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EXHIBIT 4.1.1
WARRANT AGREEMENT
Dated as of
July 16, 1997
between
IRIDIUM WORLD COMMUNICATIONS LTD.
and
STATE STREET BANK AND TRUST COMPANY,
as Warrant Agent
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Warrants for
Class A Common Stock of
Iridium World Communications Ltd.
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TABLE OF CONTENTS
ARTICLE 1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
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SECTION 1.01. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
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SECTION 1.02. Other Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
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SECTION 1.03. Rules of Construction. . . . . . . . . . . . . . . . . . . . . . . . . . . 5
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ARTICLE 2 Warrant Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 2.01. Form and Dating. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
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SECTION 2.02. Legends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
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SECTION 2.03. Execution and Countersignature. . . . . . . . . . . . . . . . . . . . . . 9
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SECTION 2.04. Certificate Register. . . . . . . . . . . . . . . . . . . . . . . . . . . 9
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SECTION 2.05. Separation of Warrants and Notes. . . . . . . . . . . . . . . . . . . . . 9
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SECTION 2.06. Transfer and Exchange. . . . . . . . . . . . . . . . . . . . . . . . . . . 9
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SECTION 2.07. Replacement Certificates. . . . . . . . . . . . . . . . . . . . . . . . 11
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SECTION 2.08. Temporary Certificates. . . . . . . . . . . . . . . . . . . . . . . . . 11
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SECTION 2.09. Cancellation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
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SECTION 2.10. Book-Entry Provisions for Global Securities. . . . . . . . . . . . . . . 11
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SECTION 2.11. Special Transfer Provisions. . . . . . . . . . . . . . . . . . . . . . . 13
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ARTICLE 3 Exercise Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 3.01. Exercise Price. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
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SECTION 3.02. Exercise Periods. . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
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SECTION 3.03. Expiration. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
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SECTION 3.04. Manner of Exercise. . . . . . . . . . . . . . . . . . . . . . . . . . . 16
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SECTION 3.05. Issuance of Warrant Shares. . . . . . . . . . . . . . . . . . . . . . . 16
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SECTION 3.06. Fractional Warrant Shares. . . . . . . . . . . . . . . . . . . . . . . . 17
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SECTION 3.07. Reservation of Warrant Shares. . . . . . . . . . . . . . . . . . . . . . 17
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SECTION 3.08. Compliance with Law. . . . . . . . . . . . . . . . . . . . . . . . . . . 17
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ARTICLE 4 Antidilution Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 4.01. Changes in Class A Common Stock. . . . . . . . . . . . . . . . . . . . . 18
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SECTION 4.02. Adjustments for Change in Capital Stock. . . . . . . . . . . . . . . . . 18
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SECTION 4.03. Adjustments for Rights Issue. . . . . . . . . . . . . . . . . . . . . . 19
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SECTION 4.04. Adjustment for Other Distributions. . . . . . . . . . . . . . . . . . . 21
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SECTION 4.05. Adjustment for Common Stock Issue. . . . . . . . . . . . . . . . . . . . 22
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SECTION 4.06. Adjustment for Convertible Securities Issue. . . . . . . . . . . . . . . 23
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SECTION 4.07. Consideration Received. . . . . . . . . . . . . . . . . . . . . . . . . 24
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SECTION 4.08. When No Adjustments Required. . . . . . . . . . . . . . . . . . . . . . 25
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SECTION 4.09. Notice of Adjustments. . . . . . . . . . . . . . . . . . . . . . . . . . 25
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SECTION 4.10. Voluntary Increase or Reduction. . . . . . . . . . . . . . . . . . . . . 25
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SECTION 4.11. Notice of Certain Transactions. . . . . . . . . . . . . . . . . . . . . 25
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SECTION 4.12. Self-Tenders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
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SECTION 4.13. Warrant Agent's Disclaimer. . . . . . . . . . . . . . . . . . . . . . . 26
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SECTION 4.14. When Issuance or Payment May Be Deferred. . . . . . . . . . . . . . . . 26
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SECTION 4.15. Adjustment in Exercise Rate. . . . . . . . . . . . . . . . . . . . . . . 26
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SECTION 4.16. Form of Warrants. . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
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SECTION 4.17. Limitation on Adjustments. . . . . . . . . . . . . . . . . . . . . . . . 27
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SECTION 4.18. No Dilution or Impairment. . . . . . . . . . . . . . . . . . . . . . . . 27
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SECTION 4.19. Notices to Warrant Holders; Rights of Warrant Holders. . . . . . . . . . 27
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SECTION 4.20. Combination; Liquidation. . . . . . . . . . . . . . . . . . . . . . . . 29
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SECTION 4.21. Minimum Adjustment. . . . . . . . . . . . . . . . . . . . . . . . . . . 29
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SECTION 4.22. Motorola Guarantee Warrants; Iridium Capital Stock. . . . . . . . . . . 30
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ARTICLE 5 Registration Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 5.01. Effectiveness of Registration Statement. . . . . . . . . . . . . . . . . 30
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SECTION 5.02. Suspension. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
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SECTION 5.03. Blue Sky. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
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SECTION 5.04. Accuracy of Disclosure. . . . . . . . . . . . . . . . . . . . . . . . . 32
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SECTION 5.05. Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
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SECTION 5.06. Additional Acts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
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SECTION 5.07. Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
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ARTICLE 6 Warrant Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
SECTION 6.01. Appointment of Warrant Agent. . . . . . . . . . . . . . . . . . . . . . 36
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SECTION 6.02. Rights and Duties of Warrant Agent. . . . . . . . . . . . . . . . . . . 36
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SECTION 6.03. Individual Rights of Warrant Agent. . . . . . . . . . . . . . . . . . . 37
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SECTION 6.04. Warrant Agent's Disclaimer. . . . . . . . . . . . . . . . . . . . . . . 37
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SECTION 6.05. Compensation and Indemnity. . . . . . . . . . . . . . . . . . . . . . . 37
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SECTION 6.06. Successor Warrant Agent. . . . . . . . . . . . . . . . . . . . . . . . . 38
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ARTICLE 7 Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 7.01. SEC Reports and Other Information. . . . . . . . . . . . . . . . . . . . 39
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SECTION 7.02. Persons Benefitting. . . . . . . . . . . . . . . . . . . . . . . . . . . 39
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SECTION 7.03. Rights of Holders. . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
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SECTION 7.04. Amendment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
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SECTION 7.05. Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
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SECTION 7.06. Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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SECTION 7.07. Successors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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SECTION 7.08. Multiple Originals. . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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SECTION 7.09. Table of Contents. . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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SECTION 7.10. Severability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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SECTION 7.11. Use of Proceeds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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EXHIBIT A - Form of Warrant Certificate
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EXHIBIT B - Form of Certificate to be Delivered Upon Termination
of the Regulation S Restricted Period
EXHIBIT C - Form of Certificate to be Delivered in Connection
with Transfers to Non-QIB Institutional Accredited
Investors
EXHIBIT D - Form of Certificate for Transfer to Rule 144A Global
Security Bearing a Securities Act Legend
EXHIBIT E - Form of Certificate to be Delivered in Connection
with Transfers Pursuant to Regulation S
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WARRANT AGREEMENT dated as of July 16, 1997 (this
"Agreement"), between IRIDIUM WORLD COMMUNICATIONS LTD., a Bermuda company
("IWCL"), and STATE STREET BANK AND TRUST COMPANY, as warrant agent (the
"Warrant Agent").
IWCL desires to issue the warrants described herein and to
purchase with the proceeds therefrom LLC Warrants (as defined herein) of
Iridium LLC, a Delaware limited liability company ("Iridium") pursuant to the
Share Issuance Agreement, dated June 9, 1997, between IWCL and Iridium. The
Warrants will initially entitle the holders thereof (the "Holders") to purchase
in the aggregate 1,560,000 shares of Class A Common Stock, par value $0.01 per
share, of IWCL (the "Class A Common Stock") in connection with an offering (as
described below, the "Units Offering") by IWCL, Iridium and Iridium Capital
Corporation, a Delaware corporation ("Iridium Capital"), of (i) 300,000 units
(the "Units"), each consisting of $1,000 principal amount of 13% Senior Notes
due 2005, Series A (the "Notes") and a warrant to purchase 5.2 shares of Class
A Common Stock (the "Warrants"), and (ii) $500,000,000 aggregate principal
amount of 14% Senior Notes due 2005, Series B. In connection with the sale of
the Units, an aggregate of 300,000 Warrants will be issued to the purchasers of
the Units.
The Warrants will not trade separately from the Notes until
the earlier of (i) the commencement of an Exchange Offer (as defined herein) or
the effectiveness of a shelf registration statement for the Notes and (ii) such
date after January 15, 1998 as Chase Securities Inc. may, in its discretion,
deem appropriate (the "Separation Date").
IWCL further desires the Warrant Agent to act on behalf of
IWCL in connection with the issuance of the Warrants as provided herein and the
Warrant Agent is willing to so act.
Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of the holders of Warrants:
ARTICLE 1
Definitions
SECTION 1.01. Definitions.
"Affiliate" of any Person means any other Person, directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specific Person. For the purposes of this definition,
"control" when used with respect to any Person means the power to direct the
management and policies of such Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; provided,
however, that beneficial ownership of 10% or more of the voting securities of a
Person shall be deemed to be control. The terms "controlling" and "controlled"
have meanings correlative to the foregoing.
"Board" means the Board of Directors of IWCL or any committee
thereof duly authorized to act on behalf of such Board of Directors.
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"Business Day" means each day that is not a Saturday, a Sunday
or a day on which banking institutions are not required to be open in
Massachusetts or New York.
"Combination" means an event in which IWCL consolidates with,
merges with or into, or sells all or substantially all of its assets to another
Person.
"Current Market Value" per share of Class A Common Stock or
any other security at any date means, on any date of determination, (1) the
average of the daily closing sale prices for each of the 20 Business Days
immediately preceding such date (or such shorter number of days during which
such security has been listed), if the security has been listed on the New York
Stock Exchange, the American Stock Exchange, the Nasdaq National Market or
other national securities exchange for at least 10 Business Days prior to such
date, (2) if such security is not so listed, the average daily closing bid
prices for each of the 15 Business Days immediately preceding such date (or
such shorter number of days during which such security has been quoted), if the
security has been quoted on a national over-the-counter market for at least 10
Business Days prior to such date, (3) if the security is not so listed and not
so quoted, the value of the security determined in good faith by the Board and
certified in a board resolution, based on the most recently completed
arm's-length transaction between IWCL and a Person other than an Affiliate of
IWCL, the closing of which occurred on such date or within six months preceding
such date, and (4) if the Board fails to make such a determination the value of
the security determined by a nationally recognized investment banking firm or
appraisal firm which is not an Affiliate of IWCL ("Independent Financial
Expert").
"Definitive Security" means certificated Warrants physically
delivered, including Warrant Certificates delivered to Institutional Accredited
Investors.
"Depositary" means The Depository Trust Company, its nominees
and their respective successors.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Offer" means an offer by Iridium and Iridium Capital
to holders of the Notes to issue and deliver to such holders, in exchange for
the Notes, a like aggregate principal amount of debt securities of Iridium and
Iridium Capital pursuant to the Exchange and Registration Rights Agreement,
dated as of July 16, 1997.
"Exercise Date" means, for a given Warrant, the day on which
such Warrant is exercised pursuant to Section 3.04.
"Guarantee Agreement" means the guarantee agreement between
Motorola and The Chase Manhattan Bank, as Administrative Agent, and the other
lenders party thereto, dated as of August 21, 1996, as amended or supplemented
from time to time with respect to the Notes.
"Guaranteed Bank Facility" means Iridium's $750 million
unsecured borrowing facility with a syndicate of banks, as amended from time to
time.
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"Indenture" means the Indenture dated as of July 16, 1997,
among Iridium, Iridium Capital, Iridium Roaming LLC and Iridium IP LLC, and the
Trustee, as amended or supplemented from time to time with respect to the
Notes.
"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.
"Issue Date" means the date on which Warrants are initially
issued.
"LLC Warrants" means the warrants, each of which represents
the right to purchase Class 1 Membership Interests in Iridium having the same
terms and tenor as the Warrants issued hereby.
"MOU" means the Memorandum of Understanding dated as of July
11, 1997 between Motorola and Iridium, as amended or supplemented from time to
time.
"Motorola" means Motorola, Inc., a Delaware corporation, or
any successor Person to Motorola.
"Motorola Additional Guarantee" means the commitment by
Motorola pursuant to the MOU to guarantee up to $350 million (inclusive of
principal and interest) in borrowings under the Guaranteed Bank Facility
(inclusive of principal and interest) in excess of the Motorola Guarantee, and
any guarantee issued by Motorola pursuant thereto.
"Motorola Guarantee" means the guarantee by Motorola of
Iridium's borrowings under the Guaranteed Bank Facility up to an aggregate
amount of $750 million (inclusive of interest).
"Non-U.S. Person" means a person who is not a U.S. person, as
defined in Rule 902 of the Securities Act.
"Offering Memorandum" means the Offering Memorandum, dated
July 11, 1997, relating to the offer and sale of the Units.
"Officer" means the Chairman of the Board and Chief Executive
Officer, the Deputy Chairman, the Chief Financial Officer, the Secretary or the
Assistant Secretary of IWCL.
"Person" means any individual, corporation, partnership, joint
venture, limited liability company, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
"Regulation S" means Regulation S under the Securities Act or
any successor provision thereto.
"SEC" means the Securities and Exchange Commission, or any
successor agency or body performing substantially similar functions.
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"Securities Act" means the Securities Act of 1933, as amended.
"Share Issuance Agreement" means the Share Issuance Agreement
between Iridium and IWCL, dated as of June 9, 1997, as amended or supplemented
from time to time.
"Time of Determination" means the time and date of the earlier
of (i) the determination of stockholders entitled to receive rights, warrants,
or options or a distribution, in each case, to which Section 4.03 or 4.04
applies and (ii) the time ("Ex-Dividend Time") immediately prior to the
commencement of "ex-dividend" trading for such rights, warrants or distribution
on such national or regional exchange or market on which the Class A Common
Stock is then listed or quoted.
"Trustee" means State Street Bank and Trust Company, or any
successor trustee under the Indenture.
"Warrant Certificates" mean the registered certificates
(including without limitation, the Global Securities) issued by IWCL under this
Agreement representing the Warrants.
"Warrant Shares" mean the shares of Class A Common Stock (and
any other securities) for which the Warrants are exercisable.
SECTION 1.02. Other Definitions.
