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EXHIBIT 3.1.5
CERTIFICATE OF DESIGNATION OF THE POWERS,
PREFERENCES AND RELATIVE, PARTICIPATING,
OPTIONAL AND OTHER SPECIAL RIGHTS OF THE 6 1/2% SERIES B
CUMULATIVE CONVERTIBLE PREFERRED STOCK AND
QUALIFICATIONS, LIMITATIONS AND RESTRICTIONS THEREOF
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Pursuant to Section 151 of the
Delaware General Corporation Law
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NM Acquisition Corp., Inc., the successor by merger to NEXTLINK
Communications, Inc. and to be known as NEXTLINK Communications, Inc.
immediately after the filing of this Certificate of Designation (the
"Corporation"), a corporation organized and existing under the Delaware General
Corporation Law, does hereby certify that, pursuant to authority conferred upon
the board of directors of the Corporation (the "Board of Directors") by Section
3 of its Amended and Restated Certificate of Incorporation, as amended from time
to time (the "Certificate of Incorporation"), and Section 151 of the Delaware
General Corporation Law ("DGCL"), said Board of Directors, on June 13, 2000,
duly approved and adopted a resolution to read as follows (the "Resolution"):
RESOLVED, that, pursuant to the authority vested in the Board of
Directors by the Section 3 of the Corporation's Certificate of Incorporation,
and Section 151 of the DGCL, the Board of Directors does hereby create,
authorize and provide for the issuance of a series of Preferred Stock designated
as the 6 1/2% Series B Cumulative Convertible Preferred Stock, (liquidation
preference $50 per share) in an amount not to exceed 4,600,000 shares, having
the designations, preferences, relative, participating, optional and other
special rights and the qualifications, limitations and restrictions thereof that
are set forth in the Certificate of Incorporation and in this Resolution as
follows:
(a) Designation.
There is hereby created out of the authorized and unissued
Preferred Stock of the Corporation a class of Preferred Stock designated as the
"6 1/2% Series B Cumulative Convertible Preferred Stock." The number of shares
constituting such class shall not exceed 4,600,000 and are referred to as the
"Convertible Preferred Stock." The liquidation preference of the Convertible
Preferred Stock shall be $50 per share.
(b) Ranking.
The Convertible Preferred Stock shall, with respect to dividends
and distributions upon liquidation, winding-up and dissolution of the
Corporation, rank (i) senior to each class of Capital Stock of the Corporation
(including, without limitation, the Corporation's Class A Common Stock, par
value $.02 per share and the Class B Common Stock, par value $.02 per
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share) outstanding or hereafter created the terms of which do not expressly
provide that it ranks senior to, or on a parity with, the Convertible Preferred
Stock as to dividends and distributions upon liquidation, winding-up and
dissolution of the Corporation (collectively referred to as "Junior Shares");
(ii) on a parity with the Corporation's 7% Series F Convertible Redeemable
Preferred Stock Due 2010 and any class of Capital Stock of the Corporation or
series of Preferred Stock of the Corporation hereafter created the terms of
which expressly provide that such class or series will rank on a parity with the
Convertible Preferred Stock as to dividends and distributions upon liquidation,
winding-up and dissolution (collectively referred to as "Parity Shares"); and
(iii) junior to the Corporation's 14% Series A Senior Exchangeable Redeemable
Preferred Shares, the Corporation's 13 1/2% Series E Senior Redeemable
Exchangeable Preferred Stock due 2010, the Corporation's Series C Cumulative
Convertible Participating Preferred Stock, the Corporations Series D Convertible
Participating Preferred Stock and each other class of Capital Stock of the
Corporation or series of Preferred Stock of the Corporation hereafter created
the terms of which expressly provide that such class or series will rank senior
to the Convertible Preferred Stock as to dividends and distributions upon
liquidation, winding-up and dissolution of the Corporation (collectively
referred to as "Senior Shares").
(c) Dividends.
