Exhibit 4.5
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WARRANT AGREEMENT
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OnePoint Communications Corp.
as Issuer
and
Xxxxxx Trust and Savings Bank
as Warrant Agent
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May 21, 1998
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WARRANT AGREEMENT dated as of May 21, 1998 between OnePoint
Communications Corp. (the "Company") and Xxxxxx Trust and Savings Bank, as
Warrant Agent (the "Warrant Agent").
WHEREAS, the Company proposes to issue common stock purchase warrants,
as hereinafter described (the "Warrants"), to purchase up to an aggregate of
111,125 shares of Common Stock, par value $0.01 per share (the "Common Stock"),
of the Company (the Common Stock issuable on exercise of the Warrants being
referred to herein as the "Warrant Shares"), in connection with a private
placement of an aggregate of $175,000,000 principal amount of the 14 1/2% Senior
Notes due 2008 (the "Notes") of the Company and 175,000 Warrants, each Warrant
entitling the holder thereof to purchase 0.635 Warrant Shares. The Notes and
Warrants will be sold in Units (the "Units"), each Unit consisting of $1,000 in
aggregate principal amount of Notes and One Warrant.
WHEREAS, the Company desires the Warrant Agent to act on behalf of the
Company, and the Warrant Agent is willing so to act, in connection with the
issuance of Warrant Certificates (as defined below) and other matters as
provided herein;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:
Section 1. Definitions.
"144A Global Warrant" means a Global Warrant in the form of Exhibit A1
hereto bearing the Global Warrant Legend and the Private Placement Legend and
deposited with or on behalf of, and registered in the name of, the Depositary or
its nominee that will be issued in a denomination equal to the outstanding
number of the Warrants sold in reliance on Rule 144A.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with") as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise; provided that
beneficial ownership of 10% or more of the voting equity interests of a Person
shall be deemed to be control.
"Applicable Procedures" means, with respect to any transfer or
exchange of or for beneficial interests in any Global Warrant, the rules and
procedures of the Depositary, Euroclear and Cedel Bank that apply to such
transfer or exchange.
"Business Day" means any day other than a Legal Holiday.
"Cedel Bank" means Cedel Bank, SA.
"Definitive Warrant" means a certificated Warrant registered in the
name of the holder thereof and issued in accordance with Section 3.6 hereof, in
the form of Exhibit A1 hereto except that such Warrant shall not bear the Global
Warrant Legend and shall not have the "Schedule of Exchanges of Interests in the
Global Warrant" attached thereto.
"Depositary" means, with respect to the Warrants issuable or issued in
whole or in part in global form, the Person specified in Section 3.3 hereof as
the Depositary with respect to the Warrants, and any and all successors thereto
appointed as Depositary hereunder and having become such pursuant to the
applicable provision of this Indenture.
"Disinterested Director" means, in connection with any issuance of
securities that give rise to a determination of the Fair Market Value thereof
(as described in Section 8.7 hereof), each member of the Board of Directors of
the Company who is not an officer, employee, director or other Affiliate of the
party to whom the Company is proposing to issue the securities giving rise to
such determination.
"Euroclear" means Xxxxxx Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear system.
"Global Warrants" means, individually and collectively, each of the
Restricted Global Warrants, in the form of Exhibits A1 and A2 hereto issued in
accordance with Section 3.1 hereof.
"Global Warrant Legend" means the legend set forth in Section
3.6(f)(ii), which is required to be placed on all Global Warrants issued under
this Warrant Agreement.
"IAI Global Warrant" means the Global Warrant in the form of Exhibit A
hereto bearing the Global Warrant Legend and the Private Placement Legend and
deposited with or on behalf of and registered in the name of the Depositary or
its nominee that will be issued in a denomination equal to the outstanding
number of the Warrants sold to Institutional Accredited Investors.
"Indirect Participant" means a Person who holds a beneficial interest
in a Global Warrant through a Participant.
"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, who are not also QIBs.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York, the City of Chicago, Illinois or at a
place of payment are authorized by law, regulation or executive order to remain
closed. If a payment date is a Legal Holiday at a place of payment, payment may
be made at that place on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue on such payment for the intervening period.
"Non-U.S. Person" means a Person who is not a U.S. Person.
"Officer" means, with respect to any Person, the Chairman of the
Board, the Chief Executive Officer, the President, the Chief Operating Officer,
the Chief Financial Officer, the Treasurer, any Assistant Treasurer, the
Controller, the Secretary or any Vice-President of such Person.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Warrant Agent in form and substance reasonably
acceptable to the Warrant Agent. The counsel may be an employee of or counsel to
the Company, any subsidiary of the Company or the Warrant Agent.
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"Participant" means, with respect to the Depositary, Euroclear or
Cedel, a Person who has an account with the Depositary, Euroclear or Cedel,
respectively (and, with respect to The Depository Trust Company, shall include
Euroclear and Cedel).
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust, business
trust, unincorporated organization or government or any agency or political
subdivision thereof.
"Private Placement Legend" means the legend set forth in Section
3.6(f)(i) to be placed on all Warrants issued under this Warrant Agreement
except where otherwise permitted by the provisions of this Warrant Agreement.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Registrable Securities" shall have the meaning ascribed to such term
in the Warrant Registration Rights Agreement, of even date herewith, between the
Company and the Initial Purchasers (as defined therein).
"Regulation S" means Regulation S promulgated under the Securities
Act.
"Regulation S Global Warrant" means a Global Warrant in the form of
Exhibit A hereto bearing the Global Warrant Legend and the Private Placement
Legend and deposited with or on behalf of and registered in the name of the
Depositary or its nominee, issued in a denomination equal to the outstanding
number of the Warrants initially sold in reliance on Rule 903 of Regulation S.
"Restricted Definitive Warrant" means a Definitive Warrant bearing the
Private Placement Legend.
"Restricted Global Warrant" means a Global Warrant bearing the Private
Placement Legend.
"Rule 144" means Rule 144 promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"Rule 903" means Rule 903 promulgated under the Securities Act.
"Rule 904" means Rule 904 promulgated under the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended.
"U.S. Person" means a U.S. person as defined in Rule 902(o) under the
Securities Act.
Section 2. Appointment of Warrant Agent.
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The Company hereby appoints the Warrant Agent to act as agent for the
Company in accordance with the instructions set forth hereinafter in this
Agreement, and the Warrant Agent hereby accepts such appointment.
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Section 3. Warrant Certificate.
3.1. Form and Dating.
(a) General.
The Warrants shall be substantially in the form of Exhibit A hereto
(the "Warrant Certificates"). The Warrants may have notations, legends or
endorsements required by law, stock exchange rule or usage. Each Warrant shall
be dated the date of the countersignature.
The terms and provisions contained in the Warrants shall constitute,
and are hereby expressly made, a part of this Warrant Agreement. The Company and
the Warrant Agent, by their execution and delivery of this Warrant Agreement,
expressly agree to such terms and provisions and to be bound thereby. However,
to the extent any provision of any Warrant conflicts with the express provisions
of this Warrant Agreement, the provisions of this Warrant Agreement shall govern
and be controlling.
(b) Global Warrants.
Warrants issued in global form shall be substantially in the form of
Exhibit A attached hereto (including the Global Warrant Legend thereon and the
"Schedule of Exchanges of Interests in the Global Warrant" attached thereto).
Warrants issued in definitive form shall be substantially in the form of Exhibit
A attached hereto (but without the Global Warrant Legend thereon and without the
"Schedule of Exchanges of Interests in the Global Warrant" attached thereto).
Each Global Warrant shall represent such of the outstanding Warrants as shall be
specified therein and each shall provide that it shall represent the number of
outstanding Warrants from time to time endorsed thereon and that the number of
outstanding Warrants represented thereby may from time to time be reduced or
increased, as appropriate, to reflect exchanges and redemptions. Any endorsement
of a Global Warrant to reflect the amount of any increase or decrease in the
number of outstanding Warrants represented thereby shall be made by the Warrant
Agent in accordance with instructions given by the holder thereof as required by
Section 3.6 hereof.
(c) Euroclear and Cedel Procedures Applicable.
The provisions of the "Operating Procedures of the Euroclear System"
and "Terms and Conditions Governing Use of Euroclear" and the "General Terms and
Conditions of Cedel Bank" and "Customer Handbook" of Cedel Bank shall be
applicable to transfers of beneficial interests in the Regulation S Global
Warrant that are held by Participants through Euroclear or Cedel Bank.
3.2. Execution.
An Officer shall sign the Warrants for the Company by manual or
facsimile signature.
If the Officer whose signature is on a Warrant no longer holds that
office at the time a Warrant is authenticated, the Warrant shall nevertheless be
valid.
A Warrant shall not be valid until countersigned by the manual
signature of the Warrant Agent. The signature shall be conclusive evidence that
the Warrant has been authenticated under this Warrant Agreement.
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The Warrant Agent shall, upon a written order of the Company signed by
an Officer (a "Warrant Countersignature Order"), countersign Warrants for
original issue up to the number stated in the preamble hereto.
The Warrant Agent may appoint an agent acceptable to the Company to
countersign Warrants. Such an agent may countersign Warrants whenever the
Warrant Agent may do so. Each reference in this Warrant Agreement to a
countersignature by the Warrant Agent includes a countersignature by such agent.
Such an agent has the same rights as an Agent to deal with the Company or an
Affiliate of the Company.
3.3. Warrant Registrar.
The Company shall maintain an office or agency where Warrants may be
presented for registration of transfer or for exchange ("Warrant Registrar").
The Warrant Registrar shall keep a register of the Warrants and of their
transfer and exchange. The Company may appoint one or more co-Warrant
Registrars. The term "Warrant Registrar" includes any co-Warrant Registrar. The
Company may change any Warrant Registrar without notice to any holder. The
Company shall notify the Warrant Agent in writing of the name and address of any
Agent not a party to this Warrant Agreement. If the Company fails to appoint or
maintain another entity as Warrant Registrar, the Warrant Agent shall act as
such. The Company or any of its subsidiaries may act as Warrant Registrar.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect to the Global Warrants.
The Company initially appoints the Warrant Agent to act as the Warrant
Registrar with respect to the Global Warrants.
3.4. Holder Lists.
The Warrant Agent shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all holders. If the Warrant Agent is not the Warrant Registrar, the Company
shall furnish to the Warrant Agent at least seven Business Days before each
interest payment date and at such other times as the Warrant Agent may request
in writing, a list in such form and as of such date as the Warrant Agent may
reasonably require of the names and addresses of the holders of Warrants.
3.5. Registration of Transfers and Exchanges.
(a) Transfer and Exchange of Global Warrants. The transfer and
exchange of Global Warrants or beneficial interests therein shall be effected
through the Depositary, in accordance with this Agreement and the procedures of
the Depositary therefor.
(b) Exchange of a Beneficial Interest in a Global Warrant for a
Definitive Warrant.
(i) Any holder of a beneficial interest in a Global Warrant may
upon request exchange such beneficial interest for a Definitive
Warrant. Upon receipt by the Warrant Agent of written instructions or
such other form of instructions as is customary for the Depositary
from the Depositary or its nominee on behalf of any Person having a
beneficial interest in a Global Warrant and, in the case of a
Registrable Security, the following additional information and
documents (all of which may be submitted by
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facsimile):
(A) if such beneficial interest is being delivered to the
Person designated by the Depositary as being the beneficial owner, a
certification to that effect (in substantially the form of Exhibit B
hereto);
(B) if such beneficial interest is being transferred (1) to
a "qualified institutional buyer" (as defined in Rule 144A under the
Securities Act) in accordance with Rule 144A under the Securities Act
or (2) pursuant to an exemption from registration in accordance with
Rule 144 under the Securities Act (based on an opinion of counsel if
the Company so requests) or (3) pursuant to an effective registration
statement under the Securities Act, a certification to that effect (in
substantially the form of Exhibit B hereto);
(C) if such beneficial interest is being transferred to any
institutional "accredited investor," within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act pursuant to a
private placement exemption from the registration requirements of the
Securities Act (based on an opinion of counsel if the Company so
requests), a certification to that effect (in substantially the form
of Exhibit B hereto) and a certification from the applicable
transferee ;
(D) if such beneficial interest is being transferred
pursuant to an exemption from registration in accordance with Rule 904
under the Securities Act (and based on an opinion of counsel if the
Company so requests), a certification to that effect (in substantially
the form of Exhibit B);or
(E) if such beneficial interest is being transferred in
reliance on another exemption from the registration requirements of
the Securities Act (and based on an opinion of counsel if the Company
so requests), a certification to that effect (in substantially the
form of Exhibit B hereto);
then the Warrant Agent shall cause, in accordance with the standing
instructions and procedures existing between the Depositary and Warrant Agent,
the number of Warrants and Warrant Shares represented by the Global Warrant to
be reduced by the number of Warrants and Warrant Shares to be represented by the
Definitive Warrants to be issued in exchange for the interest of such Person in
the Global Warrant and, following such reduction, the Company shall execute and
the Warrant Agent shall countersign and deliver to the transferee, as the case
may be, a Definitive Warrant.