Defined in
Term Section
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"Agreement" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
"Certificate Register" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.04
"Common Shelf Registration Statement" . . . . . . . . . . . . . . . . . . . . 5.01
"Common Stock" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.01
"Class A Common Stock" . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
"Delivering Seller" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.05
"Exercise Price" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.01
"Exercise Rate" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.01
"Expiration Date" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.02(b)
"Expiration Time" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.12
"Extraordinary Cash Dividend" . . . . . . . . . . . . . . . . . . . . . . . . 4.04
"Global Securities" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.01
"Holders" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
"Indemnified Parties" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.05
"Notes" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
"Private Placement Legend" . . . . . . . . . . . . . . . . . . . . . . . . . . 2.02(c)
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"Purchased Shares" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.12
"QIBs" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.01
"Registrar" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.07
"Regulation S Global Security" . . . . . . . . . . . . . . . . . . . . . . . . 2.01
"Regulation S Permanent Global Security" . . . . . . . . . . . . . . . . . . . 2.01
"Regulation S Restricted Period" . . . . . . . . . . . . . . . . . . . . . . . 2.01
"Regulation S Securities Exchange Date" . . . . . . . . . . . . . . . . . . . 2.01
"Regulation S Temporary Global Security" . . . . . . . . . . . . . . . . . . . 2.01
"Rule 144A" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.01
"Rule 144A Global Security" . . . . . . . . . . . . . . . . . . . . . . . . . 2.01
"Separability Legend" . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.02(b)
"Separation Date" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
"Successor Company" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4.20(a)
"Transfer Agent" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3.05
"Transfer Restricted Security" . . . . . . . . . . . . . . . . . . . . . . . . 2.06
"Units" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
"Units Offering" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
"Warrant Agent" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
"Warrants" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Recitals
"Warrant Shelf Registration Statement" . . . . . . . . . . . . . . . . . . . . 5.01
SECTION 1.03. Rules of Construction. Unless the text
otherwise requires:
(i) a defined term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting principles as
in effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including without limitation; and
(v) words in the singular include the plural and words in the
plural include the singular unless the context otherwise requires.
ARTICLE 2
Warrant Certificates
SECTION 2.01. Form and Dating. Warrants initially offered
and sold to "qualified institutional buyers" (as defined in Rule 144A under the
Securities Act) ("QIBs") in accordance with Rule 144A under the Securities Act
(such Rule, or any successor provision thereto, "Rule 144A") shall be issued on
the Issue Date initially in the form of one or more
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permanent global Warrant Certificates in registered form, substantially in the
form set forth in Exhibit A hereto (each, a "Rule 144A Global Security"),
deposited with the Warrant Agent, as custodian for the Depositary, duly
executed by IWCL and countersigned by the Warrant Agent as hereinafter
provided. Warrants initially offered and sold in offshore transactions in
reliance on Regulation S shall be issued on the Issue Date initially in the
form of one or more temporary global Warrant Certificates in registered form,
substantially in the form of Exhibit A hereto (each, a "Regulation S Temporary
Global Security"). The Regulation S Temporary Global Securities will be
registered in the name of, and held by, a temporary certificate holder
designated by Chase Securities Inc. until the 40th day after the later of the
commencement of the distribution of the respective initial Warrants and the
Issue Date (each, a "Regulation S Restricted Period") with respect to the offer
and sale of the respective initial Warrants (the "Regulation S Securities
Exchange Date"). IWCL shall promptly notify the Warrant Agent in writing of
the occurrence of the Regulation S Securities Exchange Date and, within a
reasonable period after the Regulation S Securities Exchange Date, upon receipt
by the Warrant Agent and IWCL of one or more certificates substantially in the
form set forth in Exhibit B hereto from one or more Holders of interests in the
applicable Regulation S Temporary Global Security, IWCL shall execute, if not
already executed, and the Warrant Agent shall countersign and deliver, if not
already countersigned and delivered, one or more permanent global Warrant
Certificates in registered form, substantially in the form set forth in Exhibit
A hereto (each, a "Regulation S Permanent Global Security" and, together with
the related Regulation S Temporary Global Security, a "Regulation S Global
Security") or increase the beneficial ownership interest therein if already
executed, countersigned and delivered, in exchange for the related Regulation S
Temporary Global Securities of like tenor and amount. The Rule 144A Global
Securities and Regulation S Global Security are referred to herein as the
"Global Securities". Each Warrant Certificate may have notations, legends or
endorsements required by law, stock exchange rule, agreements to which IWCL is
subject, if any, or usage (provided that any such notation, legend or
endorsement is in a form acceptable to IWCL) and shall bear the legends
required by Section 2.02. Each Warrant Certificate shall be dated the date of
its countersignature. The terms of the Warrant Certificate set forth in
Exhibit A are part of the terms of this Agreement. Notwithstanding the
foregoing, the IWCL may execute, and the Warrant Agent may countersign and
deliver Regulation S Permanent Global Securities in a $0 amount at the time of
issuance of the Regulation S Temporary Global Security.
SECTION 2.02. Legends. (a) Each Warrant Certificate shall
bear the following legend:
THE CLASS A COMMON STOCK, PAR VALUE $0.01 PER SHARE, OF IRIDIUM WORLD
COMMUNICATIONS LTD. ("IWCL") FOR WHICH THIS WARRANT IS EXERCISABLE MAY
NOT BE OFFERED OR SOLD IN THE UNITED STATES ABSENT REGISTRATION UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND ANY
APPLICABLE STATE SECURITIES LAWS. ACCORDINGLY, NO HOLDER SHALL BE
ENTITLED TO EXERCISE SUCH HOLDER'S WARRANTS AT ANY TIME UNLESS, AT THE
TIME OF EXERCISE, A REGISTRATION STATEMENT UNDER THE SECURITIES ACT
RELATING TO THE SHARES OF CLASS A COMMON STOCK ISSUABLE UPON THE
EXERCISE OF THIS WARRANT HAS BEEN FILED WITH, AND
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DECLARED EFFECTIVE BY, THE SECURITIES AND EXCHANGE COMMISSION (THE
"SEC"), AND NO STOP ORDER SUSPENDING THE EFFECTIVENESS OF SUCH
REGISTRATION STATEMENT HAS BEEN ISSUED BY THE SEC.
(b) Each Warrant Certificate issued prior to the Separation
Date shall bear the following legend (the "Separability Legend"):
THE WARRANTS REPRESENTED BY THIS CERTIFICATE WERE INITIALLY ISSUED AS
PART OF AN ISSUANCE OF UNITS, EACH OF WHICH CONSISTS OF SENIOR NOTES
DUE 2005, SERIES A OF IRIDIUM LLC AND IRIDIUM CAPITAL CORPORATION (IN
EITHER SUCH CASE, THE "NOTES") AND WARRANTS. THE WARRANTS AND THE
NOTES WILL NOT TRADE SEPARATELY UNTIL THE EARLIER OF (I) THE
COMMENCEMENT OF AN EXCHANGE OFFER OR THE EFFECTIVENESS OF A SHELF
REGISTRATION STATEMENT FOR SUCH NOTES AND (II) SUCH DATE AFTER JANUARY
15, 1998 AS CHASE SECURITIES INC. MAY DETERMINE.
(c) Unless otherwise provided in Section 2.06 each Warrant
Certificate shall bear the following legend (the "Private Placement Legend"):
THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT
TO, REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES NOT TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE
(THE "RESALE RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER
THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH
IWCL OR ANY AFFILIATE OF IWCL WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY), EXCEPT (A) TO IWCL, (B) PURSUANT TO A
REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A PERSON IT
REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN
RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO
OFFSHORE TRANSACTIONS MEETING THE REQUIREMENTS OF RULE 903 OR RULE 904
UNDER THE SECURITIES ACT, (E) TO AN "ACCREDITED INVESTOR" WITHIN THE
MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT
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THAT IS AN INSTITUTIONAL INVESTOR ACQUIRING IN A TRANSACTION EXEMPT
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES (IF AVAILABLE) OR
(F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, AND, IN EACH CASE (A) THROUGH (F),
IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE
UNITED STATES AND OTHER JURISDICTIONS AND SUBJECT TO THE ISSUERS' AND
THE WARRANT AGENT'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (D), (E) OR (F) TO REQUIRE THE DELIVERY OF AN
OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM, AND IN THE CASE OF THE FOREGOING CLAUSES
(A) THROUGH (F), A CERTIFICATE OF TRANSFER IS COMPLETED AND DELIVERED
BY THE TRANSFEROR TO IWCL AND THE WARRANT AGENT. THIS LEGEND WILL BE
REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE.
BY ITS ACQUISITION HEREOF, THE HOLDER REPRESENTS THAT IT IS NOT AN
AFFILIATE OF IWCL OR ACTING ON BEHALF OF IWCL AND (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR"
(AS DEFINED IN RULE 501(A)(1),(2),(3) OR (7) UNDER THE SECURITIES ACT)
OR (C) IT IS NOT A U.S. PERSON AND IS ACQUIRING THE SECURITY IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S.
(d) Each Warrant Certificate issued in global form and
deposited with DTC shall bear the following legend:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO
IWCL OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
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
REQUESTED 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.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF
OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE
RESTRICTIONS SET FORTH IN THE WARRANT AGREEMENT REFERRED TO HEREIN.
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SECTION 2.03. Execution and Countersignature. Two Officers
shall sign the Warrant Certificates for IWCL by manual or facsimile signature.
If an Officer whose signature is on a Warrant Certificate no longer holds that
office at the time the Warrant Agent countersigns the Warrant Certificate, the
Warrant Certificate shall nevertheless be valid. A Warrant Certificate shall
not be valid until an authorized signatory of the Warrant Agent manually
countersigns the Warrant Certificate. Such authorized signature shall be
conclusive evidence that the Warrant Certificate has been countersigned under
this Agreement.
The Warrant Agent shall initially countersign and deliver
Warrant Certificates which are Units entitling the Holders thereof to purchase
in the aggregate not more than 1,560,000 Warrant Shares upon a written order of
IWCL signed by two Officers.
The Warrant Agent may appoint an agent reasonably acceptable
to IWCL to countersign the Warrant Certificates. Unless limited by the terms
of such appointment, such agent may countersign Warrant Certificates whenever
the Warrant Agent may do so. Each reference in this Agreement to
countersignature by the Warrant Agent includes countersignature by such agent.
Such agent will have the same rights as the Warrant Agent for service of
notices and demands.
SECTION 2.04. Certificate Register. The Warrant Agent shall
keep a register ("Certificate Register") of the Warrant Certificates and of
their transfer and exchange. The Certificate Register shall show the names and
addresses of the respective Holders and the date and number of Warrants
represented on the face of each Warrant Certificate. IWCL and the Warrant
Agent may deem and treat the Person in whose name a Warrant Certificate is
registered as the absolute owner of such Warrant Certificate for all purposes
whatsoever and neither IWCL nor the Warrant Agent shall be affected by notice
to the contrary.
SECTION 2.05. Separation of Warrants and Notes. (a) Prior to
the Separation Date, no Warrant may be sold, assigned or otherwise transferred
to any Person unless, simultaneously with such transfer, the Warrant Agent
receives confirmation from the Trustee for the Notes that the Holder thereof
has requested a transfer of such Notes to the same transferee.
(b) On or after the Separation Date, the holder of a Warrant
Certificate containing a Separability Legend may surrender such Warrant
Certificate accompanied by a written application to the Warrant Agent, duly
executed by the Holder thereof, for a new Warrant Certificate or certificates
not containing the Separability Legend.
SECTION 2.06. Transfer and Exchange. The Warrant
Certificates shall be issued in registered form only and shall be transferable
only upon the surrender of such Warrant Certificate for registration of
transfer. When a Warrant Certificate is presented to the Warrant Agent with a
request to register a transfer, the Warrant Agent shall register the transfer
as requested if the reasonable requirements of the Warrant Agent and of Section
8-401(1) of the Uniform Commercial Code as in effect in the State of New York
are met, as stated to the Warrant Agent in an opinion of counsel if requested
by the Registrar; provided, however, that prior to the Separation Date the
Warrant Agent shall not register a transfer of a Warrant
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Certificate and such transfer will be void and of no effect unless the Notes
that are a part of the same Unit as the Warrants represented by such Warrant
Certificate to be transferred are simultaneously transferred to the same
transferee. To permit the registration of transfers and exchanges, IWCL shall
execute and the Warrant Agent shall countersign Warrant Certificates at the
Warrant Agent's request. All Warrant Certificates issued upon any registration
of transfer or exchange of Warrant Certificates shall be valid obligations of
IWCL, entitled to the same benefits under this Agreement as the Warrant
Certificates surrendered upon such registration of transfer or exchange. No
service charge will be made to a Holder for any registration of transfer or
exchange upon surrender of any Warrant Certificate at the office of the Warrant
Agent maintained for that purpose. However, IWCL may require payment of a sum
sufficient to cover any tax, assessment or other governmental charge that may
be imposed in connection with any registration of transfer or exchange of
Warrant Certificates but not for any exchange or original issuance (not
involving a transfer) pursuant to Section 2.08, 3.04 or 3.05.
During the period beginning on the later of the Issue Date and
the last date on which IWCL or any Affiliate of IWCL was the owner of an
initial Warrant (or any predecessor Warrant) and ending on the date two years
(or such shorter period of time as permitted by Rule 144(k) under the
Securities Act or any successor provision thereunder) from any such date, any
initial Warrant issued or owned during the period set forth above, as the case
may be, and any Warrant issued upon registration of transfer of, or in exchange
for, or in lieu of, such initial Warrant shall be deemed a "Transfer Restricted
Security" and shall be subject to the restrictions on transfer provided in the
legend set forth in Section 2.02(c); provided, however, that the term "Transfer
Restricted Security" shall not include (a) any initial Warrant which is issued
upon transfer of, or in exchange for, any Warrant which is not a Transfer
Restricted Security or (b) any initial Warrant as to which such restrictions on
transfer have been terminated in accordance with this Section 2.06.
Every Transfer Restricted Security shall be subject to the
restrictions on transfer set forth in Section 2.01 and Section 2.11 and shall
bear the Private Placement Legend and the Holder of each Transfer Restricted
Security, by such Holder's acceptance thereof, agrees to be bound by such
restrictions on transfer.
The restrictions imposed by Section 2.01 and Section 2.11 upon
the transferability of any particular Transfer Restricted Security shall cease
and terminate and the Private Placement Legend shall no longer be necessary (a)
in the case of a Regulation S Global Security, on the Regulation S Securities
Exchange Date with respect to the Warrants or (b) in the case of a Rule 144A
Global Security or Definitive Security, on (x) the later of two years (or such
shorter period of time as permitted by Rule 144(k) under the Securities Act or
any successor provision thereunder) after the later of the Issue Date or the
last date on which IWCL or any Affiliate of IWCL was the owner of the
applicable Transfer Restricted Security (or any predecessor of such Transfer
Restricted Security) or (y) (if earlier) if and when such Transfer Restricted
Security has been sold pursuant to an effective registration statement under
the Securities Act or, unless the Holder thereof is an Affiliate of IWCL,
transferred pursuant to Rule 144 or Rule 904 under the Securities Act (or any
successor provision). IWCL shall inform the Warrant Agent in writing of the
effective date of any registration statement registering any Transfer
Restricted Securities under the Securities Act.
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Any Holder of a Global Security shall, by acceptance of such
Global Security, agree that transfers of beneficial interests in such Global
Security may be effected only through a book-entry system maintained by the
Holder of such Global Security (or its agent), and that ownership of a
beneficial interest in the Global Security shall be required tn be reflected in
a book-entry.
SECTION 2.07. Replacement Certificates. If a mutilated
Warrant Certificate is surrendered to the Warrant Agent or if the Holder of a
Warrant Certificate claims that the Warrant Certificate has been lost,
destroyed or wrongfully taken, IWCL shall issue and the Warrant Agent shall
countersign a replacement Warrant Certificate of the same tenor and amount if
the reasonable requirements of the Warrant Agent and of Section 8-405 of the
Uniform Commercial Code as in effect in the State of New York are met. Such
Holder shall furnish an indemnity bond sufficient in the judgment of IWCL and
the Warrant Agent to protect IWCL and the Warrant Agent from any loss which
either of them may suffer if a Warrant Certificate is replaced. IWCL and the
Warrant Agent may charge the Holder for their expenses in replacing a Warrant
Certificate. Every replacement Warrant Certificate is an additional obligation
of IWCL.
