting Holder shall
present or surrender to the Warrant Registrar the Definitive Warrants duly
endorsed or accompanied by a written instruction of transfer in form
satisfactory to the Warrant Registrar duly executed by such Holder or by its
attorney, duly authorized in writing. In addition, the requesting Holder shall
provide any additional certifications, documents and information, as applicable,
required pursuant to the following provisions of this Section 3.5(e).
(i) Restricted Definitive Warrants to Restricted Definitive
Warrants. Any Restricted Definitive Warrant may be transferred to and
registered in the name of Persons who take delivery thereof in the form of
a Restricted Definitive Warrant if the Warrant Registrar receives the
following:
(A) if the transfer will be made pursuant to Rule 144A under
the Securities Act, then the transferor must deliver a certificate in
the form of Exhibit B hereto, including the certifications in item (1)
thereof;
(B) if the transfer will be made pursuant to Rule 903 or
Rule 904, then the transferor must deliver a certificate in the form
of Exhibit B hereto, including the certifications in item (2) thereof;
or
(C) if the transfer will be made pursuant to any other
exemption from the registration requirements of the Securities Act,
then the transferor must deliver a certificate in the form of Exhibit
B hereto, including the certifications, certificates and Opinion of
Counsel required by item (3) thereof, if applicable.
16
(ii) Restricted Definitive Warrants to Unrestricted Definitive
Warrants. Any Restricted Definitive Warrant may be exchanged by the Holder
thereof for an Unrestricted Definitive Warrant or transferred to a Person
or Persons who take delivery thereof in the form of an Unrestricted
Definitive Warrant if:
(A) any such transfer is effected pursuant to the
Registration Statement in accordance with the Warrant Registration
Rights Agreement; or
(B) the Warrant Registrar receives the following:
(1) if the Holder of such Restricted Definitive
Warrants proposes to exchange such Warrants for an Unrestricted
Definitive Warrant, a certificate from such Holder in the form of
Exhibit C hereto, including the certifications in item (1)(d)
thereof; or
(2) if the Holder of such Restricted Definitive
Warrants proposes to transfer such Warrants to a Person who shall
take delivery thereof in the form of an Unrestricted Definitive
Warrant, a certificate from such Holder in the form of Exhibit B
hereto, including the certifications in item (4) thereof;
and, in each such case set forth in this subparagraph (B), if the
Warrant Registrar so requests, an Opinion of Counsel in form
reasonably acceptable to the Company to the effect that such exchange
or transfer is in compliance with the Securities Act and that the
restrictions on transfer contained herein and in the Private Placement
Legend are no longer required in order to maintain compliance with the
Securities Act.
(iii) Unrestricted Definitive Warrants to Unrestricted
Definitive Warrants. A Holder of Unrestricted Definitive Warrants may
transfer such Warrants to a Person who takes delivery thereof in the form
of an Unrestricted Definitive Warrant. Upon receipt of a written request to
register such a transfer, the Warrant Registrar shall register the
Unrestricted Definitive Warrants pursuant to the instructions from the
Holder thereof.
(f) Registration Statement.
Upon the effectiveness of a Registration Statement and sales of
Warrants in connection therewith, the Company shall issue and, upon receipt of a
Warrant Countersignature Order in accordance with Section 3.2, the Warrant Agent
shall countersign (i) one or more Unrestricted Global Warrants in an amount
equal to the amount of the beneficial interests in the Restricted Global
Warrants sold under such Registration Statement and (ii) Definitive Warrants in
an amount equal to the amount of the beneficial interests of the Restricted
Definitive Warrants sold under such Registration Statement. Concurrently with
the issuance of such Warrants, the Warrant
17
Agent shall cause the amount of the applicable Restricted Global Warrants to be
reduced accordingly, and the Company shall execute and the Warrant Agent shall
countersign and deliver to the Persons designated by the Holders of Definitive
Warrants so accepted Definitive Warrants in the appropriate amount.
(g) Legends.
The following legends shall appear on the face of all Global Warrants
and Definitive Warrants issued under this Warrant Agreement unless specifically
stated otherwise in the applicable provisions of this Warrant Agreement.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each
Global Warrant and each Definitive Warrant (and all Warrants issued in
exchange therefor or substitution thereof) shall bear the legend in
substantially the following form:
"THIS SECURITY (OR ITS PREDECESSOR) AND THE WARRANT SHARES TO BE
ISSUED UPON ITS EXERCISE HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT
BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES
OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH
IN THE NEXT SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST
HEREIN, THE HOLDER:
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"), (B) IT HAS
ACQUIRED THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH
REGULATION S UNDER THE SECURITIES ACT OR (C) IT IS AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A)(1),(2), (3) OR (7) OF
REGULATION D UNDER THE SECURITIES ACT) (AN "IAI"),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY
EXCEPT (A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR
FOR THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A, (C) IN AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903
OR 904 OF THE SECURITIES ACT, (D) IN A TRANSACTION MEETING THE REQUIREMENTS
OF RULE 144 UNDER THE SECURITIES ACT, (E) TO AN INSTITUTIONAL ACCREDITED
INVESTOR THAT, PRIOR TO SUCH TRANSFER,
18
FURNISHES THE WARRANT AGENT A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS SECURITY
(THE FORM OF WHICH CAN BE OBTAINED FROM THE WARRANT AGENT) AND, IF SUCH
TRANSFER IS IN RESPECT OF AN AGGREGATE PRINCIPAL AMOUNT OF SECURITY LESS
THAN $250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH
TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (F) IN ACCORDANCE WITH
ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
(AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY) OR (G)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN
ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY OTHER APPLICABLE JURISDICTION,
(3) AGREES NOT TO ENGAGE IN HEDGING TRANSACTIONS UNLESS IN COMPLIANCE
WITH THE SECURITIES ACT AND
(4) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY
OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT
OF THIS LEGEND.
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES"
HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE
SECURITIES ACT. THE WARRANT AGREEMENT CONTAINS A PROVISION REQUIRING THE
WARRANT AGENT TO REFUSE TO REGISTER ANY TRANSFER OF THIS SECURITY IN
VIOLATION OF THE FOREGOING.
(B) Notwithstanding the foregoing, any Global Warrant or
Definitive Warrant issued pursuant to subparagraphs (b)(iv), (c)(ii),
(c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this Section
3.5 (and all Warrants issued in exchange therefor or substitution
thereof) shall not bear the Private Placement Legend.
(ii) Global Warrant Legend. Each Global Warrant shall bear a
legend in substantially the following form:
"THIS GLOBAL WARRANT IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
WARRANT AGREEMENT GOVERNING THIS WARRANT) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY
PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE WARRANT AGENT MAY MAKE
SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 3.5 OF THE
WARRANT AGREEMENT, (II) THIS GLOBAL WARRANT MAY BE
19
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 3.5(a) OF THE
WARRANT AGREEMENT, (III) THIS GLOBAL WARRANT MAY BE DELIVERED TO THE
WARRANT AGENT FOR CANCELLATION PURSUANT TO SECTION 3.8 OF THE WARRANT
AGREEMENT AND (IV) THIS GLOBAL WARRANT MAY BE TRANSFERRED TO A SUCCESSOR
DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY."
(iii) Unit Legend. Each Warrant issued prior to the Separation
Date shall bear a legend in substantially the following form:
"THE WARRANTS EVIDENCED BY THIS CERTIFICATE ARE INITIALLY ISSUED
AS PART OF AN ISSUANCE OF UNITS (THE "UNITS"), EACH OF WHICH CONSISTS OF
$1,000 PRINCIPAL AMOUNT AT MATURITY OF THE 14% SENIOR DISCOUNT NOTES DUE
2010 OF iPCS, INC. (THE "NOTES") AND WARRANTS (THE "WARRANTS") EACH
INITIALLY ENTITLING THE HOLDER THEREOF TO PURCHASE 9.94233 SHARES OF COMMON
STOCK, PAR VALUE $.01 PER SHARE, OF THE COMPANY.
"PRIOR TO THE EARLIEST OF (I) 180 DAYS AFTER THE CLOSING OF THE
OFFERING OF THE UNITS, (II) THE DATE ON WHICH A REGISTRATION STATEMENT WITH
RESPECT TO A REGISTERED EXCHANGE OFFER FOR THE NOTES IS DECLARED EFFECTIVE
UNDER THE ACT, (III) THE DATE A SHELF REGISTRATION STATEMENT WITH RESPECT
TO THE NOTES IS DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (IV) THE
OCCURRENCE OF A CHANGE OF CONTROL OR AN EVENT OF DEFAULT (EACH AS DEFINED
IN THE INDENTURE GOVERNING THE NOTES) AND (V) SUCH DATE AS XXXXXXXXX,
XXXXXX & XXXXXXXX SECURITIES CORPORATION IN ITS SOLE DISCRETION SHALL
DETERMINE UPON NOTICE TO THE COMPANY, THE WARRANTS EVIDENCED BY THIS
CERTIFICATE MAY NOT BE TRANSFERRED OR EXCHANGED SEPARATELY FROM, BUT MAY BE
TRANSFERRED OR EXCHANGED ONLY TOGETHER WITH, THE NOTES."