(ii) Definitive Warrants issued in exchange for a beneficial
interest in a Global Warrant pursuant to this Section 3.5(b) shall be
registered in such names as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct
the Warrant Agent. The Warrant Agent shall deliver such Definitive
Warrants to the Persons in whose names such Warrants are so
registered.
(c) Transfer and Exchange of Definitive Warrants.
When Definitive Warrants are presented to the Warrant Agent with a
request:
(i) to register the transfer of the Definitive Warrants; or
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(ii) to exchange such Definitive Warrants for an equal number of
Definitive Warrants of other authorized denominations,
the Warrant Agent shall register the transfer or make the exchange as requested
if its requirements for such transactions are met; provided, however, that the
Definitive Warrants presented or surrendered for registration of transfer or
exchange:
(x) shall be duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Warrant Agent, duly executed by the holder
thereof or by his attorney, duly authorized in writing; and
(y) in the case of Registrable Securities, such request shall be
accompanied by the following additional information and documents, as
applicable:
(A) if such Registrable Security is being delivered to the
Warrant Agent by a holder for registration in the name of such holder,
without transfer, a certification from such holder to that effect (in
substantially the form of Exhibit B hereto);
(B) if such Registrable Security is being transferred (1) to
a "qualified institutional buyer" (as defined in Rule 144A under the
Securities Act) in accordance with Rule 144A under the Securities Act
or (2) pursuant to an exemption from registration in accordance with
Rule 144 under the Securities Act (and based on an opinion of counsel
if the Company so requests) or (3) pursuant to an effective
registration statement under the Securities Act, a certification to
that effect (in substantially the form of Exhibit B hereto);
(C) if such Registrable Security is being transferred to an
institutional "accredited investor," within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act pursuant to a
private placement exemption from the registration requirements of the
Securities Act (and based on an opinion of counsel if the Company so
requests), a certification to that effect (in substantially the form
of Exhibit B hereto) and a certification from the applicable
transferee ;
(D) if such Registrable Security is being transferred
pursuant to an exemption from registration in accordance with Rule 904
under the Securities Act (and based on an opinion of counsel if the
Company so requests), a certification to that effect (in substantially
the form of Exhibit B hereto); or
(E) if such Registrable Security is being transferred in
reliance on another exemption from the registration requirements of
the Securities Act (and based on an opinion of counsel if the Company
so requests), a certification to that effect (in substantially the
form of Exhibit B hereto).
(d) Restrictions on Exchange or Transfer of a Definitive Warrant for a
Beneficial Interest in a Global Warrant. A Definitive Warrant may not be
exchanged for a beneficial interest in a Global Warrant except upon satisfaction
of the requirements set forth below. Upon receipt by the Warrant Agent of a
Definitive Warrant, duly endorsed or accompanied by appropriate instruments of
transfer, in form satisfactory to the Warrant Agent, together with:
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(i) if such Definitive Warrant is a Registrable Security,
certification from the holder thereof (in substantially the form of
Exhibit B hereto) to the effect that such Definitive Warrant is being
transferred by such holder either (A) to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act) in
accordance with Rule 144A under the Securities Act, (B) outside the
United States to a foreign Person in a transaction meeting the
requirements of Rule 904 under the Securities Act (and based on an
opinion of counsel if the Company so requests) or (C) to an
institutional "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act, pursuant to a
private placement exemption from the registration requirements of the
Securities Act, who has provided a certification to that effect (and
based on an opinion of counsel if the Company so requests) and who
wishes to take delivery thereof in the form of a beneficial interest
in a Global Warrant; and
(ii) whether or not such Definitive Warrant is a Registrable
Security, written instructions directing the Warrant Agent to make, or
to direct the Depositary to make, an endorsement on the Global Warrant
to reflect an increase in the number of Warrants and Warrant Shares
represented by the Global Warrant equal to the number of Warrants and
Warrant Shares represented by such Definitive Warrant,
then the Warrant Agent shall cancel such Definitive Warrant and cause, or direct
the Depositary to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Warrant Agent, the number of
Warrants and Warrant Shares represented by the Global Warrant to be increased
accordingly. If no Global Warrants are then outstanding, the Company shall issue
and the Warrant Agent shall countersign a new Global Warrant representing the
appropriate number of Warrants and Warrant Shares.
(e) Restrictions on Transfer and Exchange of Global Warrants.
Notwithstanding any other provisions of this Agreement (other than the
provisions set forth in subsection (f) of this Section 3.5), a Global Warrant
may not be transferred as a whole except by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
(f) Countersigning of Definitive Warrants in Absence of Depositary. If
at any time:
(i) the Depositary for the Global Warrants notifies the Company
that the Depositary is unwilling or unable to continue as Depositary
for the Global Warrants and a successor Depositary for the Global
Warrants is not appointed by the Company within 90 days after delivery
of such notice; or
(ii) the Company, in its sole discretion, notifies the Warrant
Agent in writing that it elects to cause the issuance of Definitive
Warrants under this Agreement,
then the Company shall execute, and the Warrant Agent, upon written instructions
signed by an officer of the Company, shall countersign and deliver Definitive
Warrants, in an aggregate number equal to the number of Warrants represented by
the Global Warrants, in exchange for such Global Warrants.
(g) Legends.
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The following legends shall appear on the face of all Global Warrants
and Definitive Warrants issued under this Warrant Agreement unless specifically
stated otherwise in the applicable provisions of this Warrant Agreement.
(i) Private Placement Legend.
(A) Except as permitted by subparagraph (B) below, each
Global Warrant and each Definitive Warrant (and all Warrants issued in
exchange therefor or substitution thereof) shall bear the legend in
substantially the following form:
"THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS
ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER XXXXXXX 0
XX XXX XXXXXX XXXXXX SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND THE SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR
OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. EACH PURCHASER OF THE SECURITY EVIDENCED HEREBY IS
HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER. THE HOLDER OF THE SECURITY EVIDENCED HEREBY AGREES FOR THE
BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY MAY BE RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED, ONLY (1)(a) TO A PERSON WHO THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER
THE SECURITIES ACT) (b) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144A UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED STATES TO A FOREIGN
PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904 UNDER THE
SECURITIES ACT, (d) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" AS DEFINED IN
RULE 501(a)(1), (2), (3) OR (7) OF THE SECURITIES ACT (AN "INSTITUTIONAL
ACCREDITED INVESTOR") IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OR (e) IN ACCORDANCE WITH ANOTHER
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (2) TO
THE COMPANY OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN
EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE
HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER FROM IT OF THE SECURITY EVIDENCED HEREBY OF THE RESALE
RESTRICTIONS SET FORTH IN (A) ABOVE."
(B) Notwithstanding the foregoing, any Global Warrant or
Definitive Warrant issued pursuant to subparagraphs (b)(iv), (c)(ii),
(c)(iii), (d)(ii), (d)(iii), (e)(ii), (e)(iii) or (f) to this Section
3.6 (and all Warrants issued in exchange therefor or substitution
thereof) shall not bear the Private Placement Legend.
(ii) Global Warrant Legend. Each Global Warrant shall bear a
legend in substantially the following form:
"THIS GLOBAL WARRANT IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
WARRANT AGREEMENT GOVERNING THIS WARRANT) OR ITS
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NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS
NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE
WARRANT AGENT MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO
SECTION 3.7 OF THE WARRANT AGREEMENT, (II) THIS GLOBAL WARRANT MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 3.6(a) OF THE
WARRANT AGREEMENT, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE WARRANT
AGREEMENT FOR CANCELLATION PURSUANT TO SECTION 3.11 OF THE WARRANT AGENT
AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY WITH
THE PRIOR WRITTEN CONSENT OF THE COMPANY."
(iii) Unit Legend. Each Warrant issued prior to the Separation
Date shall bear the following legend (the "Unit Legend") on the face
thereof:
"THE WARRANTS EVIDENCED BY THIS CERTIFICATE ARE INITIALLY ISSUED
AS PART OF AN ISSUANCE OF UNITS (THE "UNITS"), EACH OF WHICH CONSIST OF
$1,000 PRINCIPAL AMOUNT OF THE 14 1/2% SENIOR NOTES DUE 2008 OF THE COMPANY
(THE "NOTES") AND ONE WARRANT (THE "WARRANT") INITIALLY ENTITLING THE
HOLDER THEREOF TO PURCHASE 0.635 SHARES, PAR VALUE $0.01 PER SHARE, OF THE
COMPANY. PRIOR TO THE EARLIEST TO OCCUR OF (i) THE DATE THAT IS SIX MONTHS
FOLLOWING THE INITIAL SALE OF THE UNITS, (ii) THE COMMENCEMENT OF AN
EXCHANGE OFFER WITH RESPECT TO THE NOTES, (iii) THE DATE A SHELF
REGISTRATION STATEMENT (AS DEFINED IN THE INDENTURE) WITH RESPECT TO THE
NOTES IS DECLARED EFFECTIVE, (iv) A CHANGE OF CONTROL (AS DEFINED IN THE
INDENTURE), OR (v) SUCH DATE AS BEAR, XXXXXXX & CO. INC. MAY, IN ITS SOLE
DISCRETION, DEEM APPROPRIATE, THE WARRANTS EVIDENCED BY THIS CERTIFICATE
MAY NOT BE TRANSFERRED OR EXCHANGED SEPARATELY FROM, BUT MAY BE TRANSFERRED
OR EXCHANGED ONLY TOGETHER WITH, THE NOTES.
(h) Cancellation and/or Adjustment of Global Warrants.
At such time as all beneficial interests in a particular Global
Warrant have been exercised or exchanged for Definitive Warrants or a particular
Global Warrant has been exercised, redeemed, repurchased or canceled in whole
and not in part, each such Global Warrant shall be returned to or retained and
canceled by the Warrant Agent in accordance with Section 3.11 hereof. At any
time prior to such cancellation, if any beneficial interest in a Global Warrant
is exercised or exchanged for or transferred to a Person who will take delivery
thereof in the form of a beneficial interest in another Global Warrant or for
Definitive Warrants, the amount of Warrants represented by such Global Warrant
shall be reduced accordingly and an endorsement shall be made on such Global
Warrant by the Warrant Agent or by the Depositary at the direction of the
Warrant Agent to reflect such reduction; and if the beneficial interest is being
exchanged for or transferred to a Person who will take delivery thereof in the
form of a beneficial interest in another Global Warrant, such other Global
Warrant shall be increased accordingly and an endorsement shall be made on such
Global Warrant by the Warrant Agent or by the Depositary at the direction of the
Warrant Agent to reflect such increase.
(i) General Provisions Relating to Transfers and Exchanges.
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(i) To permit registrations of transfers and exchanges, the
Company shall execute and the Warrant Agent shall countersign Global
Warrants and Definitive Warrants upon the Company's order or at the
Warrant Registrar's request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Warrant or to a holder of a Definitive Warrant
for any registration of transfer or exchange, but the Company may
require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other
than any such transfer taxes or similar governmental charge payable
upon exchange or transfer pursuant to Sections 3.10) hereof.
(iii) All Global Warrants and Definitive Warrants issued upon any
registration of transfer or exchange of Global Warrants or Definitive
Warrants shall be the duly authorized, executed and issued warrants
for Common Stock of the Company, not subject to any preemptive rights,
and entitled to the same benefits under this Warrant Agreement, as the
Global Warrants or Definitive Warrants surrendered upon such
registration of transfer or exchange.
(iv) Prior to due presentment for the registration of a transfer
of any Warrant, the Warrant Agent, any Agent and the Company may deem
and treat the Person in whose name any Warrant is registered as the
absolute owner of such Warrant for all purposes and none of the
Warrant Agent, any Agent or the Company shall be affected by notice to
the contrary.
(v) The Warrant Agent shall countersign Global Warrants and
Definitive Warrants in accordance with the provisions of Section 3.2
hereof.
(j) Facsimile Submissions to Warrant Agent.
All certifications, certificates and Opinions of Counsel required to
be submitted to the Warrant Registrar pursuant to this Section 3.6 to effect a
registration of transfer or exchange may be submitted by facsimile.