SECTION 2.08. Temporary Certificates. Until definitive
Warrant Certificates are ready for delivery, IWCL may prepare and the Warrant
Agent shall countersign temporary Warrant Certificates. Temporary Warrant
Certificates shall be substantially in the form of definitive Warrant
Certificates but may have variations that IWCL considers appropriate for
temporary Warrant Certificates. Without unreasonable delay, IWCL shall prepare
and the Warrant Agent shall countersign definitive Warrant Certificates and
deliver them in exchange for temporary Warrant Certificates.
SECTION 2.09. Cancellation. (a) In the event IWCL shall
purchase or otherwise acquire Warrant Certificates, the same shall thereupon be
delivered to the Warrant Agent for cancellation.
(b) The Warrant Agent and no one else shall cancel and may,
but shall not be required to, destroy all Warrant Certificates surrendered for
transfer, exchange, replacement, exercise or cancellation unless IWCL directs
the Warrant Agent to deliver cancelled Warrant Certificates to IWCL. IWCL may
not issue new Warrant Certificates to replace Warrant Certificates to the
extent they represent Warrants which have been exercised or Warrants which IWCL
has purchased or otherwise acquired.
SECTION 2.10. Book-Entry Provisions for Global Securities.
(a) Each Global Security shall (i) be registered in the name of the Depositary
for such Global Security or the nominee of such Depositary, (ii) be delivered
to the Warrant Agent as custodian for such Depositary and (iii) bear the Global
Securities legend as set forth in Section 2.02(d).
Members of, or participants in, the Depositary ("Agent
Members") shall have no rights under this Warrant Agreement with respect to any
Global Security held on their behalf by the Depositary, or the Warrant Agent as
its custodian, or under such Global Security, and the Depositary may be treated
by IWCL, the Warrant Agent and any agent of IWCL or the Warrant
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Agent as the absolute owner of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent IWCL,
the Warrant Agent or any agent of IWCL or the Warrant Agent, from giving effect
to any written certification, proxy or other authorization furnished by the
Depositary or shall impair, as between the Depositary and its Agent Members,
the operation of customary practices governing the exercise of the rights of a
holder of any Warrant Certificate.
(b) Transfers of a Global Security shall be limited to
transfers of such Global Security in whole, but not in part, to the Depositary,
its successors or their respective nominees. Interests of beneficial owners in
a Global Security may be transferred in accordance with the rules and
procedures of the Depositary and the provisions of Section 2.11. Except as
otherwise provided in Section 2.11, beneficial owners of interests in a Global
Security may obtain Definitive Securities in exchange for their beneficial
interests in such Global Security only if (i) IWCL notifies the Warrant Agent
in writing that the Depositary is no longer willing or able to continue as
Depositary for such Global Security or the Depositary ceases to be a "clearing
agency" registered under the Exchange Act and, in each case, a successor
depository is not appointed by IWCL within 90 days of such notice or such
cessation, as the case may be, (ii) an Event of Default (as defined in the
Indenture has occurred and is continuing under the Indenture and the Warrant
Agent has received a request from the Depositary to effect such exchange or
(iii) IWCL, at its option, notifies the Warrant Agent that it elects to cause
the issuance of the Warrants in definitive form.
(c) Any beneficial interest in one of the Global Securities
that is transferred to a person who takes delivery in the form of an interest
in the other Global Security will, upon transfer, cease to be an interest in
such Global Security and become an interest in the other Global Security and,
accordingly, will thereafter be subject to all transfer restrictions, if any,
and other procedures applicable to beneficial interests in such other Global
Security for as long as it remains such an interest.
(d) In connection with any transfer of a portion of the
beneficial interest in a Global Security to beneficial owners pursuant to
Section 2.10(b) or Section 2.11, the Warrant Agent shall reflect on its books
and records the date and a decrease in the aggregate number of Warrants in such
Global Security in an amount equal to the aggregate number of Warrants in the
beneficial interest in such Global Security to be transferred, and IWCL shall
execute, and the Warrant Agent shall countersign and deliver, one or more
Definitive Securities of like tenor and amount.
(e) In connection with the transfer of an entire Global
Security to beneficial owners thereof pursuant to subsection (b) of this
Section, such Global Security shall be deemed to be surrendered to the Warrant
Agent for cancellation, and IWCL shall execute, and the Warrant Agent shall
authenticate and deliver, to each beneficial owner identified by the Depositary
in exchange for its beneficial interest in such Global Security, an equal
aggregate number of Warrants represented by Definitive Securities of authorized
denominations.
(f) Any Definitive Security delivered in exchange for an
interest in a Rule 144A Global Security pursuant to Section 2.10(b) or Section
2.10(d) shall, unless the circumstances
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provided in Section 2.11(a)(i)(x) exist or except as otherwise provided in
Section 2.11(e), bear the Private Placement Legend.
(g) The registered holder of a Global Security may grant
proxies and otherwise authorize any person, including Agent Members and persons
that may hold interests through Agent Members, to take any action which a
Holder is entitled to take under this Warrant Agreement or the Warrants.
SECTION 2.11. Special Transfer Provisions. (a) Transfers to
Non-QIB Institutional Accredited Investors. The following provisions shall
apply with respect to the registration of any proposed transfer of a Transfer
Restricted Security to any Institutional Accredited Investor which is not a QIB
(excluding Non-U.S. Persons):
(i) The Warrant Agent shall register the transfer of any
Warrant Certificate, whether or not such Warrant Certificate bears the
Private Placement Legend, if (x) the requested transfer is subsequent
to a date which is two years after the later of the Issue Date and the
last date on which IWCL or any of its Affiliates was the owner of such
Warrant or (y) the proposed transferee has delivered to the Warrant
Agent a certificate substantially in the form set forth in Exhibit C
hereto.
(ii) If the proposed transferor is an Agent Member holding a
beneficial interest in a Rule 144A Global Security seeking to transfer
a Definitive Security to another person, upon receipt by the Warrant
Agent of (x) the documents, if any, required by paragraph (i) and (y)
instructions given in accordance with the Depositary's and the Warrant
Agent's procedures therefor, the Warrant Agent shall reflect on its
books and records the date and a decrease in the number of Warrants
represented by Rule 144A Global Security in an amount equal to the
number of Warrants represented by such Rule 144A Global Security to be
transferred, and IWCL shall execute, and the Warrant Agent shall
authenticate and deliver, one or more Definitive Certificates of like
tenor and amount.
(iii) An Institutional Accredited Investor which is not a QIB
and not a Non-U.S. Person shall only hold Definitive Securities.
(b) Transfers to QIBs. The following provisions shall apply
with respect to the registration of any proposed transfer of a Transfer
Restricted Security to a QIB (other than a Non-U.S. person);
(i) If the Warrant to be transferred consists of (x)
Definitive Securities, the Security Registrar shall register the
transfer if such transfer is being made by a proposed transferor who
has delivered to the Warrant Agent a certificate substantially in the
form set forth in Exhibit D hereto to the Warrant Agent or (y) an
interest in a Rule 144A Global Security, the transfer of such interest
may be effected only through the book-entry system maintained by the
Depositary.
(ii) If the Warrant to be transferred consists of Definitive
Securities, upon receipt by the Warrant Agent of instructions given in
accordance with the Depositary's and the
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Warrant Agent's procedures therefor, the Warrant Agent shall reflect
on its books and records the date and an increase in the number of
Warrants represented by the Rule 144A Global Security in an amount
equal to the number of Warrants represented by the Definitive
Securities to be transferred, and the Warrant Agent shall cancel the
Definitive Securities so transferred.
(c) Transfers of Interests in a Regulation S Global Security
to U.S. Persons. The following provisions shall apply with respect to any
transfer of interests in a Regulation S Global Security to U.S. Persons:
(i) If the beneficial interest to be transferred is in a
Regulation S Temporary Global Security, transfers by an owner of a
beneficial interest in such Regulation S Global Security to a
transferee who takes delivery of such interest through the Rule 144A
Global Security will be made only upon receipt by the Warrant Agent
from the transferor of a certificate substantially in the form set
forth in Exhibit D hereto to the effect that such transfer is being
made to a person who the transferor reasonably believes is a QIB
within the meaning of Rule 144A in a transaction meeting the
requirements of Rule 144A; and
(ii) If the beneficial interest to be transferred is in a
Regulation S Permanent Global Security, the Warrant Agent shall
register the transfer of any such Warrant Certificate without
requiring any additional certification.
(d) Transfers to Non-U.S. Person at Any Time. The following
provisions shall apply with respect to any transfer of a Warrant Certificate to
a Non-U.S. Person:
(i) The Warrant Agent shall register any proposed transfer to
any Non-U.S. Person if the Warrant Certificate to be transferred is a
Definitive Security or an interest in a Rule 144A Global Security only
upon receipt of a certificate substantially in the form set forth in
Exhibit E hereto from the proposed transferor. Prior to the
termination of the Regulation S Restricted Period, any Non-U.S. Person
shall be delivered a beneficial interest in the Regulation S Temporary
Global Security.
(ii) (x) If the proposed transferor is an Agent Member
holding a beneficial interest in a Rule 144A Global Security, upon
receipt by the Warrant Agent of (1) the documents required by
paragraph (i) of this paragraph (d) and (2) instructions in accordance
with the Depositary's and the Warrant Agent's procedures, the Warrant
Agent shall reflect on its books and records the date and a decrease
in the number of Warrants represented by such Rule 144A Global
Security in an amount equal to the number of Warrants represented by
the beneficial interest in such Rule 144A Global Security to be
transferred, and (y) upon receipt by the Warrant Agent of instructions
given in accordance with the Depositary's and the Warrant Agent's
procedures, the Warrant Agent shall reflect on its books and records
the date and an increase in the number of Warrants represented by the
Regulation S Global Security in an amount equal to the number of
Warrants represented by the Definitive Securities or such Rule 144A
Global Security, as the case may be, to be transferred, and the
Warrant Agent shall cancel
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the Definitive Security so transferred or decrease the number of
Warrants represented by such Rule 144A Global Security, as the case
may be.
(e) Private Placement Legend. Upon the transfer, exchange or
replacement of Warrant Certificates not bearing the Private Placement Legend,
the Warrant Agent shall deliver Warrant Certificates that do not bear the
Private Placement Legend. Upon the transfer, exchange or replacement of
Warrant Certificates bearing the Private Placement Legend, the Warrant Agent
shall deliver only Warrant Certificates that bear the Private Placement Legend
unless either (i) the Private Placement Legend is no longer required pursuant
to Section 2.01 and Section 2.06, or (ii) there is delivered to the Warrant
Agent an opinion of counsel reasonably satisfactory to IWCL and the Warrant
Agent to the effect that neither such legend nor the related restrictions on
transfer are required in order to maintain compliance with the provisions of
the Securities Act.
(f) General. By its acceptance of any Warrant Certificate,
or any beneficial interest in any Global Security, bearing the Private
Placement Legend, each Holder of such Warrant Certificate or beneficial
interest acknowledges the restrictions on transfer of such Warrant Certificate
set forth in this Warrant Agreement and in the Private Placement Legend and
agrees that it will transfer such Warrant Certificate only as provided in this
Warrant Agreement. The Warrant Agent shall not register a transfer of any
Warrant Certificate unless such transfer complies with the restrictions on
transfer of such Warrant Certificate set forth in this Warrant Agreement. In
connection with any transfer of Warrant Certificates to an Institutional
Accredited Investor, each such Holder or beneficial owner agrees by its
acceptance of the Warrant Certificates to furnish the Warrant Agent or IWCL
such certifications, legal opinions or other information as such Person may
reasonably require to confirm that such transfer is being made pursuant to an
exemption from, or a transaction not subject to, the registration requirements
of the Securities Act; provided that the Warrant Agent shall not be required to
determine (but may rely on a determination made by IWCL with respect to) the
sufficiency of any such certifications, legal opinions or other information.
ARTICLE 3
Exercise Terms
SECTION 3.01. Exercise Price. Each Warrant shall initially
entitle the Holder thereof, subject to adjustment pursuant to the terms of this
Agreement, to purchase 5.2 shares of Class A Common Stock for a per share
exercise price (the "Exercise Price") of $20.90.
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SECTION 3.02. Exercise Periods. (a) Subject to the terms and
conditions set forth herein, the Warrants shall be exercisable at any time or
from time to time after July 16, 1998; provided, however, that holders of
Warrants will be able to exercise their Warrants only if the Common Shelf
Registration Statement relating to the Warrant Shares is effective and the
Warrant Shares are qualified for sale or exempt from qualification under the
applicable securities laws of the states or other jurisdictions in which such
holders reside.
(b) No Warrant shall be exercisable after July 15, 2005, at
which time the Warrants shall automatically expire (the "Expiration Date").
SECTION 3.03. Expiration. Each Warrant shall terminate and
become void as of the earlier of (i) the close of business on the Expiration
Date or (ii) the date such Warrant is exercised. IWCL shall give notice not
less than 90 and not more than 120 days prior to the Expiration Date to the
Holders of all then outstanding Warrants to the effect that the Warrants will
terminate and become void as of the close of business on the Expiration Date;
provided, however, that if IWCL fails to give notice as provided in this
Section 3.03, the Warrants will nevertheless expire and become void on the
Expiration Date.
SECTION 3.04. Manner of Exercise. Warrants may be exercised
upon (i) surrender to the Warrant Agent at the principal corporate trust office
of the Warrant Agent, together with the form of election to purchase Class A
Common Stock on the reverse thereof duly filled in and signed by the Holder
thereof, and (ii) payment to the Warrant Agent, for the account of IWCL, of the
Exercise Price for each Warrant Share issuable upon the exercise of such
Warrants then exercised. Such payment shall be made in cash or by certified or
official bank check payable to the order of IWCL or by wire transfer of funds
to an account designated by IWCL for such purpose. Subject to Section 3.02,
Warrants shall be exercisable at the election of the Holders thereof either in
full at any time or in part from time to time, and in the event that a Warrant
Certificate is surrendered for exercise of less than all the Warrants
represented by such Warrant Certificate at any time prior to the Expiration
Date, a new Warrant Certificate representing the remaining Warrants shall be
issued. The Warrant Agent shall countersign and deliver the required new
Warrant Certificates, and IWCL, at the Warrant Agent's request, shall supply
the Warrant Agent with Warrant Certificates duly signed on behalf of IWCL for
such purpose.
SECTION 3.05. Issuance of Warrant Shares. Subject to Section
2.07, upon the surrender of Warrant Certificates and payment of the per share
Exercise Price, as set forth in Section 3.04, IWCL shall issue and cause The
Bank of New York, as transfer agent for the Class A Common Stock or any
successor thereto ("Transfer Agent") to countersign and deliver 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
so purchased upon the exercise of such Warrants or other securities or property
to which it is entitled, registered or otherwise, to the Person or Persons
entitled to receive the same, together with cash as provided in Section 3.06 in
respect of any fractional Warrant Shares otherwise issuable upon such exercise.
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
Warrant Certificates and payment of the per share Exercise
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Price, as aforesaid; provided, however, that if, at such date, the transfer
books for the Warrant Shares shall be closed, the certificates for the Warrant
Shares in respect of which such Warrants are then exercised shall be issuable
as of the date on which such books shall next be opened and until such date
IWCL shall be under no duty to deliver any certificates for such Warrant
Shares; provided further, however, that such transfer books, unless otherwise
required by law, shall not be closed at any one time for a period longer than
20 calendar days.