(iv) Regulation S. Legend. Each Warrant that is a Registrable
Security and issued pursuant to Regulation S shall bear the following
legend on the fact thereof:
"THIS WARRANT AND THE SECURITIES TO BE ISSUED UPON ITS EXERCISE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT AND THE WARRANT MAY NOT
BE EXERCISED BY OR ON BEHALF OF ANY U.S. PERSON UNLESS REGISTERED UNDER THE
U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") OR AN
EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE. IN ORDER TO EXERCISE THIS
WARRANT, THE HOLDER MUST FURNISH TO THE COMPANY AND THE WARRANT AGENT
EITHER (A) A WRITTEN CERTIFICATION THAT IT IS NOT A U.S. PERSON AND
20
THE WARRANT IS NOT BEING EXERCISED ON BEHALF OF A U.S. PERSON OR (B) A
WRITTEN OPINION OF COUNSEL TO THE EFFECT THAT THE SECURITIES DELIVERED UPON
EXERCISE OF THE WARRANT HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OR
THAT THE DELIVERY OF SUCH SECURITIES IS EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. TERMS IN THIS LEGEND HAVE THE MEANINGS
GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT."
(h) Cancellation and/or Adjustment of Global Warrants.
At such time as all beneficial interests in a particular Global
Warrant have been exercised or exchanged for Definitive Warrants or a particular
Global Warrant has been exercised, redeemed, repurchased or canceled in whole
and not in part, each such Global Warrant shall be returned to or retained and
canceled by the Warrant Agent in accordance with Section 3.8 hereof. At any time
prior to such cancellation, if any beneficial interest in a Global Warrant is
exercised or exchanged for or transferred to a Person who will take delivery
thereof in the form of a beneficial interest in another Global Warrant or for
Definitive Warrants, the amount of Warrants represented by such Global Warrant
shall be reduced accordingly and an endorsement shall be made on such Global
Warrant by the Warrant Agent or by the Depositary at the written direction of
the Depositary to reflect such reduction; and if the beneficial interest is
being exchanged for or transferred to a Person who will take delivery thereof in
the form of a beneficial interest in another Global Warrant, such other Global
Warrant shall be increased accordingly and an endorsement shall be made on such
Global Warrant by the Warrant Agent or by the Depositary at the written
direction of the Depositary to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Warrant Agent shall countersign Global
Warrants and Definitive Warrants upon the Company's written order.
(ii) No service charge shall be made to a holder of a
beneficial interest in a Global Warrant or to a holder of a Definitive
Warrant for any registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any transfer tax or similar
governmental charge payable in connection therewith.
(iii) All Global Warrants and Definitive Warrants issued upon
any registration of transfer or exchange of Global Warrants or Definitive
Warrants shall be the duly authorized, executed and issued warrants for
Common Stock of the Company, not subject to any preemptive rights, and
entitled to the same benefits under this Warrant Agreement, as the Global
Warrants or Definitive Warrants surrendered upon such registration of
transfer or exchange.
21
(iv) Prior to due presentment for the registration of a
transfer of any Warrant, the Warrant Agent and the Company may deem and
treat the Person in whose name any Warrant is registered as the absolute
owner of such Warrant for all purposes and neither the Warrant Agent nor
the Company shall be affected by notice to the contrary.
(v) The Warrant Agent shall countersign Global Warrants and
Definitive Warrants in accordance with the provisions of Section 3.2
hereof.
(j) Facsimile Submissions to Warrant Agent.
All certifications, certificates and Opinions of Counsel required to
be submitted to the Warrant Registrar pursuant to this Section 3.5 to effect a
registration of transfer or exchange may be submitted by facsimile with the
original to follow immediately thereafter.
The Warrant Registrar shall not be liable or responsible for
confirming the truth or accuracy of representations made in any such
certifications or certificates. As to any Opinions of Counsel delivered
pursuant to this Section 3.5, the Warrant Registrar may rely conclusively upon,
and be fully protected in relying upon, such opinions.
3.6 Replacement Warrants.
If any mutilated Warrant is surrendered to the Warrant Agent or the
Company and the Warrant Agent receives evidence to its satisfaction of the
destruction, loss or theft of any Warrant, together with an indemnity bond
supplied by the Holder that is sufficient in the judgment of the Warrant Agent
and the Company to protect the Company, the Warrant Agent, and any agent for
purposes of the countersignature from any loss that any of them may suffer if a
Warrant is replaced, the Company shall issue and the Warrant Agent, upon receipt
of a Warrant Countersignature Order, shall countersign a replacement Warrant if
the Warrant Agent's requirements are met. The Company may charge for its
expenses in replacing a Warrant.
Every replacement Warrant is an additional warrant of the Company and
shall be entitled to all of the benefits of this Warrant Agreement equally and
proportionately with all other Warrants duly issued hereunder.
3.7 Temporary Warrants.
Until certificates representing Warrants are ready for delivery, the
Company may prepare and the Warrant Agent, upon receipt of a Warrant
Countersignature Order, shall issue temporary Warrants. Temporary Warrants
shall be substantially in the form of certificated Warrants but may have
variations that the Company considers appropriate for temporary Warrants and as
shall be reasonably acceptable to the Warrant Agent. Without unreasonable
delay, the Company shall prepare and the Warrant Agent shall countersign
definitive Warrants in exchange for temporary Warrants.
22
Holders of temporary Warrants shall be entitled to all of the benefits
of this Warrant Agreement.
3.8 Cancellation.
Subject to Section 3.5(h) hereof, the Company at any time may deliver
Warrants to the Warrant Agent, together with written instructions for any such
Warrants, for cancellation. The Warrant Registrar and Warrant Paying Agent
shall forward to the Warrant Agent any Warrants surrendered to them for
registration of transfer, exchange or exercise. The Warrant Agent and no one
else shall cancel all Warrants surrendered for registration of transfer,
exchange, exercise, replacement or cancellation and shall destroy canceled
Warrants (subject to the record retention requirement of the Exchange Act).
Certification of the destruction of all canceled Warrants shall be delivered to
the Company. The Company may not issue new Warrants to replace Warrants that
have been exercised or that have been delivered to the Warrant Agent for
cancellation.
SECTION 4. SEPARATION OF WARRANTS; TERMS OF WARRANTS; EXERCISE OF WARRANTS.
(a) The Notes and Warrants will not be separately transferable
until the Separation Date. Subject to the terms of this Agreement, each Holder
shall have the right, which may be exercised during the period commencing at the
opening of business on the Exercise Date and until 5:00 p.m., New York City time
on July 15, 2010 (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 (i) by tendering Notes having an aggregate principal amount at maturity,
plus accrued and unpaid interest, if any thereon to the date of exercise (or, if
such exercise takes place prior to July 15, 2005, an Accreted Value on the date
of exercise) or (ii) in cash, by wire transfer or by certified or official check
payable to the order of the Company, in each case, equal to 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 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. Each Warrant not exercised prior to 5:00 p.m., New York City
time, on July 15, 2010 (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) In order to exercise all or any of the Warrants represented
by a Warrant Certificate, the holder thereof must deliver to the Warrant Agent
at its office designated for such purposes set forth in Section 15 hereof the
Warrant Certificate and 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
23
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, by wire transfer or by
certified or official bank check payable to the order of the Company or (ii) by
tendering Notes in the manner provided in Section 4(a) hereof.
(c) Subject to the provisions of Section 5 hereof, upon compliance
with clause (b) above, 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 Holder may designate, a certificate or certificates
for the number of whole Warrant Shares issuable upon the exercise of such
Warrants, together with cash delivered by the Company in lieu of fractional
shares as provided in Section 9 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 8(m) hereof, or a tender offer or an exchange offer for
shares of Common Stock shall be made, upon such surrender of Warrants and
payment of the Exercise Price as aforesaid, the 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 9 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. If less than all
the Warrants represented by a Definitive Warrant are exercised, such Definitive
Warrant shall be surrendered and a new Definitive Warrant of the same tenor and
for the number of Warrants which were not exercised shall be executed by the
Company and delivered to the Warrant Agent and the Warrant Agent shall
countersign the new Definitive Warrant, registered in such name or names as may
be directed in writing by the Holder, and shall deliver the new Definitive
Warrant to the Person or Persons entitled to receive the same. The Warrant Agent
shall make such notations on the Schedule of Exchange of Interests of Global
Warrants to each Global Warrant as are required to reflect any change in the
number of Warrants represented by such Global Warrant resulting from any
exercise in accordance with the terms hereof.