Notwithstanding anything herein to the contrary, as to any
certificates and/or certifications delivered to the Warrant Registrar pursuant
to this Section 3.5, the Warrant Registrar's duties shall be limited to
confirming that any such certifications and certificates delivered to it are in
the form of Exhibits B and C attached hereto. The Warrant Registrar shall not be
responsible for confirming the truth or accuracy of representations made in any
such certifications or certificates. As to any Opinions of Counsel delivered
pursuant to this Section 3.5, the Warrant Registrar may rely upon, and be fully
protected in relying upon, such opinions.
3.6. Replacement Warrants.
If any mutilated Warrant is surrendered to the Warrant Agent or the
Company and the Warrant Agent receives evidence to its satisfaction of the
destruction, loss or theft of any Warrant, the Company shall issue and the
Warrant Agent, upon receipt of a Warrant Countersignature Order, shall
countersign a replacement Warrant if the Warrant Agent's requirements are met.
If required by the Warrant Agent or the Company, an indemnity bond must be
supplied by the holder that is sufficient in the judgment of the Warrant Agent
and the Company to protect the Company, the Warrant Agent, any
11
Agent and any agent for purposes of the countersignature from any loss that any
of them may suffer if a Warrant is replaced. The Company may charge for its
expenses in replacing a Warrant.
Every replacement Warrant is an additional warrant of the Company and
shall be entitled to all of the benefits of this Warrant Agreement equally and
proportionately with all other Warrants duly issued hereunder.
3.7. Temporary Warrants
Until certificates representing Warrants are ready for delivery, the
Company may prepare and the Warrant Agent, upon receipt of a Warrant
Authentication Order, shall authenticate temporary Warrants. Temporary Warrants
shall be substantially in the form of certificated Warrants but may have
variations that the Company considers appropriate for temporary Warrants and as
shall be reasonably acceptable to the Warrant Agent. Without unreasonable delay,
the Company shall prepare and the Warrant Agent shall countersign definitive
Warrants in exchange for temporary Warrants.
Holders of temporary Warrants shall be entitled to all of the benefits
of this Warrant Agreement.
3.8. Cancellation.
Subject to Section 3.7 hereof, the Company at any time may deliver
Warrants to the Warrant Agent for cancellation. The Warrant Registrar and
Warrant Paying Agent shall forward to the Warrant Agent any Warrants surrendered
to them for registration of transfer, exchange or exercise. The Warrant Agent
and no one else shall cancel all Warrants surrendered for registration of
transfer, exchange, exercise, replacement or cancellation and shall destroy
canceled Warrants (subject to the record retention requirement of the Exchange
Act). Certification of the destruction of all canceled Warrants shall be
delivered to the Company. The Company may not issue new Warrants to replace
Warrants that have been exercised or that have been delivered to the Warrant
Agent for cancellation.
Section 4. Separation of Warrants; Terms of Warrants; Exercise of
Warrants.
4.1. The Notes and Warrants will not be separately transferable until
the earliest to occur of (i) the date that is six months following the initial
sale of the Units, (ii) the commencement of the Exchange Offer (as defined in
the Indenture), (iii) the date a Shelf Registration Statement (as defined in the
Indenture) with respect to the Notes is declared effective, (iv) a Change of
Control (as defined in the Indenture) or (v) such date as Bear, Xxxxxxx & Co.
Inc. may, in its sole discretion, deem appropriate (the earliest of such dates,
the "Separation Date"), at which time such Warrants shall become separately
transferable. Subject to the terms of this Agreement, each Warrant holder shall
have the right, which may be exercised during the period commencing on the
earlier of (a) the opening of business on the Separation Date and (b) in the
event a Change of Control occurs, the date the Company mails notice thereof to
holders of Notes and Warrants, until 5:00 p.m., New York City time on June 1,
2008 (the "Exercise Period"), to receive from the Company the number of fully
paid and nonassessable Warrant Shares which the holder may at the time be
entitled to receive on exercise of such Warrants and payment of the exercise
price (the "Exercise Price") then in effect for such Warrant Shares; provided
that holders shall be able to exercise their Warrants only if a registration
statement relating to the Warrant Shares is then in effect, or the exercise of
such Warrants is exempt from the registration requirements of the Securities Act
of 1933, as amended (the "Securities Act"), and such securities are qualified
for sale or exempt from qualification under the applicable securities laws of
the states in which the various holders
12
of the Warrants or other persons to whom it is proposed that the Warrant Shares
be issued on exercise of the Warrants reside. In the alternative, each holder
may exercise its right to receive Warrant Shares on a net basis, such that
without the exchange of any funds, the holder receives that number of Warrant
Shares otherwise issuable upon exercise of its Warrants less that number of
Warrant Shares having a Fair Market Value equal to the aggregate Exercise Price
that would otherwise have been paid by the holder for the Warrant Shares being
issued. For purposes of the foregoing sentence, the "Fair Market Value" of the
Warrant Shares shall be the current market price of the Warrant Shares on the
date immediately preceding the date of payment of the Exercise Price as
determined by the procedures set forth in Section 8.7. Each Warrant not
exercised prior to 5:00 p.m., New York City time, on June 1, 2008 (the
"Expiration Date") shall become void and all rights thereunder and all rights in
respect thereof under this agreement shall cease as of such time. No adjustments
as to dividends will be made upon exercise of the Warrants.
The Company shall give notice not less than 90, and not more than 120,
days prior to the Expiration Date to the registered holders of all then
outstanding Warrants to the effect that the Warrants will terminate and become
void as of 5:00 p.m., New York City time, on the Expiration Date. If the Company
fails to give such notice, the Warrants will not expire until 90 days after the
Company gives such notice; provided, however, in no event will holders be
entitled to any damages or other remedy for the Company's failure to give such
notice other than any such extension.
4.2. In order to exercise all or any of the Warrants represented by a
Warrant Certificate, (i) in the case of Definitive Warrants, the holder thereof
must surrender for exercise the Warrant Certificate to the Company at the office
of the Warrant Agent at its New York corporate trust office, (ii) in the case of
a book-entry interest in a Global Warrant, the exercising Participant whose name
appears on a securities position listing of the Depositary as the holder of such
book-entry interest must comply with the Depositary's procedures relating to the
exercise of such book-entry interest in such Global Warrant and (iii) in the
case of both Global Warrants and Definitive Warrants, the holder thereof or the
Participant, as applicable, must deliver to the Company at the office of the
Warrant Agent the form of election to purchase on the reverse thereof duly
filled in and signed, which signature shall be a medallion guaranteed by an
institution which is a member of a Securities Transfer Association recognized
signature guarantee program, and upon payment to the Warrant Agent for the
account of the Company of the Exercise Price, which is set forth in the form of
Warrant Certificate as adjusted as herein provided, for the number of Warrant
Shares in respect of which such Warrants are then exercised. In addition, if the
holder is exercising warrants sold pursuant to Regulation S, such holder must
certify in writing that it is not a U.S. Person and that the warrant is not
being exercised on behalf of a U.S. Person or give a written opinion of counsel
to the effect that the warrant and the securities delivered upon exercise
thereof have been registered under the Securities Act or are exempt from
registration thereunder. Payment of the aggregate Exercise Price shall be made
(i) in cash, by wire transfer or by certified or official bank check payable to
the order of the Company or (ii) on a net basis in the manner provided in
Section 4.1 hereof.
4.3. Subject to the provisions of Section 5 hereof, upon compliance
with Section 4.2 above, the Company shall deliver or cause to be delivered with
all reasonable dispatch, to or upon the written order of the holder and in such
name or names as the Warrant holder or Participant may designate, a certificate
or certificates for the number of whole Warrant Shares issuable upon the
exercise of such Warrants or other securities or property to which such holder
is entitled hereunder, together with cash as provided in Section 9 hereof;
provided that if any consolidation, merger or lease or sale of assets is
proposed to be effected by the Company as described in Section 8.13 hereof, or a
tender offer or an exchange offer for shares of Common Stock is made, upon such
surrender of Warrants and payment of
13
the Exercise Price as aforesaid, the Company shall, as soon as possible, but in
any event not later than two Business Days thereafter, deliver or cause to be
delivered the full number of Warrant Shares issuable upon the exercise of such
Warrants in the manner described in this sentence or other securities or
property to which such holder is entitled hereunder, together with cash as
provided in Section 9 hereof. Such certificate or certificates shall be deemed
to have been issued and any person so designated to be named therein shall be
deemed to have become a holder of record of such Warrant Shares as of the date
of the surrender of such Warrants and payment of the Exercise Price.
4.4. The Warrants shall be exercisable, at the election of the holders
thereof, either in full or from time to time in part. If less than all the
Warrants represented by a Definitive Warrant are exercised, such Definitive
Warrant shall be surrendered and a new Definitive Warrant of the same tenor and
for the number of Warrants which were not exercised shall be executed by the
Company and delivered to the Warrant Agent and the Warrant Agent shall
countersign the new Definitive Warrant, registered in such name or names as may
be directed in writing by the holder, and shall deliver the new Definitive
Warrant to the Person or Persons entitled to receive the same. The Warrant Agent
shall make such notations on Schedule A to each Global Warrant as are required
to reflect any change in the number of Warrants represented by such Global
Warrant resulting from any exercise in accordance with the terms hereof.
4.5. All Warrant Certificates surrendered upon exercise of Warrants
shall be canceled by the Warrant Agent. Such canceled Warrant Certificates shall
then be disposed of by the Warrant Agent in a manner satisfactory to the
Company. The Warrant Agent shall account promptly to the Company with respect to
Warrants exercised and concurrently pay to the Company all monies received by
the Warrant Agent for the purchase of the Warrant Shares through the exercise of
such Warrants.
4.6. The Warrant Agent shall keep copies of this Agreement and any
notices given or received hereunder available for inspection by the holders
during normal business hours at its office. The Company shall supply the Warrant
Agent from time to time with such numbers of copies of this Agreement as the
Warrant Agent may request.
Section 5. Payment of Taxes.
The Company will pay all documentary stamp taxes attributable to the
initial issuance of Warrant Shares upon the exercise of Warrants; provided,
however, that the Company shall not be required to pay any tax or taxes which
may be payable in respect of any transfer involved in the issue of any Warrant
Certificates or any certificates for Warrant Shares in a name other than that of
the registered holder of a Warrant Certificate surrendered upon the exercise of
a Warrant, and the Company shall not be required to issue or deliver such
Warrant Certificates unless or until the person or persons requesting the
issuance thereof shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax has been paid.
Section 6. Reservation of Warrant Shares.
6.1. The Company will at all times reserve and keep available, free
from preemptive rights, out of the aggregate of its authorized but unissued
Common Stock or its authorized and issued Common Stock held in its treasury, for
the purpose of enabling it to satisfy any obligation to issue Warrant Shares
upon exercise of Warrants, the maximum number of shares of Common Stock which
may then be deliverable upon the exercise of all outstanding Warrants.
14
6.2. The Company or, if appointed, the transfer agent for the Common
Stock (the "Transfer Agent") and every subsequent transfer agent for any shares
of the Company's capital stock issuable upon the exercise of any of the rights
of purchase aforesaid will be irrevocably authorized and directed at all times
to reserve such number of authorized shares as shall be required for such
purpose. The Company will keep a copy of this Agreement on file with the
Transfer Agent and with every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the exercise of the rights of purchase
represented by the Warrants. The Warrant Agent is hereby irrevocably authorized
to requisition from time to time from such Transfer Agent the stock certificates
required to honor outstanding Warrants upon exercise thereof in accordance with
the terms of this Agreement. The Company will supply such Transfer Agent with
duly executed certificates for such purposes and will provide or otherwise make
available any cash which may be payable as provided in Section 9. The Company
will furnish such Transfer Agent a copy of all notices of adjustments and
certificates related thereto, transmitted to each holder pursuant to Section 10
hereof.
6.3. Before taking any action which would cause an adjustment pursuant
to Section 8 hereof to reduce the Exercise Price below the then par value (if
any) of the Warrant Shares, the Company will take any corporate action which
may, in the opinion of its counsel (which may be counsel employed by the
Company), be necessary in order that the Company may validly and legally issue
fully paid and nonassessable Warrant Shares at the Exercise Price as so
adjusted.
6.4. The Company covenants that all Warrant Shares which may be issued
upon exercise of Warrants will, upon issue, be fully paid, nonassessable, free
of preemptive rights and free from all taxes, liens, charges and security
interests with respect to the issue thereof.
Section 7. Obtaining Stock Exchange Listings.
The Company will from time to time take all action which may be
necessary so that the Warrant Shares, immediately upon their issuance upon the
exercise of Warrants, will be listed on the principal securities exchanges and
markets within the United States of America, if any, on which other shares of
Common Stock are then listed.
Section 8. Adjustment of Exercise Price and Number of Warrant Shares
Issuable.