SECTION 3.06. Fractional Warrant Shares. IWCL shall not be
required to issue fractional Warrant Shares on the exercise of Warrants. If
more than one Warrant shall be exercised in full at the same time by the same
Holder, the number of whole Warrant Shares which shall be issuable upon such
exercise shall be computed on the basis of the aggregate number of Warrant
Shares purchasable pursuant thereto. If any fraction of a Warrant Share would,
except for the provisions of this Section 3.06, be issuable on the exercise of
any Warrant (or specified portion thereof), IWCL shall pay at the time of
exercise an amount in cash equal to the Current Market Value per Warrant Share,
as determined on the Business Day immediately preceding the date the Warrant is
exercised, multiplied by such fraction, computed to the nearest whole cent.
SECTION 3.07. Reservation of Warrant Shares. IWCL shall at
all times keep reserved out of its authorized shares of Class A Common Stock a
number of shares of Class A Common Stock sufficient to provide for the exercise
of all outstanding Warrants. The Bank of New York, as U.S. Registrar, and
Codan Services Limited, as Bermuda Registrar, for the Class A Common Stock or
any successor thereto (in each case, the "Registrar"), shall at all times until
the Expiration Date reserve such number of authorized shares as shall be
required for such purpose. IWCL will keep a copy of this Agreement on file
with the Transfer Agent. All Warrant Shares which may be issued upon exercise
of Warrants shall, upon issue, be fully paid, nonassessable, free of preemptive
rights and free from all taxes, liens, charges and security interests with
respect to the issue thereof. IWCL will supply such Transfer Agent with duly
executed stock certificates for such purpose and will itself provide or
otherwise make available any cash which may be payable as provided in Section
3.06. IWCL will furnish to such Transfer Agent a copy of all notices of
adjustments (and certificates related thereto) transmitted to each Holder.
Before taking any action which would cause an adjustment
pursuant to Article 4 to reduce the Exercise Price below the then par value
($0.01 per share) of the Class A Common Stock, IWCL shall take any and all
corporate action which may, in the opinion of its counsel, be necessary in
order that IWCL may validly and legally issue fully paid and nonassessable
shares of Class A Common Stock at the Exercise Price as so adjusted.
IWCL covenants that all shares of Class A Common Stock which
may be issued upon exercise of Warrants will, upon issue, be duly and validly
issued, fully paid, nonassessable, free of preemptive rights, free from all
taxes and free from all liens, charges and security interests, created by or
through IWCL, with respect to the issue thereof.
SECTION 3.08. Compliance with Law. Notwithstanding anything
in this Agreement to the contrary, in no event shall a Holder be entitled to
exercise a Warrant unless (i)
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a registration statement filed under the Securities Act in respect of the
issuance of the Warrant Shares is then effective or (ii) in the opinion of
counsel to IWCL addressed to the Warrant Agent 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 or other jurisdictions in which such
holders reside.
ARTICLE 4
Antidilution Provisions
SECTION 4.01. Changes in Class A Common Stock. The number of
Warrant Shares that may be purchased upon the exercise of each Warrant (the
"Exercise Rate") and the related Exercise Price will both be subject to
adjustment from time to time upon the occurrence of the events enumerated in
this Article 4. For purposes of this Article 4, "Common Stock" means the Class
A Common Stock and any other stock of IWCL for which the Warrants may be
exercised and where, as a result of this definition, the term refers to more
than one class of securities, the adjustment provisions of this Article 4 shall
be equitably adjusted to achieve as nearly as practicable the intended result
as evidenced by the text of such adjustment provisions.
SECTION 4.02. Adjustments for Change in Capital Stock. If at
any time after the date of this Agreement, IWCL:
(1) pays a dividend or makes a distribution on its Common
Stock in shares of its Common Stock;
(2) subdivides its outstanding shares of Common Stock
into a greater number of shares;
(3) combines its outstanding shares of Common Stock into
a smaller number of shares;
(4) pays a dividend or makes a distribution on its Common
Stock in shares of its capital stock other than
Common Stock; or
(5) issues by reclassification of its Common Stock any
shares of its capital stock;
then the Exercise Price and the Exercise Rate 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 IWCL which such holder would have owned immediately following
such action if such Warrant had been exercised immediately prior to such
action.
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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 and upon exercise of a Warrant the
holder may receive shares of two or more classes or series of capital stock of
IWCL, IWCL shall determine the allocation of the adjusted Exercise Price
between the classes of capital stock. After such allocation, the exercise
privilege and the Exercise Price of each class of capital stock shall
thereafter be subject to adjustment on terms comparable to those applicable to
Common Stock in this Article 4.
Such adjustment shall be made successively whenever any event
listed above occurs.
SECTION 4.03. Adjustments for Rights Issue. If IWCL
distributes any rights, options or warrants to all holders of its Common Stock
entitling them for a period expiring within 60 days after the record date
mentioned below to purchase shares of Common Stock or securities convertible
into, or exchangeable or exercisable for, Common Stock at a price per share
less than the Current Market Value per share as of the Time of Determination,
the Exercise Price shall be adjusted in accordance with the formula:
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O + N x P
-----
E' = E x M
----------
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 that
may be acquired in connection with such distribution.
P = the price per share to acquire such additional shares
of Common Stock.
M = the Current Market Value per share, minus, in case
(i) any other distribution has occurred to which
Section 4.02(4) applies or (ii) any other
distribution which has occurred to which Section 4.04
applies, and with respect to which, in either case,
(x) the record date shall occur on or before the
record date for the distribution to which this
Section 4.02 applies or (y) the Ex-Dividend Time (as
defined in the definition of Time of Determination)
shall occur on or after the date of the Time of
Determination for the distribution to which this
Section 4.03 applies, the fair market value (on the
record date for the distribution to which this
Section 4.03 applies) of (1) the capital stock of
IWCL distributed in respect of each share of Common
Stock in such Section 4.02(4) distribution and (2)
the assets of IWCL or debt securities or any rights,
warrants or options to purchase securities of IWCL
distributed in respect of each share of Common Stock
in such Section 4.04 distribution.
The Board shall determine fair market values in good faith for
the purpose of this Section 4.03.
The adjustment shall become effective immediately after the
record date for the determination of stockholders entitled to receive the
rights, warrants or options to which this Section 4.03 applies. To the extent
that shares of Common Stock are not delivered after the expiration of such
rights or warrants, the Exercise Price shall be readjusted to the Exercise
Price which would otherwise be in effect had the adjustment made upon the
issuance of such rights or warrants been made on the basis of delivery of only
the number of shares of Common Stock actually delivered. In the event that
such rights or warrants are not so issued, the Exercise Price shall again be
adjusted to be the Exercise Price which would then be in effect if such date
fixed for determination of stockholders entitled to receive such rights or
warrants had not been so fixed.
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No adjustment shall be made under this Section 4.03 if the
application of the formula stated above in this Section 4.03 would result in a
value of E' that is higher than the value of E.
SECTION 4.04. Adjustment for Other Distributions. If IWCL
distributes to all holders of its Common Stock any of its assets, debt
securities or any rights, options or warrants to purchase debt securities,
assets or other securities of IWCL, the Exercise Price shall be adjusted in
accordance with the formula:
E' = E x M - F
-----
M
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
M = the Current Market Value (including securities or
cash, but excluding (1) distributions of capital
stock referred to in Section 4.02 and distributions
of rights, warrants or options referred to in Section
4.03 and (2) cash dividends or other distributions
that are paid out of consolidated current net
earnings retained in the business as shown on the
books of IWCL unless such cash dividends or other
cash distributions are Extraordinary Cash Dividends
(as hereinafter defined)) per share of Common Stock
on the record date for the determination of
stockholders entitled to receive the distribution.
F = the fair market value (as determined in good faith by
the Board) of the assets, securities, rights or
warrants applicable to one share of Common Stock as
of the Time of Determination for the determination of
stockholders entitled to receive the distribution.
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 4.04 shall not apply to cash dividends or cash
distributions paid out of consolidated current or retained earnings or earned
surplus as shown on the books of IWCL prepared in accordance with generally
accepted accounting principles other than any Extraordinary Cash Dividend.
Also, this subsection shall not apply to rights, options or warrants referred
to in Section 4.03. An "Extraordinary Cash Dividend" shall be any cash
dividend other than a dividend that, when added to all other cash dividends
paid in the twelve month period prior to the declaration date of such dividend
(excluding any such other dividend included in a previous adjustment of the
Exercise Price under this Section 4.04), does not exceed 10% of the Current
Market Value per share of Common Stock on such declaration date. In all cases,
IWCL
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shall give the Warrant holders at least 10 days notice of a record date for any
dividend payment on the Common Stock.
SECTION 4.05. Adjustment for Common Stock Issue. If IWCL
issues shares of Common Stock for a consideration per share less than the
Current Market Value per share on the date IWCL fixes the offering price of
such additional shares, the Exercise Price shall be adjusted in accordance with
the formula:
O + P
E' = E x M --
-----
O + N
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 additional shares.
N = the number of additional shares issued.
P = the aggregate consideration received for the issuance
of such additional shares.
M = the Current Market Value per share on the date of
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 Section 4.05 does not apply to:
(1) any of the transactions described in Sections 4.02,
4.03 and 4.04;
(2) the exercise of Warrants or other warrants
outstanding on the date of this Agreement, or the conversion or exchange of
other securities convertible or exchangeable for Common Stock;
(3) Common Stock issued to IWCL's or Iridium's employees
under bona fide employee benefit plans adopted by the Board and approved by the
holders of Common Stock when required by law, and Common Stock issued to the
non-employee directors of IWCL or Iridium upon the exercise of options granted
to such persons, if such Common Stock would otherwise be covered by this
Section 4.05 (but only to the extent that the aggregate number of shares
excluded hereby and issued after the date of this Agreement shall not exceed 4%
(in
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equivalent value) of the Class 1 Membership Interests in Iridium outstanding at
the time of the adoption of each such plan, exclusive of antidilution
adjustments thereunder);
(4) Common Stock issuable upon the exercise of rights or
warrants issued to the holders of Common Stock;
(5) Common Stock issued to stockholders of any person
which is merged with IWCL or any subsidiary of IWCL or Iridium in proportion to
their stock holdings of such person immediately prior to such merger, upon such
merger;
(6) Common Stock issued in a bona fide public offering
pursuant to a firm commitment underwriting;
(7) Common Stock issued in a bona fide offering under
Rule 144A or Regulation S or a bona fide private placement, in each case to
multiple purchasers; or
(8) Common Stock issued in exchange for Class 1
Membership Interests of Iridium LLC pursuant to the Interest Exchange
Agreement, dated as of June 9, 1997 between IWCL and Iridium.
SECTION 4.06. Adjustment for Convertible Securities Issue.
If IWCL issues any securities convertible into or exchangeable for Common Stock
(other than securities issued in transactions described in Sections 4.02, 4.03
and 4.04) for a consideration per share of Common Stock initially deliverable
upon conversion or exchange of such securities less than the Current Market
Value per share of the Common Stock on the date of issuance of such convertible
or exchangeable securities, the Exercise Price shall be adjusted in accordance
with the formula:
O + P
---
E' = E x M
---
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 additional shares.
D = the maximum number of shares deliverable upon
conversion of or in exchange for such securities at
the initial conversion or exchange rate.
P = the aggregate consideration received for the issuance
of such securities.
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M = the Current Market Value per share on the date of
issuance of such securities.
The adjustment shall be made successively whenever any such
issuance is made, and shall become effective immediately after such issuance.
If all the Common Stock deliverable upon conversion or
exchange of such securities has not been issued when such securities are no
longer convertible, exchangeable or 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 Section 4.06 does not apply to:
(1) convertible or exchangeable securities issued to
stockholders of any person which is merged with IWCL or any subsidiary of IWCL,
in proportion to their stock holdings of such person immediately prior to such
merger, upon such merger;
(2) convertible or exchangeable securities issued in a
bona fide public offering pursuant to a firm commitment underwriting; or
(3) convertible or exchangeable securities issued in a
bona fide offering under Rule 144A or Regulation S or a bona fide private
placement, in each case to multiple purchasers.
SECTION 4.07. Consideration Received. For purposes of any
computation respecting consideration received pursuant to Sections 4.05 and
4.06, the following shall apply:
(1) 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 IWCL for any underwriting of the issue or otherwise in
connection therewith;
(2) 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 (irrespective of the accounting treatment
thereof) and described in a Board resolution which shall be filed with the
Warrant Agent; and
(3) 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 IWCL for the issuance of
such securities plus the additional minimum consideration, if any, to be
received by IWCL upon the conversion or exchange thereof (the consideration in
each case to be determined in the same manner as provided in paragraphs (1) and
(2) of this Section 4.07); provided that if consideration in addition to such
additional minimum consideration is received by IWCL then the Exercise Price
shall be promptly readjusted to the
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Exercise Price which would then be in effect had such additional consideration
been included in the calculation of the Exercise Price.
SECTION 4.08. When No Adjustments Required. To the extent
the Warrants become convertible into cash pursuant to Section 4.20, no
adjustment shall be made thereafter. Interest will not accrue on the cash.
SECTION 4.09. Notice of Adjustments. Whenever the Exercise
Rate or Exercise Price is adjusted, IWCL shall provide the written notices
required by Section 4.19.
SECTION 4.10. Voluntary Increase or Reduction. IWCL from
time to time may increase the Exercise Rate or decrease the Exercise Price, as
the case may be, by any amount for any period of time if the period is at least
20 days and if the increase or decrease, as the case may be, is irrevocable
during the period.
Whenever the Exercise Rate is increased or the Exercise Price
is decreased, as the case may be, IWCL shall mail to registered Warrant holders
and the Warrant Agent a notice of the increase or decrease, as the case may be.
IWCL shall mail the notice at least 15 days before the date the increased
Exercise Rate or decreased Exercise Rate or decreased Exercise Price, as the
case may be, and the period it will be in effect.
An increase in the Exercise Rate or decrease in the Exercise
Price, as the case may be, does not change or adjust the Exercise Rate or
Exercise Price, as the case may be, otherwise in effect, or as used for
calculations, for purposes of Sections 4.02, 4.03, 4.04, 4.05 and 4.06.
SECTION 4.11. Notice of Certain Transactions. If: (1) IWCL
takes any action that would require an adjustment in the Exercise Rate pursuant
to Section 4.02, 4.03 or 4.04 or (2) IWCL takes any action that would require a
supplemental Warrant Agreement pursuant to Section 4.20, IWCL shall mail to
registered Warrant holders and the Warrant Agent a notice stating the proposed
record date for a dividend or distribution or the expected effective date of a
subdivision, combination, reclassification, consolidation, merger, transfer,
lease, liquidation or dissolution. IWCL shall mail the notice at least 20 days
before such date. Failure to mail the notice or any defect in it shall not
affect the validity of the transaction.