(i) (A) Beginning on the Issue Date, the Holders of
the outstanding Convertible Preferred Stock shall be entitled to
receive, when, as and if declared by the Board of Directors, out
of funds legally available therefor, distributions in the form of
dividends on each share of Convertible Preferred Stock, at a rate
per annum equal to 6 1/2% of the liquidation preference per share
of the Convertible Preferred Stock, payable quarterly. No interest
shall be payable in respect to any dividends that may be in
arrears. All dividends shall be cumulative, whether or not earned
or declared, on a daily basis from their date of issuance and
shall be payable quarterly in arrears on each Dividend Payment
Date, commencing on the first Dividend Payment Date after the
Merger Date. Such dividends shall be paid only in cash. Each
dividend shall be payable to the shares of Convertible Preferred
Stock held by Holders of record as they appear on the share books
of the Corporation on the Dividend Record Date immediately
preceding the related Dividend Payment Date. Dividends shall cease
to accumulate in respect of shares of Convertible Preferred Stock
on the date of their redemption unless the Corporation shall have
failed to pay the relevant redemption price on the date fixed for
redemption. (B) In the event that (1) the Corporation has not
filed the registration statement relating to the shelf
registration of the Convertible Preferred Stock for resale by
Holders contemplated by the Registration Rights Agreement (the
"Resale Registration") on or before the 90th day after the Issue
Date, (2) the Resale Registration has not become effective on or
before the 120th day after the Issue Date, or (3) the Resale
Registration is filed and declared effective but shall thereafter
cease to be effective (except as specifically permitted therein)
without being succeeded immediately by an additional registration
statement filed and declared effective (any such event referred to
in clauses (1) through (3), a
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"Registration Default"), then additional dividends will accrue (in
addition to the stated dividends on the Convertible Preferred
Stock) at the rate of 0.25% per annum on the liquidation
preference of the Convertible Preferred Stock for the period from
and including the occurrence of the Registration Default until
such time as no Registration Default is in effect. Such additional
dividends (the "Special Dividends") will be payable quarterly in
arrears on each regular Dividend Payment Date in accordance with
the provisions of this paragraph (c). For each 90-day period that
the Registration Default continues, the per annum rate of such
Special Dividends will increase by an additional 0.25%; provided
that such rate shall in no event exceed 1.0% per annum in the
aggregate. At such time as the Registration Default is no longer
in effect, the dividend rate on the Convertible Preferred Stock
shall be the rate stated in paragraph (c)(i)(A) hereof and no
further Special Dividends will accrue unless and until another
Registration Default shall occur.
(ii) All dividends paid with respect to the Convertible
Preferred Stock pursuant to paragraph (c)(i) shall be paid pro
rata to the Holders entitled thereto.
(iii) Nothing herein contained shall in any way or under
any circumstances be construed or deemed to require the Board of
Directors to declare, or the Corporation to pay or set apart for
payment, any dividends on the Convertible Preferred Stock at any
time.
(iv) Dividends on account of arrears for any past
Dividend Period and dividends in connection with any mandatory
redemption pursuant to paragraph (e)(ii) may be declared and paid
at any time, without reference to any regular Dividend Payment
Date, to Holders of record on such date, not more than forty-five
(45) days prior to the payment thereof, as may be fixed by the
Board of Directors of the Corporation.
(v) No full dividends shall be declared by the Board of
Directors or paid or set apart for payment by the Corporation on
any Parity Shares for any period unless full cumulative dividends
have been or contemporaneously are declared and paid in full, or
declared and, if payable in cash, a sum in cash set apart
sufficient for such payment, on the Convertible Preferred Stock
for all Dividend Periods terminating on or prior to the date of
payment of such full dividends on such Parity Shares. If full
dividends are not so paid, all dividends declared upon the
Convertible Preferred Stock and any other Parity Shares shall be
declared pro rata so that the amount of dividends declared per
share on the Convertible Preferred Stock and such Parity Shares
shall in all cases bear to each other the same ratio that accrued
dividends per share on the Convertible Preferred Stock and such
Parity Shares bear to each other.
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(vi) (A) Holders of shares of Convertible Preferred
Stock shall be entitled to receive the dividends provided for in
paragraph (c)(i) hereof in preference to and in priority over any
dividends upon any of the Junior Shares.
(B) No dividends may be paid or set apart for
such payment on Junior Shares (except dividends on Junior
Shares payable in additional Junior Shares) if full
cumulative, accrued dividends have not been paid in full on
the Convertible Preferred Stock. So long as any shares of
Convertible Preferred Stock are outstanding, the
Corporation shall not make any payment on account of, or
set apart for payment money for a sinking or other similar
fund for, the purchase, redemption or other retirement of,
any Parity Shares or Junior Shares, or any warrants,
rights, calls or options to purchase any Parity Shares or
Junior Shares, whether in cash, obligations or shares of
the Corporation or other property, and shall not permit any
corporation or other entity directly or indirectly
controlled by the Corporation to purchase or redeem any
Parity Shares or Junior Shares or any such warrants,
rights, calls or options unless full cumulative, accrued
dividends determined in accordance herewith on the
Convertible Preferred Stock have been paid in full.