The Exercise Price and the number of Warrant Shares issuable upon the
exercise of each Warrant are subject to adjustment from time to time upon the
occurrence of the events enumerated in this Section 8. For purposes of this
Section 8 "Common Stock" means shares now or hereafter authorized of any class
of common stock of the Company and any other stock of the Company, however
designated, that has the right (subject to any prior rights of any class or
series of preferred stock) to participate in any distribution of the assets or
earnings of the Company without limit as to per share amount.
8.1. Adjustment for Change in Capital Stock. If the Company (i) pays a
dividend or makes a distribution on its Common Stock in shares of its Common
Stock, (ii) subdivides its outstanding shares of Common Stock into a greater
number of shares, (iii) combines its outstanding shares of Common Stock into a
smaller number of shares, (iv) makes a distribution on its Common Stock in
shares of its capital stock other than Common Stock or (v) issues by
reclassification of its Common Stock any shares of its capital stock; then the
Exercise Price in effect immediately prior to such action shall be
proportionately adjusted so that the holder of any Warrant thereafter exercised
may receive the aggregate number and kind of shares of capital stock of the
Company which he would have owned immediately following such action if such
Warrant had been exercised immediately prior to such action.
15
The adjustment shall become effective immediately after the record
date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
If, after an adjustment, a holder of a Warrant upon exercise of it may receive
shares of two or more classes of capital stock of the Company, the Company shall
determine the allocation of the adjusted Exercise Price between the classes of
capital stock. After such allocation, the exercise privilege and the Exercise
Price of each class of capital stock shall thereafter be subject to adjustment
on terms comparable to those applicable to Common Stock in this Section 8. Such
adjustment shall be made successively whenever any event listed above shall
occur.
8.2. Adjustment for Rights Issue. If the Company distributes any
rights, options or warrants to all holders of its Common Stock entitling them
for a period expiring within 45 days after the record date mentioned below to
purchase shares of Common Stock, or securities convertible into or exchangeable
for shares of Common Stock, at a price per share less than the Fair Market Value
(as defined herein) per share on that record date, the Exercise Price shall be
adjusted in accordance with the formula:
O + N x P
-----
E' = E x M
----------
O + N
where:
E' = the adjusted Exercise Price.
E = the current Exercise Price.
O = the number of shares of Common Stock outstanding on the record date.
N = the number of additional shares of Common Stock offered.
P = the offering price per share of the additional shares.
M = the Fair Market Value per share of Common Stock on the record date.
The adjustment shall be made successively whenever any such rights,
options or warrants are issued and shall become effective immediately after the
record date for the determination of stockholders entitled to receive the
rights, options or warrants. If at the end of the period during which such
rights, options or warrants are exercisable, not all rights, options or warrants
shall have been exercised, the Exercise Price shall be immediately readjusted to
what it would have been if "N" in the above formula had been the number of
shares actually issued.
8.3. Adjustment for Other Distributions. If the Company distributes to
all holders of its Common Stock any of its assets or debt securities or any
rights or warrants to purchase debt securities, assets or other securities of
the Company, the Exercise Price shall be adjusted in accordance with the
formula:
E'= E x M - F
-----
M
where:
16
E' = the adjusted Exercise Price.
E = the current Exercise Price.
M = the Fair Market Value per share of Common Stock on the record date
mentioned below.
F = the fair market value on the record date of the assets, securities,
rights or warrants to be distributed in respect of one share of Common
Stock as determined in good faith by the Board of Directors of the
Company (the "Board of Directors").
The adjustment shall be made successively whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the distribution.
This Section 8.3 does not apply to cash dividends or cash
distributions paid out of consolidated current or retained earnings as shown on
the books of the Company prepared in accordance with generally accepted
accounting principles. Also, this Section 8.3 does not apply to rights, options
or warrants referred to in Section 8.2 hereof.
8.4. Adjustment for Common Stock Issue. If the Company issues shares
of Common Stock for a consideration per share less than the Fair Market Value
per share on the date the Company fixes the offering price of such additional
shares, the Exercise Price shall be adjusted in accordance with the formula:
C
-
E'= Ex O + M
-------
A
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.
C = the aggregate consideration received for the issuance of such
additional shares.
M = the Fair Market Value per share on the date of issuance of such
additional shares.
A = the number of shares outstanding immediately after the issuance of
such additional shares.
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
This Section 8.4 does not apply to:
(i) any of the transactions described in Sections 8.2 and 8.3
hereof,
17
(ii) the exercise of Warrants, or the conversion or exchange of
other securities convertible or exchangeable for Common Stock,
(iii) Common Stock issued to the Company's employees under bona
fide employee benefit plans adopted by the Board of Directors and
approved by the holders of Common Stock when required by law, if such
Common Stock would otherwise be covered by this subsection (d) (but
only to the extent that the aggregate number of shares excluded hereby
and issued after the date of this Warrant Agreement shall not exceed
15% of the Common Stock outstanding at the time of the adoption of
each such plan, exclusive of antidilution adjustments thereunder),
(iv) Common Stock upon the exercise of rights or warrants issued
to the holders of Common Stock,
(v) Common Stock issued to shareholders of any person which
merges into the Company in proportion to their stock holdings of such
person immediately prior to such merger, upon such merger, or
(vi) the issuance of shares of Common Stock pursuant to rights,
options or warrants which were originally issued in a Non-Affiliate
Sale (as defined below) together with one or more other securities as
part of a unit at a price per unit.
8.5. Adjustment for Convertible Securities Issue. If the Company
issues any securities convertible into or exchangeable for Common Stock (other
than securities issued in transactions described in Sections 8.2 and 8.3 hereof
for a consideration per share of Common Stock initially deliverable upon
conversion or exchange of such securities less than the Fair Market Value per
share on the date of issuance of such securities, the Exercise Price shall be
adjusted in accordance with this formula:
C
-
E'= Ex O + 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 securities.
C = the aggregate consideration received for the issuance of such
securities.
M = the Fair Value per share on the date of issuance of such securities.
D = the maximum number of shares deliverable upon conversion or in
exchange for such securities at the initial conversion or exchange
rate.
18
The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.
If all of the Common Stock deliverable upon conversion or exchange of
such securities have not been issued when such securities are no longer
outstanding, then the Exercise Price shall promptly be readjusted to the
Exercise Price which would then be in effect had the adjustment upon the
issuance of such securities been made on the basis of the actual number of
shares of Common Stock issued upon conversion or exchange of such securities.
This Section 8.5 does not apply to convertible securities issued to
shareholders of any person which merges into the Company, or with a subsidiary
of the Company, in proportion to their stock holdings of such person immediately
prior to such merger, upon such merger.
8.6. Consideration Received. For purposes of any computation
respecting consideration received pursuant to Sections 8.4 and 8.5 hereof the
following shall apply:
(i) in the case of the issuance of shares of Common Stock for
cash, the consideration shall be the amount of such cash, provided
that in no case shall any deduction be made for any commissions,
discounts or other expenses incurred by the Company for any
underwriting of the issue or otherwise in connection therewith;
(ii) in the case of the issuance of shares of Common Stock for a
consideration in whole or in part other than cash, the consideration
other than cash shall be deemed to be the fair market value thereof as
determined in good faith by the Board of Directors (irrespective of
the accounting treatment thereof), whose determination shall be
conclusive, and described in a Board resolution which shall be filed
with the Warrant Agent;
(iii) in the case of the issuance of securities convertible into
or exchangeable for shares, the aggregate consideration received
therefor shall be deemed to be the consideration received by the
Company for the issuance of such securities plus the additional
consideration, if any, to be received by the Company upon the
conversion or exchange thereof (the consideration in each case to be
determined in the same manner as provided in clauses (1) and (2) of
this subsection); and
(iv) in the case of the issuance of shares of Common Stock
pursuant to rights, options or warrants, which rights, options or
warrants were originally issued together with one or more other
securities as part of a unit, the consideration shall be deemed to be
(i) the fair value of such rights, options or warrants at the time of
issuance thereof as determined in good faith by the Board of Directors
whose determination shall be conclusive and described in a Board
resolution which shall be filed with the Warrant Agent plus (ii) the
additional consideration, if any, to be received by the Company upon
the exercise, conversion or exchange thereof (as determined in the
same manner as provided in clause (1) and (2) of this subsection).
8.7. Fair Market Value. The Fair Market Value for a security shall be
(A) the average over the 20 trading days ending on the date immediately
preceding the date of such determination of the last reported sale price, or, if
no such sale takes place on any such day, the closing bid price, in either case
as reported for consolidated transactions on the principal national securities
19
exchange (including the NASDAQ National Market) on which such security is listed
or admitted for trading; provided, however, that if any event that results in an
adjustment of the Exercise Price occurs during the period beginning on the first
day of such 20-day period and ending on the date immediately preceding the date
of determination, the Fair Market Value as determined pursuant to the foregoing
will be appropriately adjusted to reflect the occurrence of such event or (B) if
such security is not listed on any exchange or admitted for trading on the
NASDAQ Stock Market, the Fair Market Value shall be (1) in connection with a
sale to a party that is not an Affiliate of the Company in an arm's length
transaction (a "Non-Affiliate Sale"), the price per security at which such
security is sold and (2) in connection with any sale to an Affiliate of the
Company, (a) the last price per security at which such security was sold in a
Non-Affiliate Sale within the three-month period preceding such date of
determination or (b) if clause (a) is not applicable, the fair market value of
such security determined in good faith by (i) a majority of the Board of
Directors of the Company, including a majority of the Disinterested Directors,
and approved in a board resolution delivered to the Warrant Agent or (ii) a
nationally recognized investment banking, appraisal or valuation firm, which is
not an Affiliate of the Company, in each case, taking into account, among other
factors deemed relevant by the Board of Directors or such investment banking,
appraisal or valuation firm, the trading price and volume of such security on
any national securities exchange or automated quotation system on which such
security is traded.
8.8. When De Minimis Adjustment May Be Deferred. No adjustment in
the Exercise Price need be made unless the adjustment would require an increase
or decrease (prior to rounding) of at least 1.0% in the Exercise Price. Any
adjustments that are not made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Section 8 shall be made
to the nearest cent or to the nearest 1/100th of a share, as the case may be.
8.9. When No Adjustment Required. No adjustment need be made for a
transaction referred to Sections 8.1., 8.2, 8.3, 8.4 or 8.5 hereof, if Warrant
holders are to participate in the transaction on a basis and with notice that
the Board of Directors determines to be fair and appropriate in light of the
basis and notice on which holders of Common Stock participate in the
transaction. No adjustment need be made for (i) rights to purchase Common Stock
pursuant to a the Company plan for reinvestment of dividends or interest, (ii) a
change in the par value or no par value of the Common Stock. To the extent the
Warrants become convertible into cash, no adjustment need be made thereafter as
to the cash. Interest will not accrue on the cash.
8.10. Notice of Adjustment. Whenever the Exercise Price is adjusted,
the Company shall provide the notices required by Section 10 hereof.
8.11. Voluntary Reduction. The Company from time to time may reduce
the Exercise Price by any amount for any period of time, if the period is at
least 20 days and if the reduction is irrevocable during the period; provided
that in no event may the Exercise Price be less than the par value of a share of
Common Stock. Whenever the Exercise Price is reduced, the Company shall mail to
Warrant holders a notice of the reduction. The Company shall mail the notice at
least 15 days before the date the reduced Exercise Price takes effect. The
notice shall state the reduced Exercise Price and the period in which it will be
in effect. A reduction of the Exercise Price does not change or adjust the
Exercise Price otherwise in effect for purposes of Sections 8.1, 8.2, 8.3, 8.4
and 8.5 hereof.
8.12. Notice of Certain Transactions. If (i) the Company takes any
action that would require an adjustment in the Exercise Price pursuant to
Sections 8.1, 8.2, 8.3, 8.4 and 8.5 hereof and if the Company does not arrange
for Warrant holders to participate pursuant to Section 8.9 hereof, (ii) the
Company takes any action that would require a supplemental Warrant Agreement
pursuant to Section
20
8.13 hereof or (iii) there is a liquidation or dissolution of the Company, then
the Company shall mail to Warrant holders a notice stating the proposed record
date for a dividend or distribution or the proposed effective date of a
subdivision, combination, reclassification, consolidation, merger, transfer,
lease, liquidation or dissolution. The Company shall mail the notice at least 15
days before such date. Failure to mail the notice or any defect in it shall not
affect the validity of the transaction.
