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