EXHIBIT 10.19
WARRANT AGREEMENT
Dated as of
August 11, 1997
between
PRICE COMMUNICATIONS CELLULAR HOLDINGS INC.
PRICE COMMUNICATIONS CORPORATION
and
BANK OF MONTREAL TRUST COMPANY,
as the Warrant Agent
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Warrants for
Common Stock of
Price Communications Corporation
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TABLE OF CONTENTS
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Page
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ARTICLE I. Definitions.................................................... 2
SECTION 1.1 Definitions............................................... 2
SECTION 1.2 Other Definitions......................................... 5
SECTION 1.3 Rules of Construction..................................... 6
ARTICLE II. Warrant Certificates........................................... 6
SECTION 2.1 Form of Warrant Certificates.............................. 6
SECTION 2.2 Legends................................................... 7
SECTION 2.3 Execution and Delivery of Warrant
Certificates.................................. 8
SECTION 2.4 Loss or Mutilation........................................ 9
ARTICLE III. Exercise Terms................................................ 9
SECTION 3.1 Exercise Price............................................ 9
SECTION 3.2 Exercise Period........................................... 10
SECTION 3.3 Expiration................................................ 10
SECTION 3.4 Manner of Exercise........................................ 10
SECTION 3.5 Issuance of Warrant Shares................................ 11
SECTION 3.6 Fractional Warrant Shares................................. 11
SECTION 3.7 Reservation of Warrant Shares............................. 11
SECTION 3.8 Compliance with Law....................................... 12
ARTICLE IV. Antidilution Provisions........................................ 13
SECTION 4.1 Changes in Common Stock................................... 13
SECTION 4.2 Cash Dividends and Other Distributions.................... 13
SECTION 4.3 Rights Issue.............................................. 14
SECTION 4.4 Combination; Liquidation.................................. 15
SECTION 4.5 Other Events.............................................. 16
SECTION 4.6 Superseding Adjustment.................................... 17
SECTION 4.7 Minimum Adjustment........................................ 17
SECTION 4.8 Notice of Adjustment...................................... 18
SECTION 4.9 Notice of Certain Transactions............................ 18
SECTION 4.10 Adjustment to Warrant Certificate........................ 19
ARTICLE V. Transferability................................................ 19
SECTION 5.1 Transfer and Exchange of Warrants......................... 19
SECTION 5.2 Registration of Transfers and Exchanges................... 21
SECTION 5.3 Surrender of Warrant Certificates......................... 22
(i)
Page
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ARTICLE VI. Company's Special Right of Repurchase.......................... 23
SECTION 6.1............................................................ 23
ARTICLE VII. Warrant Agent................................................. 24
SECTION 7.1 Appointment of Warrant Agent............................. 24
SECTION 7.2 Rights and Duties of Warrant Agent....................... 24
SECTION 7.3 Individual Rights of Warrant Agent....................... 26
SECTION 7.4 Warrant Agent's Disclaimer............................... 26
SECTION 7.5 Compensation and Indemnity............................... 26
SECTION 7.6 Successor Warrant Agent.................................. 27
ARTICLE VIII. Miscellaneous................................................. 29
SECTION 8.1 Company Resales.......................................... 29
SECTION 8.2 SEC Reports and Other Information........................ 29
SECTION 8.3 Persons Benefitting...................................... 29
SECTION 8.4 Rights of Holders........................................ 29
SECTION 8.5 Amendment................................................ 29
SECTION 8.6 Notices.................................................. 30
SECTION 8.7 Governing Law............................................ 31
SECTION 8.8 Successors............................................... 31
SECTION 8.9 Multiple Originals....................................... 31
SECTION 8.10 Table of Contents........................................ 32
SECTION 8.11 Severability............................................. 32
SECTION 8.12 Further Assurances....................................... 32
(ii)
WARRANT AGREEMENT (this "Agreement") dated as of August 8, 1997,
between PRICE COMMUNICATIONS CELLULAR HOLDINGS, INC. ("Holdings"), PRICE
COMMUNICATIONS CORPORATION, a New York corporation (together with its permitted
successors and assigns, the "Company"), and Bank of Montreal Trust Company, as
Warrant Agent (together with its permitted successors and assigns, the "Warrant
Agent").
WHEREAS, the Company, Holdings and Price Communications Cellular,
Inc. ("Cellular") have entered into a purchase agreement, dated July 31, 1997,
with NatWest Capital Markets Limited ("NatWest") and ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Securities, Inc. (together with NatWest, the "Purchasers"), in which Holdings
has agreed to sell to the Purchasers 153,400 Units each consisting of $1,000
aggregate principal amount at maturity of 13 1/2% Senior Secured Discount Notes
due 2007 (the "Notes") of Holdings and 3.44 Warrants (the "Warrants"), each
Warrant to purchase one share of Common Stock, par value $.01 per share (the
"Common Stock"), of the Company. The Notes will be issued under an indenture
dated as of August 11, 1997 (the "Indenture"), between Cellular, Holdings and
Bank of Montreal Trust Company, as trustee (the "Trustee"). Each Warrant
entitles the person in whose name the Warrant is registered (each a "Holder"),
upon exercise to receive from the Company, as adjusted as provided herein, one
fully paid and nonassessable share of Common Stock at the Exercise Price (as
defined in Section 3.1 herein); and
WHEREAS, the Notes will be detachable from the Warrants and upon
re-sale by the Purchasers will be immediately separated.
WHEREAS, the Company further desires the Warrant Agent to act on
behalf of the Company in connection with the issuances, division, transfer,
exchange, substitution and exercise of the Warrants, and the Warrant Agent is
willing to so act.
Each party agrees as follows for the benefit of the other party
and for the equal and ratable benefit of the holders of Warrants:
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ARTICLE I.
Definitions
SECTION 1.1 Definitions. "Affiliate" of any specified Person
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means (i) any other Person which, directly or indirectly, is controlling or
controlled by or under direct or indirect common control with such specified
Person, or (ii) any other Person who is a director or executive officer (A) of
such Person, (B) of any subsidiary of such specified Person, or (C) of any
Person described in clause (i) above. For purposes of this definition,
"control," when used with respect to any specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing. Affiliate shall also mean any beneficial owner of shares representing
10% or more of the total voting power of the Voting Stock (on a fully diluted
basis) of the Company or warrants to purchase such Voting Stock (whether or not
currently exercisable) and any Person who would be an Affiliate of any such
beneficial owner pursuant to the first sentence hereof.
"Board" means the Board of Directors of the Company or any
committee thereof duly authorized to act on behalf of such Board of Directors.
"Business Day" means each day that is not a Saturday, a Sunday or
a day on which banking institutions are not required to be open in New York City
or in the city where the Warrant Agent's principal corporate trust office is
located.
"Certificated Warrants" means certificated Warrants
in fully registered definitive form.
"Change of Control" shall have the meaning provided in the
Indenture provided that the Corporate Change shall not be deemed to be a Change
of Control.
"Combination" means an event in which the Company consolidates
with, merges with or into, or sells all or substantially all its property and
assets to another Person provided that the Corporate Change shall not be deemed
to be a Combination.
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"Common Stock" has the meaning ascribed thereto in
the preamble to this Agreement.
"Corporate Change" shall mean a corporate change, subject to
approval of the Company's shareholders, pursuant to which the Company would
become a wholly owned subsidiary of the Holding Company in a transaction in
which each share of capital stock and each option and warrant to purchase
capital stock of the Company (including the Warrants) outstanding immediately
prior to the consummation of such Corporate Change will be automatically
converted into a share of capital stock, option or warrant, as the case may be,
in each case with identical rights and an identical economic interest in the
Holding Company.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the SEC pursuant thereto.
"Extraordinary Cash Dividend" means that portion, if any, of the
aggregate amount of all dividends or distributions (including by way of tender
or exchange offer to any of its equity holders) paid by the Company on its
Common Stock in any fiscal year that exceeds $1.0 million.
"Fair Market Value" means, with respect to any asset or property,
the price which could be negotiated in an arm's-length free market transaction,
for cash, between a willing seller and a willing buyer, neither of whom is under
undue pressure or compulsion to complete the transaction. Fair Market Value will
be determined, except as otherwise provided, (i) if such property or asset has a
Fair Market Value of less than $5 million, by any Officer of the Company or (ii)
if such property or asset has a Fair Market Value in excess of $5 million, by a
majority of the Board of Directors of the Company and evidenced by a Board
Resolution, dated within 30 days of the relevant transaction.
"Holding Company" shall mean a newly organized holding company
with a substantially identical certificate of incorporation, by-laws and capital
structure to those of the Company immediately prior to the consummation of the
Corporate Change.
"Institutional Accredited Investor" shall mean an institutional
"accredited investor" (as defined in rule
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501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act.
"Issue Date" means the date on which Warrants are
initially issued.
"Market Value" means, in respect of one share of the Common Stock
of the Company (i) the average closing price per share for such Common Stock for
the thirty consecutive trading days immediately prior to the Triggering Date on
the New York Stock Exchange or such other United States national securities
exchange on which such Common Stock is listed and principally traded or, if such
securities are not listed on any national securities exchange, as reported by
the Nasdaq Stock Market, Inc. or, if not so reported by the Nasdaq Stock Market,
Inc., the average of the high bid and low asked quotations for one share of such
Common Stock as reported by the National Quotations Bureau Incorporated or
similar organization or (ii) if the closing price for such Common Stock cannot
be calculated in the manner specified in clause (i) at the relevant time, the
Fair Market Value of one share of such Common Stock (without giving effect to
any discount for lack of liquidity or to the fact that shares of such Common
Stock may not be registered under the Exchange Act) as of the Business Day
immediately preceding the Triggering Date as determined in an opinion letter
delivered and addressed to the Warrant Agent by an independent appraisal firm
appointed by the Company (or by a majority of the holders of the Warrants or
related Warrant Shares, as the case may be, if the Company fails to appoint one)
reasonably acceptable to the Warrant Agent.