(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
24
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 5. 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 and the Warrant Agent shall not be required to issue
or deliver any such Warrant Certificates unless or until the Person or Persons
requesting the issuance thereof shall have paid to the Company the amount of
such tax or shall have established to the satisfaction of the Company and the
Warrant Agent that such tax has been paid.
SECTION 6. 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 9 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
10 hereof.
(c) Before taking any action which would cause an adjustment
pursuant to Section 8 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.
25
(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.
SECTION 7. 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,
automated quotation systems or other markets within the United States of
America, if any, on which other shares of Common Stock are then listed, if any.
SECTION 8. 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 8. For purposes of this
Section 8, "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, in good faith, the allocation of the adjusted Exercise Price between
the classes of capital stock and notify the Warrant Agent of such determination.
After such allocation, the exercise privilege and the Exercise Price of each
class of capital stock shall thereafter be subject to adjustment
26
on terms comparable to those applicable to Common Stock in this Section 8. 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 45 days
after the record date mentioned below to purchase shares of Common Stock at a
price per share less than the Fair Value (as defined herein) per share on that
record date, the Exercise Price shall be adjusted in accordance with the
formula:
N x P
O+______
M
E' = E x ________
O + N
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
O = the number of shares of Common Stock outstanding on the
record date.
N = the number of additional shares of Common Stock issued
pursuant to such rights, options or warrants.
P = the aggregate price per share of the additional shares.
M = the Fair Value 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 of the Company, the Exercise Price shall be adjusted in accordance
with the formula:
27
M - F
E'= E x-----
M
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
M = the Fair Value per share of Common Stock on the record date
mentioned below.
F = the fair market value on the record date of the assets,
securities, rights or warrants to be distributed in respect
of one share of Common Stock as determined in good faith by
the Board of Directors of the Company (the "Board of
Directors").
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.
This Section 8(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 8(c) does not apply to rights,
options or warrants referred to in Section 8(b) hereof.
(d) Adjustment for Common Stock Issue.
If the Company issues shares of Common Stock for a consideration per
share less than the Fair Value per share on the date the Company fixes the
offering price of such additional shares, the Exercise Price shall be adjusted
in accordance with the formula:
O + P
--
M
E' = E x------
M
where:
E' = the adjusted Exercise Price.
E = the then current Exercise Price.
28
O = the number of shares outstanding immediately prior to the
issuance of such additional shares.
P = the aggregate consideration received for the issuance of
such additional shares.
M = the Fair Value per share on the date of issuance of such
additional shares.
A = the number of shares outstanding immediately after the
issuance of such additional shares.
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
This subsection (d) does not apply to:
(1) any of the transactions described in subsections
(a), (b) and (c) of this Section 8,
(2) the exercise of Warrants, or the conversion or
exchange of other securities convertible or exchangeable for
Common Stock the issuance of which caused an adjustment to be
made under Section 8(e),
(3) Common Stock issued to the Company's current or
former employees, directors or consultants (or employees,
directors or consultants of its subsidiaries) under bona fide
employee benefit plans adopted by the Board of Directors, if such
Common Stock would otherwise be covered by this subsection (d)
(but only to the extent that the aggregate number of shares
excluded hereby and issued after the date of this Warrant
Agreement, together with the number of shares issuable upon
conversion of the securities described in clause (e)(2) below,
shall not exceed 5% of the Common Stock outstanding at the time
of the adoption of each such plan, exclusive of anti-dilution
adjustments thereunder),
(4) Common Stock issued to shareholders of any person
which merges with the Company, or with a subsidiary of the
Company, in proportion to their stock holdings of such person
immediately prior to such merger, upon such merger, provided that
if such person is an Affiliate of the Company, the Board of
Directors shall have obtained a fairness opinion from a
nationally recognized investment banking, appraisal or valuation
firm, which is not an Affiliate of the Company, stating that the
consideration received in such merger is fair to the Company from
a financial point of view,
29
(5) the issuance of shares of Common Stock pursuant to
rights, options or warrants which were originally issued in a
Non-Affiliate Sale (as defined below) together with one or more
other securities as part of a unit at a price per unit,
(6) Common Stock issued upon the exercise of the
convertible securities described in the last paragraph of clause
(e) below, or
(7) Common Stock issued upon the conversion of the
Company's Series A-1 Preferred Stock and Series A-2 Preferred
Stock.
(e) Adjustment for Convertible Securities Issue.
If the Company issues any securities convertible into or exchangeable
for Common Stock (other than securities issued in transactions described in
subsections (b) and (c) of this Section 8) for a consideration per share of
Common Stock initially deliverable upon conversion or exchange of such
securities less than the Fair Value per share on the date of issuance of such
securities, the Exercise Price shall be adjusted in accordance with this
formula:
P
O + --
M
E' = E x ------
O + D
where:
E' = the adjusted Exercise Price.
E = the then current Exercise Price.
O = the number of shares outstanding immediately prior to the
issuance of such securities.
P = the aggregate consideration received for the issuance of
such securities.
M = the Fair Value per share on the date of issuance of such
securities.
D = the maximum number of shares deliverable upon conversion or
in exchange for such securities at the initial conversion or
exchange rate.
30
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
If all of the Common Stock deliverable upon conversion or exchange of
such securities have not been issued when such securities are no longer
outstanding, then the Exercise Price shall promptly be readjusted to the
Exercise Price which would then be in effect had the adjustment upon the
issuance of such securities been made on the basis of the actual number of
shares of Common Stock issued upon conversion or exchange of such securities.
This subsection (e) does not apply to:
(1) convertible securities issued to shareholders of
any person which merges with the Company, or with a subsidiary of
the Company, in proportion to their stock holdings of such person
immediately prior to such merger, upon such merger, provided that
if such Person is an Affiliate of the Company, the Board of
Directors shall have obtained a fairness opinion from a
nationally recognized investment banking, appraisal or valuation
firm, which is not an Affiliate of the Company, stating that the
consideration received in such merger is fair to the Company from
a financial point of view,
(2) convertible securities issued to current or former
employees, directors or consultants of iPCS under bona fide
employee benefit plans adopted by the Board of Directors (but
only to the extent the aggregate number of shares of Common Stock
to be issued upon the exercise of the convertible securities,
together with the number of shares issued pursuant to clause
(d)(3) above, shall not exceed 5% of the Common Stock outstanding
at the time of adoption of each such plan, exclusive of anti-
dilution adjustments thereunder),
(3) issuance of Series A-1 Preferred Stock and Series
A-2 Preferred Stock, including dividends thereon, and
(4) the issuance of warrants to purchase 1,151,938
shares of Common Stock to Sprint Spectrum L.P. or its designee
pursuant to the Warrant Agreement dated [.], 2000.
(f) Consideration Received.
For purposes of any computation respecting consideration received
pursuant to subsections (d), and (e) of this Section 8, the following shall
apply:
31
(i) in the case of the issuance of shares of Common Stock for
cash, the consideration shall be the amount of such cash, provided that in
no case shall any deduction be made for any commissions, discounts or other
expenses incurred by the Company for any underwriting of the issue or
otherwise in connection therewith;
(ii) in the case of the issuance of shares of Common Stock for
a consideration in whole or in part other than cash, the consideration
other than cash shall be deemed to be the fair market value thereof as
determined in good faith by the Board of Directors (irrespective of the
accounting treatment thereof), whose determination shall be conclusive for
all purposes, and described in a Board resolution which shall be filed with
the Warrant Agent;
(iii) in the case of the issuance of securities convertible into
or exchangeable for shares, the aggregate consideration received therefor
shall be deemed to be the consideration received by the Company for the
issuance of such securities plus the additional minimum consideration, if
any, to be received by the Company upon the conversion or exchange thereof
(the consideration in each case to be determined in the same manner as
provided in clauses (i) and (ii) of this subsection); and
(iv) in the case of the issuance of shares of Common Stock
pursuant to rights, options or warrants which rights, options or warrants
were originally issued together with one or more other securities as part
of a unit at a price per unit, the consideration shall be deemed to be the
fair value of such rights, options or warrants at the time of issuance
thereof as determined in good faith by the Board of Directors whose
determination shall be conclusive for all purposes and described in a Board
resolution which shall be filed with the Warrant Agent plus the additional
minimum consideration, if any, to be received by the Company upon the
exercise, conversion or exchange thereof (as determined in the same manner
as provided in clauses (i) and (ii) of this subsection).
(g) Fair Value.