(vii) Dividends payable on the Convertible Preferred Stock
for any period shorter than a quarterly dividend period shall be
computed on the basis of a 360-day year of twelve 30-day months
and the actual number of days elapsed in the period for which
payable.
(d) Liquidation Preference.
(i) In the event of any voluntary or involuntary
liquidation, dissolution or winding-up of affairs of the
Corporation, the Holders of shares of Convertible Preferred Stock
then outstanding shall be entitled to be paid, out of the assets
of the Corporation available for distribution to its shareholders,
an amount in cash equal to the liquidation preference of $50 per
share of Convertible Preferred Stock, plus, without duplication,
an amount in cash equal to accumulated and unpaid dividends
thereon to the date fixed for liquidation, dissolution or
winding-up (including an amount equal to a prorated dividend for
the period from the last Dividend Payment Date to the date fixed
for liquidation, dissolution or winding-up) before any payment
shall be made or any assets distributed to the holders of any of
the Junior Shares including, without limitation, common stock of
the Corporation. Except as provided in the preceding sentence,
Holders of shares of Convertible Preferred Stock shall not be
entitled to any distribution in the event of any liquidation,
dissolution or winding-up of the affairs of the Corporation. If
the assets of the Corporation are not sufficient to pay in full
the liquidation payments payable to the Holders of
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outstanding shares of Convertible Preferred Stock and all Parity
Shares, then the holders of all such shares shall share equally
and ratably in such distribution of assets in proportion to the
full liquidation preference, including, without duplication, all
accrued unpaid dividends, to which each is entitled.
(ii) For the purposes of this paragraph (d), neither the
sale, conveyance, exchange or transfer (for cash, shares of stock,
securities or other consideration) of all or substantially all of
the property or assets of the Corporation nor the consolidation or
merger of the Corporation with or into one or more entities shall
be deemed to be a liquidation, dissolution or winding-up of the
affairs of the Corporation.
(iii) Nothing herein contained shall in any way or under
any circumstances be construed or deemed to require the Board of
Directors to declare, or the Corporation to pay or set apart for
payment, any amounts for the payment of liquidation preference on
Convertible Preferred Stock at any time.
(e) Redemption.
(i) (A) Mandatory Redemption. On March 31, 2010, the
Corporation shall redeem, to the extent of funds legally available
therefor, in the manner provided for in paragraph (e)(ii) hereof,
all of the shares of Convertible Preferred Stock then outstanding
at a redemption price equal to 100% of the liquidation preference
per share, plus, without duplication, an amount in cash equal to
all accumulated and unpaid dividends per share (including an
amount equal to a prorated dividend for the period from the
Dividend Payment Date immediately prior to the Redemption Date to
the Redemption Date).
(B) Optional Redemption. The Convertible
Preferred Stock shall be redeemable, at any time on or
after April 16, 2006, in whole or in part, at the option of
the Company, at a redemption price equal to 100% of the
liquidation preference per share, plus, without
duplication, an amount in cash equal to all accumulated and
unpaid dividends per share (including an amount equal to a
prorated dividend for the period from the Dividend Payment
Date immediately prior to the Redemption Date to the
Redemption Date).
(ii) Procedures for Redemption.
(A) At least thirty (30) days and not more than
sixty (60) days prior to the date fixed for any redemption
of shares of Convertible Preferred Stock pursuant to
paragraph (e)(i) hereof, written notice (each, a
"Redemption Notice") shall be given by
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first class mail, postage prepaid, to each Holder of record
on the record date fixed for such redemption of shares of
Convertible Preferred Stock at such Holder's address as it
appears on the stock books of the Corporation, provided
that no failure to give such notice nor any deficiency
therein shall affect the validity of the procedure for the
redemption of any shares of Convertible Preferred Stock to
be redeemed except as to the Holder or Holders to whom the
Corporation has failed to give said notice or except as to
the Holder or Holders whose notice was defective. The
Redemption Notice shall state:
(1) The redemption price;
(2) The Redemption Date;
(3) That the Holder is to surrender to the
Corporation, in the manner, at the place or places and at
the price designated, his certificate or certificates
representing the shares of Convertible Preferred Stock to
be redeemed; and
(4) That dividends on the shares of Convertible
Preferred Stock to be redeemed shall cease to accumulate on
such Redemption Date unless the Corporation defaults in the
payment of the redemption price.