"Merger" shall have the meaning provided in the Indenture.
"Officer" means the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Financial
Officer, any Executive Vice President or the Treasurer of the
Company.
"Parent" means any Person who beneficially owns, directly or
indirectly, all of the Voting Stock of the Company.
"Person" means any individual, corporation, company (including
any limited liability company), partnership, joint venture, trust,
unincorporated organization, government or any agency or political subdivision
thereof.
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"Redeemable Stock" means, with respect to any Person, any capital
stock that by its terms (or by the terms of any security into which it is
convertible or exchangeable) or otherwise (i) matures or is mandatorily
redeemable pursuant to a sinking fund obligation or otherwise, (ii) is or may
become redeemable or repurchasable at the option of the holder thereof, in whole
or in part, or (iii) is convertible or exchangeable for indebtedness.
"Repurchase Price" means $8.00 per Warrant, subject to adjustment
as provided herein.
"Restricted Warrant" means a Restricted Certificated Warrant.
"Rule 144A" means Rule 144A under the Securities Act.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Triggering Date" shall mean the date on which a holder exercises
any Warrant pursuant to Article III.
"Voting Stock" means all classes of capital stock of such
corporation then outstanding and normally entitled to vote in the election of
directors.
"Warrant Shares" means the Common Stock (and other securities)
issuable upon the exercise of the Warrants.
SECTION 1.2 Other Definitions.
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Defined in
Term Section
"Certificate Register"......................... 5.1
"Company" ................................. Recitals
"Exercise Price"............................... 3.1
"Expiration Date".............................. 3.2
"Holders" ................................. Recitals
"Repurchase Date".............................. 6.1
"Successor Company"............................ 4.4(a)
"Warrants"..................................... Recitals
"Warrant Agent"................................ Recitals
"Warrant Certificates"......................... 2.1
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SECTION 1.3 Rules of Construction. Unless the text otherwise
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requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting
principles as in effect from time to time;
(iii) "or" is not exclusive;
(iv) "including" means including, without limitation; and
(v) words in the singular include the plural and words in the
plural include the singular.
ARTICLE II.
Warrant Certificates
SECTION 2.1 Form of Warrant Certificates. Certificates
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representing the Warrants (the "Warrant Certificates") shall be in registered
form only and substantially in the form attached hereto as Exhibit A. The
Warrant Certificates shall be dated the date on which countersigned by the
Warrant Agent and shall have such insertions as are appropriate or required or
permitted by this Agreement and may have such letters, numbers or other marks of
identification and such legends and endorsements typed, stamped, printed,
lithographed or engraved thereon as the Company may deem appropriate and as are
not inconsistent with the provisions of this Agreement, or as may be required to
comply with any law or with any rule or regulation pursuant thereto, or to
conform to usage. The Company shall approve the form of the Warrant Certificates
and any notation, legend or endorsement on them.
The terms and provisions contained in the form of the Warrant
Certificate annexed hereto as Exhibit A shall constitute, and are hereby
expressly made, a part of this Agreement.
The definitive Warrant Certificates shall be typed, printed,
lithographed or engraved or produced by any combina-
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tion of these methods, all as determined by the officer of the Company executing
such Warrant Certificates, as evidenced by such officer's execution of such
Warrant Certificates.
Pending the preparation of definitive Warrant Certificates,
temporary Warrant Certificates may be issued, which may be printed,
lithographed, typewritten, mimeographed or otherwise produced, and which will be
substantially of the tenor of the definitive Warrant Certificates in lieu of
which they are issued.
If temporary Warrant Certificates are issued, the Company will
cause definitive Warrant Certificates to be prepared without unreasonable delay.
After the preparation of definitive Warrant Certificates, the temporary Warrant
Certificates shall be exchangeable for definitive Warrant Certificates upon
surrender of the temporary Warrant Certificates to the Warrant Agent, without
charge to the Holder. Until so exchanged the temporary Warrant Certificates
shall in all respects be entitled to the same benefits under this Agreement as
definitive Warrant Certificates.
SECTION 2.2 Legends. Unless and until the Warrants and the
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Warrant Shares are included in an effective registration statement under the
Securities Act, each Warrant Certificate (and all Warrant Certificates issued in
exchange therefor or substitution thereof) and each certificate representing the
Warrant Shares shall bear a legend in substantially the following form (with any
appropriate modification for the Warrant Shares):
THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN
THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT
AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A
BENEFICIAL INTEREST HEREIN, THE HOLDER (1) REPRESENTS THAT (A) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR
(7) OF REGULATION D UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED
INVESTOR") OR (B) IT IS NOT A U.S. PERSON, IS NOT ACQUIRING THIS SECURITY FOR
THE ACCOUNT OR BENEFIT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN
OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT,
(2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO UNDER RULE
144(k) (TAKING INTO ACCOUNT THE PROVISIONS OF RULE 144(d) UNDER THE SECURITIES
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ACT, IF APPLICABLE) UNDER THE SECURITIES ACT AS IN EFFECT ON THE DATE OF THE
TRANSFER OF THIS SECURITY, RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A)
TO PRICE COMMUNICATIONS CORPORATION (THE "COMPANY") OR ANY SUBSIDIARY THEREOF,
(B) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE
904 UNDER THE SECURITIES ACT, (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE, BASED UPON AN
OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY), (D) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (E) IN ACCORDANCE WITH
ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND
BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY) AND, IN EACH CASE,
IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, AND (3) AGREES THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN,
THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S PERSON" HAVE THE
MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE
WARRANT AGREEMENT CONTAINS A PROVISION REQUIRING THE WARRANT AGENT TO REFUSE TO
REGISTER TRANSFER OF THIS SECURITY IN VIOLATION OF THE FOREGOING RESTRICTIONS.
SECTION 2.3 Execution and Delivery of Warrant Certificates.
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Warrant Certificates evidencing Warrants to purchase initially an aggregate of
up to 527,696 Warrant Shares may be executed, on or after the Issue Date, by the
Company and delivered to the Warrant Agent for countersignature, and the Warrant
Agent shall thereupon countersign and deliver such Warrant Certificates upon the
written order and at the direction of the Company to the purchasers thereof on
the date of issuance. The Warrant Agent is hereby authorized to countersign and
deliver Warrant Certificates as required by this Section 2.3 or by Section 2.4,
3.4, 5.3 or 5.4.
The Warrant Certificates shall be executed on behalf of the
Company by its President or any Executive Vice President or any Vice President,
either manually or by facsimile signature printed thereon. The Warrant
Certificates shall be countersigned manually by the Warrant Agent and shall not
be valid for any purpose unless so countersigned. In case any officer of the
Company whose signature shall have been placed upon any of the Warrant
Certificates shall cease to be such officer of the Company before
counter-signature by the Warrant Agent and issuance and delivery thereof, such
Warrant Certificates may, nevertheless, be countersigned by the Warrant Agent
and issued and delivered
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with the same force and effect as though such person had not ceased to be such
officer of the Company.
SECTION 2.4 Loss or Mutilation. Upon receipt by the Company and
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the Warrant Agent of evidence satisfactory to them of the ownership and the
loss, theft, destruction or mutilation of any Warrant Certificate and of
indemnity satisfactory to them and (in the case of mutilation) upon surrender
and cancellation thereof, then, in the absence of notice to the Company or the
Warrant Agent that the Warrants represented thereby have been acquired by a bona
fide purchaser, the Company shall execute and the Warrant Agent shall
countersign and deliver to the registered Holder of the lost, stolen, destroyed
or mutilated Warrant Certificate, in exchange for or in lieu thereof, a new
Warrant Certificate of the same tenor and for a like aggregate number of
Warrants. Upon the issuance of any new Warrant Certificate under this Section
2.4, the Company may require the payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in relation thereto and other
expenses (including the reasonable fees and expenses of the Warrant Agent and of
counsel to the Company) in connection therewith. Every new Warrant Certificate
executed and delivered pursuant to this Section 2.4 in lieu of any lost, stolen
or destroyed Warrant Certificate shall constitute a contractual obligation of
the Company, whether or not the allegedly lost, stolen or destroyed Warrant
Certificates shall be at any time enforceable under applicable law, and shall be
entitled to the benefits of this Agreement equally and proportionately with any
and all other Warrant Certificates duly executed and delivered hereunder. The
provisions of this Section 2.4 are exclusive and shall preclude (to the extent
lawful) all other rights or remedies with respect to the replacement of
mutilated, lost, stolen or destroyed Warrant Certificates.
ARTICLE III.
Exercise Terms
SECTION 3.1 Exercise Price. Each Warrant shall initially entitle
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the Holder thereof, subject to adjustment pursuant to the terms of this
Agreement, to purchase one share of Common Stock for an exercise price of $0.01
per share of Common Stock (the "Exercise Price"). The Exercise Price will be
payable at the Holder's' option by certified or cashier's check payable to the
order of the Company, or by any combination thereof. The Exercise Price may be
paid,
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without a payment in cash or check being required, for such number of Warrant
Shares equal to the product of (i) the number of Warrant Shares for which such
Warrant is exercisable as of the date of exercise (if the Exercise Price were
being paid in cash) and (ii) the Cashless Exercise Ratio. The Cashless Exercise
Ratio shall equal a fraction the numerator of which is the Market Value per
share of Common Stock on the date of exercise minus the Exercise Price per share
as of the date of exercise and the denominator of which is the Market Value per
share on the date of exercise.