In Sections 8(d) and (e) hereof, the "Fair Value" per security at any
date of determination shall be (1) in connection with a sale by the Company to a
party that is not an Affiliate of the Company in an arm's-length transaction (a
"Non-Affiliate Sale"), the price per security at which such security is sold and
(2) in connection with any sale by the Company to an Affiliate of the Company,
(a) the last price per security at which such security was sold in a Non-
Affiliate Sale within the three-month period preceding such date of
determination or (b) if clause (a) is not applicable, the fair market value of
such security determined in good faith by (i) a majority of the Board of
Directors, including a majority of the Disinterested Directors, and approved in
a Board resolution delivered to the Warrant Agent or (ii) a nationally
recognized investment banking, appraisal or valuation firm, which is not an
Affiliate of the Company, in each case, taking into account, among all other
factors deemed relevant by the Board of Directors or such investment banking,
appraisal or valuation firm, the trading price and volume of such security on
any national
32
securities exchange or automated quotation system on which such security is
traded. Notwithstanding the foregoing, any sale to Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation (or any successor thereto) pursuant to an underwritten
public offering registered under the Securities Act shall be deemed to be and
treated as a Non-Affiliate Sale.
In Sections 8(b) and (c) hereof, the "Fair Value" per security at any
date of determination shall be (a) the last price per security at which such
security was sold by the Company in a Non-Affiliate Sale within the three-month
period preceding such date of determination or (b) if clause (a) is not
applicable, the fair market value of such security determined in good faith by
(i) a majority of the Board of Directors, including a majority of the
Disinterested Directors, and approved in a Board resolution delivered to the
Warrant Agent or (ii) a nationally recognized investment banking, appraisal or
valuation firm, which is not an Affiliate of the Company, in each case, taking
into account, among all other factors deemed relevant by the Board of Directors
or such investment banking, appraisal or valuation firm, the trading price and
volume of such security on any national securities exchange or automated
quotation system on which such security is traded.
For purposes of this Section 8(g), "Disinterested Director" means, in
connection with any issuance of securities that gives rise to a determination of
the Fair Value thereof, each member of the Board of Directors who is not an
officer, employee, director or other Affiliate of the party to whom the Company
is proposing to issue the securities giving rise to such determination.
For purposes of this Section 8(g), "Affiliate" of any specified Person
means (A) any other Person directly or indirectly controlling or controlled by
or under direct or indirect common control with such specified Person and (B)
any director, officer or employee of such specified person. For purposes of
this definition "control" (including, with correlative meanings, the terms
"controlling," "controlled by" and "under common control with") as used with
respect to any Person, shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities, by agreement or
otherwise.
(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 8 shall be made
to the nearest cent or to the nearest 1/100th of a share, as the case may be, it
being understood that no such rounding shall be made under subsection (p).
(i) When No Adjustment Required.
No adjustment need be made for a transaction referred to Section 8(a),
(b), (c), (d), (e) or (f) hereof, if Warrant Holders are to participate (without
being required to exercise their Warrants) in the transaction on a basis and
with written notice that the Board of Directors determines
33
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, or (iii) the adoption of a plan commonly referred to as a
"Stockholders' Rights Plan" which provides for the issuance of rights to acquire
shares of capital stock upon the occurrence of some event that is not within the
control of the rights holders, or the issuance of rights under such plan;
provided that the issuance of capital stock pursuant to such rights shall
require adjustment to the Exercise Price and number of shares of Common Stock
purchasable upon the exercise of each Warrant as set forth in this Agreement. 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 10 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 and the Warrant Agent 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 Section 8(a), (b),
(c), (d), (e) and (f) 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 8(a), (b), (c), (d), (e) or (f) hereof
and if the Company does not arrange for Warrant Holders to participate pursuant
to Section 8(i) hereof, (ii) the Company takes any action that would require a
supplemental Warrant Agreement pursuant to Section 8(m) hereof or (iii) there is
a liquidation or dissolution of the Company, then the Company shall mail to
Warrant Holders and the Warrant Agent 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.
(m) Reorganization of Company.
Immediately after the date hereof, 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
34
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 with notice thereof to the Warrant Agent. 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 8(m). The successor Company shall mail to Warrant Holders and the
Warrant Agent a written 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 8(m) applies, Sections 8(a), (b), (c), (d),
(e) and (f) hereof do not apply.
(n) Company Determination Final.
Any determination that the Company or the Board of Directors must make
pursuant to Section 8(a), (c), (d), (e), (f), (g), (h) or (i) and any other
Section hereof is conclusive for all purposes and the Warrant Agent may assume
that the Board of Directors acted in good faith..
(o) Warrant Agent's Disclaimer.
The Warrant Agent has no duty to determine when an adjustment under
this Section 8 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 8(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 or
liable for the Company's failure to comply with this Section 8.
(p) When Issuance or Payment May Be Deferred.
In any case in which this Section 8 shall require that an adjustment
in the Exercise Price be made effective as of a record date for a specified
event, the Company may, with notice thereof to the Warrant Agent, 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 9 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.
35
(q) Adjustment in Number of Shares.
Upon each adjustment of the Exercise Price pursuant to this Section 8,
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:
E
N' = N X ---
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 9. 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 9, be issuable on the exercise of any Warrants
(or specified portion thereof), the Company shall pay an amount in cash equal to
the Fair Value 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.
36
SECTION 10. NOTICES TO WARRANT HOLDERS.
(a) Upon any adjustment of the Exercise Price pursuant to Section 8
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 for all purposes, and (ii) cause to
be given to each of the registered holders of Warrants at the address appearing
on the Warrant register for each such registered holder 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 10.
(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 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 or dividends
payable in shares of Common Stock or distributions referred to in Section
8(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 8(a) hereof) which would
require an adjustment of the Exercise Price pursuant to Section 8 hereof;
37
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 or her 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 10 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 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 11. MERGER, CONSOLIDATION OR CHANGE OF NAME OF WARRANT AGENT.
(a) Any Person into which the Warrant Agent may be merged or with
which it may be consolidated, or any Person resulting from any merger or
consolidation to which the Warrant Agent shall be a party, or any Person
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 Person
would be eligible for appointment as a successor warrant agent under the
provisions of Section 13 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,
38
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 12. WARRANT AGENT.
The Warrant Agent only undertakes the express 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
liability or responsibility for the correctness of any of the same. The Warrant
Agent assumes no liability or responsibility with respect to the distribution of
the Warrant Certificates except as herein otherwise provided.
(b) The Warrant Agent shall not be liable or 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 or to any other Person whatsoever in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
accordance with the opinion or the advice of such counsel.
(d) The Warrant Agent shall incur no liability or responsibility to
the Company or to any holder of any Warrant Certificate or to any other Person
whatsoever for any action taken, suffered or omitted in reliance on any Warrant
Certificate, certificate of shares, adjustments, determination, 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 (which shall include the reasonable fees and expenses of its
counsel) for all services rendered by the Warrant Agent in the execution,
administration, preparation, delivery and amendment 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, administration, preparation, delivery and amendment of this
Agreement. The Company shall indemnify the Warrant Agent against any and all
losses, liabilities, damage, judgment, fine, penalty charges, demand,
settlement, cost or expenses incurred by it arising out of or in connection with
the acceptance or administration of its duties under this Warrant Agreement,
including the costs and expenses of enforcing this Warrant Agreement against the
Company and defending itself against any claim
39
(whether asserted by the Company or any Holder or any other Person) or liability
in connection with the exercise or performance of any of its powers or duties
hereunder, except to the extent any such loss, liability or expense may be
attributable to its gross negligence or wilful misconduct, as finally determined
by a court of competent jurisdiction. The Company undertakes to comply with the
DTC Letter of Representations dated [.] executed by the Company and CIC Illinois
Trust Company, and to indemnify the Warrant Agent from any party's breach of a
representation, warranty or obligation thereunder. The indemnity provided in
this Agreement shall survive the termination of this Agreement and the
resignation or removal of the Warrant Agent. The costs and expenses incurred in
enforcing this right of indemnification shall be paid by the Company. Anything
to the contrary notwithstanding, in no event shall the Warrant Agent be liable
for special, punitive, indirect, consequential or incidental loss or damage of
any kind whatsoever (including but not limited to lost profits), even if the
Warrant Agent has been advised of the likelihood of such loss or damage. Any
liability of the Warrant Agent under this Agreement will be limited to the
amount of fees paid to the Warrant Agent hereunder. The Warrant Agent shall
notify the Company promptly of any claim for which it may seek indemnity.