(B) Each Holder of shares of Convertible
Preferred Stock shall surrender the certificate or
certificates representing such shares to the Corporation,
duly endorsed (or otherwise in proper form for transfer, as
determined by the Corporation), in the manner and at the
place designated in the Redemption Notice, and on the
Redemption Date the full redemption price for such shares
shall be payable in cash to the Person whose name appears
on such certificate or certificates as the owner thereof,
and each surrendered certificate shall be canceled and
retired.
(C) On and after the Redemption Date, unless the
Corporation defaults in the payment in full of the
applicable redemption price, dividends on the shares of
Convertible Preferred Stock called for redemption shall
cease to accumulate on the Redemption Date, and all rights
of the Holders of redeemed shares shall terminate with
respect thereto on the Redemption Date, other than the
right to receive the redemption price, without interest;
provided, however, that if a notice of redemption shall
have been given as provided in paragraph
(iii) (A) above and the funds necessary for redemption
(including an amount in respect of all dividends that will accrue
to the
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Redemption Date) shall have been irrevocably deposited in trust
for the equal and ratable benefit for the Holders of the shares
called for redemption, then, at the close of business on the day
on which such funds are segregated and set apart, the Holders of
the shares to be redeemed shall cease to be shareholders of the
Corporation and shall be entitled only to receive the redemption
price, without interest.
(f) Voting Rights.
(i) The Holders of shares of Convertible Preferred
Stock, except as otherwise required under Delaware law or as set
forth in paragraphs (ii), (iii) and (iv) below, shall not be
entitled or permitted to vote on any matter required or permitted
to be voted upon by the shareholders of the Corporation.
(ii) (A) So long as any shares of Convertible
Preferred Stock are outstanding, the Corporation shall not amend,
alter or repeal any of the provisions of the Corporation's
Certificate of Incorporation (including this Certificate of
Designations) or the bylaws of the Corporation so as to affect
adversely the specified rights, powers, preferences, privileges or
voting rights of the Holders of the Convertible Preferred Stock or
reduce the time for any notice which the Holders of the
Convertible Preferred Stock may be entitled without the
affirmative vote or consent of Holders of at least two-thirds of
the issued and outstanding shares of Convertible Preferred Stock,
voting or consenting, as the case may be, as one class, given in
person or by proxy, either in writing or by resolution adopted at
an annual or special meeting.
(B) Notwithstanding the foregoing, modifications
and amendments of the terms of this Certificate of
Designations contained in paragraph (i) below may be made
by the Corporation with the consent of the Holders of a
majority of the outstanding shares of Convertible Preferred
Stock. In addition, the Holders of a majority of the
outstanding shares of Convertible Preferred Stock, on
behalf of all holders of Convertible Preferred Stock, may
waive compliance by the Corporation with the covenant set
forth below in paragraph (i) and may waive any past default
under the Certificate of Designations.
(C) Notwithstanding anything to the contrary
contained herein, (x) the creation, authorization or
issuance of any shares of any Junior Shares, Parity Shares
or Senior Shares or (y) the increase or decrease in the
amount of authorized Capital Stock of any class, including
Senior Shares or Parity Shares (other than a reduction in
the number of authorized shares of Preferred Stock below
the number thereof then outstanding), shall not require the
consent of Holders of Convertible Preferred Stock and shall
not be
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deemed to affect adversely the rights, preferences,
privileges or voting rights of Holders of shares of
Convertible Preferred Stock.
(iii) Without the affirmative vote or consent of Holders
of a majority of the issued and outstanding shares of Convertible
Preferred Stock, voting or consenting, as the case may be, as a
separate class, given in person or by proxy, either in writing or
by resolution adopted at an annual or special meeting, the
Corporation shall not, in a single transaction or series of
related transactions, consolidate with or merge with or into, or
sell, assign, transfer, lease, convey or otherwise dispose of all
or substantially all of its assets to, another Person or adopt a
plan of liquidation unless: (A) either (1) the Corporation is the
surviving or continuing Person or (2) the Person (if other than
the Corporation) formed by such consolidation or into which the
Corporation is merged or the Person that acquires by conveyance,
transfer or lease the properties and assets of the Corporation
substantially as an entirety or in the case of a plan of
liquidation, the Person to which assets of the Corporation have
been transferred, shall be a corporation, limited liability
Company, partnership or trust organized and existing under the
laws of the United States or any State thereof or the District of
Columbia; (B) either (1) the Corporation is the surviving or
continuing Person and the outstanding shares of Convertible
Preferred Stock continue to exist as outstanding shares of
Convertible Preferred Stock or are converted into or exchanged for
shares of Capital Stock of an Acquiring Entity, having the same
powers, preferences and relative, participating, optional or other
special rights and the qualifications, limitations or restrictions
thereon that the shares of Convertible Preferred Stock had
immediately prior to such transaction or (2) the shares of
Convertible Preferred Stock shall be converted into or exchanged
for shares of Capital Stock of such successor, transferee or
resulting Person or an Acquiring Entity, having in respect of such
successor, transferee or resulting Person, the same powers,
preferences and relative, participating, optional or other special
rights and the qualifications, limitations or restrictions
thereon, that the shares of Convertible Preferred Stock had
immediately prior to such transaction; (C) immediately after
giving pro forma effect to such transaction, no Voting Rights
Triggering Event shall have occurred or be continuing; and (D) the
Corporation has delivered to the Transfer Agent prior to the
consummation of the proposed transaction an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation,
merger or transfer complies with the terms hereof and that all
conditions precedent herein relating to such transaction have been
satisfied.