SECTION 4.12. Self-Tenders. In case of the consummation of a
tender or exchange offer (other than an odd-lot tender offer) made by IWCL or
any subsidiary of IWCL to all or substantially all of IWCL's stockholders for
all or any portion of the Common Stock where the cash and value of any other
consideration included in such payment per share of Common Stock exceeds the
Current Market Value of the common Stock on the business day immediately
preceding the commencement of the self-tender or exchange offer, the Exercise
Price shall be reduced on the 5th Business Day following the Expiration Time
(as defined) so that it shall equal the price determined by multiplying the
Exercise Price in effect immediately prior to the last time tenders or
exchanges may be made pursuant to such tender or exchange offer (the
"Expiration Time") by a fraction, the numerator of which shall be the number of
shares of Common Stock outstanding (without giving effect to any reduction in
respect of any tendered of
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exchanged shares) on the Expiration Time multiplied by the Current Market Value
of the Common Stock on the business day immediately preceding the commencement
of the self-tender or exchange offer, and the denominator of which shall be the
sum of (A) the fair market value (determined by the Board in good faith) of the
aggregate consideration payable to stockholders based on the actual acceptances
(up to any maximum specified in the terms of the tender or exchange offer) of
all shares validly tendered or exchanged and not withdrawn as of the Expiration
Time (the shares deemed so accepted, up to any such maximum, being referred to
as the "Purchased Shares") and (B) the product of the number of shares of
Common Stock outstanding (less any Purchased Shares) on the Expiration Time and
the Current Market Value of the Common Stock on the business day immediately
preceding the commencement of the self-tender or exchange offer, such reduction
to become effective immediately prior to the opening of business on the day
following the Expiration Time.
SECTION 4.13. Warrant Agent's Disclaimer. The Warrant Agent
has no duty to determine when an adjustment under this Article 4 should be
made, how such adjustment should be made or what such adjustment should be.
The Warrant Agent has no duty to determine whether any provisions of a
supplemental Warrant Agreement under Section 4.20 are correct. The Warrant
Agent makes no representation or warranty as to the validity or value of any
securities or assets issued upon exercise of Warrants or pursuant to any
adjustment. The Warrant Agent shall not be responsible for IWCL's failure to
comply with Article 4.
SECTION 4.14. When Issuance or Payment May Be Deferred. In
any case in which this Article 4 shall require that an adjustments in the
Exercise Rate be made effective as of a record date for a specified event, IWCL
may elect to defer until the occurrence of such event (i) issuing to the holder
of any Warrant exercised after such record date the Warrant Shares and other
capital stock of IWCL, if any, issuable upon such exercise over and above the
Warrant Shares and other capital stock of IWCL, if any, issuable upon such
exercise on the basis of the Exercise Rate and (ii) paying to such holder any
amount in cash in lieu of a fractional share pursuant to Section 3.06;
provided, however, that IWCL 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.
SECTION 4.15. Adjustment in Exercise Rate. Upon each
adjustment of the Exercise Price pursuant to this Article 4 with respect to the
Warrants, each such Warrant outstanding prior to the making of the adjustment
in 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:
N' = N x E
--
E'
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where:
N' = the adjusted Exercise Rate of the Warrants.
N = the Exercise Rate of the Warrants, prior to
adjustment.
E' = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
SECTION 4.16. Form of Warrants. Irrespective of any
adjustments in the Exercise Price or the Exercise Rate or kind of shares or
other assets 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 or other assets as are stated in the Warrants
initially issuable pursuant to this Agreement.
SECTION 4.17. Limitation on Adjustments. IWCL shall take no
action which reduces the Exercise Price below the then par value of the Warrant
Shares.
SECTION 4.18. No Dilution or Impairment. If any event shall
occur as to which the provisions of Article 4 are not strictly applicable but
the failure to make any adjustment would adversely affect the purchase rights
represented by the Warrants in a way that is contrary to the manifest and
essential intent and principles of Article 4, then, in each such case, IWCL
shall appoint an investment banking firm of recognized national standing, or
any other financial expert that does not (or whose directors, officers,
employees, affiliates or stockholders do not) have a direct or material
indirect financial interest in IWCL, who has not been, and, at the time it is
called upon to give independent financial advice to IWCL, is not (and none of
its directors, officers, employees, affiliates or stockholders are) a promoter,
director or officer of IWCL, which shall give their opinion upon the
adjustment, if any, on a basis consistent with the manifest and essential
intent and principles established in Article 4, necessary to preserve, without
dilution, the purchase rights, represented by the Warrants. Upon receipt of
such opinion, IWCL will promptly mail a copy thereof to the Warrant Agent and
the Warrant holders and shall make the adjustments described therein.
SECTION 4.19. Notices to Warrant Holders; Rights of Warrant
Holders. Upon any adjustment of the Exercise Rate pursuant to Article 4, IWCL
shall as soon as practicable (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 (who may be the regular auditors of IWCL) setting forth
the Exercise Rate and Exercise Price for each of the Warrants 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 of the
Exercise Rate, upon exercise of a Warrant, and the Exercise Price in effect
after such adjustment and (ii) cause to be given to each of the registered
holders of the Warrant certificates at his or her address appearing on the
Warrant register written notice of such adjustments by first-class mail,
postage prepaid. Where appropriate, such notice may be
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given in advance and included as a part of the notice required to be mailed
under the other provisions of this Section 4.19.
In case:
(a) IWCL 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 and other than issuances in exchange for equivalent
consideration; or
(b) IWCL shall authorize the distribution to all holders
of shares of Common Stock of evidences of its indebtedness or assets
(other than cash dividends or cash distributions payable out of
consolidated earnings or earned surplus or dividends payable in shares
of Common Stock or distributions referred to in Section 4.02 each and
other than distributions in exchange for equivalent consideration, but
including Extraordinary Cash Dividends); or
(c) of any consolidation or merger to which IWCL is a
party and for which approval of any shareholders of IWCL is required,
or of the conveyance or transfer of the properties and assets of IWCL
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 by IWCL for shares of Common
Stock; or
(d) of the voluntary or involuntary dissolution,
liquidation or winding up of IWCL; or
(e) IWCL proposes to take any action (other than actions
of the character described in Section 4.02) which would require an
adjustment of the Exercise Price pursuant to Article 4;
then IWCL shall cause to be filed with the Warrant Agent and shall cause to be
given to each of the registered holders of the Warrant certificates at the
address appearing on the Warrant register, at least 10 days (or 5 days in any
case specified in clauses (a) or (b) 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 (i)
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, or (ii) the initial or record expiration date set forth in any
tender offer or exchange offer for shares of Common Stock, or (iii) the date on
which any such consolidation, merger, conveyance, transfer, reclassification,
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
share of Common Stock shall be entitle to exchange such shares for securities
or other property, if any, deliverable upon such consolidation, merger,
conveyance, transfer, reclassification, dissolution, liquidation or winding up.
The failure to give the notice required by the Section 4.19 or any defect
therein shall not affect the legality of
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validity of any issuance, right, option, warrant, distribution, tender offer,
exchange offer, consolidation, merger, conveyance, transfer, reclassification,
dissolution, liquidation or winding up, or the vote upon any action.
SECTION 4.20. Combination; Liquidation. (a) Except as
provided in Section 4.20(b), in the event of a Combination, each Holder shall
have the right to receive upon exercise of the Warrants the kind and amount of
shares of capital stock or other securities or property which such Holder would
have been entitled to receive upon or as a result of such Combination had such
Warrant been exercised immediately prior to such event. Unless paragraph (b)
is applicable to a Combination, IWCL shall provide that the surviving or
acquiring Person (the "Successor Company") in such Combination will enter into
a supplemental agreement with the Warrant Agent confirming the Holders' rights
pursuant to this Section 4.20(a) and providing for adjustments, which shall be
as nearly equivalent as may be practicable to the adjustments provided for in
this Article 4. The provisions of this Section 4.20(a) shall similarly apply
to successive Combinations involving any Successor Company.
(b) In the event of (i) a Combination where consideration to
the holders of Common Stock in exchange for their shares is payable solely in
cash or (ii) the dissolution, liquidation or winding-up of IWCL, the holders of
the Warrants shall be entitled to receive, upon surrender of their Warrant
Certificates, distributions on an equal basis with the holders of Common Stock
or other securities issuable upon exercise of the Warrants, as if the Warrants
had been exercised immediately prior to such event, less the Exercise Price.
In case of any Combination described in this Section 4.20(b),
the surviving or acquiring Person and, in the event of any dissolution,
liquidation or winding-up of IWCL, IWCL, shall deposit promptly with the
Warrant Agent the funds, if any, necessary to pay to the holders of the
Warrants the amounts to which they are entitled as described above. After such
funds and the surrendered Warrant Certificates are received, the Warrant Agent
is required to deliver a check in such amount as is appropriate (or, in the
case of consideration other than cash, such other consideration as is
appropriate) to such Person or Persons as it may be directed in writing by the
Holders surrendering such Warrants. Upon receipt of such payment, if any, the
Warrants will expire and the rights of the Holders thereof shall cease.
If this Section 4.20 applies, Sections 4.02, 4.03, 4.04, 4.05,
4.06 and 4.12 shall not apply.
SECTION 4.21. Minimum Adjustment. The adjustments required
by the preceding Sections of this Article 4 shall be made whenever and as often
as any specified event requiring an adjustment shall occur, except that no
adjustment of the Exercise Price or the number of shares of Common Stock
issuable upon exercise of Warrants that would otherwise be required shall be
made unless and until such adjustment either by itself or with other
adjustments not previously made increases or decreases by at least 1% the
Exercise Price or the number of shares of Common Stock issuable upon exercise
of Warrants immediately prior to the making of such adjustment. Any adjustment
representing a change of less than such minimum amount shall be carried forward
and made as soon as such adjustment, together with other adjustments required
by this Article 4 and not previously made, would result in a minimum
adjustment. For any adjustment, any specified event shall be deemed to have
occurred at the close of business on
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the date of its occurrence. In computing adjustments under this Article 4,
fractional interests in Common Stock shall be taken into account to the nearest
one-hundredth of a share.
SECTION 4.22. Motorola Guarantee Warrants; Iridium Capital
Stock. Notwithstanding anything to the contrary contained in this Article 4,
no adjustment will be made, directly or indirectly, as a direct or indirect
result of the issuance, acceleration or exercise of the warrants to compensate
Motorola for issuance or modification of the Guarantee Agreement or any
guarantee provided pursuant to the Motorola Additional Guarantee, in each case
as required by the MOU, or the issuance or other distribution of membership
interests or other capital stock by Iridium.
ARTICLE 5
Registration Rights
SECTION 5.01. Effectiveness of Registration Statement.
Subject to Section 5.02, IWCL shall cause to be filed pursuant to Rule 415 (or
any successor provision) of the Securities Act not later than the first date on
which IWCL is eligible to file a registration statement on Form S-3, a shelf
registration statement relating to the offer and sale of the Warrants by the
Holders from time to time in accordance with the methods of distribution
elected by such Holders and set forth in such registration statement (the
"Warrant Shelf Registration Statement"), and shall use its reasonable efforts
to cause the Warrant Shelf Registration Statement to be declared effective on
or before 365 days after the Issue Date. Subject to Section 5.02, IWCL shall
cause to be filed pursuant to Rule 415 (or any successor provision) of the
Securities Act not later than the first date on which IWCL is eligible to file
a registration statement on Form S-3, a shelf registration statement covering
the issuance of Warrant Shares to the Holders upon exercise of the Warrants by
the Holders thereof (the "Common Shelf Registration Statement", and together
with the Warrant Shelf Registration Statement, the "Registration Statements")
and shall use its reasonable efforts to cause the Common Shelf Registration
Statement to be declared effective on or before 365 days after the Issue Date.
Subject to Section 5.02, IWCL shall cause each of the Registration Statements
to remain effective until (A) in the case of the Common Shelf Registration
Statement, the earlier of (i) such time as all Warrants have been exercised and
(ii) the Expiration Date and (B) in the case of the Warrant Shelf Registration
Statement, the earliest of (i) such time as all the Warrants have been sold
thereunder, (ii) two years after its effective date and (iii) such time as the
Warrants can be sold by Persons who are not Affiliates of IWCL without
restriction under the Securities Act. In connection with any Registration
Statement, (i) IWCL shall furnish to the Warrant Agent, prior to the filing
with the SEC, a copy of any Registration Statement, and each amendment thereof
and each amendment or supplement, if any, to the prospectus included therein
and shall use its reasonable best efforts to reflect in each such document,
when filed with the SEC, such comments as the Warrant Agent may reasonably
propose, (ii) IWCL shall furnish to each Holder, without charge, at least one
copy of any Registration Statement and any post-effective amendment thereto,
including financial statements and schedules, and, if the Holder so requests in
writing, all exhibits thereto (including those incorporated by reference),
(iii) IWCL shall, for
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so long as any Registration Statement is effective, deliver to each Holder,
without charge, as many copies of the prospectus (including each preliminary
prospectus) included in such Registration Statement and any amendment or
supplement thereto as such Holder may reasonably request, and IWCL consents to
the proper use of the most recent prospectus included therein and the most
recent amendment or supplement thereto by each of the selling Holders in
connection with the offering and sale of the Warrants or the Warrant Shares, as
the case may be, covered by such prospectus and any amendment or supplement
thereto, (iv) IWCL may require each Holder of Warrants to be sold pursuant to
the Warrant Shelf Registration Statement or to be exercised in connection with
the Common Shelf Registration Statement to furnish to IWCL such information
regarding the Holder and the distribution of such Warrants or Warrant Shares as
IWCL may from time to time reasonably request for inclusion in such
Registration Statement, (v) IWCL shall, if requested, promptly incorporate in a
prospectus supplement or post-effective amendment to such Registration
Statement such information as a majority of the Holders of all then outstanding
Warrants issued in the Units Offerings taken as a single class reasonably agree
should be included therein and shall make all required filings of such
prospectus supplement or post-effective amendment as soon as practicable after
being notified in writing of the matters to be incorporated in such prospectus
supplement or post-effective amendment, (vi) IWCL shall enter into such
agreements (including underwriting agreements) as are appropriate, customary
and reasonably necessary in connection with any such Registration Statement and
(vii) IWCL shall (A) make available all material customary for reasonable due
diligence examinations in connection with such Registration Statements, (B)
make such representations and warranties to the Holders of Warrants as are
customary and reasonable in connection with such Registration Statements, (C)
obtain such opinions of counsel to IWCL addressed to and reasonably
satisfactory to the Holders of Warrants as are customary and reasonable in
connection with such Registration Statements and (D) obtain such "comfort"
letters and updates thereof from the independent certified public accountants
of IWCL addressed to the Holders of Warrants as are customary and reasonable in
connection with such Registration Statements. IWCL will furnish the Warrant
Agent with current prospectuses meeting the requirements of the Securities Act
in sufficient quantity to permit the Warrant Agent to deliver, at IWCL's
expense, a prospectus to each holder of a Warrant upon the exercise thereof.
IWCL shall promptly inform the Warrant Agent in writing of any change in the
status of the effectiveness or availability of any Registration Statement.
SECTION 5.02. Suspension. During any consecutive 365-day
period, IWCL shall be entitled to suspend the availability of each of the
Warrant Shelf Registration Statement and the Common Shelf Registration
Statement for up to two 45 consecutive-day periods (except during the 45
consecutive-day period immediately prior to the Expiration Date) if the Board
determines in the exercise of its reasonable judgement that there is a valid
business purpose for such suspension and provides notice that such
determination was made by the Board to the holders of the Warrants; provided,
however, that in no event shall IWCL be required to disclose the business
purpose for such suspension if IWCL determines in good faith that such business
purpose must remain confidential.
SECTION 5.03. Blue Sky. IWCL shall use its reasonable
efforts to register or qualify the Warrants and the Warrant Shares under all
applicable securities laws, blue sky laws or similar laws of all jurisdictions
in the United States and Canada in which any Holder of
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Warrants may or may be deemed to purchase Warrants or Warrant Shares upon the
exercise of Warrants and shall use its reasonable efforts to maintain such
registration or qualification (A) in the case of the Common Shelf Registration
Statement, until the earlier of (i) such time as all Warrants have been
exercised and (ii) the Expiration Date, and (B) in the case of the Warrant
Shelf Registration Statement, until the earliest of (i) such time as all the
Warrants have been sold thereunder, (ii) such time as the Warrants can be sold
by Persons who are not Affiliates of IWCL without restriction under the
Securities Act and (iii) two years after its effective date; provided, however,
that IWCL shall not be required to qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 5.03 or to take any action which would subject it to general service of
process or to taxation or any other governmental fees or charges in any such
jurisdiction where it is not then so subject.