Failure by the Warrant Agent to so notify the Company shall not relieve the
Company of its obligations hereunder. The Company shall defend the claim and the
Warrant Agent shall cooperate in the defense. The Warrant Agent may have
separate counsel and the Company shall pay the reasonable fees and expenses of
such counsel. The Company need not pay for any settlement made without its
consent, which consent shall not be unreasonably withheld.
(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 security and indemnity for any costs and expenses
which may be incurred through such legal proceedings, 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 Person.
(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 hereunder for anything which it may do or
refrain from doing in connection with this Agreement
40
except for its own gross negligence or bad faith as finally determined by a
court of competent jurisdiction.
(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 adjustments, or
with respect to the nature, extent or accuracy 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.
(j) The Warrant Agent is hereby authorized and directed to accept
instructions with respect to the performance of its duties hereunder from any
one of the President, any Vice President, the Treasurer or the Secretary of the
Company, and to apply to such officers for advice or instructions in connection
with its duties, and such instructions shall be full authorization and
protection to the Warrant Agent and the Warrant Agent shall not be liable for or
in respect of any action taken, suffered or omitted by it in good faith in
accordance with instructions of any such officer or for any delay in acting
while waiting for those instructions. The Warrant Agent shall be fully
authorized and protected in relying upon the most recent instructions received
by any such officer. Any application by the Warrant Agent for written
instructions from the Company may, at the option of the Warrant Agent, set forth
in writing any action proposed to be taken, suffered or omitted by the Warrant
Agent under this Agreement and the date on and/or after which such action shall
be taken or suffered or such omission shall be effective. The Warrant Agent
shall not be liable for any action taken or suffered by, or omission of, the
Warrant Agent in accordance with a proposal included in any such application on
or after the date specified in such application (which date shall not be less
than five Business Days after the date any officer of the Company actually
receives such application, unless any such officer shall have consented in
writing to an earlier date) unless, prior to taking any such action (or the
effective date in the case of an omission), the Warrant Agent shall have
received written instructions in response to such application specifying the
action to be taken, suffered or omitted.
(k) The Warrant Agent may execute and exercise any of the rights or
powers hereby vested in it or perform any duty hereunder either by itself
(through its directors, officers and employees) or by or through its attorneys
or agents, and the Warrant Agent shall not be answerable or accountable for any
act, default, neglect or misconduct of any such attorneys or agents or for any
loss to the Company or any other Person resulting for any such act, default,
neglect or misconduct, absent gross negligence, bad faith or willful misconduct,
as finally determined by a court of competent jurisdiction, in the selection and
continued employment thereof.
41
(l) No provision of this Agreement shall require the Warrant Agent to
expend or risk its own fund or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if
it believes that repayment of such funds or adequate indemnification against
such risk or liability is not reasonably assured to it.
(m) The Warrant Agent, in its capacity as Warrant Registrar, shall
have all the rights, powers, privileges, exculpation, protections, and
indemnities as are provided to the Warrant Agent under this Agreement.
SECTION 13. CHANGE OF WARRANT AGENT.
The Warrant Agent may resign as Warrant Agent at any time following 30
days written notice thereof to the Company. 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 13, however, or any defect therein, shall not affect the legality or
validity of the appointment of a successor to the Warrant Agent.
SECTION 14. REPORTS.
(a) Whether or not required by the rules and regulations of the
Commission, so long as any Warrants are outstanding, the Company shall furnish
to the Warrant Agent and 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
42
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 14.
SECTION 15. 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 received 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:
iPCS, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
Attention: President and Chief Financial Officer
With a copy to:
Xxxxx, Xxxxx & Xxxxx
000 Xxxxx XxXxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxx, Esq.
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 received 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:
ChaseMellon Shareholder Services, L.L.C.
00 Xxxxxxxxxx Xxxx
Xxxxxxxxxx Xxxx, Xxx Xxxxxx 00000
Attention: Xxxxxxx Xxxxx
SECTION 16. 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
43
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 an 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). Upon
receipt of a certificate from the appropriate officer of the Company which
states that the proposed supplement or amendment is in compliance with the terms
of this Section 16, and such supplement or amendment does not change the Warrant
Agent's duties, liabilities or obligations, the Warrant Agent shall execute such
supplement or amendment.
SECTION 17. 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 including, without
limitation and without the need for an express assignment, subsequent Holders.
SECTION 18. TERMINATION.
This Agreement shall terminate at 5:00 p.m., New York City time on
July 15, 2010. Notwithstanding the foregoing, this Agreement will terminate on
any earlier date if all Warrants have been exercised. The provisions of Section
12 shall survive such termination.
SECTION 19. 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 20. BENEFITS OF THIS AGREEMENT.
Nothing in this Agreement shall be construed to give to any Person
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. The Company agrees that
the Holders of the Warrants shall be third-party beneficiaries to the agreements
made hereunder by the Company and each Holder shall have the right to enforce
such agreements directly to the extent it deems enforcement necessary or
advisable to protect its rights hereunder.
44
SECTION 21. 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]
45
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.
iPCS, Inc.
By: /s/ Xxxxxxx X. Xxxxx
-----------------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: President and Chief Executive Officer
ChaseMellon Shareholder Services, L.L.C.,
as Warrant Agent
By: /s/ Xxxxxxx X. Xxxxxx
----------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
EXHIBIT A
[Form of Warrant Certificate]
[Face]
Unit Legend. Each Warrant issued prior to the Separation Date shall
bear the following legend (the "Unit Legend") on the face thereof:
THE WARRANTS EVIDENCED BY THIS CERTIFICATE ARE INITIALLY ISSUED AS PART OF AN
ISSUANCE OF UNITS (THE "UNITS"), EACH OF WHICH CONSIST OF $1,000 PRINCIPAL
AMOUNT AT MATURITY OF THE 14% SENIOR DISCOUNT NOTES DUE 2010 OF iPCS, INC. (THE
"NOTES") AND ONE WARRANT (THE "WARRANTS") INITIALLY ENTITLING THE HOLDER THEREOF
TO PURCHASE 9.94233 SHARES OF COMMON STOCK, PAR VALUE $.01 PER SHARE, OF iPCS,
INC.
PRIOR TO THE EARLIEST OF (I) 180 DAYS AFTER THE CLOSING OF THE OFFERING OF THE
UNITS, (II) THE DATE ON WHICH A REGISTRATION STATEMENT WITH RESPECT TO A
REGISTERED EXCHANGE OFFER FOR THE NOTES IS DECLARED EFFECTIVE UNDER THE ACT,
(III) THE DATE A SHELF REGISTRATION STATEMENT WITH RESPECT TO THE NOTES IS
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (IV) THE OCCURRENCE OF A CHANGE OF
CONTROL OR AN EVENT OF DEFAULT (EACH AS DEFINED IN THE INDENTURE GOVERNING THE
NOTES) AND (V) SUCH DATE AS XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
IN ITS SOLE DISCRETION SHALL DETERMINE UPON NOTICE TO THE COMPANY, THE WARRANTS
EVIDENCED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED OR EXCHANGED SEPARATELY
FROM, BUT MAY BE TRANSFERRED OR EXCHANGED ONLY TOGETHER WITH, THE NOTES.
[THIS GLOBAL WARRANT IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
WARRANT AGREEMENT GOVERNING THIS WARRANT) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY
PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE WARRANT AGENT MAY MAKE
SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 3.5 OF THE
WARRANT AGREEMENT, (II) THIS GLOBAL WARRANT MAY BE EXCHANGED IN WHOLE BUT
NOT IN PART PURSUANT TO SECTION 3.5(a) OF THE WARRANT AGREEMENT, (III) THIS
GLOBAL WARRANT MAY BE DELIVERED TO THE WARRANT AGENT FOR CANCELLATION
PURSUANT TO SECTION 3.8 OF THE WARRANT AGREEMENT AND (IV) THIS GLOBAL
WARRANT MAY BE TRANSFERRED
A-1
TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE
COMPANY.]/1/
Private Placement Legend: Each Warrant issued pursuant to an
exemption from the registration requirements of the Securities Act shall bear
the following legend (the "Private Placement Legend") on the face thereof:
THIS SECURITY (OR ITS PREDECESSOR) AND THE WARRANT SHARES TO BE ISSUED
UPON ITS EXERCISE HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR
THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE NEXT
SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE
HOLDER:
(1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"), (B) IT HAS ACQUIRED
THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER
THE SECURITIES ACT OR (C) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE 501(A)(1),(2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES
ACT (AN "IAI"),
(2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE TRANSFER THIS SECURITY
EXCEPT (A) TO THE COMPANY OR ANY OF ITS SUBSIDIARIES, (B) TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN
AN OFFSHORE TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR 904 OF THE
SECURITIES ACT, (D) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER
THE SECURITIES ACT, (E) TO AN IAI THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE
WARRANT AGENT A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS
RELATING TO THE TRANSFER OF THIS SECURITY (THE FORM OF WHICH CAN BE OBTAINED
FROM THE WARRANT AGENT) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGREEMENT
PRINCIPAL AMOUNT OF SECURITY LESS THAN $250,000, AN OPINION OF COUNSEL
ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE WITH THE
SECURITIES ACT, (F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON
_________________________
/1/This paragraph should be included only if the Warrant is issued in global
form.