For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise, in a single transaction or series of related transactions) of
all or substantially all of the properties or assets of one or more Subsidiaries
of the Corporation, the Capital Stock of which constitutes all or substantially
all of the properties and assets of the Corporation, shall be deemed to be the
transfer of all or substantially all of the properties and assets of the
Corporation.
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Except as specified in this paragraph, the Holders of Convertible
Preferred Stock shall not have voting rights with respect to mergers.
(iv) (A) If (1) dividends on the Convertible Preferred
Stock are in arrears and unpaid for six or more Dividend Periods
(whether or not consecutive) (a "Dividend Default"); (2) the
Corporation fails to redeem all of the then outstanding shares of
Convertible Preferred Stock on March 31, 2010 or fails otherwise
to discharge any redemption obligation with respect to the
Convertible Preferred Stock; (3) the Corporation breaches or
violates one of the provisions set forth in any paragraphs
(f)(iii) or (i) hereof and the breach or violation continues for a
period of 30 days or more after the Corporation receives notice
thereof specifying the default from the Holders of at least 25% of
the shares of Convertible Preferred Stock then outstanding, or (4)
the Corporation fails to pay at the final stated maturity (giving
effect to any extensions thereof) the principal amount of any Debt
of the Corporation or any Subsidiary of the Corporation, or the
final stated maturity of any such Debt is accelerated, if the
aggregate principal amount of such Debt, together with the
aggregate principal amount of any other such Debt in default for
failure to pay principal at the final stated maturity (giving
effect to any extensions thereof) or that has been accelerated,
aggregates $15,000,000 or more at any time, in each case, after a
10-day period during which such default shall not have been cured
or such acceleration rescinded, then in the case of any of clauses
(1)-(4) the number of directors constituting the Board of
Directors shall be adjusted by the number, if any, necessary to
permit the Holders of the Convertible Preferred Stock, voting
together with any outstanding Parity Shares separately as a single
class, to elect the lesser of two directors and that number of
directors constituting 25% of the members of the Board of
Directors. Each such event described in clauses (1), (2), (3) and
(4) is a "Voting Rights Triggering Event." Holders of a majority
of the issued and outstanding shares of Convertible Preferred
Stock, voting together with any outstanding Parity Shares
separately as a single class, shall have the exclusive right to
elect the lesser of two directors and that number of directors
constituting 25% of the members of the Board of Directors at a
meeting therefor called upon occurrence of such Voting Rights
Triggering Event, and at every subsequent meeting at which the
terms of office of the directors so elected shall expire (other
than as described in (f)(iv)(B) below). The voting rights provided
herein shall be the exclusive remedy at law or in equity of the
Holders of the Convertible Preferred Stock for any Voting Rights
Triggering Event.