SECTION 3.2 Exercise Period. (a) Subject to the terms and
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conditions set forth herein, the Warrants will be exercisable upon the earlier
to occur of (i) the consummation of the Merger (provided that if the Merger does
not occur prior to December 31, 1997, the Warrants will be subject to special
redemption as provided in Section 6.1) and (ii) the occurrence of a Change of
Control (the "Exercise Date").
(b) No Warrant shall be exercisable after 5:00 p.m., New York
City time, on August 1, 2007 (the "Expiration Date").
SECTION 3.3 Expiration. A Warrant shall terminate and become void
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as of the earlier of (i) 5:00 p.m., New York City time on the Expiration Date or
(ii) the date such Warrant is exercised. The Company shall give notice not less
than 90, and not more than 120, days prior to the Expiration Date to the Holders
of all then outstanding Warrants to the effect that the Warrants will terminate
and become void as of the close of business on the Expiration Date; provided,
--------
however, that notwithstanding that the Company may fail to give notice as
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provided in this Section 3.3, the Warrants will terminate and become void on the
Expiration Date.
SECTION 3.4 Manner of Exercise. Warrants may be exercised upon
------------------
surrender to the Warrant Agent of the Warrant Certificates, together with the
form of election to purchase Common Stock on the reverse thereof duly filled in
and signed by the Holder thereof. Subject to Section 3.2, the rights represented
by the Warrants shall be exercisable at the election of the Holders thereof
either in full at any time or from time to time in part and in the event that a
Warrant Certificate is surrendered for exercise in respect of less than all the
Warrant Shares purchasable on such exercise at any time prior to the expiration
of the Exercise Period a new Warrant Certificate exercisable for the remaining
Warrant Shares will be issued. The Warrant Agent shall countersign
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and deliver the required new Warrant Certificates, and the Company, at the
Warrant Agent's request, shall supply the Warrant Agent with Warrant
Certificates duly signed on behalf of the Company for such purpose.
SECTION 3.5 Issuance of Warrant Shares. Upon the surrender of
--------------------------
Warrant Certificates, as set forth in Section 3.4, the Warrant Agent will
requisition from the Company, and the Company shall issue and cause the transfer
agent for the Common Stock ("Stock Transfer Agent") to countersign and deliver
to or upon the written order of the Holder and in such name or names as the
Holder may designate, a certificate or certificates for the number of full
Warrant Shares so purchased upon the exercise of such Warrants or other
securities or property to which it is entitled, registered or otherwise, to the
Person or Persons entitled to receive the same, together with cash as provided
in Section 3.6 in respect of any fractional Warrant Shares otherwise issuable
upon such exercise. Such certificate or certificates shall be deemed to have
been issued and any Person so designated to be named therein shall be deemed to
have become a holder of record of such Warrant Shares as of the date of the
surrender of such Warrant Certificates and payment of the per share Exercise
Price, as aforesaid.
SECTION 3.6 Fractional Warrant Shares. The Company shall not be
-------------------------
required to issue fractional Warrant Shares on the exercise of Warrants. If more
than one Warrant shall be exercised in full at the same time by the same Holder,
the number of full Warrant Shares which shall be issuable upon such exercise
shall be computed on the basis of the aggregate number of Warrant Shares
purchasable pursuant thereto. If any fraction of a Warrant Share would, except
for the provisions of this Section 3.6, be issuable on the exercise of any
Warrant (or specified portion thereof), the Company shall pay an amount in cash
equal to the Market Value for one Warrant Share on the trading day immediately
preceding the date the Warrant is exercised, multiplied by such fraction,
computed to the nearest whole cent.
SECTION 3.7 Reservation of Warrant Shares. The Company shall at
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all times keep reserved out of its authorized shares of Common Stock, a number
of shares of Common Stock sufficient to provide for the exercise of all
outstanding Warrants. The registrar for the Common Stock (the "Registrar") shall
at all times until the expiration of the Exercise Period reserve such number of
authorized shares as shall be required for such purpose. The Company will keep a
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copy of this Agreement on file with its Stock Transfer Agent. The Company will
supply such Stock Transfer Agent with duly executed stock certificates for such
purpose and will itself provide or otherwise make available any cash which may
be payable as provided in Section 3.6. The Company will furnish to such Stock
Transfer Agent a copy of all notices of adjustments and certificates related
thereto transmitted to each Holder.
Before taking any action which would cause an adjustment pursuant
to Article IV to reduce the Exercise Price below the then par value (if any) of
the Common Stock, the Company shall take any and all corporate action which may,
in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue fully paid and nonassessable shares of Common Stock at
the Exercise Price as so adjusted.
The Company covenants that all shares of Common Stock which may
be issued upon exercise of Warrants will, upon issue, be fully paid,
nonassessable, free of preemptive rights, free from all taxes and free from all
liens, charges and security interests, created by or through the Company, with
respect to the issue thereof.
SECTION 3.8 Compliance with Law. (a) Notwithstanding anything in
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this Agreement to the contrary, in no event shall a Holder be entitled to
exercise a Warrant, unless (i) a registration statement filed under the
Securities Act in respect of the issuance of the Warrant Shares is then
effective or (ii) in the opinion of counsel addressed to the Warrant Agent and
the Company an exemption from the registration requirements is available under
the Securities Act for the issuance of the Warrant Shares (and the delivery of
any other securities for which the Warrants may at the time be exercisable) at
the time of such exercise.
(b) If any shares of Common Stock required to be reserved for
purposes of exercise of Warrants require, under any other Federal or state law
or applicable governing rule or regulation of any national securities exchange,
registration with or approval of any governmental authority, or listing on any
such national securities exchange before such shares may be issued upon
exercise, the Company will in good faith and as expeditiously as possible
endeavor also to cause such shares to be duly registered or approved by such
governmental authority or listed on the relevant national securities exchange,
as the case may be.
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ARTICLE IV.
Antidilution Provisions
SECTION 4.1 Changes in Common Stock. In the event that at any
-----------------------
time or from time to time the Company shall (i) pay a dividend or make a
distribution on its Common Stock in shares of its Common Stock or the right to
receive or convert into additional shares of Common Stock in each case, (ii)
subdivide its outstanding shares of Common Stock into a larger number of shares
of Common Stock, (iii) combine its outstanding shares of Common Stock into a
smaller number of shares of Common Stock, or (iv) increase or decrease the
number of shares of Common Stock outstanding by reclassification of its Common
Stock, then the number of shares of Common Stock purchasable upon exercise of
each Warrant immediately prior to the happening of such event shall be adjusted
so that, after giving effect to such adjustment, the holder of each Warrant
shall be entitled to receive the number of shares of Common Stock upon exercise
of such Warrant that such holder would have owned or have been entitled to
receive had such Warrants been exercised immediately prior to the happening of
the events described above (or, in the case of a dividend or distribution of
Common Stock, immediately prior to the record date therefor). An adjustment made
pursuant to this Section 4.1 shall become effective immediately after the
effective date, retroactive to the record date therefor in the case of a
dividend or distribution in shares of Common Stock, and shall become effective
immediately after the effective date in the case of a subdivision, combination
or reclassification.
SECTION 4.2 Cash Dividends and Other Distributions. In case at
--------------------------------------
any time or from time to time the Company shall distribute to holders of Common
Stock (i) any dividend or other distribution (including any dividend or
distribution made in connection with a consolidation or merger in which the
Company is the continuing corporation) of cash, evidences of its indebtedness,
assets, shares of its capital stock or any other properties or securities or
(ii) any options, warrants or other rights to subscribe for or purchase any of
the foregoing (other than, in the case of clauses (i) and (ii) above, (x) any
dividend or distribution described in Section 4.1, (y) any rights, options,
warrants or securities described in Section 4.3 and (z) a cash dividend that is
not an Extraordinary Cash Dividend), then the number of shares of Common Stock
purchasable upon the exercise of each Warrant
-13-
immediately after the record date for the determination of stockholders entitled
to receive such dividend or distribution shall be increased to a number
determined by multiplying the number of shares of Common Stock purchasable upon
the exercise of such Warrant immediately prior to such record date for any such
dividend or distribution by a fraction, the numerator of which shall be the
Market Value per share of Common Stock as of the record date for such
distribution plus the fair market value (as determined by the Board of Directors
of the Company acting in good faith, whose determination shall be evidenced by a
board resolution, dated within 30 days of the relevant record date) as of such
record date of such Extraordinary Cash Dividend, the evidences of indebtedness,
shares of capital stock or other assets, properties or securities, or any
options, warrants or rights to subscribe for or purchase any of the foregoing,
to be dividended or distributed in respect of one share of Common Stock, and the
denominator of which shall be such Market Value per share of Common Stock as of
such record date; and the Exercise Price shall be adjusted to a number
determined by dividing the Exercise Price immediately prior to such record date
by the above fraction. Such adjustments shall be made, and shall only become
effective, whenever any dividend or distribution is made; provided, however,
-------- -------
that the Company is not required to make an adjustment pursuant to this Section
4.2 if at the time of such distribution the Company makes the same distribution
to Holders of Warrants as it makes to holders of Common Stock pro rata based on
the number of shares of Common Stock for which such Warrants are exercisable
(whether or not currently exercisable). No adjustment shall be made pursuant to
this Section 4.2 which shall have the effect of decreasing the number of shares
of Common Stock purchasable upon exercise of each Warrant or increasing the
Exercise Price.