A-2
AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY) OR (G) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE
JURISDICTION,
(3) AGREES NOT TO ENGAGE IN HEDGING TRANSACTIONS UNLESS IN COMPLIANCE
WITH THE SECURITIES ACT AND
(4) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SECURITY
OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND.
AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE THE
MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT.
THE WARRANT AGREEMENT CONTAINS A PROVISION REQUIRING THE WARRANT AGENT TO REFUSE
TO REGISTER ANY TRANSFER OF THIS SECURITY IN VIOLATION OF THE FOREGOING.
No. ___________ ___Warrants
CUSIP No. ________
A-3
Warrant Certificate
iPCS, INC.
This Warrant Certificate certifies that Cede & Co., or its registered
assigns, is the registered holder of Warrants expiring July 15, 2010 (the
"Warrants") to purchase Common Stock, par value $.01 (the "Common Stock"), of
iPCS, Inc., a Delaware corporation (the "Company"). Each Warrant entitles the
registered holder upon exercise at any time from 9:00 a.m. on July 15, 2001
referred to below (the "Exercise Date") until 5:00 p.m. New York City time on
July 15, 2010, to receive from the Company 9.94233 fully paid and nonassessable
shares of Common Stock (the "Warrant Shares") at the initial exercise price (the
"Exercise Price") of $5.50 per share payable upon surrender of this Warrant
Certificate and payment of the Exercise Price at the office of the Warrant
Agent, but only subject to the conditions set forth herein and in the Warrant
Agreement referred to on the reverse hereof. 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
July 15, 2010, 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 unless countersigned by
the Warrant Agent, as such term is used in the Warrant Agreement.
This Warrant Certificate shall be governed by and construed in
accordance with the internal laws of the State of New York.
A-4
IN WITNESS WHEREOF, iPCS, Inc. has caused this Warrant Certificate to
be signed below.
Dated: [.], 2000
iPCS, Inc.
By:___________________________________
Name:
Title:
Countersigned:
ChaseMellon Shareholder Services, L.L.C.
as Warrant Agent
By: _____________________________________
Authorized Signature
[Reverse of Warrant Certificate]
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants expiring at 5:00 p.m. New York City time on July
15, 2010 entitling the holder on exercise to receive shares of Common Stock, and
are issued or to be issued pursuant to a Warrant Agreement dated as of July 12,
2000 (the "Warrant Agreement"), duly executed and delivered by the Company to
ChaseMellon Shareholder Services, L.L.C., a New Jersey limited liability
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 the Exercise Date
and on or before 5:00 p.m. New York City time on July 15, 2010; provided that
holders shall be able to exercise their Warrants only if a Registration
Statement relating to the exercise of the Warrants is then in 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. In order to exercise all or any of the
Warrants represented by this Warrant Certificate, the holder must deliver to the
Warrant Agent at its office designated for such purpose this Warrant Certificate
and the form of election to purchase on the reverse hereof 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, as adjusted as provided in the Warrant Agreement, for the
number of Warrant Shares in respect of which such Warrants are then 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.
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
A-6
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 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-7
[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 iPCS,
Inc., in the amount of $__________ in accordance with the terms hereof. 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 ____________________.
________________________________________
Signature
Date:
________________________________________
Signature Guaranteed
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Warrant Agent, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Warrant Agent in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
SCHEDULE OF EXCHANGES OF INTERESTS
OF GLOBAL WARRANTS/2/
The following exchanges of a part of this Global Warrant have been made:
Amount of
decrease in Amount of
Number of increase in Number of Signature of
warrants in Number of Warrants in this Global authorized
Date of this Global Warrants in this Warrant following such officer of
Exchange Warrant Global Warrant decrease or increase Warrant Agent
--------------------------------------------------------------------------------
____________________
/2/ To be included only on Global Warrants.
A-9
EXHIBIT B
[Form of Unit Certificate]
NO. _____ CUSIP NO. ________
iPCS, Inc.
[GUARANTORS]
__________ UNITS
[THIS GLOBAL UNIT IS COMPOSED OF THE ATTACHED GLOBAL SENIOR DISCOUNT
NOTE AND GLOBAL WARRANT CERTIFICATE. THE GLOBAL UNIT, THE GLOBAL SENIOR
SUBORDINATED DISCOUNT NOTE AND THE GLOBAL WARRANT CERTIFICATE ARE COLLECTIVELY
REFERRED TO HEREIN AS THE "SECURITIES."]/1/
----------
THIS CERTIFICATE REPRESENTS _______ UNITS OF iPCS, PCS, INC. EACH UNIT
CONSISTS OF $1,000 AGGREGATE PRINCIPAL AMOUNT AT MATURITY OF iPCS 14% SENIOR
DISCOUNT NOTES DUE 2010 AND ONE WARRANT TO PURCHASE 9.94233 SHARES OF COMMON
STOCK OF iPCS, INC. AT AN INITIAL EXERCISE PRICE OF $5.50 (SUBJECT TO ADJUSTMENT
AS DESCRIBED IN THE WARRANT AGREEMENT) [THE SENIOR DISCOUNT NOTES AND WARRANTS
CONSTITUTING A PART OF THE UNITS REPRESENTED BY THIS CERTIFICATE ARE REPRESENTED
BY THE NOTES AND WARRANT CERTIFICATES ATTACHED HERETO.]/2/
[THE SECURITIES ARE GLOBAL SECURITIES WITHIN THE MEANING OF THE
INDENTURE GOVERNING THE SENIOR DISCOUNT NOTES REPRESENTED BY THE GLOBAL SENIOR
NOTE (THE "INDENTURE") AND THE WARRANT AGREEMENT GOVERNING THE WARRANTS
---------
REPRESENTED BY THE GLOBAL WARRANT CERTIFICATE (THE "WARRANT AGREEMENT") AND ARE
-----------------
REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A
SUCCESSOR DEPOSITARY. THE SECURITIES ARE NOT EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND THE WARRANT
______________________
/1/This bracketed language should be included only if the Unit certificate
is issued in global form.
/2/This bracketed language should be included only if the Units represented
by the Unit certificate are issued in definitive form.
B-1
AGREEMENT, AND NO TRANSFER OF THE SECURITIES (OTHER THAN A TRANSFER OF THE
SECURITIES AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN
THE INDENTURE AND THE WARRANT AGREEMENT.]/1/
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER
---
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUIRED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]/1/
[THE SENIOR DISCOUNT NOTES AND THE WARRANTS CONSTITUTING A PART OF THE
UNITS REPRESENTED BY THIS GLOBAL UNIT WILL TRADE SEPARATELY UPON THE EARLIEST TO
OCCUR OF: (I) 180 DAYS AFTER THE CLOSING OF THE OFFERING OF THE UNITS, (II) THE
DATE ON WHICH A REGISTRATION STATEMENT WITH RESPECT TO A REGISTERED EXCHANGE
OFFER FOR THE NOTES IS DECLARED EFFECTIVE UNDER THE ACT, (III) THE DATE A SHELF
REGISTRATION STATEMENT WITH RESPECT TO THE NOTES IS DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (IV) THE OCCURRENCE OF A CHANGE OF CONTROL OR AN EVENT OF
DEFAULT ON THE SENIOR SUBORDINATED DISCOUNT NOTES AND (V) SUCH DATE AS
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION IN ITS SOLE DISCRETION SHALL
DETERMINE.]/3/
____________________
/3/This paragraph should be included only if the Unit certificate is issued
prior to the Separation Date.
B-2
iPCS, INC.
By:________________________________________
Name:
Title:
[GUARANTORS]
By:___________________________________________
Name:
Title:
Date: [.], 2000
EXHIBIT C
FORM OF CERTIFICATE OF TRANSFER
iPCS, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
ChaseMellon Shareholder Services, L.L.C.
00 Xxxxxxxxxx Xxxx
Xxxxxxxxxx Xxxx, Xxx Xxxxxx 00000
Re: Warrants
Reference is hereby made to the Warrant Agreement, dated as of July
12, 2000 (the "Warrant Agreement"), between iPCS, Inc., as issuer (the
"Company"), and ChaseMellon Shareholder Services, L.L.C., as warrant agent.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Warrant Agreement.