8.13. Reorganization of the Company. Immediately after the Effective
Time, if the Company consolidates or merges with or into, or transfers or leases
all or substantially all its assets to, any person, upon consummation of such
transaction the Warrants shall automatically become exercisable for the kind and
amount of securities, cash or other assets which the holder of a Warrant would
have owned immediately after the consolidation, merger, transfer or lease if the
holder had exercised the Warrant immediately before the effective date of the
transaction. Concurrently with the consummation of such transaction, the
corporation formed by or surviving any such consolidation or merger if other
than the Company, or the person to which such sale or conveyance shall have been
made, shall enter into a supplemental Warrant Agreement so providing and further
providing for adjustments which shall be as nearly equivalent as may be
practical to the adjustments provided for in this Section 8.13. The successor
company shall mail to Warrant holders a notice describing the supplemental
Warrant Agreement. If the issuer of securities deliverable upon exercise of
Warrants under the supplemental Warrant Agreement is an affiliate of the formed,
surviving, transferee or lessee corporation, that issuer shall join in the
supplemental Warrant Agreement. If this Section 8.13 applies, Sections 8.1, 8.2,
8.3, 8.4 and 8.5 hereof do not apply.
8.14. The Company Determination Final. Any determination that the
Company or the Board of Directors must make pursuant to Section 8.1, 8.2, 8.3,
8.4 ,8.5, 8.6, 8.7 or 8.8 hereof is conclusive.
8.15. Warrant Agent's Disclaimer. The Warrant Agent has no duty to
determine when an adjustment under this Section 8 should be made, how it should
be made or what it should be. The Warrant Agent has no duty to determine whether
any provisions of a supplemental Warrant Agreement under Section 8.13 hereof are
correct. The Warrant Agent makes no representation as to the legality, validity
or value of any securities or assets issued upon exercise of Warrants. The
Warrant Agent shall not be responsible for the Company's failure to comply with
this Section 8.
8.16. When Issuance or Payment May Be Deferred. In any case in which
this Section 8 shall require that an adjustment in the Exercise Price be made
effective as of a record date for a specified event, the Company may elect to
defer until the occurrence of such event (i) issuing to the holder of any
Warrant exercised after such record date the Warrant Shares and other capital
stock of the Company, if any, issuable upon such exercise over and above the
Warrant Shares and other capital stock of the Company, if any, issuable upon
such exercise on the basis of the Exercise Price and (ii) paying to such holder
any amount in cash in lieu of a fractional share pursuant to Section 9 hereof;
provided that the Company shall deliver to such holder a due xxxx or other
appropriate instrument evidencing such holder's right to receive such additional
Warrant Shares, other capital stock and cash upon the occurrence of the event
requiring such adjustment.
8.17. Adjustment in Number of Shares. Upon each adjustment of the
Exercise Price pursuant to this Section 8, each Warrant outstanding prior to the
making of the adjustment in the Exercise Price shall thereafter evidence the
right to receive upon payment of the adjusted Exercise Price that number of
shares of Common Stock (calculated to the nearest hundredth) obtained from the
following formula:
21
N' = N x E
----------------------
E'
where:
N' = the adjusted number of Warrant Shares issuable upon exercise of a
Warrant by payment of the adjusted Exercise Price.
N = the number or Warrant Shares previously issuable upon exercise of a
Warrant by payment of the Exercise Price prior to adjustment.
E' = the adjusted Exercise Price.
E = the Exercise Price prior to adjustment.
8.18. Form of Warrants. Irrespective of any adjustments in the Exercise
Price or the number or kind of shares purchasable upon the exercise of the
Warrants, Warrants theretofore or thereafter issued may continue to express the
same price and number and kind of shares as are stated in the Warrants
initially issuable pursuant to this Agreement.
Section 9. Fractional Interests.
The Company shall not be required to issue fractional Warrant Shares
on the exercise of Warrants. If more than one Warrant shall be presented for
exercise in full at the same time by the same holder, the number of full Warrant
Shares which shall be issuable upon the exercise thereof shall be computed on
the basis of the aggregate number of Warrant Shares purchasable on exercise of
the Warrants so presented. If any fraction of a Warrant Share would, except for
the provisions of this Section 9, be issuable on the exercise of any Warrants
(or specified portion thereof), the Company shall pay an amount in cash equal to
the Fair Market Value on the day immediately preceding the date the Warrant is
presented for exercise, multiplied by such fraction.
Section 10. Notices to Warrant Holders.
Upon any adjustment of the Exercise Price pursuant to Section 8, the
Company shall promptly thereafter (i) cause to be filed with the Warrant Agent a
certificate of a firm of independent public accountants of recognized standing
selected by the Board of Directors of the Company (who may be the regular
auditors of the Company) setting forth the Exercise Price after such adjustment
and setting forth in reasonable detail the method of calculation and the facts
upon which such calculations are based and setting forth the number of Warrant
Shares (or portion thereof) issuable after such adjustment in the Exercise
Price, upon exercise of a Warrant and payment of the adjusted Exercise Price,
which certificate shall be conclusive evidence of the correctness of the matters
set forth therein, and (ii) cause to be given to each of the registered holders
of the Warrant Certificates at his address appearing on the Warrant register
written notice of such adjustments by first-class mail, postage prepaid. Where
appropriate, such notice may be given in advance and included as a part of the
notice required to be mailed under the other provisions of this Section 10.
In case:
22
(a) The Company shall authorize the issuance to all holders of shares
of Common Stock of rights, options or warrants to subscribe for or purchase
shares of Common Stock or of any other subscription rights or warrants; or
(b) The Company shall authorize the distribution to all holders of
shares of Common Stock of evidences of its indebtedness or assets (other than
cash dividends or cash distributions payable out of consolidated earnings or
earned surplus or dividends payable in shares of Common Stock or distributions
referred to in Section 8.1 hereof); or
(c) of any consolidation or merger to which the Company is a party and
for which approval of any shareholders of the Company is required, or of the
conveyance or transfer of the properties and assets of the Company substantially
as an entirety, or of any reclassification or change of Common Stock issuable
upon exercise of the Warrants (other than a change in par value, or from par
value to no par value, or from no par value to par value, or as a result of a
subdivision or combination), or a tender offer or exchange offer for shares of
Common Stock; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company; or
(e) The Company proposes to take any action (other than actions of the
character described in Section 8.1 which would require an adjustment of the
Exercise Price pursuant to Section 8,
then the Company shall cause to be filed with the Warrant Agent and shall cause
to be given to each of the registered holders of the Warrant Certificates at his
address appearing on the Warrant register, at least 20 days (or 10 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 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, dissolution, liquidation or winding
up is expected to become effective or consummated, and the date as of which it
is expected that holders of record of shares of Common Stock shall be entitled
to exchange such shares for securities or other property, if any, deliverable
upon such reclassification, consolidation, merger, conveyance, transfer,
dissolution, liquidation or winding up. The failure to give the notice required
by this Section 10 or any defect therein shall not affect the legality or
validity of any distribution, right, option, warrant, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up, or the vote upon
any action.
Nothing contained in this Agreement or in any of the Warrant
Certificates shall be construed as conferring upon the holders thereof the right
to vote or to consent or to receive notice as shareholders in respect of the
meetings of shareholders or the election of Directors of the Company or any
other matter, or any rights whatsoever as shareholders of the Company.
Section 11. Merger, Consolidation or Change of Name of Warrant Agent.
Any corporation into which the Warrant Agent may be merged or with
which it may be consolidated, or any corporation resulting from any merger or
consolidation to which the Warrant Agent shall be a party, or any corporation
succeeding to the business of the Warrant Agent, shall be the successor to the
Warrant Agent hereunder without the execution or filing of any paper or any
further act
23
on the part of any of the parties hereto, provided that such corporation would
be eligible for appointment as a successor warrant agent under the provisions of
Section 14. In case at the time such successor to the Warrant Agent shall
succeed to the agency created by this Agreement, and in case at that time any of
the Warrant Certificates shall have been countersigned but not delivered, any
such successor to the Warrant Agent may adopt the countersignature of the
original Warrant Agent; and in case at that time any of the Warrant Certificates
shall not have been countersigned, any successor to the Warrant Agent may
countersign such Warrant Certificates either in the name of the predecessor
Warrant Agent or in the name of the successor to the Warrant Agent; and in all
such cases such Warrant Certificates shall have the full force and effect
provided in the Warrant Certificates and in this Agreement.
In case at any time the name of the Warrant Agent shall be changed and
at such time any of the Warrant Certificates shall have been countersigned but
not delivered, the Warrant Agent whose name has been changed may adopt the
countersignature under its prior name, and in case at that time any of the
Warrant Certificates shall not have been countersigned, the Warrant Agent may
countersign such Warrant Certificates either in its prior name or in its changed
name, and in all such cases such Warrant Certificates shall have the full force
and effect provided in the Warrant Certificates and in this Agreement.
Section 12. Warrant Agent.
The Warrant Agent undertakes the duties and obligations imposed by
this Agreement upon the following terms and conditions, by all of which the
Company and the holders of Warrants, by their acceptance thereof, shall be
bound:
(a) The duties of the Warrant Agent shall be determined by the express
provisions of this Warrant Agreement and no implied covenants or obligations
shall be read into this Warrant Agreement against the Trustee.
(b) The statements contained herein and in the Warrant Certificates
shall be taken as statements of the Company and the Warrant Agent assumes no
responsibility for the correctness of any of the same except such as describe
the Warrant Agent or action taken or to be taken by it. The Warrant Agent
assumes no responsibility with respect to the distribution of the Warrant
Certificates except as herein otherwise provided.
(c) The Warrant Agent shall not be responsible for any failure of the
Company to comply with any of the covenants contained in this Agreement or in
the Warrant Certificates to be complied with by the Company.
(d) Before the Warrant Agent acts or refrains from acting, the Warrant
Agent may consult at any time with counsel satisfactory to it (who may be
counsel for the Company) and the Warrant Agent shall incur no liability or
responsibility to the Company or to any holder of any Warrant Certificate in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in accordance with the opinion or the advice of such counsel.
(e) The Warrant Agent shall incur no liability or responsibility to
the Company or to any holder of any Warrant Certificate for any action taken in
reliance on any Warrant Certificate, certificate of shares, notice, resolution,
waiver, consent, order, certificate, or other paper, document or instrument
believed by it to be genuine and to have been signed, sent or presented by the
proper party or parties.
24
(f) The Company agrees to pay to the Warrant Agent reasonable
compensation for all services rendered by the Warrant Agent in the execution of
this Agreement, to reimburse the Warrant Agent for all expenses, taxes and
governmental charges and other charges of any kind and nature incurred by the
Warrant Agent in the execution of this Agreement and to indemnify the Warrant
Agent and save it harmless against any and all liabilities, including judgments,
costs and counsel fees, for anything done or omitted by the Warrant Agent in the
execution of this Agreement except as a result of its negligence or bad faith.
(g) The Company shall indemnify the Warrant Agent against any and all
losses, liabilities or expenses incurred by it arising out of or in connection
with the acceptance or administration of its duties under this Warrant
Agreement, including the costs and expenses of enforcing this Warrant Agreement
against the Company (including this Section 12(f)) and defending itself or
investigating against any claim (whether asserted by the Company or any holder
or any other person) or liability in connection with the exercise or performance
of any of its powers or duties hereunder, except to the extent any such loss,
liability or expense may be attributable to its negligence or bad faith. The
Warrant Agent shall notify the Company promptly of any claim for which it may
seek indemnity. Failure by the Warrant Agent to so notify the Company shall not
relieve the Company of its obligations hereunder. The Company shall defend the
claim and the Warrant Agent shall cooperate in the defense. The Warrant Agent
may have separate counsel and the Company shall pay for reasonable fees and
expenses of such counsel. The Company need not pay for any settlement made
without its consent. All rights of action under this Agreement or under any of
the Warrants may be enforced by the Warrant Agent without the possession of any
of the Warrant Certificates or the production thereof at any trial or other
proceeding relative thereto, and any such action, suit or proceeding instituted
by the Warrant Agent shall be brought in its name as Warrant Agent and any
recovery of judgment shall be for the ratable benefit of the registered holders
of the Warrants, as their respective rights or interests may appear.
(h) The Warrant Agent, and any stockholder, director, officer or
employee of it, may buy, sell or deal in any of the Warrants or other securities
of the Company or become pecuniarily interested in any transaction in which the
Company may be interested, or contract with or lend money to the Company or
otherwise act as fully and freely as though it were not Warrant Agent under this
Agreement. Nothing herein shall preclude the Warrant Agent from acting in any
other capacity for the Company or for any other legal entity.
(i) The Warrant Agent shall act hereunder solely as agent for the
Company, and its duties shall be determined solely by the provisions hereof. The
Warrant Agent shall not be liable for anything which it may do or refrain from
doing in connection with this Agreement except for its own negligence or bad
faith.