SECTION 4.3 Rights Issue. In the event that at any time or from
------------
time to time the Company shall issue rights, options or warrants to acquire, or
securities convertible or exchangeable into, Common Stock to all holders of
Common Stock, entitling such holders to subscribe for or purchase shares of
Common Stock at a price per share that is less than the Market Value per share
of Common Stock as of the record date for the determination of stockholders
entitled to receive such rights, options, warrants or securities, the number of
shares of Common Stock purchasable upon the exercise of each Warrant immediately
after such record date shall be determined by multiplying the number of shares
of Common Stock purchasable upon exercise of each Warrant immediately
-14-
prior to such record date by a fraction, the numerator of which shall be the
number of shares of Common Stock outstanding on a fully-diluted basis as of the
close of business on the record date for the issuance of such rights, options,
warrants or securities plus the number of additional shares of Common Stock
offered for subscription or purchase or into which such securities are
convertible or exchangeable, and the denominator of which shall be the number of
shares of Common Stock outstanding on a fully-diluted basis as of the close of
business on the record date for the issuance of such rights, options, warrants
or securities plus the total number of shares of Common Stock which the
aggregate consideration expected to be received by the Company upon the
exercise, conversion or exchange of such rights, options, warrants or securities
(as determined by the Board of Directors of the Company acting in good faith,
whose determination shall be evidenced by a board resolution) would purchase at
the Market Value per share of Common Stock as of the record date. In the event
of any such adjustment, the Exercise Price shall be adjusted to a number
determined by dividing the Exercise Price immediately prior to such date of
issuance by the aforementioned fraction. Such adjustment shall be made, and
shall only become effective, whenever such rights, options, warrants or
securities are issued. No adjustment shall be made pursuant to this Section 4.3
which shall have the effect of decreasing the number of shares of Common Stock
purchasable upon exercise of each Warrant or of increasing the Exercise Price.
Notwithstanding the foregoing no adjustment will be made pursuant to this
Section 4.3 on account of any dividend or interest reinvestment plan or any
employee stock purchase plan providing for the purchase of shares of Company
Common Stock at a discount from the Market Value; provided, however, that such
-------- -------
plans shall have a valid business purpose.
SECTION 4.4 Combination; Liquidation. (a) Except as provided in
------------------------
Section 4.4(b), in the event of a Combination, the Holders shall have the right
to receive upon exercise of the Warrants such number of shares of capital stock
or other securities or property which such Holder would have been entitled to
receive upon or as a result of such Combination had such Warrant been exercised
immediately prior to such event. Unless paragraph (b) is applicable to a
Combination or in the event the Corporate Change is consummated, the Company
shall provide that the surviving or acquiring Person (the "Successor Company")
in such Combination or Corporate Change will enter into an agreement with the
Warrant Agent confirming the Holders' rights pursuant to this Agreement and
providing for adjustments, which shall be as nearly equiv-
-15-
alent as may be practicable to the adjustments provided for in this Article IV.
The provisions of this Section 4.4(a) shall similarly apply to successive
Combinations involving any Successor Company.
(b) In the event of (i) a Combination where consideration to the
holders of Common Stock in exchange for their shares is payable solely in cash,
or (ii) the dissolution, liquidation or winding-up of the Company, then the
holders of the Warrants will be entitled to receive distributions on an equal
basis with the holders of Common Stock or other securities issuable upon
exercise of the Warrants, as if the Warrants had been exercised immediately
prior to such event.
In case of any Combination described in this Section 4.4(b), the
surviving or acquiring Person and, in the event of any dissolution, liquidation
or winding-up of the Company, the Company shall deposit promptly with the
Warrant Agent the funds, if any, necessary to pay to the holders of the Warrants
the amounts to which they are entitled as described above. After such funds and
the surrendered Warrant Certificates are received, the Warrant Agent shall make
payment to the Holders by delivering a check in such amount as is appropriate
(or, in the case of consideration other than cash, such other consideration as
is appropriate) to such Person or Persons as it may be directed in writing by
the holders surrendering such Warrants.
SECTION 4.5 Other Events. (a) If any event occurs as to which the
------------
foregoing provisions of this Article IV are not strictly applicable or, if
strictly applicable, would not, in the good faith judgment of the Board, fairly
and adequately protect the purchase rights of the Warrants in accordance with
the essential intent and principles of such provisions, then such Board shall
make such adjustments in the application of such provisions, in accordance with
such essential intent and principles, as shall be reasonably necessary, in the
good faith opinion of such Board, to protect such purchase rights as aforesaid,
but in no event shall any such adjustment have the effect of increasing the
Exercise Price or decreasing the number of shares or aggregate percentage of
Common Stock subject to purchase upon exercise of this Warrant.
(b) In the event the Corporate Change is consummated: (i) the
Holding Company will comply with the second sentence of Section 4.4(a) and will
enter into an agreement
-16-
with the Warrant Agent whereby it will expressly assume all of the obligations
of the Company in connection with the Warrants and this Agreement and (ii) the
Warrants will be automatically converted into warrants with identical rights and
an identical economic interest in the Holding Company.
SECTION 4.6 Superseding Adjustment. Upon the expiration of any
----------------------
rights, options, warrants or conversion or exchange privileges which resulted in
the adjustments pursuant to this Article IV, if any thereof shall not have been
exercised, the number of Warrant Shares purchasable upon the exercise of each
Warrant shall be readjusted as if (A) the only shares of Common Stock issuable
upon exercise of such rights, options, warrants, conversion or exchange
privileges were the shares of Common Stock, if any, actually issued upon the
exercise of such rights, options, warrants or conversion or exchange privileges
and (B) shares of Common Stock actually issued, if any, were issuable for the
consideration actually received by the Company upon such exercise plus the
aggregate consideration, if any, actually received by the Company for the
issuance, sale or grant of all such rights, options, warrants or conversion or
exchange privileges whether or not exercised and the Exercise Price shall be
readjusted inversely; provided, however, that no such readjustment shall (except
-------- -------
by reason of an intervening adjustment under Section 4.1) have the effect of
decreasing the number, or aggregate percentage, of Warrant Shares purchasable
upon the exercise of each Warrant or increasing the Exercise Price by an amount
in excess of the amount of the adjustment initially made in respect of the
issuance, sale or grant of such rights, options, warrants or conversion or
exchange privileges.
SECTION 4.7 Minimum Adjustment. The adjustments required by the
------------------
preceding Sections of this Article IV shall be made whenever and as often as any
specified event requiring an adjustment shall occur, except that no adjustment
of the Exercise Price or the number of shares of Common Stock purchasable upon
exercise of Warrants that would otherwise be required shall be made (except in
the case of a subdivision or combination of shares of Common Stock, as provided
for in Section 4.1) unless and until such adjustment either by itself or with
other adjustments not previously made increases or decreases by at least 1% of
the number of shares of Common Stock purchasable upon exercise of Warrants
immediately prior to the making of such adjustment. Any adjustment representing
a change of less than such minimum amount shall be carried forward and made as
soon as such adjustment, together
-17-
with other adjustments required by this Article IV and not previously made,
would result in a minimum adjustment. For the purpose of any adjustment, any
specified event shall be deemed to have occurred at the close of business on the
date of its occurrence. In computing adjustments under this Article IV,
fractional interests in Common Stock shall be taken into account to the nearest
one-hundredth of a share.
SECTION 4.8 Notice of Adjustment. Whenever the Exercise Price or
--------------------
the number of shares of Common Stock and other property, if any, purchasable
upon exercise of Warrants is adjusted, as herein provided, the Company shall
deliver to the Warrant Agent a certificate of a firm of independent accountants
selected by the Board (who may be the regular accountants employed by the
Company) setting forth, in reasonable detail, the event requiring the adjustment
and the method by which such adjustment was calculated (including a description
of the basis on which the Board of Directors of the Company determined the fair
market value of any evidences of indebtedness, other securities or property or
warrants or other subscription or purchase rights), and specifying the Exercise
Price and the number of shares of Common Stock purchasable upon exercise of
Warrants after giving effect to such adjustment. The Company shall promptly
cause the Warrant Agent to mail a copy of such certificate to each Holder in
accordance with Section 8.6. The Warrant Agent shall be entitled to rely on such
certificate and shall be under no duty or responsibility with respect to any
such certificate, except to exhibit the same from time to time, to any Holder
desiring an inspection thereof upon reasonable notice during business hours. The
Warrant Agent shall not at any time be under any duty or responsibility to any
Holder to determine whether any facts exist which may require any adjustment of
the Exercise Price or the number of shares of Common Stock or other stock or
property, purchasable on exercise of the Warrants, or with respect to the nature
or extent of any such adjustment when made, or with respect to the method
employed in making such adjustment or the validity or value of any shares of
Common Stock.