___________________, (the "Transferor") owns and proposes to transfer
the Warrant[s] or interest in such Warrant[s] specified in Annex A hereto, in
the principal amount at maturity of $___________ in such Warrant[s] or interests
(the "Transfer"), to ___________________________ (the "Transferee"), as further
specified in Annex A hereto. In connection with the Transfer, the Transferor
hereby certifies that:
[CHECK ALL THAT APPLY]
1. [_] Check if Transferee will take delivery of a beneficial interest
---------------------------------------------------------------
in the 000X Xxxxxx Xxxxxxx or a Definitive Warrant Pursuant to Rule 144A. The
------------------------------------------------------------------------
Transfer is being effected pursuant to and in accordance with Rule 144A under
the United States Securities Act of 1933, as amended (the "Securities Act"),
and, accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Warrant is being transferred to a Person that the
Transferor reasonably believed and believes is purchasing the beneficial
interest or Definitive Warrant for its own account, or for one or more accounts
with respect to which such Person exercises sole investment discretion, and such
Person and each such account is a "qualified institutional buyer" within the
meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and
such Transfer is in compliance with any applicable blue sky securities laws of
any state of the United States. Upon consummation of the proposed Transfer in
accordance with the terms of the Warrant Agreement, the transferred beneficial
interest or Definitive Warrant will be subject to the restrictions on
C-1
transfer enumerated in the Private Placement Legend printed on the 144A Global
Warrant and/or the Definitive Warrant and in the Warrant Agreement and the
Securities Act.
2. [_] Check if Transferee will take delivery of a beneficial interest
---------------------------------------------------------------
in the Regulation S Global Warrant or a Definitive Warrant pursuant to
----------------------------------------------------------------------
Regulation S. The Transfer is being effected pursuant to and in accordance with
------------
Rule 903 or Rule 904 under the Securities Act and, accordingly, the Transferor
hereby further certifies that (i) the Transfer is not being made to a person in
the United States and (x) at the time the buy order was originated, the
Transferee was outside the United States or such Transferor and any Person
acting on its behalf reasonably believed and believes that the Transferee was
outside the United States or (y) the transaction was executed in, on or through
the facilities of a designated offshore securities market and neither such
Transferor nor any Person acting on its behalf knows that the transaction was
prearranged with a buyer in the United States, (ii) no directed selling efforts
have been made in contravention of the requirements of Rule 903(b) or Rule
904(b) of Regulation S under the Securities Act, (iii) the transaction is not
part of a plan or scheme to evade the registration requirements of the
Securities Act and (iv) if the proposed transfer is being made prior to the
expiration of the Restricted Period, the transfer is not being made to a U.S.
Person or for the account or benefit of a U.S. Person (other than an Initial
Purchaser). Upon consummation of the proposed transfer in accordance with the
terms of the Warrant Agreement, the transferred beneficial interest or
Definitive Warrant will be subject to the restrictions on Transfer enumerated in
the Private Placement Legend printed on the Regulation S Global Warrant and/or
the Definitive Warrant and in the Warrant Agreement and the Securities Act.
3. [_] Check and complete if Transferee will take delivery of a
--------------------------------------------------------
beneficial interest in the IAI Global Warrant or a Definitive Warrant pursuant
------------------------------------------------------------------------------
to any provision of the Securities Act other than Rule 144A or Regulation S.
---------------------------------------------------------------------------
The Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Warrants and Restricted
Definitive Warrants and pursuant to and in accordance with the Securities Act
and any applicable blue sky securities laws of any state of the United States,
and accordingly the Transferor hereby further certifies that (check one):
(a) [_] such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) [_] such Transfer is being effected to the Company or a subsidiary
thereof;
or
C-2
(c) [_] such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act;
or
(d) [_] such Transfer is being effected to an Institutional Accredited
Investor and pursuant to an exemption from the registration requirements of
the Securities Act other than Rule 144A, Rule 144 or Rule 904, and the
Transferor hereby further certifies that it has not engaged in any general
solicitation within the meaning of Regulation D under the Securities Act
and the Transfer complies with the transfer restrictions applicable to
beneficial interests in a Restricted Global Warrant or Restricted
Definitive Warrants and the requirements of the exemption claimed, which
certification is supported by (1) a certificate executed by the Transferee
in the form of Exhibit D to the Warrant Agreement and (2) if the Company
requests, an Opinion of Counsel provided by the Transferor or the
Transferee (a copy of which the Transferor has attached to this
certification), to the effect that such Transfer is in compliance with the
Securities Act. Upon consummation of the proposed transfer in accordance
with the terms of the Warrant Agreement, the transferred beneficial
interest or Definitive Warrant will be subject to the restrictions on
transfer enumerated in the Private Placement Legend printed on the IAI
Global Warrant and/or the Definitive Warrants and in the Warrant Agreement
and the Securities Act.
4. [_] Check if Transferee will take delivery of a beneficial interest
---------------------------------------------------------------
in an Unrestricted Global Warrant or of an Unrestricted Definitive Warrant.
--------------------------------------------------------------------------
(a) [_] Check if Transfer is pursuant to Rule 144. (i) The Transfer is
being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained
in the Warrant Agreement and any applicable blue sky securities laws of any
state of the United States and (ii) the restrictions on transfer contained
in the Warrant Agreement and the Private Placement Legend are not required
in order to maintain compliance with the Securities Act. Upon consummation
of the proposed Transfer in accordance with the terms of the Warrant
Agreement, the transferred beneficial interest or Definitive Warrant will
no longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Warrants, on
Restricted Definitive Warrants and in the Warrant Agreement.
(b) [_] Check if Transfer is Pursuant to Regulation S. (i) The Transfer
is being effected pursuant to and in accordance with Rule 903 or Rule 904
under the Securities Act and in compliance with the transfer restrictions
contained in the Warrant Agreement and any applicable blue sky securities
laws of any state of the United States and (ii) the restrictions on
transfer contained in the Warrant Agreement and the Private Placement
Legend are not required in order to maintain compliance
C-3
with the Securities Act. Upon consummation of the proposed Transfer in
accordance with the terms of the Warrant Agreement, the transferred
beneficial interest or Definitive Warrant will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed
on the Restricted Global Warrants, on Restricted Definitive Warrants and in
the Warrant Agreement.
(c) [_] Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption
from the registration requirements of the Securities Act other than Rule
144, Rule 903 or Rule 904 and in compliance with the transfer restrictions
contained in the Warrant Agreement and any applicable blue sky securities
laws of any State of the United States and (ii) the restrictions on
transfer contained in the Warrant Agreement and the Private Placement
Legend are not required in order to maintain compliance with the Securities
Act. Upon consummation of the proposed Transfer in accordance with the
terms of the Warrant Agreement, the transferred beneficial interest or
Definitive Warrant will not be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Global
Warrants or Restricted Definitive Warrants and in the Warrant Agreement.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
_______________________________________
[Insert Name of Transferor]
By:
Name:
Title:
Dated:__________________
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [_] a beneficial interest in the:
(i) [_] 144A Global Warrant, or
(ii) [_] Regulation S Global Warrant; or
(b) [_] a Restricted Definitive Warrant.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [_] a beneficial interest in the:
(i) [_] 144A Global Warrant, or
(ii) [_] Regulation S Global Warrant, or
(ii) [_] Unrestricted Global Warrant; or
(b) [_] a Restricted Definitive Warrant; or
(c) [_] an Unrestricted Definitive Warrant,
in accordance with the terms of the Warrant Agreement.
C-5
EXHIBIT D
FORM OF CERTIFICATE OF EXCHANGE
iPCS, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
ChaseMellon Shareholder Services, L.L.C.
00 Xxxxxxxxxx Xxxx
Xxxxxxxxxx Xxxx, Xxx Xxxxxx 00000
Re: Warrants
(CUSIP ____________)
Reference is hereby made to the Warrant Agreement, dated as of [.],
2000 (the "Warrant Agreement"), between iPCS, Inc., as issuer (the "Company"),
and ChaseMellon Shareholder Services, L.L.C., as warrant agent. Capitalized
terms used but not defined herein shall have the meanings given to them in the
Warrant Agreement.
__________________________, (the "Owner") owns and proposes to
exchange the Warrant[s] or interest in such Warrant[s] specified herein, in the
amount of $____________ in such Warrant[s] or interests (the "Exchange"). In
connection with the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Warrants or Beneficial
--------------------------------------------------------
Interests in a Restricted Global Warrant for Unrestricted Definitive Warrants or
--------------------------------------------------------------------------------
Beneficial Interests in an Unrestricted Global Warrant
------------------------------------------------------
(a) [_] Check if Exchange is from beneficial interest in a Restricted
Global Warrant to beneficial interest in an Unrestricted Global Warrant.