(j) The Warrant Agent shall not at any time be under any duty or
responsibility to any holder of any Warrant Certificate to make or cause to be
made any adjustment of the Exercise Price or number of the Warrant Shares or
other securities or property deliverable as provided in this Agreement, or to
determine whether any facts exist which may require any of such adjustments, or
with respect to the nature or extent of any such adjustments, when made, or with
respect to the method employed in making the same. The Warrant Agent shall not
be accountable with respect to the legality, validity or value or the kind or
amount of any Warrant Shares or of any securities or property which may at any
time be issued or delivered upon the exercise of any Warrant or with respect to
whether any such Warrant Shares or other securities will when issued be validly
issued and fully paid and nonassessable, and makes no representation with
respect thereto.
25
(k) The Warrant Agent shall not be required to take notice or be
deemed to have notice of any fact, event or determination (including, without
limitation, any dates other than the end of the Exercise Period or events
defined in this Agreement or the designation of any Person as an Affiliate),
under this Agreement unless and until the Warrant Agent shall be specifically
notified in writing by the Company or any holder of such fact, event or
determination.
(l) No provision of this Agreement shall require the Warrant Agent to
expand or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of its rights if
there shall be reasonable grounds for believing that repayment of such funds or
adequate indemnification against such risk or liability is not reasonably
assured to it.
(m) The Warrant Agent may act through its attorneys or agents and
shall not be responsible for the willful misconduct or negligence of any agent
appointed with due care.
Section 13. Change of Warrant Agent.
If the Warrant Agent shall become incapable of acting as Warrant
Agent, the Company shall appoint a successor to such Warrant Agent. If the
Company shall fail to make such appointment within a period of 30 days after it
has been notified in writing of such incapacity by the Warrant Agent or by the
registered holder of a Warrant Certificate, then the registered holder of any
Warrant Certificate may apply to any court of competent jurisdiction for the
appointment of a successor to the Warrant Agent. Pending appointment of a
successor to such Warrant Agent, either by the Company or by such a court, the
duties of the Warrant Agent shall be carried out by the Company. After
appointment the successor to the Warrant Agent shall be vested with the same
powers, rights, duties and responsibilities as if it had been originally named
as Warrant Agent without further act or deed; but the former Warrant Agent shall
deliver and transfer to the successor to the Warrant Agent any property at the
time held by it hereunder and execute and deliver any further assurance,
conveyance, act or deed necessary for the purpose. Failure to give any notice
provided for in this Section 13, however, or any defect therein, shall not
affect the legality or validity of the appointment of a successor to the Warrant
Agent.
Section 14. Registration.
Holders shall be able to exercise their Warrants only if a
registration statement relating to the Warrant Shares is then in effect, or the
exercise of such Warrants is exempt from the registration requirements of the
Securities Act, and such securities are qualified for sale or exempt from
qualification under the applicable securities laws of the states in which the
various holders of the Warrants or other persons to whom it is proposed that the
Warrant Shares be issued on exercise of the Warrants reside.
Section 15. Reports.
(a) Whether or not required by the rules and regulations of the
Securities and Exchange Commission (the "Commission"), so long as any Warrants
are outstanding, the Company shall furnish to the Warrant Agent and the holders
of Warrants (i) all quarterly and annual financial information that would be
required to be contained in a filing with the Commission on Forms 10-Q and 10-K
if the Company were required to file such Forms, including a "Management's
Discussion and Analysis of Financial Condition and Results of Operations" and,
with respect to the annual information only, a report thereon by the Company's
certified independent accountants (provided, however, that quarterly information
for the first quarter of 1998 need not be furnished prior to August 15, 1998)
and (ii) all current reports that would be required to be filed with the
Commission on Form 8-K if the
26
Company were required to file such reports. In addition, whether or not required
by the rules and regulations of the Commission, the Company shall file a copy of
all such information and reports with the Commission for public availability
(unless the Commission shall not accept such a filing) and make such information
available to securities analysts and prospective investors upon request.
(b) The Company shall provide the Warrant Agent with a sufficient
number of copies of all such reports that the Warrant Agent may be required to
deliver to the holders of the Warrants under this Section 15.
Section 16. Notices to the Company and Warrant Agent.
Any notice or demand authorized by this Agreement to be given or made
by the Warrant Agent or by the registered holder of any Warrant Certificate to
or on the Company shall be sufficiently given or made when and if deposited in
the mail, first class or registered, postage prepaid, addressed (until another
address is filed in writing by the Company with the Warrant Agent), as follows:
OnePoint Communications Corp.
0000 Xxxxxxxx Xxxx
Xxxxx X-000
Xxxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxx X. Xxxxxx
In case the Company shall fail to maintain such office or agency or
shall fail to give such notice of the location or of any change in the location
thereof, presentations may be made and notices and demands may be served at the
principal office of the Warrant Agent.
Any notice pursuant to this Agreement to be given by the Company or by
the registered holder(s) of any Warrant Certificate to the Warrant Agent shall
be sufficiently given when and if deposited in the mail, first-class or
registered, postage prepaid, addressed (until another address is filed in
writing by the Warrant Agent with the Company) to the Warrant Agent as follows:
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxx Xxxxxxxxx
Section 17. Supplements and Amendments.
From time to time, the Company and the Warrant Agent, without consent
of the holders of the Warrants, may amend or supplement the Warrant Agreement
for certain purposes, including curing defects or inconsistencies or making
changes that do not materially adversely affect the rights of any holder. Any
amendment or supplement to the Warrant Agreement that has a material adverse
effect on the interests of the holders of the Warrants requires the written
consent of the holders of a majority of the then outstanding Warrants, including
any Warrants held by the Company or a subsidiary of the Company. The consent of
each holder of the Warrants is required for any amendment pursuant to which the
Exercise Price would be increased or the number of Warrant Shares purchasable
upon exercise of Warrants would be decreased (other than pursuant to adjustments
provided for in the Warrant Agreement as generally described above).
Notwithstanding anything in this Agreement to the contrary, no supplement or
amendment that changes the rights and duties of the Warrant Agent under this
Agreement
27
will be effective against the Warrant Agent without the execution of such
supplement or amendment by the Warrant Agent.
Section 18. Successors.
All the covenants and provisions of this Agreement by or for the
benefit of the Company or the Warrant Agent shall bind and inure to the benefit
of their respective successors and assigns hereunder.
Section 19. Termination.
This Agreement shall terminate at 5:00 p.m., New York City time on
June 1, 2008. Notwithstanding the foregoing, this Agreement will terminate on
any earlier date if all Warrants have been exercised. The provisions of Section
12, regarding indemnification, shall survive such termination.
Section 20. Governing Law.
This Agreement and each Warrant Certificate issued hereunder shall be
deemed to be a contract made under the laws of the State of New York and for all
purposes shall be construed in accordance with the internal laws of said State.
Section 21. Benefits of This Agreement.
Nothing in this Agreement shall be construed to give to any person or
corporation other than the Company, the Warrant Agent and the registered holders
of the Warrant Certificates any legal or equitable right, remedy or claim under
this Agreement; but this Agreement shall be for the sole and exclusive benefit
of the Company, the Warrant Agent and the registered holders of the Warrant
Certificates.
Section 22. Counterparts.
This Agreement may be executed in any number of counterparts and each
of such counterparts shall for all purposes be deemed to be an original, and all
such counterparts shall together constitute but one and the same instrument.
[Signature Page Follows]
28
IN WITNESS WHEREOF, the parties hereto have caused this Warrant
Agreement to be duly executed, as of the day and year first above written.
OnePoint Communications Corp.
By: /s/ Xxxxx X. Xxxxxxxxx
----------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Chairman and Chief Executive Officer
Xxxxxx Trust and Savings Bank,
as Warrant Agent
By: /s/ X. Xxxxxxxxx
----------------------------------
Name: X. Xxxxxxxxx
Title: Vice President
EXHIBIT A
FORM OF WARRANT
[Face of Warrant Certificate]
THE SECURITY (OR ITS PREDECESSOR) EVIDENCED HEREBY WAS ORIGINALLY
ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER XXXXXXX 0 XX XXX XXXXXX
XXXXXX SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND THE
SECURITY EVIDENCED HEREBY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER. THE HOLDER OF THE SECURITY
EVIDENCED HEREBY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) SUCH SECURITY
MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1)(a) TO A PERSON WHO THE
SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) (b) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A UNDER THE SECURITIES ACT, (c) OUTSIDE THE UNITED
STATES TO A FOREIGN PERSON IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 904
UNDER THE SECURITIES ACT, (d) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF THE SECURITIES ACT (AN
"INSTITUTIONAL ACCREDITED INVESTOR") IN A TRANSACTION EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (e) IN ACCORDANCE WITH
ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, (2)
TO THE COMPANY OR (3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN
EACH CASE, IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (B) THE HOLDER WILL, AND
EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE
SECURITY EVIDENCED HEREBY OF THE RESALE RESTRICTIONS SET FORTH IN (A) ABOVE.
THIS GLOBAL WARRANT IS HELD BY THE DEPOSITARY (AS DEFINED IN THE
WARRANT AGREEMENT GOVERNING THIS WARRANT) OR ITS NOMINEE IN CUSTODY FOR THE
BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON
UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE WARRANT AGENT MAY MAKE SUCH
NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 3.7 OF THE WARRANT
AGREEMENT, (II) THIS GLOBAL WARRANT MAY BE EXCHANGED IN WHOLE BUT NOT IN PART
PURSUANT TO SECTION 3.6(a) OF THE WARRANT AGREEMENT, (III) THIS GLOBAL NOTE MAY
BE DELIVERED TO THE WARRANT AGREEMENT FOR CANCELLATION PURSUANT TO SECTION 3.11
OF THE WARRANT AGENT AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR
DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
THE WARRANTS EVIDENCED BY THIS CERTIFICATE ARE INITIALLY ISSUED AS
PART OF AN ISSUANCE OF UNITS (THE "UNITS"), EACH OF WHICH CONSIST OF $1,000
PRINCIPAL AMOUNT OF 14 1/2% SENIOR NOTES DUE 2008 OF THE COMPANY AND ONE
A-1
WARRANT ("WARRANT") INITIALLY ENTITLING THE HOLDER THEREOF TO PURCHASE 0.635
SHARES, PAR VALUE $0.01 PER SHARE, OF THE COMPANY. PRIOR TO THE EARLIEST TO
OCCUR OF (i) THE DATE THAT IS SIX MONTHS FOLLOWING THE INITIAL SALE OF THE
UNITS, (ii) THE COMMENCEMENT OF AN EXCHANGE OFFER WITH RESPECT TO THE NOTES,
(iii) THE DATE A SHELF REGISTRATION STATEMENT (AS DEFINED IN THE INDENTURE) WITH
RESPECT TO THE NOTES IS DECLARED EFFECTIVE, (iv) A CHANGE OF CONTROL (AS DEFINED
IN THE INDENTURE), OR (v) SUCH DATE AS BEAR, XXXXXXX & CO. INC. MAY, IN ITS SOLE
DISCRETION, DEEM APPROPRIATE, THE WARRANTS EVIDENCED BY THIS CERTIFICATE MAY NOT
BE TRANSFERRED OR EXCHANGED SEPARATELY FROM, BUT MAY BE TRANSFERRED OR EXCHANGED
ONLY TOGETHER WITH, THE NOTES.
EXERCISABLE ON OR AFTER THE SEPARATION DATE
No. ______ _________ Warrants
Warrant Certificate
ONEPOINT COMMUNICATIONS CORP.
This Warrant Certificate certifies that ______________, or registered
assigns, is the registered holder of Warrants expiring June 1, 2008 (the
"Warrants") to purchase Common Stock. Each Warrant entitles the holder upon
exercise to receive from the Company commencing on the earlier of (a) the
Separation Date (as defined in the Warrant Agreement) and (b) in the event a
Change of Control occurs, the date the Company mails notice thereof to holders
of Notes and Warrants, until 5:00 p.m. New York City Time on June 1, 2008, the
number of fully paid and nonassessable Warrant Shares as set forth in the
Warrant Agreement, subject to adjustment as set forth in Section 8 of the
Warrant Agreement, at the initial exercise price (the "Exercise Price") of $0.01
per share payable in lawful money of the United States of America upon surrender
of this Warrant Certificate and payment of the Exercise Price at the office or
agency of the Warrant Agent, but only subject to the conditions set forth herein
and in the Warrant Agreement referred to on the reverse hereof. Notwithstanding
the foregoing, Warrants may be exercised without the exchange of funds pursuant
to the net exercise provisions of Section 4 of the Warrant Agreement. The
Exercise Price and number of Warrant Shares issuable upon exercise of the
Warrants are subject to adjustment upon the occurrence of certain events set
forth in the Warrant Agreement. No Warrant may be exercised after 5:00 p.m.,
New York City Time on June 1, 2008, and to the extent not exercised by such time
such Warrants shall become void. Reference is hereby made to the further
provisions of this Warrant Certificate set forth on the reverse hereof and such
further provisions shall for all purposes have the same effect as though fully
set forth at this place. This Warrant Certificate shall not be valid unless
countersigned by the Warrant Agent, as such term is used in the Warrant
Agreement. This Warrant Certificate shall be governed and construed in
accordance with the internal laws of the State of New York.