SECTION 4.9 Notice of Certain Transactions. In the event that the
------------------------------
Company shall propose (a) to pay any dividend payable in securities of any class
to the holders of its Common Stock or to make any other distribution to the
holders of its Common Stock, (b) to offer the holders of its Common Stock rights
to subscribe for or to purchase any securities convertible into shares of Common
Stock or shares of stock of any class or any other securities, rights or
-18-
options, (c) to effect any capital reorganization, consolidation or merger
(including the Corporate Change) or (d) to effect the voluntary or involuntary
dissolution, liquidation or winding-up of the Company, the Company shall within
5 days send to the Warrant Agent and the Warrant Agent shall within 5 days send
the Holders a notice (in such form as shall be furnished to the Warrant Agent by
the Company) of such proposed action or offer, such notice to be mailed by the
Warrant Agent to the Holders at their addresses as they appear in the
Certificate Register, which shall specify the record date for the purposes of
such dividend, distribution or rights, or the date such issuance or event is to
take place and the date of participation therein by the holders of Common Stock,
if any such date is to be fixed, and shall briefly indicate the effect of such
action on the Common Stock and on the number and kind of any other shares of
stock and on other property, if any, and the number of shares of Common Stock
and other property, if any, purchasable upon exercise of each Warrant and the
Exercise Price after giving effect to any adjustment which will be required as a
result of such action. Such notice shall be given as promptly as possible and,
in the case of any action covered by clause (a) or (b) above, at least 20 days
prior to the record date for determining holders of the Common Stock for
purposes of such action and, in the case of any other such action, at least 30
days prior to the date of the taking of such proposed action or the date of
participation therein by the holders of Common Stock, whichever shall be the
earlier.
SECTION 4.10 Adjustment to Warrant Certificate. The form of
---------------------------------
Warrant Certificate need not be changed because of any adjustment made pursuant
to this Article IV, and Warrant Certificates issued after such adjustment may
state the same Exercise Price and the same number of shares of Common Stock as
are stated in the Warrant Certificates initially issued pursuant to this
Agreement. The Company, however, may at any time in its sole discretion make any
change in the form of Warrant Certificate that it may deem appropriate to give
effect to such adjustments and that does not affect the substance of the Warrant
Certificate, and any Warrant Certificate thereafter issued or countersigned,
whether in exchange or substitution for an outstanding Warrant Certificate or
otherwise, may be in the form as so changed.
-19-
ARTICLE V.
Transferability
SECTION 5.1 Transfer and Exchange of Warrants. The Warrant
---------------------------------
Certificates shall be issued in registered form only. The Warrant Agent shall
from time to time, subject to the limitations of Section 5.4, register the
transfer of any outstanding Warrants upon the records to be maintained by it
(the "Certificate Register") for that purpose, upon surrender thereof duly
endorsed or accompanied (if so required by it) by a written instrument or
instruments of transfer in form satisfactory to the Warrant Agent, duly executed
by the registered Holder or Holders thereof or by the duly appointed legal
representative thereof or by a duly authorized attorney. Subject to the terms of
this Agreement, each Warrant Certificate may be exchanged for another
certificate or certificates entitling the Holder thereof to purchase a like
aggregate number of Warrant Shares as the certificate or certificates
surrendered then entitle each Holder to purchase. Any Holder desiring to
exchange a Warrant Certificate or Certificates shall make such request in
writing delivered to the Warrant Agent, and shall surrender, duly endorsed or
accompanied (if so required by the Warrant Agent) by a written instrument or
instruments of transfer in form satisfactory to the Warrant Agent, the Warrant
Certificate or Certificates to be so exchanged.
Upon registration of transfer, the Warrant Agent shall
countersign and deliver by certified mail a new Warrant Certificate or
Certificates to the persons entitled thereto. The Warrant Certificates may be
exchanged at the option of the Holder thereof, when surrendered at the office or
agency of the Company maintained for such purpose, which initially will be the
corporate trust office of the Warrant Agent in New York, New York for another
Warrant Certificate, or other Warrant Certificates of different denominations,
of like tenor and representing in the aggregate the right to purchase a like
number of Warrant Shares. All Warrant Certificates issued upon any registration
of transfer or exchange of Warrant Certificates shall be the valid obligations
of the Company, evidencing the same obligations, and entitled to the same
benefit under this Agreement, as the Warrant Certificates surrendered for such
registration of transfer or exchange.
To permit registrations of transfer and exchanges, the Company
shall, upon request of the Warrant Agent, make
-20-
available to the Warrant Agent a sufficient number of executed Warrant
Certificates to effect such registrations of transfers and exchanges. No service
charge shall be made for any exchange or registration of transfer of Warrant
Certificates, but the Company may require payment of a sum sufficient to cover
any stamp or other tax or other governmental charge that is imposed in
connection with any such exchange or registration of transfer.
SECTION 5.2 Registration of Transfers and Exchanges.
---------------------------------------
(a) Transfer and Exchange. When Warrant Certificates are
presented to the Warrant Agent with a request:
(i) to register the transfer of the Warrants
Certificates; or
(ii) to exchange such Warrant Certificates for an equal
number of Warrant Certificates of other authorized denominations, the
Warrant Agent shall register the transfer or make the exchange as
requested if the requirements under this Agreement as set forth in this
Section 5.2 for such transactions are met; provided, however, that the
-------- -------
Warrant Certificates presented or surrendered for registration of
transfer or exchange:
(I) shall be duly endorsed or accompanied by a written
instrument of transfer in form satisfactory to the Warrant Agent,
duly executed by the Holder thereof or his attorney duly
authorized in writing; and
(II) in the case of Warrants the offer and sale of which
have not been registered under the Securities Act of 1933, as
amended (the "Security Act"), such Warrants shall be accompanied
by the following additional information and documents, as
applicable:
(A) if such Warrant Certificates are 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); or
-21-
(B) if such Warrant Certificates are being
transferred to an Institutional
Accredited Investor delivery of a certi-
fication to that effect (in substanti-
ally the form of Exhibit B hereto) and a
Transferee Certificate for Institutional
Accredited Investors in substantially
the form of Exhibit C hereto; or
(C) if such Warrant Certificates are being transferred
in reliance on Regulation S under the Securities
Act ("Regulation S"), delivery of a certification
to that effect (in substantially the form of
Exhibit B hereto) and a Transferee Certificate for
Regulation S Transfers in substantially the form of
Exhibit D hereto and an Opinion of Counsel
reasonably satisfactory to the Company to the
effect that such transfer is in compliance with the
Securities Act; or
(D) if such Warrant Certificates are being
transferred in reliance on another
exemption from the registration require-
ments of the Securities Act, a certifi-
cation to that effect (in substantially
the form of Exhibit B hereto) and an
opinion of counsel reasonably satisfac-
tory to the Company to the effect that
such transfer is in compliance with the
Securities Act.
(b) General. By its acceptance of any Warrants represented by a
Warrant Certificate bearing the legend in Section 2.2, each Holder of such
Warrants acknowledges the restrictions on transfer of such Warrants set forth in
this Agreement and in the legend and agrees that it will transfer such Warrants
only as provided in this Agreement. The Warrant Agent shall not register a
transfer of any Warrants unless such transfer complies with the requirements of
this Section 5.2.
(c) Records. The Warrant Agent shall retain copies of all
letters, notices and other written communications received pursuant to Section
5.1 hereof or this Section 5.2. The Company shall have the right to inspect and
make copies of all such letters, notices or other written communi-
-22-
cations at any reasonable time upon the giving of reasonable written notice to
the Warrant Agent.
SECTION 5.3 Surrender of Warrant Certificates. Any Warrant
---------------------------------
Certificate surrendered for registration of transfer, exchange, exercise or
repurchase of the Warrants represented thereby shall, if surrendered to the
Company, be delivered to the Warrant Agent, and all Warrant Certificates
surrendered or so delivered to the Warrant Agent shall be promptly canceled by
the Warrant Agent and shall not be reissued by the Company and, except as
provided in this Article V in case of an exchange or in Article III hereof in
case of the exercise or repurchase of less than all the Warrants represented
thereby or in case of a mutilated Warrant Certificate, no Warrant Certificate
shall be issued hereunder in lieu thereof. The Warrant Agent shall deliver to
the Company from time to time or otherwise dispose of such canceled Warrant
Certificates as the Company may direct in writing.
ARTICLE VI.
Company's Special Right of Repurchase
SECTION 6.1 If the Merger is not consummated on or before
December 31, 1997 or if it appears, in the sole judgment of Holdings, that the
Merger will not be consummated by December 31, 1997, then, on, or at any time
prior to, December 31, 1997, the Company shall have the right to repurchase the
Warrants by paying to the Warrant Agent for the benefit of the Holders of
Warrants the Repurchase Price. Upon such payment, all the Warrants shall be
cancelled.
(a) Notice of Warrant Repurchase. As promptly as practicable
following December 31, 1997 or, at any time prior thereto, the date Holdings
determines that the Merger will not be consummated by December 31, 1997 (in
either case the "Repurchase Date") Holdings on behalf of the Company shall give
notice of the terms of the Warrant Repurchase (a "Repurchase Notice") to each
Holder, as of the Repurchase Date, of then outstanding Warrants. Each Repurchase
Notice: (i) shall be given by Holdings on behalf of the Company directly to all
Holders of the Warrants, with a copy to the Warrant Agent and (ii) shall be
given within five Business Days after the Repurchase Date and shall specify (A)
the manner in which Warrants shall be surrendered to the Warrant Agent for
repurchase by the Company, (B) the Repurchase Price
-23-
at which the Warrants will be repurchased by the Company, and (C) that payment
of the Repurchase Price will be made by the Warrant Agent.
(b) Payment for Warrants. (i) To receive payment for any Warrants
pursuant to this Section 6.1, each Holder thereof shall, except as otherwise
provided herein, surrender to the Warrant Agent the Warrant Certificates
evidencing such Holder's Warrants.