SECTION 5.04. Accuracy of Disclosure. IWCL represents and
warrants to each Holder and agrees for the benefit of each Holder that (i) each
of the Warrant Shelf Registration Statement and the Common Shelf Registration
Statement and any amendment thereto, each as of its effective date, will not
contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
contained therein not misleading; and (ii) each of the prospectus furnished to
such Holder for delivery in connection with the sale of Warrants and the
prospectus delivered to such Holder upon the exercise of Warrants and the
documents incorporated by reference therein as of its date will not contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements contained therein, in
light of the circumstances under which they were made, not misleading;
provided, however, that IWCL shall have no liability under clauses (i) or (ii)
of this Section 5.04 with respect to any such untrue statement or omission.
SECTION 5.05. Indemnification. (a) In connection with any
Registration Statement, IWCL agrees to indemnify and hold harmless each Holder
of the Warrants and each person, if any, who controls such Holder within the
meaning of the Securities Act or the Exchange Act (each Holder and such
controlling persons being referred to collectively as the "Indemnified
Parties") from and against any losses, claims, damages or liabilities, joint or
several, or any actions in respect thereof (including but not limited to any
losses, claims, damages, liabilities or actions relating to purchases and sales
of the Warrants or the Warrant Shares) to which each Indemnified Party may
become subject under the Securities Act, the Exchange Act or otherwise, insofar
as such losses, claims, damages, liabilities or actions arise out of or are
based upon any untrue statement or alleged untrue statement of a material fact
contained in such Registration Statement or prospectus or in any amendment or
supplement thereto, or arise out of, or are based upon, the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, and shall reimburse, as incurred, the
Indemnified Parties for any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such loss, claim, damage,
liability or action in respect thereof; provided, however, that (i) IWCL shall
not be liable in any such case to the extent that such loss, claim, damage or
liability arises out of or is based upon any untrue statement or alleged untrue
statement or omission or alleged omission made in such Registration Statement
or any preliminary or final prospectus or in any amendment or supplement
thereto in
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reliance upon and in conformity with written information pertaining to such
Holder and furnished to IWCL by or on behalf of such Holder specifically for
inclusion therein, (ii) with respect to any untrue statement or omission or
alleged untrue statement or omission made in any prospectus relating to such
Registration Statement, the indemnity agreement contained in this subsection
(a) shall not inure to the benefit of any person as to which there is a
prospectus delivery requirement (a "Delivering Seller") that sold the Warrants
or Warrant Shares, as the case may be, to the person asserting any such losses,
claims, damages or liabilities to the extent that any such loss, claim, damage
or liability of such Delivering Seller results from the fact that there was not
sent or given to such person, on or prior to the written confirmation of such
sale, a copy of the relevant prospectus, as amended and supplemented, provided
that (i) IWCL shall have previously furnished copies thereof to such Delivering
Seller in accordance with this Agreement and (ii) such furnished prospectus, as
amended and supplemented, would have corrected any such untrue statement or
omission or alleged untrue statement or omission.
(b) In connection with any Registration Statement, each Holder
of the Warrants or Warrant Shares, as the case may be, severally and not
jointly, will indemnify and hold harmless IWCL and each person, if any, who
controls IWCL within the meaning of the Securities Act or the Exchange Act and
the directors, officers, agents and employees of such controlling persons from
and against any losses, claims, damages or liabilities or any actions in
respect thereof to which IWCL or any such controlling person or director,
officer, agent or employee of such controlling person may become subject under
the Securities Act, the Exchange Act or otherwise, insofar as such losses,
claims, damages, liabilities or actions arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in
such Registration Statement or preliminary or final prospectus or in any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, but in each case only to the extent that the untrue statement
or alleged untrue statement or omission or alleged omission was made in
reliance upon and in conformity with written information pertaining to such
Holder and furnished to IWCL by or on behalf of such Holder specifically for
inclusion therein; and, subject to the limitation set forth immediately
preceding this clause, shall reimburse, as incurred, IWCL for any legal or
other expenses reasonably incurred by IWCL or any such controlling person in
connection with investigating or defending any loss, claim, damage, liability
or action in respect thereof. This indemnity agreement will be in addition to
any liability which such Holder may otherwise have to IWCL or any of its
controlling persons.
(c) Promptly after receipt by an indemnified party under this
Section 5.05 of notice of any claim or the commencement of any action or
proceeding (including a governmental investigation), such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party pursuant to subsection (a) or (b), notify the indemnifying party in
writing of the claim or the commencement of the action or proceeding; provided,
however, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have under this Section 5.05 except to the
extent that it has been materially prejudiced (through the forfeiture of
substantive rights or defenses) by such failure; and, provided, further, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have to an indemnified party otherwise than under this
Section 5.05. If any such claim, action or proceeding shall be
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brought against an indemnified party, and it shall notify the indemnifying
party thereof, the indemnifying party shall be entitled to participate therein
and, to the extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party. After notice from the indemnifying
party to the indemnified party of its election to assume the defense of such
claim, action or proceeding, the indemnifying party shall not be liable to the
indemnified party under this Section 5.05 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
an indemnified party shall have the right to employ its own counsel in any such
action, but the fees, expenses and other charges of such counsel for the
indemnified party will be at the expense of such indemnified party unless (1)
the employment of independent counsel by the indemnified party has been
authorized in writing by the indemnifying party, (2) the indemnified party has
reasonably concluded (based upon advice of independent counsel to the
indemnified party) that there may be legal defenses available to it or other
indemnified parties that are different from or in addition to those available
to the indemnifying party, (3) a conflict or potential conflict exists (based
upon advice of independent counsel to the indemnified party) between the
indemnified party and the indemnifying party (in which case the indemnifying
party will not have the right to direct the defense of such action on behalf of
the indemnified party) or (4) the indemnifying party has not in fact employed
counsel reasonably satisfactory to the indemnified party to assume the defense
of such action or proceeding within a reasonable time after receiving notice of
the commencement of the action or proceeding, in each of which cases the
reasonable fees, disbursements and other charges of counsel will be at the
expense of the indemnifying party or parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable
fees, disbursements and other charges of more than one separate firm of
attorneys (in addition to any local counsel) at any one time for all such
indemnified party or parties. Each indemnified party, as a condition of the
indemnity agreements contained in subsections 5.05(a) and 5.05(b), shall use
all reasonable efforts to cooperate with the indemnifying party in the defense
of any such action or claim. No indemnifying party shall be liable for any
settlement of any action effected without its written consent. No indemnifying
party shall, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party unless such settlement includes an
unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.
(d) If the indemnification provided for in this section is
unavailable or insufficient to hold harmless an indemnified party under
subsections (a) or (b) above for any reason other than as provided in
subsection (c) above, then each indemnifying party shall contribute to the
amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to in
subsection (a) or (b) above (i) in such proportion as is appropriate to reflect
the relative benefits received by the indemnifying party or parties on the one
hand and the indemnified party on the other or (ii) if the allocation provided
by the foregoing clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and the indemnified party on the other in connection
with the statements or omissions that resulted in such losses, claims, damages
or
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liabilities (or actions in respect thereof) as well as any other relevant
equitable considerations. The relative fault of the parties shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by IWCL on the one hand
or such Holder or such other indemnified person, as the case may be, on the
other, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The amount paid
by an indemnified party as a result of the losses, claims, damages or
liabilities referred to in the first sentence of this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any action or
claim which is the subject of this subsection (d). Notwithstanding any other
provision of this Section 5.05(d), the Holders shall not be required to
contribute any amount in excess of the amount by which the net proceeds
received by such Holders from the sale of the Warrants pursuant to the Warrant
Shelf Registration Statement or the Warrant Shares pursuant to the Common Shelf
Registration Statement exceeds the amount of damages which such Holders would
have otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this paragraph (d), each
officer, director, employee, representative and agent of an indemnified party
and each person, if any, who controls such indemnified party within the meaning
of the Securities Act or the Exchange Act shall have the same rights to
contribution as such indemnified party, and each officer, director, employee,
representative and agent of IWCL and each person, if any, who controls IWCL
within the meaning of the Securities Act or the Exchange Act shall have the
same rights to contribution as IWCL.
(e) The agreements contained in this section shall survive the
sale of the Warrants pursuant to the Warrant Shelf Registration Statement and
the sale of the Warrant Shares pursuant to the Common Shelf Registration
Rtatement, as the case may be, and shall remain in full force and effect,
regardless of any termination or cancellation of this Agreement or any
investigation made by or on behalf of any indemnified party.
SECTION 5.06. Additional Acts. If the sale of Warrants or
the issuance or sale of any Class A Common Stock or other securities issuable
upon the exercise of the Warrants requires registration or approval of any
governmental authority (other than the registration requirements under the
Securities Act), or the taking of any other action under the laws of the United
States of America or any political subdivision thereof or Bermuda before such
securities may be validly offered or sold in compliance with such laws, then
IWCL covenants that it will, in good faith and as expeditiously as reasonably
possible, use all reasonable efforts to secure and maintain such registration
or approval or to take such other action, as the case may be.
SECTION 5.07. Expenses. All expenses incident to IWCL's
performance of or compliance with its obligations under this Article 5 will be
borne by IWCL, including without limitation: (i) all SEC, stock exchange or
National Association of Securities Dealers, Inc. registration and filing fees,
(ii) all reasonable fees and expenses incurred in connection with compliance
with state securities or blue sky laws, (iii) all reasonable expenses of any
Persons incurred by or on behalf of and at the direction of IWCL in preparing
or assisting in preparing,
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printing and distributing the Warrant Shelf Registration Statement, the Common
Shelf Registration Statement or any other registration statement, prospectus,
any amendments or supplements thereto and other documents relating to the
performance of and compliance with this Article 5, (iv) the fees and
disbursements of the Warrant Agent, (v) the fees and disbursements of counsel
for IWCL and the Warrant Agent and (vi) the fees and disbursements of the
independent public accountants of IWCL, including the expenses of any special
audits or comfort letters required by or incident to such performance and
compliance.
ARTICLE 6
Warrant Agent
SECTION 6.01. Appointment of Warrant Agent. IWCL hereby
appoints the Warrant Agent to act as agent for IWCL in accordance with the
express provisions of this Agreement and the Warrant Agent hereby accepts such
appointment.
SECTION 6.02. Rights and Duties of Warrant Agent. (a) Agent
for IWCL. In acting under this Warrant Agreement and in connection with the
Warrant Certificates, the Warrant Agent is acting solely as agent of IWCL and
does not assume any obligation or relationship or agency or trust for or with
any of the holders of Warrant Certificates or beneficial owners of Warrants.
(b) Counsel. The Warrant Agent may consult with counsel
satisfactory to it (who may be counsel to IWCL), and the advice of such counsel
shall be full and complete authorization and protection in respect of any
action taken, suffered or omitted by it hereunder in good faith and in
accordance with the advice of such counsel.
(c) Documents. The Warrant Agent shall be protected and shall
incur no liability for or in respect of any action taken or thing suffered by
it in reliance upon any Warrant Certificate, notice, direction, consent,
certificate, affidavit, statement, opinion or other paper or document
reasonably believed by it to be genuine and to have been presented or signed by
the proper parties.
(d) No Implied Obligations. The Warrant Agent shall be
obligated to perform only such duties as are specifically set forth herein and
in the Warrant Certificates, and no implied duties or obligations of the
Warrant Agent shall be read into this Agreement or the Warrant Certificates.
The Warrant Agent shall not be under any obligation to take any action
hereunder which may tend to involve it in any expense or liability for which it
does not receive indemnity if such indemnity is reasonably requested. The
Warrant Agent shall not be accountable or under any duty or responsibility for
the use by IWCL of any of the Warrant Certificates countersigned by the Warrant
Agent and delivered by it to the Holders or on behalf of the Holders pursuant
to this Agreement or for the application by IWCL of the proceeds of the
Warrants. The Warrant Agent shall have no duty or responsibility in case of
any default by
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IWCL in the performance of its covenants or agreements contained herein or in
the Warrant Certificates or in the case of the receipt of any written demand
from a Holder with respect to such default, including any duty or
responsibility to initiate or attempt to initiate any proceedings at law or
otherwise.
(e) Not Responsible for Adjustments or Validity of Stock. The
Warrant Agent shall not at any time be under any duty or responsibility to any
Holder to determine whether any facts exist that may require an adjustment of
the number of shares of Class A Common Stock issuable upon exercise of each
Warrant or the Exercise Price, or with respect to the nature or extent of any
adjustment when made or with respect to the method employed or provided to be
employed herein or in any supplemental agreement in making the same. The
Warrant Agent shall not be accountable with respect to the validity or value of
any shares of Class A Common Stock or of any securities or property which may
at any time be issued or delivered upon the exercise of any Warrant or upon any
adjustment pursuant to Article 4, and it makes no representation with respect
thereto. The Warrant Agent shall not be responsible for any failure of IWCL to
make any cash payment or to issue, transfer or deliver any shares of Class A
Common Stock or stock certificates upon the surrender of any Warrant
Certificate for the purpose of exercise or upon any adjustment pursuant to
Article 4, or to comply with any of the covenants of IWCL contained in Article
4.
SECTION 6.03. Individual Rights of Warrant Agent. The
Warrant Agent and any stockholder, director, officer or employee of the Warrant
Agent may buy, sell or deal in any of the Warrants, Warrant Shares or other
securities of IWCL or its affiliates or become pecuniarily interested in
transactions in which IWCL or its affiliates may be interested, or contract
with or lend money to IWCL or its affiliates or otherwise act as fully and
freely as though it were not the Warrant Agent under this Agreement. Nothing
herein shall preclude the Warrant Agent from acting in any other capacity for
IWCL or for any other legal entity.
SECTION 6.04. Warrant Agent's Disclaimer. The Warrant Agent
shall not be responsible for and makes no representation as to the validity or
adequacy of this Agreement or the Warrant Certificates and it shall not be
responsible for any statement in this Agreement or the Warrant Certificates
other than its countersignature thereon.
SECTION 6.05. Compensation and Indemnity. IWCL agrees to pay
the Warrant Agent from time to time compensation for its services and to
reimburse the Warrant Agent upon request for all reasonable out-of-pocket
expenses incurred by it, including the reasonable compensation and expenses of
the Warrant Agent's agents and counsel. IWCL shall indemnify the Warrant Agent
against any and all loss, liability, damage, claim or expense (including
agents' and attorneys' fees and expenses) incurred by it without negligence or
bad faith on its part arising out of or in connection with the acceptance or
performance of its duties under this Agreement. The Warrant Agent shall notify
IWCL promptly of any claim for which it may seek indemnity. IWCL need not
reimburse any expense or indemnify against any loss or liability incurred by
the Warrant Agent through wilful misconduct, negligence or bad faith. IWCL's
payment obligations pursuant to this Section 6.05 shall survive the termination
of this Agreement.
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SECTION 6.06. Successor Warrant Agent. (a) IWCL to Provide
Warrant Agent. IWCL agrees for the benefit of the Holders that there shall at
all times be a Warrant Agent hereunder until all the Warrants have been
exercised or are no longer exercisable.