A-2
IN WITNESS WHEREOF, OnePoint Communications Corp. has caused this
Warrant Certificate to be signed by its President and Treasurer and by its Vice
President and Secretary and may cause its corporate seal to be affixed hereunto
or imprinted hereon.
Dated: May 21, 1998
OnePoint Communications Corp.
By:
-----------------------------------
Name:
Title:
By:
-----------------------------------
Name:
Title:
Countersigned:
Xxxxxx Trust and Savings Bank,
as Warrant Agent
By:
-----------------------------------
Name:
Title:
A-3
[Reverse of Warrant Certificate]
The Warrants evidenced by this Warrant Certificate are part of a duly
authorized issue of Warrants expiring June 1, 2008 entitling the holder on
exercise to receive shares of Common Stock, and are issued or to be issued
pursuant to a Warrant Agreement dated as of May 21, 1998 (the "Warrant
Agreement") and a Warrant Registration Rights Agreement (the "Warrant
Registration Rights Agreement"), both duly executed and delivered by the Company
to Xxxxxx Trust and Savings Bank, as warrant agent (the "Warrant Agent"), which
Warrant Agreement and Warrant Registration Rights Agreement are hereby
incorporated by reference in and made a part of this instrument and are hereby
referred to for a description of the rights, limitation of rights, obligations,
duties and immunities thereunder of the Warrant Agent, the Company and the
holders (the words "holders" or "holder" meaning the registered holders or
registered holder) of the Warrants. Copies of the Warrant Agreement and the
Warrant Registration Rights Agreement may be obtained by the holder hereof upon
written request to the Company.
Warrants may be exercised at any time on or after the earlier of (a)
the Separation Date and (b) in the event a Change of Control occurs, the date
the Company mails notice thereof to holder of Notes and Warrants, and on or
before June 1, 2008; provided that holders shall be able to exercise their
Warrants only if a registration statement relating to the Warrant Shares is then
in effect, or the exercise of such Warrants is exempt from the registration
requirements of the Securities Act of 1933, as amended (the "Securities Act"),
and such securities are qualified for sale or exempt from qualification under
the applicable securities laws of the states in which the various holders of the
Warrants or other persons to whom it is proposed that the Warrant Shares be
issued on exercise of the Warrants reside. In order to exercise all or any of
the Warrants represented by this Warrant Certificate, (i) in the case of
Definitive Warrants, the holder must surrender for exercise this Warrant
Certificate to the Warrant Agent at its New York corporate trust office set
forth in Section 16 of the Warrant Agreement, (ii) in the case of a book-entry
interest in a Global Warrant, the exercising Participant whose name appears on a
securities position listing of the Depositary as the holder of such book-entry
interest must comply with the Depositary's procedures relating to the exercise
of such book-entry interest in such Global Warrant and (iii) in the case of both
Global Warrants and Definitive Warrants, the holder thereof or the Participant,
as applicable, must deliver to the Warrant Agent the form of election to
purchase on the reverse hereof duly filled in and signed, which signature shall
be a medallion guaranteed by an institution which is a member of a Securities
Transfer Association recognized signature guarantee program, and upon payment to
the Warrant Agent for the account of the Company of the Exercise Price, as
adjusted as provided in the Warrant Agreement, for the number of Warrant Shares
in respect of which such Warrants are then exercised. No adjustment shall be
made for any dividends on any Common Stock issuable upon exercise of this
Warrant.
The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price set forth on the face hereof may, subject to certain
conditions, be adjusted. If the Exercise Price is adjusted, the Warrant
Agreement provides that the number of shares of Common Stock issuable upon the
exercise of each Warrant shall be adjusted. No fractions of a share of Common
Stock will be issued upon the exercise of any Warrant, but the Company will pay
the cash value thereof determined as provided in the Warrant Agreement.
Warrant Certificates, when surrendered at the office of the Warrant
Agent by the registered holder thereof in person or by legal representative or
attorney duly authorized in writing, may be exchanged, in the manner and subject
to the limitations provided in the Warrant Agreement, but
A-4
without payment of any service charge, for another Warrant Certificate or
Warrant Certificates of like tenor evidencing in the aggregate a like number of
Warrants.
Upon due presentation for registration of transfer of this Warrant
Certificate at the office of the Warrant Agent a new Warrant Certificate or
Warrant Certificates of like tenor and evidencing in the aggregate a like number
of Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided in the Warrant Agreement,
without charge except for any tax or other governmental charge imposed in
connection therewith.
The Company and the Warrant Agent may deem and treat the registered
holder(s) thereof as the absolute owner(s) of this Warrant Certificate
(notwithstanding any notation of ownership or other writing hereon made by
anyone), for the purpose of any exercise hereof, of any distribution to the
holder(s) hereof, and for all other purposes, and neither the Company nor the
Warrant Agent shall be affected by any notice to the contrary. Neither the
Warrants nor this Warrant Certificate entitles any holder hereof to any rights
of a stockholder of the Company.
A-5
Form of Election to Purchase
(To Be Executed Upon Exercise Of Warrant)
The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to receive _______ shares of Common
Stock and herewith tenders payment for such shares to the order of the Company
in the amount of $______ in accordance with the terms hereof unless the holder
is exercising Warrants pursuant to the net exercise provisions of Section 4 of
the Warrant Agreement in which case the holder shall tender Warrants having a
Fair Market Value (as defined in the Warrant Agreement) equal to the Exercise
Price of the Warrants being exercised by such holder. The undersigned requests
that a certificate for such shares be registered in the name
of ______________________, whose address is ___________________________ and that
such shares be delivered to ________________ whose address is
_________________________________. If said number of shares is less than all of
the shares of Common Stock purchasable hereunder, the undersigned requests that
a new Warrant Certificate representing the remaining balance of such shares be
registered in the name of ______________, whose address is
_________________________, and that such Warrant Certificate be delivered to
_________________, whose address is __________________.
Date: ______________, ____
__________________________
(Signature)
__________________________
(Signature Guaranteed)
A-6
SCHEDULE A
SCHEDULE OF WARRANTS
EVIDENCED BY THIS GLOBAL WARRANT
The initial number of Warrants evidenced by this Global Warrant shall
be 175,000. The following decreases/increases in the number of Warrants
evidenced by this Warrant have been made:
Decrease in Total Number of
Number of Increase in Warrants Evidenced
Warrants Number of by this Global
Date of Evidenced by Warrants Warrant Following Notation Made by
Decrease/ this Global Evidenced by this such Decrease/ or on Behalf of
Increase Warrant Global Warrant Increase Warrant Agent
--------- ------------ ----------------- ------------------ ----------------
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A-7
EXHIBIT B
FORM OF CERTIFICATE OF TRANSFER
OnePoint Communications Corp.
0000 Xxxxxxxx Xxxx
Xxxxx X-000
Xxxxxxxxxxx, Xxxxxxxx 00000
Attention:_____________________
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxx Xxxxxx
Re: 175,000 Warrants to Purchase 111,125 Shares of Common Stock
-----------------------------------------------------------
(CUSIP __________)
Reference is hereby made to the Warrant Agreement, dated as of May 21,
1998 (the "Warrant Agreement"), among OnePoint Communications Corp., as issuer
(the "Company"), and Xxxxxx Trust and Savings Bank, as Warrant Agent.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Warrant Agreement.
______________, (the "Transferor") owns and proposes to transfer the
Warrant[s] or interest in such Warrant[s] specified in Annex A hereto, in the
amount of ___________ in such Warrant[s] or interests (the "Transfer"), to
__________ (the "Transferee"), as further specified in Annex A hereto. In
connection with the Transfer, the Transferor hereby certifies that:
[CHECK ALL THAT APPLY]
1. [_] Check if Transferee will take delivery of a beneficial interest in the
144A Global Warrant or a Definitive Warrant Pursuant to Rule 144A. The Transfer
is being effected pursuant to and in accordance with Rule 144A under the United
States Securities Act of 1933, as amended (the "Securities Act"), and,
accordingly, the Transferor hereby further certifies that the beneficial
interest or Definitive Warrant is being transferred to a Person that the
Transferor reasonably believed and believes is purchasing the beneficial
interest or Definitive Warrant for its own account, or for one or more accounts
with respect to which such Person exercises sole investment discretion, and such
Person and each such account is a "qualified institutional buyer" within the
meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and
such Transfer is in compliance with any applicable blue sky securities laws of
any state of the United States. Upon consummation of the proposed Transfer in
accordance with the terms of the Warrant Agreement, the transferred beneficial
interest or Definitive Warrant will be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the 144A Global Warrant
and/or the Definitive Warrant and in the Warrant Agreement and the Securities
Act.
2. [_] Check if Transferee will take delivery of a beneficial interest in the
Regulation S Global Warrant or a Definitive Warrant pursuant to Regulation S.
The Transfer is being effected pursuant
B-1
to and in accordance with Rule 903 or Rule 904 under the Securities Act and,
accordingly, the Transferor hereby further certifies that (i) the Transfer is
not being made to a person in the United States and (x) at the time the buy
order was originated, the Transferee was outside the United States or such
Transferor and any Person acting on its behalf reasonably believed and believes
that the Transferee was outside the United States or (y) the transaction was
executed in, on or through the facilities of a designated offshore securities
market and neither such Transferor nor any Person acting on its behalf knows
that the transaction was prearranged with a buyer in the United States, (ii) no
directed selling efforts have been made in contravention of the requirements of
Rule 903(a) or Rule 904(a) of Regulation S under the Securities Act and, (iii)
the transaction is not part of a plan or scheme to evade the registration
requirements of the Securities Act and (iv) if the proposed transfer is being
made prior to the expiration of the Restricted Period, the transfer is not being
made to a U.S. Person or for the account or benefit of a U.S. Person (other than
an Initial Purchaser). Upon consummation of the proposed transfer in accordance
with the terms of the Warrant Agreement, the transferred beneficial interest or
Definitive Warrant will be subject to the restrictions on Transfer enumerated in
the Private Placement Legend printed on the Regulation S Global Warrant and/or
the Definitive Warrant and in the Warrant Agreement and the Securities Act.
3. [_] Check and complete if Transferee will take delivery of a beneficial
interest in the IAI Global Warrant or a Definitive Warrant pursuant to any
provision of the Securities Act other than Rule 144A or Regulation S. The
Transfer is being effected in compliance with the transfer restrictions
applicable to beneficial interests in Restricted Global Warrants and Restricted
Definitive Warrants and pursuant to and in accordance with the Securities Act
and any applicable blue sky securities laws of any state of the United States,
and accordingly the Transferor hereby further certifies that (check one):
(a) [_] such Transfer is being effected pursuant to and in accordance
with Rule 144 under the Securities Act;
or
(b) [_] such Transfer is being effected to the Company or a
subsidiary thereof;
or
(c) [_] such Transfer is being effected pursuant to an effective
registration statement under the Securities Act and in compliance with the
prospectus delivery requirements of the Securities Act;
or
(d) [_] such Transfer is being effected to an Institutional
Accredited Investor and pursuant to an exemption from the registration
requirements of the Securities Act other than Rule 144A, Rule 144 or Rule 904,
and the Transferor hereby further certifies that it has not engaged in any
general solicitation within the meaning of Regulation D under the Securities Act
and the Transfer complies with the transfer restrictions applicable to
beneficial interests in a Restricted Global Warrant or Restricted Definitive
Warrants and the requirements of the exemption claimed, which certification is
supported by (1) a certificate executed by the Transferee in the form of Exhibit
D to the Warrant Agreement and (2) if such Transfer is in respect of ___________
of Warrants at the time of transfer of less than $250,000, an
B-2
Opinion of Counsel provided by the Transferor or the Transferee (a copy of which
the Transferor has attached to this certification), to the effect that such
Transfer is in compliance with the Securities Act. Upon consummation of the
proposed transfer in accordance with the terms of the Warrant Agreement, the
transferred beneficial interest or Definitive Warrant will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the IAI Global Warrant and/or the Definitive Warrants and in the Warrant
Agreement and the Securities Act.
4. [_] Check if Transferee will take delivery of a beneficial interest in an
Unrestricted Global Warrant or of an Unrestricted Definitive Warrant.