(ii) As promptly as practicable (and in any event within 10 days)
following the Repurchase Date, the Company shall deposit with the Warrant Agent
funds sufficient to make payment for all unexercised Warrants. After receipt of
such deposit from the Company, the Warrant Agent shall make payment to each
Holder, by delivering a check in an amount equal to the Repurchase Price for
each Warrant surrendered by such Holder in accordance with this Section 6.1, to
such Person or Persons as it may be directed in writing by any Holder
surrendering Warrant Certificates, net of any transfer taxes required to be paid
in the event that the check is to be delivered to a Person other than the
Holder. Any funds not used to pay for Warrants within one year after the
Repurchase Date shall be promptly returned to the Company and the Holders
thereafter shall look solely to the Company for payment for their Warrants.
(c) Compliance with Laws. Notwithstanding anything contained in
this Section 6.1, if Holdings or the Company is required to comply with laws or
regulations in connection with the making of the Warrant Repurchase, such laws
or regulations shall govern the making of such Warrant Repurchase. Holdings
shall immediately notify the Warrant Agent in writing if any such laws or
regulations shall require Holdings to supplement or amend this Agreement or to
modify or amend the procedures or manner of such repurchase or any other
provisions set forth herein and the Warrant Agent shall not be responsible or
liable for making any such determination, complying with any such laws or
regulations or for the failure of the Company to so notify the Warrant Agent.
-24-
ARTICLE VII.
Warrant Agent
SECTION 7.1 Appointment of Warrant Agent. The Company and
----------------------------
Holdings hereby appoint the Warrant Agent to act as agent for the Company and
Holdings in accordance with provisions of this Agreement and the Warrant Agent
hereby accepts such appointment.
SECTION 7.2 Rights and Duties of Warrant Agent. (a) Agent for the
----------------------------------
Company and Holdings. In acting under this Warrant Agreement and in connection
with the Warrant Certificates, the Warrant Agent is acting solely as agent of
the Company and Holdings and does not assume any obligation or relationship or
agency or trust for or with any of the Holders of Warrant Certificates or
beneficial owners of Warrants.
(b) Counsel. The Warrant Agent may consult with counsel
satisfactory to it, and the advice of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in accordance with the advice of such counsel.
(c) Documents. The Warrant Agent shall be protected and shall
incur no liability for or in respect of any action taken or thing suffered by it
in reliance upon any Warrant Certificate, notice, direction, consent,
certificate, affidavit, statement or other paper or document reasonably believed
by it to be genuine and to have been presented or signed by the proper parties.
(d) No Implied Obligations. The Warrant Agent shall be obligated
to perform only such duties as are herein and in the Warrant Certificates
specifically set forth and no implied duties or obligations shall be read into
this Agreement or the Warrant Certificates against the Warrant Agent. The
Warrant Agent shall not be under any obligation to take any action hereunder
which may tend to involve it in any expense or liability for which it does not
receive indemnity if such indemnity is reasonably requested. The Warrant Agent
shall not be accountable or under any duty or responsibility for the use by the
Company of any of the Warrant Certificates countersigned by the Warrant Agent
and delivered by it to the Holders or on behalf of the Holders pursuant to this
Agreement or for the application by the Company of the proceeds of
-25-
the Warrants. The Warrant Agent shall have no duty or responsibility in case of
any default by the Company in the performance of its covenants or agreements
contained herein or in the Warrant Certificates or in the case of the receipt of
any written demand from a Holder with respect to such default, including any
duty or responsibility to initiate or attempt to initiate any proceedings at law
or otherwise.
(e) Not Responsible for Adjustments or Validity of Stock. The
Warrant Agent shall not at any time be under any duty or responsibility to any
Holder to determine whether any facts exist that may require an adjustment of
the number of shares of Common Stock purchasable upon exercise of each Warrant
or the Exercise Price, or with respect to the nature or extent of any adjustment
when made, or with respect to the method employed, or herein or in any
supplemental agreement provided to be employed, in making the same. The Warrant
Agent shall not be accountable with respect to the validity or value of any
shares of Common Stock or of any securities or property which may at any time be
issued or delivered upon the exercise of any Warrant or upon any adjustment
pursuant to Article IV, and it makes no representation with respect thereto. The
Warrant Agent shall not be responsible for any failure of the Company or
Holdings to make any cash payment or to issue, transfer or deliver any shares of
Common Stock or stock certificates upon the surrender of any Warrant Certificate
for the purpose of exercise or upon any adjustment pursuant to Article IV, or to
comply with any of the covenants of the Company contained in Article IV.
SECTION 7.3 Individual Rights of Warrant Agent. The Warrant Agent
----------------------------------
and any stockholder, director, officer or employee of the Warrant Agent may buy,
sell or deal in any of the Warrants or other securities of the Company or
Holdings or its affiliates or become pecuniarily interested in transactions in
which the Company or its affiliates may be interested, or contract with or lend
money to the Company or its affiliates or otherwise act as fully and freely as
though it were not the Warrant Agent under this Agreement. Nothing herein shall
preclude the Warrant Agent from acting in any other capacity for the Company or
for any other legal entity.
SECTION 7.4 Warrant Agent's Disclaimer. The Warrant Agent shall
--------------------------
not be responsible for and makes no representation as to the validity or
adequacy of this Agreement or the Warrant Certificates and it shall not be
responsible for any statement in this Agreement or the Warrant Certificates
other than its countersignature thereon.
-26-
SECTION 7.5 Compensation and Indemnity. The Company agrees to pay
--------------------------
the Warrant Agent from time to time reasonable compensation for its services and
to reimburse the Warrant Agent upon request for all reasonable out-of-pocket
expenses incurred by it, including the reasonable compensation and expenses of
the Warrant Agent's counsel. The Company shall indemnify the Warrant Agent
against any loss, liability or expense (including reasonable attorneys' fees and
expenses) incurred by it without negligence or bad faith on its part arising out
of or in connection with the acceptance or performance of its duties under this
Agreement. The Warrant Agent shall notify the Company promptly of any claim for
which it may seek indemnity. The Company need not reimburse any expense or
indemnify against any loss or liability incurred by the Warrant Agent through
willful misconduct, negligence or bad faith. The Company's payment obligations
pursuant to this Section 7.5 shall survive the termination of this Agreement.
To secure the Company's payment obligations under this Agreement,
the Warrant Agent shall have a lien prior to the Warrant Holders on all money or
property held or collected by the Warrant Agent.
SECTION 7.6 Successor Warrant Agent. (a) The Company To Provide
-----------------------
Warrant Agent. The Company agrees for the benefit of the Holders that there
shall at all times be a Warrant Agent hereunder until all the Warrants have been
exercised or are no longer exercisable.
(b) Resignation and Removal. The Warrant Agent may at any time
resign by giving written notice to the Company of such intention on its part,
specifying the date on which its desired resignation shall become effective;
provided, however, that such date shall not be less than 60 days after the date
-------- -------
on which such notice is given unless the Company otherwise agrees. The Warrant
Agent hereunder may be removed at any time by the filing with it of an
instrument in writing signed by or on behalf of the Company and specifying such
removal and the date when it shall become effective, which date shall not be
less than 30 days after such notice is given unless the Warrant Agent otherwise
agrees. Any removal under this Section 7.6 shall take effect upon the
appointment by the Company as hereinafter provided of a successor Warrant Agent
(which shall be a bank or trust company authorized under the laws of the
jurisdiction of its organization to exercise corporate trust powers) and the
acceptance of such appointment by such successor Warrant Agent.
-27-
(c) The Company To Appoint Successor. In case at any time the
Warrant Agent shall resign, or shall be removed, or shall become incapable of
acting, or shall be adjudged a bankrupt or insolvent, or shall commence a
voluntary case under the Federal bankruptcy laws, as now or hereafter
constituted, or under any other applicable Federal or state bankruptcy,
insolvency or similar law or shall consent to the appointment of or taking
possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator
(or other similar official) of the Warrant Agent or its property or affairs, or
shall make an assignment for the benefit of creditors, or shall admit in writing
its inability to pay its debts generally as they become due, or shall take
corporate action in furtherance of any such action, or a decree or order for
relief by a court having jurisdiction in the premises shall have been entered in
respect of the Warrant Agent in an involuntary case under the Federal bankruptcy
laws, as now or hereafter constituted, or any other applicable Federal or state
bankruptcy, insolvency or similar law; or a decree order by a court having
jurisdiction in the premises shall have been entered for the appointment of a
receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar
official) of the Warrant Agent or of its property or affairs, or any public
officer shall take charge or control of the Warrant Agent or of its property or
affairs for the purpose of rehabilitation, conservation, winding up of or
liquidation, a successor Warrant Agent, qualified as aforesaid, shall be
appointed by the Company by an instrument in writing, filed with the successor
Warrant Agent. Upon the appointment as aforesaid of a successor Warrant Agent
and acceptance by the successor Warrant Agent of such appointment, the Warrant
Agent shall cease to be Warrant Agent hereunder; provided, however, that in the
-------- -------
event of the resignation of the Warrant Agent under this subsection (c), such
resignation shall be effective on the earlier of (i) the date specified in the
Warrant Agent's notice of resignation and (ii) the appointment and acceptance of
a successor Warrant Agent hereunder.