(b) Resignation and Removal. The Warrant Agent may at any
time resign by giving written notice to IWCL of such intention on its part,
specifying the date on which its desired resignation shall become effective;
provided, however, that such date shall not be less than 60 days after the date
on which such notice is given unless IWCL otherwise agrees. The Warrant Agent
hereunder may be removed at any time by the filing with it of an instrument in
writing signed by or on behalf of IWCL and specifying such removal and the date
when it shall become effective, which date shall not be less than 60 days after
such notice is given unless the Warrant Agent otherwise agrees. Any removal
under this Section 6.06 shall take effect upon the appointment by IWCL as
hereinafter provided of a successor Warrant Agent (which shall be a bank or
trust company authorized under the laws of the jurisdiction of its organization
to exercise corporate trust powers) and the acceptance of such appointment by
such successor Warrant Agent. If a successor Warrant Agent does not take
office within 60 days after the retiring Warrant Agent resigns or is removed,
the retiring Warrant Agent or the Holders of 10% of all then outstanding
Warrants issued in the Units Offerings taken as a single class may petition, at
the expense of IWCL, any court of competent jurisdiction for the appointment of
a successor.
(c) IWCL to Appoint Successor. In the event that at any time
the Warrant Agent shall resign, or shall be removed, or shall become incapable
of acting, or shall be adjudged a bankrupt or insolvent, or shall commence a
voluntary case under Federal bankruptcy laws, as now or hereafter constituted,
or under any other applicable Federal or state bankruptcy, insolvency or
similar law, or shall consent to the appointment of or taking possession by a
receiver, custodian, liquidator, assignee, trustee, sequestrator (or other
similar official) of the Warrant Agent or its property or affairs, or shall
make an assignment for the benefit of creditors, or shall admit in writing its
inability to pay its debts generally as they become due, or shall take
corporate action in furtherance of any such action, or a decree or order for
relief by a court having jurisdiction in the premises shall have been entered
in respect of the Warrant Agent in an involuntary case under the Federal
bankruptcy laws, as now or hereafter constituted, or any other applicable
Federal or State bankruptcy, insolvency or similar law, or a decree order by a
court having jurisdiction in the premises shall have been entered for the
appointment of a receiver, custodian, liquidator, assignee, trustee,
sequestrator (or similar official) of the Warrant Agent or of its property or
affairs, or any public officer shall take charge or control of the Warrant
Agent or of its property or affairs for the purpose of rehabilitation,
conservation, winding up or liquidation, a successor Warrant Agent, qualified
as aforesaid, shall be appointed by IWCL by an instrument in writing filed with
the successor Warrant Agent. Upon the appointment as aforesaid of a successor
Warrant Agent and acceptance by the successor Warrant Agent of such
appointment, the Warrant Agent shall cease to be the Warrant Agent hereunder;
provided, however, that in the event of the resignation of the Warrant Agent
hereunder, such resignation shall be effective on the earlier of (i) the date
specified in the Warrant Agent's notice of resignation and (ii) the appointment
and acceptance of a successor Warrant Agent hereunder.
(d) Successor To Expressly Assume Duties. Any successor
Warrant Agent appointed hereunder shall execute, acknowledge and deliver to its
predecessor and to IWCL an instrument accepting such appointment hereunder, and
thereupon such successor Warrant Agent,
38
43
without any further act, deed or conveyance, shall become vested with all the
rights and obligations of such predecessor with like effect as if originally
named as Warrant Agent hereunder, and such predecessor, upon payment of its
charges and disbursements then unpaid, shall thereupon become obligated to
transfer, deliver and pay over, and such successor Warrant Agent shall be
entitled to receive, all monies, securities and other property on deposit with
or held by such predecessor, as Warrant Agent hereunder.
(e) Successor by Merger. Any corporation into which the
Warrant Agent hereunder may be merged or consolidated, or any corporation
resulting from any merger or consolidation to which the Warrant Agent shall be
a party, or any corporation to which the Warrant Agent shall sell or otherwise
transfer all or substantially all the corporate trust or stock transfer assets
and business of the Warrant Agent, provided that it shall be qualified as
aforesaid, shall be the successor Warrant Agent under this Agreement without
the execution or filing of any paper or any further act on the part of any of
the parties hereto.
ARTICLE 7
Miscellaneous
SECTION 7.01. SEC Reports and Other Information.
Notwithstanding that IWCL may not be subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, IWCL shall file with the SEC and
thereupon provide the Warrant Agent and Holders with such annual reports and
such information, documents and other reports as are specified in Sections 13
and 15(d) of the Exchange Act and applicable to a U.S. corporation subject to
such sections, such information, documents and other reports to be so filed and
provided at the times specified for the filing of such information, documents
and reports under such sections. Delivery of such reports, information and
documents to the Warrant Agent is for informational purposes only and the
Warrant Agent's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including IWCL's compliance with any of its covenants hereunder.
SECTION 7.02. Persons Benefitting. Nothing in this Agreement
is intended or shall be construed to confer upon any Person other than IWCL,
the Warrant Agent and the Holders any right, remedy or claim under or by reason
of this agreement or any part hereof.
SECTION 7.03. Rights of Holders. Holders of unexercised
Warrants are not entitled to (i) receive dividends or other distributions, (ii)
receive notice of or vote at any meeting of the stockholders, (iii) consent to
any action of the stockholders, (iv) receive notice as stockholders of any
other proceedings of IWCL, (v) exercise any preemptive rights, (vi) share in
the assets of IWCL in the event of the liquidation, dissolution or winding up
of IWCL's affairs other than as provided in Section 4.20 or (vii) exercise any
other rights whatsoever as stockholders of IWCL.
39
44
SECTION 7.04. Amendment. This Agreement may be amended by
the parties hereto without the consent of any Holder for the purpose of curing
any ambiguity, or of curing, correcting or supplementing any defective
provision contained herein or adding or changing any other provisions with
respect to matters or questions arising under this Agreement as IWCL and the
Warrant Agent may deem necessary or desirable (including without limitation any
addition or modification to provide for compliance with the transfer
restrictions set forth herein); provided, however, that such action shall not
adversely affect the rights of any of the Holders. Any amendment or supplement
to this Agreement that has an adverse effect on the interests of the Holders
shall require the written consent of a majority of the Holders of all then
outstanding Warrants issued in the Units Offerings taken as a single class.
The consent of each Holder affected shall be required for any amendment
pursuant to which the Exercise Price would be increased or the number of
Warrant Shares issuable upon exercise of Warrants would be decreased (other
than pursuant to adjustments provided herein) or the exercise period with
respect to the Warrants would be shortened. In determining whether the Holders
of the required number of Warrants have concurred in any direction, waiver or
consent under this Agreement, Warrants owned by IWCL or by any Affiliate of
IWCL shall be disregarded and deemed not to be outstanding, except that, for
the purpose of determining whether the Warrant Agent shall be protected in
relying on any such direction, waiver or consent, only Warrants which the
Warrant Agent actually knows are so owned shall be so disregarded. Also,
subject to the foregoing, only Warrants outstanding at the time shall be
considered in any such determination.
SECTION 7.05. Notices. Any notice or communication shall be
in writing and delivered in Person or mailed by first-class mail addressed as
follows:
if to IWCL:
Clarendon Xxxxx
0 Xxxxxx Xxxxxx
Xxxxxxxx XX 00
Xxxxxxx
Xxxxxxxxx: Secretary
with a copy to:
Iridium LLC
0000 Xxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
Attention: General Counsel
if to the Warrant Agent:
State Street Bank and Trust Company
0xx Xxxxx
0 Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Corporate Trust Department
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45
Facsimile: (000) 000-0000
IWCL or the Warrant Agent by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Holder shall be mailed
to the Holder at the Holder's address as it appears on the Certificate Register
and shall be sufficiently given if so mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any
defect in it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
SECTION 7.06. 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 SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF SAID STATE, WITHOUT REGARD TO THE CONFLICT OF LAW
RULES THEREOF.
SECTION 7.07. Successors. All agreements of IWCL in this
Agreement and the Warrant Certificates shall bind its successors. All
agreements of the Warrant Agent in this Agreement shall bind its successors.
SECTION 7.08. Multiple Originals. The parties may sign any
number of copies of this Agreement. Each signed copy shall be an original, but
all of them together represent the same agreement. One signed copy is enough
to prove this Agreement.
SECTION 7.09. Table of Contents. The table of contents and
headings of the Articles and Sections of this Agreement have been inserted for
convenience of reference only, are not intended to be considered a part hereof
and shall not modify or restrict any of the terms or provisions hereof.
SECTION 7.10. Severability. The provisions of this Agreement
are severable, and if any clause or provision shall be held invalid, illegal or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect in that jurisdiction only such clause or
provision, or part thereof, and shall not in any manner affect such clause or
provision in any other jurisdiction or any other clause or provision of this
Agreement in any jurisdiction.
SECTION 7.11. Use of Proceeds. IWCL agrees, for the benefit
of the Holders of the Warrants from time to time and of the Class A Common
Stock or any other capital stock of IWCL underlying such Warrants upon exercise
thereof, to use the proceeds from the issuance and sale of the Warrants (net of
any expenses of the offering of the Units allocable to IWCL) to purchase LLC
Warrants from Iridium in accordance with the Share Issuance Agreement.
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46
IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed as of the date first written above.
IRIDIUM WORLD COMMUNICATIONS LTD.
By: /s/ XXX XXXXX
-------------------------------------
Name: Xxx Xxxxx
Title: Chief Financial Officer
STATE STREET BANK AND TRUST COMPANY,
as Warrant Agent
By: /s/ X. X. XXXXXXXX
------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Assistant Vice President
42
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EXHIBIT A
[FORM OF FACE OF WARRANT CERTIFICATE]
THE WARRANTS REPRESENTED BY THIS CERTIFICATE WERE INITIALLY
ISSUED AS PART OF AN ISSUANCE OF UNITS, EACH OF WHICH CONSISTS OF SENIOR NOTES
DUE 2005, SERIES A OF IRIDIUM, LLC AND IRIDIUM CAPITAL CORPORATION (THE
"NOTES") AND ONE WARRANT TO PURCHASE 5.2 SHARES OF CLASS A COMMON STOCK, PAR
VALUE $0.01 PER SHARE OF IRIDIUM WORLD COMMUNICATIONS LTD. ("IWCL"). THE
WARRANTS AND THE NOTES WILL NOT TRADE SEPARATELY UNTIL THE EARLIER OF (I) THE
COMMENCEMENT OF AN EXCHANGE OFFER OR THE EFFECTIVENESS OF A SHELF REGISTRATION
STATEMENT FOR SUCH NOTES AND (II) SUCH DATE AFTER JANUARY 15, 1998 AS CHASE
SECURITIES INC. MAY DETERMINE.
THE CLASS A COMMON STOCK, PAR VALUE $0.01 PER SHARE, OF IWCL
FOR WHICH THIS WARRANT IS EXERCISABLE MAY NOT BE OFFERED OR SOLD IN THE UNITED
STATES ABSENT REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND ANY APPLICABLE STATE SECURITIES LAWS. ACCORDINGLY, NO
HOLDER SHALL BE ENTITLED TO EXERCISE SUCH HOLDER'S WARRANTS AT ANY TIME UNLESS,
AT THE TIME OF EXERCISE, A REGISTRATION STATEMENT UNDER THE SECURITIES ACT
RELATING TO THE SHARES OF CLASS A COMMON STOCK ISSUABLE UPON THE EXERCISE OF
THIS WARRANT HAS BEEN FILED WITH, AND DECLARED EFFECTIVE BY, THE SECURITIES AND
EXCHANGE COMMISSION (THE "SEC"), AND NO STOP ORDER SUSPENDING THE EFFECTIVENESS
OF SUCH REGISTRATION STATEMENT HAS BEEN ISSUED BY THE SEC.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
NEW YORK, NEW YORK, TO IWCL OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR 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 REQUESTED 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.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR
THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL
SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS
SET FORTH IN THE WARRANT AGREEMENT REFERRED TO ON THE REVERSE HEREOF.
48
THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT, OR ANY STATE SECURITIES LAWS. NEITHER THIS SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
REGISTRATION.
THE HOLDER OF THIS SECURITY BY ITS ACCEPTANCE HEREOF AGREES NOT TO
OFFER, SELL OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE") WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH IWCL OR ANY AFFILIATE OF
IWCL WAS THE OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY),
EXCEPT (A) TO IWCL, (B) PURSUANT TO A REGISTRATION STATEMENT THAT HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITIES
ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT, TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" AS DEFINED
IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO OFFSHORE TRANSACTIONS
MEETING THE REQUIREMENTS OF RULE 903 OR RULE 904 UNDER THE SECURITIES ACT, (E)
TO AN "ACCREDITED INVESTOR" WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR
(7) UNDER THE SECURITIES ACT THAT IS AN INSTITUTIONAL INVESTOR ACQUIRING IN A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES (IF
AVAILABLE) OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, AND, IN EACH CASE (A) THROUGH (F), IN
ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED
STATES AND OTHER JURISDICTIONS AND SUBJECT TO AND THE WARRANT AGENT'S RIGHT
PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (D), (E) OR (F) TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND IN THE CASE OF THE FOREGOING
CLAUSES (A) THROUGH (F), A CERTIFICATE OF TRANSFER IS COMPLETED AND DELIVERED
BY THE TRANSFEROR TO IWCL AND THE WARRANT AGENT. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.
BY ITS ACQUISITION HEREOF, THE HOLDER REPRESENTS THAT (A) IT
IS A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED
IN RULE 501(A)(1),(2),(3) OR (7) UNDER THE SECURITIES ACT) OR (C) IT IS NOT A
U.S. PERSON AND IS ACQUIRING THE SECURITY IN AN OFFSHORE TRANSACTION IN
ACCORDANCE WITH REGULATION S.
2
49
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE WARRANT AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS THE WARRANT AGENT
MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.
3
50
No. [ ] Certificate for ________ Warrants
WARRANTS TO PURCHASE COMMON STOCK OF
IRIDIUM WORLD COMMUNICATIONS LTD.
THIS CERTIFIES THAT ______________, or its registered assigns,
is the registered holder of the number of Warrants set forth above
(the"Warrants"). Each Warrant entitles the holder thereof (the "Holder"), at
its option and subject to the provisions contained herein and in the Warrant
Agreement referred to below, to purchase from Iridium World Communications
Ltd., a Bermuda corporation ("IWCL"), 5.2 shares of Class A Common Stock, par
value of $0.01 per share, of IWCL (the "Common Stock") at the per share
exercise price of $20.90 (the "Exercise Price"). This Warrant Certificate
shall terminate and become void as of the close of business on July 15, 2005
(the "Expiration Date") or upon the exercise hereof as to all the shares of
Class A Common Stock subject hereto. The number of shares issuable upon
exercise of the Warrants and the Exercise Price per share shall be subject to
adjustment from time to time as set forth in the Warrant Agreement.
This Warrant Certificate is issued under and in accordance
with a Warrant Agreement, dated as of July 16, 1997 (the "Warrant Agreement"),
between IWCL and State Street Bank and Trust Company, as warrant agent (the
"Warrant Agent", which term includes any successor Warrant Agent under the
Warrant Agreement), and is subject to the terms and provisions contained in the
Warrant Agreement, to all of which terms and provisions the Holder of this
Warrant Certificate consents by acceptance hereof. The Warrant Agreement is
hereby incorporated herein by reference and made a part hereof. Reference is
hereby made to the Warrant Agreement for a full statement of the respective
rights, limitations of rights, duties and obligations of IWCL, the Warrant
Agent and the Holders of the Warrants. Capitalized terms used but not defined
herein shall have the meanings ascribed thereto in the Warrant Agreement. A
copy of the Warrant Agreement may be obtained for inspection by the Holder
hereof upon written request to the Warrant Agent at 0 Xxxxxxxxxxxxx Xxxxx,
Xxxxxx, XX 00000, attention of the Corporate Trust Department.