(a) [_] Check if Transfer is pursuant to Rule 144. (i) The Transfer
is being effected pursuant to and in accordance with Rule 144 under the
Securities Act and in compliance with the transfer restrictions contained in the
Warrant Agreement and any applicable blue sky securities laws of any state of
the United States and (ii) the restrictions on transfer contained in the Warrant
Agreement and the Private Placement Legend are not required in order to maintain
compliance with the Securities Act. Upon consummation of the proposed Transfer
in accordance with the terms of the Warrant Agreement, the transferred
beneficial interest or Definitive Warrant will no longer be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Warrants, on Restricted Definitive Warrants and in the
Warrant Agreement.
(b) [_] Check if Transfer is Pursuant to Regulation S. (i) The
Transfer is being effected pursuant to and in accordance with Rule 903 or Rule
904 under the Securities Act and in compliance with the transfer restrictions
contained in the Warrant Agreement and any applicable blue sky securities laws
of any state of the United States and (ii) the restrictions on transfer
contained in the Warrant Agreement and the Private Placement Legend are not
required in order to maintain compliance with the Securities Act. Upon
consummation of the proposed Transfer in accordance with the terms of the
Warrant Agreement, the transferred beneficial interest or Definitive Warrant
will no longer be subject to the restrictions on transfer enumerated in the
Private Placement Legend printed on the Restricted Global Warrants, on
Restricted Definitive Warrants and in the Warrant Agreement.
(c) [_] Check if Transfer is Pursuant to Other Exemption. (i) The
Transfer is being effected pursuant to and in compliance with an exemption from
the registration requirements of the Securities Act other than Rule 144, Rule
903 or Rule 904 and in compliance with the transfer restrictions contained in
the Warrant Agreement and any applicable blue sky securities laws of any State
of the United States and (ii) the restrictions on transfer contained in the
Warrant Agreement and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act. Upon consummation of the proposed
Transfer in accordance with the terms of the Warrant Agreement, the transferred
beneficial interest or Definitive Warrant will not be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the Restricted Global Warrants or Restricted Definitive Warrants and in the
Warrant Agreement.
B-3
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
____________________________________
[Insert Name of Transferor]
By: ______________________________
Name:
Title:
Dated: ________ __, ____
B-4
ANNEX A TO CERTIFICATE OF TRANSFER
1. The Transferor owns and proposes to transfer the following:
[CHECK ONE OF (a) OR (b)]
(a) [_] a beneficial interest in the:
(i) [_] 144A Global Warrant (CUSIP _________), or
(ii) [_] Regulation S Global Warrant (CUSIP _________), or
(iii) [_] IAI Global Warrant (CUSIP ________); or
(b) [_] a Restricted Definitive Warrant.
2. After the Transfer the Transferee will hold:
[CHECK ONE]
(a) [_] a beneficial interest in the:
(i) [_] 144A Global Warrant (CUSIP ________), or
(ii) [_] Regulation S Global Warrant (CUSIP ________), or
(iii) [_] IAI Global Warrant (CUSIP ________); or
(iv) [_] Unrestricted Global Warrant (CUSIP ________); or
(b) [_] a Restricted Definitive Warrant; or
(c) [_] an Unrestricted Definitive Warrant,
in accordance with the terms of the Warrant Agreement.
X-0
XXXXXXX X
XXXX XX XXXXXXXXXXX XX XXXXXXXX
XxxXxxxx Communications Corp.
0000 Xxxxxxxx Xxxx
Xxxxx X-000
Xxxxxxxxxxx, Xxxxxxxx 00000
Attention:_____________________
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxx Xxxxxx
Re: 175,000 Warrants to Purchase 111,125 Shares of Common Stock
-----------------------------------------------------------
(CUSIP __________)
Reference is hereby made to the Warrant Agreement, dated as of May 21,
1998 (the "Warrant Agreement"), among OnePoint Communications Corp., as issuer
(the "Company"), and Xxxxxx Trust and Savings Bank, as Warrant Agent.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Warrant Agreement.
____________, (the "Owner") owns and proposes to exchange the
Warrant[s] or interest in such Warrant[s] specified herein, in the amount of
____________ in such Warrant[s] or interests (the "Exchange"). In connection
with the Exchange, the Owner hereby certifies that:
1. Exchange of Restricted Definitive Warrants or Beneficial Interests in a
Restricted Global Warrant for Unrestricted Definitive Warrants or Beneficial
Interests in an Unrestricted Global Warrant
(a) [_] Check if Exchange is from beneficial interest in a Restricted
Global Warrant to beneficial interest in an Unrestricted Global Warrant. In
connection with the Exchange of the Owner's beneficial interest in a Restricted
Global Warrant for a beneficial interest in an Unrestricted Global Warrant in an
equal amount, the Owner hereby certifies (i) the beneficial interest is being
acquired for the Owner's own account without transfer, (ii) such Exchange has
been effected in compliance with the transfer restrictions applicable to the
Global Warrants and pursuant to and in accordance with the United States
Securities Act of 1933, as amended (the "Securities Act"), (iii) the
restrictions on transfer contained in the Warrant Agreement and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the beneficial interest in an Unrestricted Global
Warrant is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.
(b) [_] Check if Exchange is from beneficial interest in a Restricted
Global Warrant to Unrestricted Definitive Warrant. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Warrant for
an Unrestricted Definitive Warrant, the
Owner hereby certifies (i) the Definitive Warrant is being acquired for the
Owner's own account without
C-1
transfer, (ii) such Exchange has been effected in compliance with the transfer
restrictions applicable to the Restricted Global Warrants and pursuant to and in
accordance with the Securities Act, (iii) the restrictions on transfer contained
in the Warrant Agreement and the Private Placement Legend are not required in
order to maintain compliance with the Securities Act and (iv) the Definitive
Warrant is being acquired in compliance with any applicable blue sky securities
laws of any state of the United States.
(c) [_] Check if Exchange is from Restricted Definitive Warrant to
beneficial interest in an Unrestricted Global Warrant. In connection with the
Owner's Exchange of a Restricted Definitive Warrant for a beneficial interest in
an Unrestricted Global Warrant, the Owner hereby certifies (i) the beneficial
interest is being acquired for the Owner's own account without transfer, (ii)
such Exchange has been effected in compliance with the transfer restrictions
applicable to Restricted Definitive Warrants and pursuant to and in accordance
with the Securities Act, (iii) the restrictions on transfer contained in the
Warrant Agreement and the Private Placement Legend are not required in order to
maintain compliance with the Securities Act and (iv) the beneficial interest is
being acquired in compliance with any applicable blue sky securities laws of any
state of the United States.
(d) [_] Check if Exchange is from Restricted Definitive Warrant to
Unrestricted Definitive Warrant. In connection with the Owner's Exchange of a
Restricted Definitive Warrant for an Unrestricted Definitive Warrant, the Owner
hereby certifies (i) the Unrestricted Definitive Warrant is being acquired for
the Owner's own account without transfer, (ii) such Exchange has been effected
in compliance with the transfer restrictions applicable to Restricted Definitive
Warrants and pursuant to and in accordance with the Securities Act, (iii) the
restrictions on transfer contained in the Warrant Agreement and the Private
Placement Legend are not required in order to maintain compliance with the
Securities Act and (iv) the Unrestricted Definitive Warrant is being acquired in
compliance with any applicable blue sky securities laws of any state of the
United States.
2. Exchange of Restricted Definitive Warrants or Beneficial Interests in
Restricted Global Warrants for Restricted Definitive Warrants or Beneficial
Interests in Restricted Global Warrants.
(a) [_] Check if Exchange is from beneficial interest in a Restricted
Global Warrant to Restricted Definitive Warrant. In connection with the
Exchange of the Owner's beneficial interest in a Restricted Global Warrant for a
Restricted Definitive Warrant with an equal amount, the Owner hereby certifies
that the Restricted Definitive Warrant is being acquired for the Owner's own
account without transfer. Upon consummation of the proposed Exchange in
accordance with the terms of the Warrant Agreement, the Restricted Definitive
Warrant issued will continue to be subject to the restrictions on transfer
enumerated in the Private Placement Legend printed on the Restricted Definitive
Warrant and in the Warrant Agreement and the Securities Act.
C-2
(b) [_] Check if Exchange is from Restricted Definitive Warrant to
beneficial interest in a Restricted Global Warrant. In connection with the
Exchange of the Owner's Restricted Definitive Warrant for a beneficial interest
in the [CHECK ONE] 144A Global Warrant, Regulation S Global Warrant, IAI
Global Warrant with an equal amount, the Owner hereby certifies (i) the
beneficial interest is being acquired for the Owner's own account without
transfer and (ii) such Exchange has been effected in compliance with the
transfer restrictions applicable to the Restricted Global Warrants and pursuant
to and in accordance with the Securities Act, and in compliance with any
applicable blue sky securities laws of any state of the United States. Upon
consummation of the proposed Exchange in accordance with the terms of the
Warrant Agreement, the beneficial interest issued will be subject to the
restrictions on transfer enumerated in the Private Placement Legend printed on
the relevant Restricted Global Warrant and in the Warrant Agreement and the
Securities Act.
C-3
This certificate and the statements contained herein are made for your
benefit and the benefit of the Company.
__________________________________
[Insert Name of Owner]
By: _____________________________
Name:
Title:
Dated: ________________, ____
C-4
EXHIBIT D
FORM OF CERTIFICATE FROM
ACQUIRING INSTITUTIONAL ACCREDITED INVESTOR
OnePoint Communications Corp.
0000 Xxxxxxxx Xxxx
Xxxxx X-000
Xxxxxxxxxxx, Xxxxxxxx 00000
Attention:____________________
Xxxxxx Trust and Savings Bank
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxx Xxxxxx
Re: 175,000 Warrants to Purchase 111,125 Shares of Common Stock
-----------------------------------------------------------
(CUSIP __________)
Reference is hereby made to the Warrant Agreement, dated as of May 21,
1998 (the "Warrant Agreement"), among OnePoint Communications Corp., as issuer
(the "Company"), and Xxxxxx Trust and Savings Bank, as Warrant Agent.
Capitalized terms used but not defined herein shall have the meanings given to
them in the Warrant Agreement.
In connection with our proposed purchase of ____________ amount of:
(a) [_] a beneficial interest in a Global Warrant, or
(b) [_] a Definitive Warrant,
we confirm that:
1. We understand that any subsequent transfer of the Warrants or any
interest therein is subject to certain restrictions and conditions set forth in
the Warrant Agreement and the undersigned agrees to be bound by, and not to
resell, pledge or otherwise transfer the Warrants or any interest therein except
in compliance with, such restrictions and conditions and the United States
Securities Act of 1933, as amended (the "Securities Act").
2. We understand that the offer and sale of the Warrants have not
been registered under the Securities Act, and that the Warrants and any interest
therein may not be offered or sold except as permitted in the following
sentence. We agree, on our own behalf and on behalf of any accounts for which
we are acting as hereinafter stated, that if we should sell the Warrants or any
interest therein, we will do so only (A) to the Company or any subsidiary
thereof, (B) in accordance with Rule 144A under the Securities Act to a
"qualified institutional buyer" (as defined therein), (c) to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to you and to the
Company a signed letter substantially in the form of this letter and, if such
transfer is in respect of a __________ of Warrants, at the time of transfer of
less than $250,000, an Opinion of Counsel in form reasonably acceptable to the
Company to the effect that such
D-1
transfer is in compliance with the Securities Act, (D) outside the United States
in accordance with Rule 904 of Regulation S under the Securities Act, (E)
pursuant to the provisions of Rule 144(k) under the Securities Act or (F)
pursuant to an effective registration statement under the Securities Act, and we
further agree to provide to any person purchasing the Definitive Warrant or
beneficial interest in a Global Warrant from us in a transaction meeting the
requirements of clauses (A) through (E) of this paragraph a notice advising such
purchaser that resales thereof are restricted as stated herein.
3. We understand that, on any proposed resale of the Warrants or
beneficial interest therein, we will be required to furnish to you and the
Company such certifications, legal opinions and other information as you and the
Company may reasonably require to confirm that the proposed sale complies with
the foregoing restrictions. We further understand that the Warrants purchased
by us will bear a legend to the foregoing effect. We further understand that
any subsequent transfer by us of the Warrants or beneficial interest therein
acquired by us must be effected through one of the Initial Purchasers.
4. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the Warrants, and we and
any accounts for which we are acting are each able to bear the economic risk of
our or its investment.
5. We are acquiring the Warrants or beneficial interest therein
purchased by us for our own account or for one or more accounts (each of which
is an institutional "accredited investor") as to each of which we exercise sole
investment discretion.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative or legal proceedings or official inquiry with
respect to the matters covered hereby.
__________________________________________
[Insert Name of Accredited Investor]
By: _______________________________
Name:
Title:
D-2