(d) Successor Expressly To Assume Duties. Any successor Warrant
Agent appointed hereunder shall execute, acknowledge and deliver to its
predecessor and to the Company an instrument accepting such appointment
hereunder, and thereupon such successor Warrant Agent, without any further act,
deed or conveyance, shall become vested with all the rights and obligations of
such predecessor with like effect as if originally named as Warrant Agent
hereunder, and such predecessor, upon payment of its charges and disbursements
-28-
then unpaid, shall thereupon become obligated to transfer, deliver and pay over,
and such successor Warrant Agent shall be entitled to receive, all monies,
securities and other property on deposit with or held by such predecessor, as
Warrant Agent hereunder.
(e) Successor by Merger. Any Person into which the Warrant Agent
hereunder may be merged or consolidated, or any Person resulting from any merger
or consolidation to which the Warrant Agent shall be a party, or any Person to
which the Warrant Agent shall sell or otherwise transfer all or substantially
all of its corporate trust business; provided that it shall be qualified as
--------
aforesaid, shall be the successor Warrant Agent under this Agreement without the
execution or filing of any paper or any further act on the part of any of the
parties hereto.
ARTICLE VIII.
Miscellaneous
SECTION 8.1 Company Resales. The Company hereby agrees with each
---------------
Holder, that the Company shall not resell any Warrants or Warrant Shares it
acquires, by purchase or otherwise, except pursuant to an effective registration
statement.
SECTION 8.2 SEC Reports and Other Information. Notwithstanding
---------------------------------
that the Company may not be subject to the reporting requirements of Section 13
or 15(d) of the Exchange Act, the Company shall, for all periods ending after
the date of this Warrant Agreement, file with the SEC and thereupon provide the
Warrant Agent and Holders with such annual reports and such information,
documents and other reports as are specified in Sections 13 and 15(d) of the
Exchange Act and applicable to a U.S. corporation subject to such Sections, such
information, documents and other reports to be so filed and provided at the
times specified for the filing of such information, documents and reports under
such Sections.
SECTION 8.3 Persons Benefitting. Nothing in this Agreement is
-------------------
intended or shall be construed to confer upon any Person other than the Company,
the Warrant Agent and the Holders any right, remedy or claim under or by reason
of this agreement or any part hereof.
-29-
SECTION 8.4 Rights of Holders. Except as expressly contemplated
-----------------
herein, Holders of unexercised Warrants are not entitled (i) to receive
dividends or other distributions, (ii) to receive notice of or vote at any
meeting of the stockholders, (iii) to consent to any action of the stockholders,
(iv) to exercise any preemptive right or to receive notice of any other
proceedings of the Company or (v) to exercise any other rights whatsoever as
stockholders of the Company.
SECTION 8.5 Amendment. This Agreement may be amended by the
---------
parties hereto without the consent of any Holder for the purpose of curing any
ambiguity, or of curing, correcting or supplementing any defective provision
contained herein or making any other provisions with respect to matters or
questions arising under this Agreement as the Company and the Warrant Agent may
deem necessary or desirable; provided, however, that the Company determines, and
-------- -------
the Warrant Agent may rely on such determination, that such action shall not
affect adversely the rights of the Holders. Any amendment or supplement to this
Agreement that has a material adverse effect on the interests of the Holders
shall require the written consent of the Holders of a majority of the then
outstanding Warrants. The consent of each Holder affected shall be required for
any amendment pursuant to which the Exercise Price would be increased or the
number of Warrant Shares purchasable upon exercise of Warrants would be
decreased (other than pursuant to adjustments provided in Article IV as of the
Issue Date of the Warrants). In determining whether the Holders of the required
number of Warrants have concurred in any direction, waiver or consent, Warrants
owned by the Company or by any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company shall
be disregarded and deemed not to be outstanding, except that, for the purpose of
determining whether the Warrant Agent shall be protected in relying on any such
direction, waiver or consent, only Warrants which the Warrant Agent knows are so
owned shall be so disregarded. Also, subject to the foregoing, only Warrants
outstanding at the time shall be considered in any such determination.
SECTION 8.6 Notices. Any notice or communication shall be in
-------
writing and delivered in Person or mailed by first-class mail addressed as
follows:
if to the Company:
-30-
Price Communications Corporation
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: President
with a copy to:
Proskauer Rose LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
if to the Warrant Agent:
The Bank of Montreal Trust Company
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
The Company or the Warrant Agent by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
Any notice or communication mailed to a Holder shall be mailed to
the Holder at the Holder's address as it appears on the register in which the
Company shall provide for the registration of Warrants and Warrant Shares and of
transfers and exchanges of Warrants and Warrant Shares and shall be sufficiently
given if so mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any
defect in it shall not affect its sufficiency with respect to other Holders. If
a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it.
SECTION 8.7 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY
-------------
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK AS
APPLIED TO CONTRACTS MADE AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK,
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. THE COMPANY, ON BEHALF OF
ITSELF, HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF THE FEDERAL AND NEW
YORK STATE COURTS LOCATED IN THE CITY OF NEW YORK IN CONNECTION WITH ANY SUIT,
ACTION OR PROCEEDING RELATED TO THIS AGREEMENT OR ANY OF THE MATTERS
CONTEMPLATED HEREBY, IRREVOCABLY WAIVES ANY DEFENSE OF LACK OF PERSONAL
JURISDICTION AND IRREVOCABLY AGREES THAT ALL
-31-
CLAIMS IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED
IN ANY SUCH COURT. THE COMPANY, ON BEHALF OF ITSELF, IRREVOCABLY WAIVES, TO THE
FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, ANY OBJECTION
WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT,
ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
SECTION 8.8 Successors. All agreements of the Company in this
----------
Agreement and the Warrant Certificates shall bind its successors. All agreements
of the Warrant Agent in this Agreement shall bind its successors.
SECTION 8.9 Multiple Originals. The parties may sign any number
------------------
of copies of this Agreement. Each signed copy shall be an original, but all of
them together represent the same agreement. One signed copy is enough to prove
this Agreement.
SECTION 8.10 Table of Contents. The table of contents and
-----------------
headings of the Articles and Sections of this Agreement have been inserted for
convenience of reference only, are not intended to be considered a part hereof
and shall not modify or restrict any of the terms or provisions hereof.
SECTION 8.11 Severability. The provisions of this Agreement are
------------
severable, and if any clause or provision shall be held invalid, illegal or
unenforceable in whole or in part in any jurisdiction, then such invalidity or
unenforceability shall affect in that jurisdiction only such clause or
provision, or part thereof, and shall not in any manner affect such clause or
provision in any other jurisdiction or any other clause or provision of this
Agreement in any jurisdiction.
SECTION 8.12 Further Assurances. From time to time on and after
------------------
the date hereof, the Company shall deliver or cause to be delivered to the
Warrant Agent such further documents and instruments and shall do and cause to
be done such further acts as the Warrant Agent shall reasonably request (it
being understood that the Warrant Agent shall have no obligation to make such
request) to carry out more effectively the provisions and purposes of this
Agreement, to evidence compliance herewith or to assure itself that it is
protected hereunder.
-32-
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed as of the date first written above.
PRICE COMMUNICATIONS CORPORATION
By:__________________________
Name:
Title:
PRICE COMMUNICATIONS CELLULAR
HOLDINGS INC.
By:__________________________
Name:
Title:
BANK OF MONTREAL TRUST COMPANY,
By:__________________________
Name:
Title:
-33-
EXHIBIT A
---------
[FORM OF FACE OF WARRANT CERTIFICATE]
THIS SECURITY (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT") AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN
THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT
AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A
BENEFICIAL INTEREST HEREIN, THE HOLDER (1) REPRESENTS THAT (A) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR
(7) OF REGULATION D UNDER THE SECURITIES ACT) (AN "INSTITUTIONAL ACCREDITED
INVESTOR") OR (B) IT IS NOT A U.S. PERSON, IS NOT ACQUIRING THIS SECURITY FOR
THE ACCOUNT OR BENEFIT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN
OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT,
(2) AGREES THAT IT WILL NOT, WITHIN THE TIME PERIOD REFERRED TO UNDER RULE
144(k) (TAKING INTO ACCOUNT THE PROVISIONS OF RULE 144(d) UNDER THE SECURITIES
ACT, IF APPLICABLE) UNDER THE SECURITIES ACT AS IN EFFECT ON THE DATE OF THE
TRANSFER OF THIS SECURITY, RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A)
TO PRICE COMMUNICATIONS CORPORATION (THE "COMPANY") OR ANY SUBSIDIARY THEREOF,
(B) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE
904 UNDER THE SECURITIES ACT, (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE, BASED UPON AN
OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY), (D) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (E) IN ACCORDANCE WITH
ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND
BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY) AND, IN EACH CASE,
IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS, AND (3) AGREES THAT IT WILL
DELIVER TO EACH PERSON TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS
TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN,
THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S PERSON" HAVE THE
MEANINGS GIVEN TO THEM BY RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE
WARRANT AGREEMENT CONTAINS A PROVISION REQUIRING THE WARRANT AGENT TO REFUSE TO
REGISTER TRANSFER OF THIS SECURITY IN VIOLATION OF THE FOREGOING RESTRICTIONS.
No. [ ] Certificate for _______ Warrants
EXHIBIT A
Page 2
WARRANTS TO PURCHASE COMMON STOCK OF
PRICE COMMUNICATIONS CORPORATION
THIS CERTIFIES THAT, [ ], or its registered
assigns, is the registered holder of the number of Warrants set forth above (the
"Warrants"). Each Warrant entitles the holder thereof (the "Holder"), at its
option and subject to the provisions contained herein and in the Warrant
Agreement referred to below, to purchase from Price Communications Corporation,
a New York corporation ("the Company"), one share of Common Stock, $0.01 par
value, of the Company (the "Common Stock") at the per share exercise price of
$0.01 (the "Exercise Price"). This Warrant Certificate shall terminate and
become void as of the close of business on August 1, 2007 (the "Expiration
Date") or upon the exercise hereof as to all the shares of Common Stock subject
hereto. The number of shares purchasable upon exercise of the Warrants and the
Exercise Price per share shall be subject to adjustment from time to time as set
forth in the Warrant Agreement.