In connection with the Exchange of the Owner's beneficial interest in a
Restricted Global Warrant for a beneficial interest in an Unrestricted
Global Warrant in an equal principal amount, the Owner hereby certifies (i)
the beneficial interest is being acquired for the Owner's own account
without transfer, (ii) such Exchange has been effected in compliance with
the transfer restrictions applicable to the Global Warrants and pursuant to
and in accordance with the United States Securities Act of 1933, as amended
(the "Securities Act"), (iii) the restrictions on transfer contained in the
Warrant Agreement and the Private Placement Legend are not required in
order to maintain
D-1
compliance with the Securities Act and (iv) the beneficial interest in an
Unrestricted Global Warrant is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.
(b) [_] Check if Exchange is from beneficial interest in a Restricted
Global Warrant to Unrestricted Definitive Warrant. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Warrant
for an Unrestricted Definitive Warrant, the Owner hereby certifies (i) the
Definitive Warrant is being acquired for the Owner's own account without
transfer, (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Warrants and
pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Warrant Agreement and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Definitive Warrant is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
(c) [_] Check if Exchange is from Restricted Definitive Warrant to
beneficial interest in an Unrestricted Global Warrant. In connection with
the Owner's Exchange of a Restricted Definitive Warrant for a beneficial
interest in an Unrestricted Global Warrant, the Owner hereby certifies (i)
the beneficial interest is being acquired for the Owner's own account
without transfer, (ii) such Exchange has been effected in compliance with
the transfer restrictions applicable to Restricted Definitive Warrants and
pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Warrant Agreement and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the beneficial interest is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
(d) [_] Check if Exchange is from Restricted Definitive Warrant to
Unrestricted Definitive Warrant. In connection with the Owner's Exchange
of a Restricted Definitive Warrant for an Unrestricted Definitive Warrant,
the Owner hereby certifies (i) the Unrestricted Definitive Warrant is being
acquired for the Owner's own account without transfer, (ii) such Exchange
has been effected in compliance with the transfer restrictions applicable
to Restricted Definitive Warrants and pursuant to and in accordance with
the Securities Act, (iii) the restrictions on transfer contained in the
Warrant Agreement and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the
Unrestricted Definitive Warrant is being acquired in compliance with any
applicable blue sky securities laws of any state of the United States.
2. Exchange of Restricted Definitive Warrants or Beneficial
--------------------------------------------------------
Interests in Restricted Global Warrants for Restricted Definitive Warrants or
-----------------------------------------------------------------------------
Beneficial Interests in Restricted Global Warrants
--------------------------------------------------
(a) [_] Check if Exchange is from beneficial interest in a Restricted
Global Warrant to Restricted Definitive Warrant. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Warrant
for a Restricted Definitive Warrant in a number equal to the number of
beneficial interests exchanged, the Owner hereby certifies that the
Restricted Definitive Warrant is being acquired for the Owner's own account
without transfer. Upon consummation of the proposed Exchange in accordance
with the terms of the Warrant Agreement, the Restricted Definitive Warrant
issued will continue to be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted
Definitive Warrant and in the Warrant Agreement and the Securities Act.
(b) [_] Check if Exchange is from Restricted Definitive Warrant to
beneficial interest in a Restricted Global Warrant. In connection with the
Exchange of the Owner's Restricted Definitive Warrant for a beneficial
interest in the [CHECK ONE] [_] 144A Global Warrant, [_] Regulation S
Global Warrant, [_] IAI Global Warrant in a number equal to the number of
beneficial interests exchanged, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own account without
transfer and (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Warrants and
pursuant to and in accordance with the Securities Act, and in compliance
with any applicable blue sky securities laws of any state of the United
States. Upon consummation of the proposed Exchange in accordance with the
terms of the Warrant Agreement, the beneficial interest issued will be
subject to the restrictions on transfer enumerated in the Private Placement
Legend printed on the relevant Restricted Global Warrant and in the Warrant
Agreement and the Securities Act.
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
____________________________________
[Insert Name of Transferor]
By:
Name:
Title:
Dated:___________________
EXHIBIT E
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
iPCS, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000
ChaseMellon Shareholder Services, L.L.C.
00 Xxxxxxxxxx Xxxx
Xxxxxxxxxx Xxxx, Xxx Xxxxxx 00000
Re: Warrants
Reference is hereby made to the Warrant Agreement, dated as of
[.], 2000 (the "Warrant Agreement"), between iPCS, Inc., as issuer (the
"Company"), and ChaseMellon Shareholder Services, L.L.C., as warrant agent.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Warrant Agreement.
In connection with our proposed purchase of $____________ amount of:
(a) [_] a beneficial interest in a Global Warrant, or
(b) [_] a Definitive Warrant,
we confirm that:
1. We understand that any subsequent transfer of the Warrants or any
interest therein is subject to certain restrictions and conditions set forth in
the Warrant Agreement and the undersigned agrees to be bound by, and not to
resell, pledge or otherwise transfer the Warrants or any interest therein except
in compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Warrants have not
been registered under the Securities Act, and that the Warrants and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which
we are acting as hereinafter stated, that if we should sell the Warrants or any
interest therein, we will do so only (A) to the Company or any subsidiary
thereof, (B) in accordance with Rule 144A under the Securities Act to a
"qualified
E-1
institutional buyer" (as defined therein), (C) to an institutional "accredited
investor" (as defined below) that, prior to such transfer, furnishes (or has
furnished on its behalf by a U.S. broker-dealer) to you and to the Company a
signed letter substantially in the form of this letter and, if requested by the
Company, an Opinion of Counsel in form reasonably acceptable to the Company to
the effect that such transfer is in compliance with the Securities Act, (D)
outside the United States in accordance with Rule 904 of Regulation S under the
Securities Act, (E) pursuant to the provisions of Rule 144(k) under the
Securities Act or (F) pursuant to an effective registration statement under the
Securities Act, and we further agree to provide to any person purchasing the
Definitive Warrant or beneficial interest in a Global Warrant from us in a
transaction meeting the requirements of clauses (A) through (E) of this
paragraph a notice advising such purchaser that resales thereof are restricted
as stated herein.
3. We understand that, on any proposed resale of the Warrants or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Warrants purchased
by us will bear a legend to the foregoing effect.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Warrants, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Warrants or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
We agree not to engage in any hedging transactions with regard to the
Warrants unless such hedging transactions are in compliance with the Securities
Act.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
_______________________________________
[Insert Name of Transferor]
By:
Name:
Title:
Dated:___________________
FIRST AMENDMENT
TO THE
WARRANT AGREEMENT
THIS FIRST AMENDMENT to the Warrant Agreement, dated as of July 12, 2000
(the "Agreement"), by and among iPCS, Inc. ("iPCS"), a Delaware corporation,
and ChaseMellon Shareholder Services, L.L.C., a New Jersey limited liability
company, as warrant agent, is made as of October 31, 2000. Capitalized terms
used but not defined herein shall have the meanings set forth in the Agreement.
WHEREAS, pursuant to Section 16 of the Agreement in order to correct a
provision contained in Section 14(a) of the Agreement which is inconsistent with
the provisions of the Indenture, dated as of July 12, 2000, by and among iPCS,
as issuer, iPCS Equipment, Inc. and iPCS Wireless, Inc. as guarantors, and CTC
Illinois Trust Company, as trustee, the Company and the Warrant Agent desire to
amend the Agreement;
WHEREAS, said amendment does not require the written consent of any Holders
of Warrants because said amendment will not have an adverse effect on the
interests of the Holders of Warrants; and
WHEREAS, the Warrant Agent has received a certificate from the President
and Chief Executive Officer of iPCS which states that the proposed amendment (1)
is in compliance with the terms of Section 16 of the Agreement and (2) does not
change the Warrant Agent's duties, liabilities or obligations.
NOW THEREFORE, in consideration of the mutual covenants contained herein,
the parties hereto hereby agree as follows:
Section 14(a) of the Agreement is hereby amended by inserting the following
sentence immediately after the first sentence of such section:
Notwithstanding the foregoing, such requirements shall be deemed
satisfied prior to November 15, 2000, by filing with the
Commission and delivering to the Warrant Agent and the Holders of
Warrants on or prior to such date a registration statement under
the Securities Act that contains the information that would be
required in a Form 10-Q for the Company for the quarter ended
September 30, 2000.
IN WITNESS WHEREOF, the parties hereto have caused this amendment to be
duly executed, as of the day and year first above written.
iPCS, Inc.
By: /s/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
Title: President and Chief Executive
Officer
ChaseMellon Shareholder Services, L.L.C.,
as Warrant Agent
By: /s/ Xxxxx Xxxxx
---------------------------------------------
Name: Xxxxx Xxxxx
Title: Assistant Vice President