Subject to the terms of the Warrant Agreement, the Warrants
may be exercised in whole or in part (i) by presentation of this Warrant
Certificate with the Election to Purchase attached hereto duly executed and
with the simultaneous payment of the Exercise Price in cash (subject to
adjustment) to the Warrant Agent for the account of IWCL at the office of the
Warrant Agent.
As provided in the Warrant Agreement and subject to the terms
and conditions therein set forth, the Warrants shall be exercisable at any time
on or after July 16, 1998; provided, however, that Holders of Warrants will be
able to exercise their Warrants only if a shelf registration statement relating
to the Class A Common Stock underlying the Warrants is effective, and such
securities are qualified for sale or exempt from qualification under the
applicable securities laws of the states or other jurisdictions in which such
Holders reside; provided further, however, that no Warrant shall be exercisable
after July 15, 2005.
4
51
In the event IWCL enters into a Combination, the Holder hereof
will be entitled to receive upon exercise of the Warrants the kind and amount
of shares of capital stock or other securities or other property of such
surviving entity as the Holder would have been entitled to receive upon or as a
result of the Combination had the Holder exercised its Warrants immediately
prior to such Combination; provided, however, that in the event that, in
connection with such Combination, consideration to holders of Class A Common
Stock in exchange for their shares is payable solely in cash or in the event of
the dissolution, liquidation or winding-up of IWCL, the Holder hereof will be
entitled to receive such cash distributions as the Holder would have received
had the Holder exercised its Warrants immediately prior to such event, less the
Exercise Price.
As provided in the Warrant Agreement, the number of shares of
Class A Common Stock issuable upon the exercise of the Warrants and the
Exercise Price are subject to adjustment upon the happening of certain events.
IWCL may require payment of a sum sufficient to pay all taxes,
assessments or other governmental charges in connection with the transfer or
exchange of the Warrant Certificates pursuant to Section 2.06 of the Warrant
Agreement, but not for any exchange or original issuance (not involving a
transfer) with respect to temporary Warrant Certificates, the exercise of the
Warrants or the issuance of the Warrant Shares.
Upon any partial exercise of the Warrants, there shall be
countersigned and issued to the Holder hereof a new Warrant Certificate
representing those Warrants which were not exercised. This Warrant Certificate
may be exchanged at the office of the Warrant Agent by presenting this Warrant
Certificate properly endorsed with a request to exchange this Warrant
Certificate for other Warrant Certificates evidencing an equal number of
Warrants. No fractional Warrant Shares will be issued upon the exercise of the
Warrants, but IWCL shall pay an amount in cash equal to the Current Market
Value per Warrant Share on the day immediately preceding the date the Warrant
is exercised, multiplied by the fraction of a Warrant Share that would be
issuable on the exercise of any Warrant.
All shares of Class A Common Stock issuable by IWCL upon the
exercise of the Warrants shall, upon such issue, be duly and validly issued and
fully paid and non-assessable. The holder in whose name the Warrant
Certificate is registered may be deemed and treated by IWCL and the Warrant
Agent as the absolute owner of the Warrant Certificate for all purposes
whatsoever and neither IWCL nor the Warrant Agent shall be affected by notice
to the contrary.
The Warrants do not entitle any holder hereof to any of the
rights of a shareholder of IWCL.
5
52
This Warrant Certificate shall not be valid or obligatory for
any purpose until it shall have been countersigned by the Warrant Agent.
IRIDIUM WORLD COMMUNICATIONS LTD.
By:
---------------------------------------------------------
By:
---------------------------------------------------------
DATED:
Countersigned:
STATE STREET BANK AND
TRUST COMPANY, as
Warrant Agent
By:
----------------------------------------
Authorized Signatory
6
53
FORM OF ELECTION TO PURCHASE WARRANT SHARES (to be
executed only upon exercise of Warrants)
IRIDIUM WORLD COMMUNICATIONS LTD.
[Note: No exercise of Warrants may be made prior to a shelf
registration statement relating to the Class A Common Stock underlying the
Warrants being declared effective.]
The undersigned hereby irrevocably elects to exercise [ ]
Warrants at an exercise price per share (subject to adjustment) of $20.90 to
acquire [ ] shares of Class A Common Stock, par value $0.01 per share, of
Iridium World Communications Ltd. on the terms and conditions specified within
the Warrant Certificate and the Warrant Agreement therein referred to,
surrenders this Warrant Certificate and all right, title and interest therein
to Iridium World Communications Ltd. and directs that the shares of Class A
Common Stock deliverable upon the exercise of such Warrants be registered or
placed in the name and at the address specified below and delivered thereto.
Date:
----------------------
(Signature of Owner)
----------------------
(Street Address)
----------------------
(City) (State) (Zip Code)
Signature Guaranteed by:
[Signature must be guaranteed by an
eligible Guarantor Institution (banks,
stock brokers, savings and loan
associations and credit unions) with
membership in an approved guarantee
medallion program pursuant to
Securities and Exchange Commission Rule
17Ad-5]
-------
1. The signature must correspond with the name as written upon the face
of the within Warrant Certificate in every particular, without
alteration or enlargement or any change whatsoever, and must be
guaranteed.
7
54
Securities and/or check to be issued to:
Please insert social security or identifying number:
Name:
------------------------------
Street Address:
-----------------------
City, State and Zip Code:
--------------------
Any unexercised Warrants represented by the Warrant Certificate to be issued
to:
Please insert social security or identifying number:
Name:
------------------------------
Street Address:
-----------------------
City, State and Zip Code:
--------------------
8
55
EXHIBIT B
FORM OF CERTIFICATE TO BE DELIVERED
UPON TERMINATION OF RESTRICTED PERIOD
[_________________], 1997
Iridium World Communications Ltd.
State Street Bank and Trust Company
Corporate Trust Department
4th Floor
0 Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Re: Iridium World Communications Ltd. Warrants (the "Warrants")
to Purchase Class A Common Stock
Ladies and Gentlemen:
This letter relates to Warrants represented by a temporary
global warrant certificate (the "Temporary Certificate"). Pursuant to Section
2.01 of the Warrant Agreement dated as of July 16, 1997 relating to the
Warrants (the "Warrant Agreement"), the undersigned hereby certifies that (1)
the undersigned is the beneficial owner of [_____] Warrants represented by the
Temporary Certificate and (2) the undersigned is a Non-U.S. Person (as defined
in the Warrant Agreement) outside the United States to whom the initial
warrants could be transferred in accordance with Rule 904 of Regulation S
promulgated under the Securities Act of 1933, as amended. Accordingly, you are
hereby requested to transfer the initial Warrants represented by the Temporary
Certificate into a permanent global certificate, all in the manner provided by
the Warrant Agreement.
56
2
You and the IWCL 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. Terms used in this certificate
have the meanings set forth in Regulation S.
Very truly yours,
[NAME OF HOLDER]
By:
-------------------------
Name:
Title:
57
EXHIBIT C
FORM OF CERTIFICATE TO BE DELIVERED
IN CONNECTION WITH TRANSFERS TO
NON-QIB INSTITUTIONAL ACCREDITED INVESTORS
IRIDIUM WORLD COMMUNICATIONS LTD.
STATE STREET BANK AND TRUST COMPANY
Corporate Trust Department
4th Floor
0 Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Re: Iridium World Communication Ltd. ("IWCL") Warrants
Ladies and Gentlemen:
Reference is hereby made to the Warrant Agreement, dated as of
July 16, 1997 (the "Warrant Agreement") between IWCL and State Street Bank
Trust Company, as Warrant Agent. Capitalized terms used but not defined herein
will have the meaning given to them in the Warrant Agreement.
This certificate is delivered to request a transfer of
warrants (the "Warrants") to purchase Class A Common Stock, par value $0.01 per
share of IWCL.
Upon transfer, the Warrants would be registered in the name of
the new beneficial owner as follows:
Name:
-------------------------------
Address:
----------------------------
Taxpayer ID Number:
-----------------
The undersigned represents and warrants to Iridium World
Communications Ltd., Iridium LLC, Iridium Capital Corporation and each
subsidiary of Iridium which has guaranteed its 13% Senior Notes due 2005,
Series A or its 14% Senior Notes due 2005, Series B (together the "Iridium
Parties") that (terms used herein that are defined in Rule 144A ("Rule 144A"),
Regulation D ("Regulation D") or Regulation S ("Regulation S") under the
Securities Act are used herein as defined therein):
1. We are an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as
amended, (the "Securities Act")) and have purchased the Warrants in a
transaction exempt from the registration requirements of the
58
2
Securities Act. We have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risk of our
investment in the Warrants and invest in or purchase securities similar to the
Warrants in the normal cause of our business. We and any accounts for which we
are acting are each able to bear the economic risk of our or its investment.
2. We understand that the Warrants have not been
registered under the Securities Act and, unless so registered, may not be sold
except as permitted in the following sentence. We agree on our own behalf and
on behalf of any investor account for which we are purchasing Warrants to
offer, sell or otherwise transfer such Warrants prior to the date which is two
years after the later of the date of original issue and the last date on which
any Iridium Party or any affiliate of any Iridium Party was the owner of such
Warrants (or any predecessor thereto) (the "Resale Restriction Termination
Date") only (a) an Iridium Party, (b) pursuant to a registration statement
which has been declared effective under the Securities Act, (c) in a
transaction complying with the requirements of Rule 144A under the Securities
Act, to a person we reasonably believe is a qualified institutional buyer under
Rule 144A (a "QIB") that purchases for its own account or for the account of a
QIB and to whom notice is given that the transfer is being made in reliance on
Rule 144A, (d) pursuant to offshore transactions meeting the requirements of
Rule 903 or Rule 904 under the Securities Act, (e) to an institutional
"accredited investor" within the meaning Rule 501(a)(1), (2), (3) or (7) under
the Securities Act in a transaction exempt from the registration requirements
of the Securities Act (if available), (f) pursuant to any other available
exemption from the registration requirements of the Securities Act, and, in
each case (a) through (f), in accordance with all applicable securities laws of
the states of the United States and other jurisdictions. The foregoing
restrictions on resale will not apply subsequent to the Resale Restriction
Termination Date. If any resale or other transfer of the Warrants is proposed
to be made pursuant to the clause (e) above prior to the Resale Restrictions
Termination Date, we shall deliver a letter from the transferee substantially
in the form of this letter to the Iridium Parties and the Warrant Agent, which
shall provide, among other things, that the transferee is an institutional
"accredited investor" within the meaning of Rule 5.01(a)(1), (2), (3) or (7)
under the Securities Act and that it is acquiring such Warrants for investment
purposes and not for distribution in violation of the Securities Act. Each
purchaser acknowledges that each Iridium Party and the Warrant Agent reserve
the right prior to any offer, sale or other transfer prior to the Resale
Restriction Termination Date of the Warrants pursuant to clauses (d), (e) or
(f) above to require the delivery of an opinion of counsel, certifications
and/or other information satisfactory to the Iridium Parties and the Warrant
Agent.
TRANSFEREE:
--------------------
BY:
----------------------------
date:
59
EXHIBIT D
FORM OF TRANSFER CERTIFICATE FOR
TRANSFER TO RULE 144A GLOBAL SECURITY
BEARING A SECURITIES ACT LEGEND
IRIDIUM WORLD COMMUNICATIONS LTD.
STATE STREET BANK AND TRUST COMPANY
Corporate Trust Department
4th Floor
0 Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Re: Iridium World Communication Ltd. ("IWCL") Warrants
Ladies and Gentlemen:
Reference is hereby made to the Warrant Agreement, dated as of
July 16, 1997 (the "Warrant Agreement") between IWCL and State Street Bank
Trust Company, as Warrant Agent. Capitalized terms used but not defined herein
will have the meaning given to them in the Warrant Agreement.
This letter relates to [______] Warrants which are held in
[the form of a beneficial interest in the Regulation S Temporary Global
Security (CINS No. __________) with the Depositary in the name of the
undersigned] [definitive form].
The undersigned has requested transfer of such Warrants to a
Person who will take delivery thereof in the form of a beneficial interest in
the Rule 144A Global Security (CUSIP No. ___________). In connection with such
transfer, the undersigned does hereby confirm that such transfer has been
effected in accordance with the transfer restrictions set forth in the Warrant
Agreement and the Warrant Certificates and pursuant to and in accordance with
Rule 144A under the U.S. Securities Act of 1933, as amended, and accordingly,
the undersigned represents that:
1. the Warrants are being transferred to a transferee
that the undersigned reasonably believes is purchasing the Warrants
for its own account or one or more accounts with respect to which the
transferee exercises sole investment discretion; and
2. the undersigned reasonably believes that transferee
and any such account is a "qualified institutional buyer" within the
meaning of Rule 144A, in a transaction meeting the requirements of
Rule 144A and in accordance with any applicable securities laws of any
state of the United States or any other jurisdiction.
[NAME OF TRANSFEROR]
60
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By:
---------------------------
Name:
Title:
Dated:
-----------------------
61
EXHIBIT E
FORM OF CERTIFICATE TO BE DELIVERED
IN CONNECTION WITH TRANSFERS
PURSUANT TO REGULATION S
IRIDIUM WORLD COMMUNICATIONS LTD.
STATE STREET BANK AND TRUST COMPANY
Corporate Trust Department
4th Floor
0 Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Re: Iridium World Communications Ltd. ("IWCL") Warrants
Ladies and Gentlemen:
Reference is hereby made to the Warrant Agreement, dated as of
July 16, 1997 (the "Warrant Agreement") between IWCL and State Street Bank and
Trust Company, as Warrant Agent.
In connection with our proposed sale of warrants (the
"Warrants") to purchase Class A Common Stock, par value $0.01 per share of
IWCL, the undersigned confirms that such sale has been effected pursuant to and
in accordance with Regulation S under the Securities Act of 1933, as amended,
and, accordingly, the undersigned represents that:
(1) the offer of the Warrants was not made to a U.S.
Person;
(2) either (a) at the time of the buy order was
originated, the transferee was outside the United States or the
undersigned and any person acting on our behalf reasonably believed
that the transferee was outside in the United States or (b) the
transaction was executed in, on or through the facilities of a
designated off-shore securities market and neither the undersigned nor
any person acting on our behalf knows that the transaction has been
pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the
United States in contravention of the requirements of Rule 903(b) or
Rule 904(b) of Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to
evade the registration requirements of the U.S. Securities Act of
1933, as amended.
In addition, if the sale is made during the restricted period applicable to the
Warrants and the provisions of Rule 903(c)(2) or Rule 904(c)(1) of Regulation S
are applicable thereto, the
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undersigned confirms that such sale has been made in accordance with the
applicable provisions of Rule 903(c)(3) or Rule 904(c)(1), as the case may be.
You 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. Terms used in this certificate have the meanings set
forth in Regulation S.
[NAME OF TRANSFEROR]
By:
----------------------------
Name:
Title:
Address:
Date:
--------------------------
Upon transfer, the Warrants should be registered in the name of the new
beneficial owner as follows:
Name:
--------------------------------------------------
Address:
-----------------------------------------------
Taxpayer ID Number:
------------------------------------