This Warrant Certificate is issued under and in accordance with a
Warrant Agreement dated as of August 7, 1997 (the "Warrant Agreement"), between
the Company and The Bank of Montreal Trust Company (the "Warrant Agent," which
term includes any successor Warrant Agent under the Warrant Agreement), and is
subject to the terms and provisions contained in the Warrant Agreement, to all
of which terms and provisions the Holder of this Warrant Certificate consents by
acceptance hereof. The Warrant Agreement is hereby incorporated herein by
reference and made a part hereof. Reference is hereby made to the Warrant
Agreement for a full statement of the respective rights, limitations of rights,
duties and obligations of the Company, the Warrant Agent and the Holders of the
Warrants. Capitalized terms used but not defined herein shall have the meanings
ascribed thereto in the Warrant Agreement. A copy of the Warrant Agreement may
be obtained for inspection by the Holder hereof upon written request to the
Warrant Agent at Bank of Montreal Trust Company, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇ ▇▇▇▇▇, attention of Corporate Trust Administration.
EXHIBIT A
Page 3
Subject to the terms of the Warrant Agreement, the Warrants may
be exercised in whole or in part by presentation of this Warrant Certificate.
As provided in the Warrant Agreement and subject to the terms and
conditions therein set forth, the Warrants shall be exercisable at any time or
from time to time on any Business Day only on or after the earlier to occur of
(i) the consummation of the Merger (as defined in the Warrant Agreement)
(provided that if the Merger does not occur prior to December 31, 1997, the
Warrants will be subject to the Company's special right of repurchase, as
provided in the Warrant Agreement) and (ii) the occurrence of a Change of
Control (as defined in the Warrant Agreement); provided, however, that no
-------- -------
Warrant shall be exercisable after August 1, 2007.
In the event the Company enters into a Combination (as defined in
the Warrant Agreement), the Holder hereof will be entitled to receive the shares
of capital stock or other securities or other property of such surviving entity
as the Holder would have received had the Holder exercised its Warrants
immediately prior to such Combination; provided, however, that in the event
-------- -------
that, in connection with such Combination, consideration to holders of Common
Stock in exchange for their shares is payable solely in cash or in the event of
the dissolution, liquidation or winding-up of the Company, the Holder hereof
will be entitled to receive cash distributions as the Holder would have received
had the Holder exercised its Warrants immediately prior to such Combination.
The Company may require payment of a sum sufficient to pay all
taxes, assessments or other governmental charges in connection with the transfer
or exchange of the Warrant Certificates pursuant to Section 5.2 of the Warrant
Agreement but not for any exchange or original issuance (not involving a
transfer) with respect to temporary Warrant Certificates, the exercise of the
Warrants or the Warrant Shares.
Upon any partial exercise of the Warrants, there shall be
countersigned and issued to the Holder hereof a new Warrant Certificate in
respect of the shares of Common Stock as to which the Warrants shall not have
been exercised. This Warrant Certificate may be exchanged at the office of the
EXHIBIT A
Page 4
Warrant Agent by presenting this Warrant Certificate properly endorsed with a
request to exchange this Warrant Certificate for other Warrant Certificates
evidencing an equal number of Warrants. No fractional Warrant Shares will be
issued upon the exercise of the Warrants, but the Company shall pay an amount in
cash equal to the Market Value for one Warrant Share on the trading day
immediately preceding the date the Warrant is exercised, multiplied by the
fraction of a Warrant Share that would be issuable on the exercise of any
Warrant.
All shares of Common Stock issuable by the Company upon the
exercise of the Warrants shall, upon such issue, be duly and validly issued and
fully paid and nonassessable.
The Holder in whose name the Warrant Certificate is registered
may be deemed and treated by the Company and the Warrant Agent as the absolute
owner of the Warrant Certificate for all purposes whatsoever and neither the
Company nor the Warrant Agent shall be affected by notice to the contrary.
The Warrants do not entitle any holder hereof to any of the
rights of a stockholder of the Company.
EXHIBIT A
Page 5
This Warrant Certificate shall not be valid or obligatory for any
purpose until it shall have been countersigned by the Warrant Agent.
PRICE COMMUNICATIONS CORPORATION
By:__________________________
Title:
DATED:
Countersigned:
BANK OF MONTREAL TRUST COMPANY
By:_______________________________
Authorized Signatory
EXHIBIT B
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER OF WARRANTS
Re: Warrants to purchase
Common Stock (the "Securities"), of
Price Communications Corporation
-----------------------------------
This Certificate relates to __________ Securities held in the
form of Warrant Certificates by ____________ (the "Transferor").
The Transferor:*
/ / has requested that the Warrant Agent by written order to exchange or
register the transfer of a Warrant Certificate or Warrant Certificates.
In connection with such request and in respect of each such
Security, the Transferor does hereby certify that the Transferor is familiar
with the Warrant Agreement relating to the above captioned Securities and the
restrictions on transfers thereof as provided in Section 5 of such Warrant
Agreement, and that the transfer of these Securities does not require
registration under the Securities Act of 1933, as amended (the "Act") because*:
/ / Such Security is being acquired for the Transferor's own account,
without transfer.
/ / Such Security is being transferred to an institutional "accredited
investor" (within the meaning of subparagraphs (a)(1), (2), (3) or (7) of Rule
501 under the Act.
/ / Such Security is being transferred in reliance on Regulation S under
the Act.
/ / Such Security is being transferred in reliance on Rule 144 under the
Act.
EXHIBIT B
Page 2
/ / Such Security is being transferred in reliance on and in compliance
with an exemption from the registration requirements of the Act other than Rule
144A or Rule 144 or Regulation S under the Act to a person other than an
institutional "accredited investor."
--------------------------------
(INSERT NAME OF TRANSFEROR)
By:____________________________
(Authorized Signatory)
Date:
---------------------
*Check applicable box.
EXHIBIT C
Form of Certificate to Be
Delivered in Connection with
Transfers to Institutional Accredited Investors
[Date]
Bank of Montreal Trust Company
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Re: Price Communications Corporation
(the "Company") Warrants to purchase
Common Stock (the "Securities")
------------------------------------
Ladies and Gentlemen:
In connection with our proposed purchase of Securities, of the Company,
we confirm that:
1. We have received such information as we deem necessary in order to
make our investment decision.
2. We understand that any subsequent transfer of the Securities 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 Securities except in compliance with, such
restrictions and conditions and the Securities Act of 1933, as amended (the
"Securities Act").
3. We understand that the offer and sale of the Securities have not been
registered under the Securities Act, and that the Securities may not be offered
or sold within the United States or to, or for the account or benefit of, U.S.
persons 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 any Securities, we will do so only (A) to the
Company or any subsidiary thereof, (B) inside the United States 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
the Warrant Agent a signed letter substantially in the form hereof, (C) outside
the United States in accordance with Regulation S under the
EXHIBIT C
Page 2
Securities Act, (D) pursuant to the exemption from registration provided by Rule
144 under the Securities Act (if available), or (E) pursuant to an effective
registration statement under the Securities Act, and we further agree to provide
to any person purchasing Securities from us a notice advising such purchaser
that resales of the Securities are restricted as stated herein.
4. We understand that, on any proposed resale of Securities, we will be
required to furnish to the Warrant Agent and the Company, such certification,
legal opinions and other information as the Warrant Agent and the Company may
reasonably require to confirm that the proposed sale complies with the foregoing
restrictions. We further understand that the Securities purchased by us will
bear a legend to the foregoing effect.
5. 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 Securities, and we
and any accounts for which we are acting are each able to bear the economic risk
of our or their investment, as the case may be.
6. We are acquiring the Securities purchased by us for our 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 proceeding or official inquiry with respect
to the matters covered hereby.
Very truly yours,
(Name of Transferor)
By:______________________
(Authorized Signatory)
EXHIBIT D
Form of Certificate to Be
Delivered in Connection
with Regulation S Transfers
[Date]
Bank of Montreal Trust Company
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Re: Price Communications Corporation
(the "Company") Warrants to purchase
Common Stock (the "Securities")
------------------------------------
Dear Sirs:
In connection with our proposed sale of ________ of the Securities, we
confirm that such sale has been effected pursuant to and in accordance with
Regulation S under the Securities Act of 1933, as amended (the "Securities
Act"), and, accordingly, we represent that:
(1) the offer of the Securities was not made to a
person in the United States;
(2) either (a) at the time the buy offer was originated, the transferee
was outside the United States or we and any person acting on our behalf
reasonably believed that the transferee was outside the United States, or (b)
the transaction was executed in, on or through the facilities of a designated
off-shore securities market and neither we nor any person acting on our behalf
knows that the transaction has been prearranged with a buyer in the United
States;
(3) no directed selling efforts have been made in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act; and
EXHIBIT D
Page 2
(5) we have advised the transferee of the transfer restrictions
applicable to the Securities.
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. Defined terms used herein without
definition have the respective meanings provided in Regulation S.
Very truly yours,
(Name of Transferor)
By:______________________
(Authorized Signatory)