(B) The right of the Holders of Convertible
Preferred Stock to elect members of the Board of Directors
as set forth in subparagraph (f)(iv)(A) above shall
continue until such time as (x) in the event such right
arises due to a Dividend Default, all accumulated dividends
that are in arrears on the Convertible Preferred Stock are
paid in full and (y) in all other cases, the
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failure, breach or default giving rise to such Voting
Rights Triggering Event is remedied or waived by the
Holders of at least a majority of the shares of Convertible
Preferred Stock then outstanding, at which time (1) the
special right of the Holders of Convertible Preferred Stock
so to vote for the election of directors and (2) the term
of office of the directors elected by the Holders of the
Convertible Preferred Stock shall each terminate and the
directors elected by the holders of Voting Stock other than
the Convertible Preferred Stock shall constitute the entire
Board of Directors. At any time after voting power to elect
directors shall have become vested and be continuing in the
Holders of Convertible Preferred Stock pursuant to
paragraph (f)(iv)(A) hereof, or if vacancies shall exist in
the offices of directors elected by the Holders of
Convertible Preferred Stock, a proper officer of the
Corporation may, and upon the written request of he Holders
of record of at least twenty-five percent (25%) of the
shares of Convertible Preferred Stock then outstanding
addressed to the Secretary of the Corporation shall, call a
special meeting of the Holders of Convertible Preferred
Stock, for the purpose of electing the directors which such
Holders are entitled to elect. If such meeting shall not be
called by a proper officer of the Corporation within twenty
(20) days after personal service of said written request
upon the Secretary of the Corporation, or within twenty
(20) days after mailing the same within the United States
by certified mail, addressed to the Secretary of the
Corporation at its principal executive offices, then the
Holders of record of at least twenty-five percent (25%) of
the outstanding shares of Convertible Preferred Stock may
designate in writing one of their number to call such
meeting at the expense of the Corporation, and such meeting
may be called by the Person so designated upon the notice
required for the annual meetings of shareholders of the
Corporation and shall be held at the place for holding the
annual meetings of shareholders. Any Holder of shares of
Convertible Preferred Stock so designated shall have, and
the Corporation shall provide, access to the lists of
shareholders to be called pursuant to the provisions
hereof.
(C) At any meeting held for the purpose of
electing directors at which the Holders of Convertible
Preferred Stock voting together with any outstanding shares
of Parity Shares as a separate class shall have the right
as described herein to elect directors, the presence in
person or by proxy of the Holders of at least a majority of
the then outstanding shares of Convertible Preferred Stock
and Parity Shares shall be required to constitute a quorum
of such Convertible Preferred Stock and Parity Shares.
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(D) Any vacancy occurring in the office of a
director elected by the Holders of shares of Convertible
Preferred Stock and Parity Shares may be filled by the
remaining directors elected by the Holders of Convertible
Preferred Stock and Parity Shares unless and until such
vacancy shall be filled by the Holders of Convertible
Preferred Stock and Parity Shares.
(v) In any case in which the Holders of Convertible
Preferred Stock shall be entitled to vote pursuant to this
paragraph (f) or pursuant to Delaware law, each Holder of shares
of Convertible Preferred Stock entitled to vote with respect to
such matter shall be entitled to one vote for each share of
Convertible Preferred Stock held.
(vi) The Corporation may voluntarily grant voting rights
to the holders of Convertible Preferred Stock under such terms and
conditions as the Corporation shall determine, provided, however,
that such grant does not affect adversely the then-existing voting
rights of such holders.
(g) Reissuance of Convertible Preferred Stock.
Shares of Convertible Preferred Stock that have been issued and
reacquired in any manner, including shares purchased or redeemed, shall (upon
compliance with any applicable provisions of the laws of Delaware) have the
status of authorized and unissued shares of Preferred Stock undesignated as to
series and may be redesignated and reissued as part of any series of Preferred
Stock; provided that such reacquired shares shall not be reissued as shares of
Convertible Preferred Stock.
(h) Business Day.
If any payment, redemption or exchange shall be required by the
terms hereof to be made on a day that is not a Business Day, such payment,
redemption or exchange shall be made on the immediately succeeding Business Day.
(i) Certain Additional Provisions.
(i) Reports. So long as any shares of Convertible
Preferred Stock are outstanding, the Corporation will provide to
the Holders of Convertible Preferred Stock, within 15 days after
it files them with the Securities and Exchange Commission (or any
successor agency performing similar functions), copies of the
annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the
Commission may by rules and regulation prescribe) which the
Corporation files with the Commission pursuant to Section 13 or
15(d) of the Exchange Act. In the event that the Corporation is no
longer required to furnish such reports to its securityholders
pursuant to the Exchange Act, the Corporation will cause its
consolidated financial statements, comparable to those which would
have been required to
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appear in annual or quarterly reports, to be delivered to the
Holders of Convertible Preferred Stock.
(j) Definitions.
As used in this Certificate of Designations, the following terms
shall have the following meanings (with terms defined in the singular having
comparable meanings when used in the plural and vice versa), unless the context
otherwise requires.
"Acquired Debt" means, with respect to any specified Person, (i)
Debt of any other Person existing at the time such Person merges with or into or
consolidates with or becomes a Restricted Subsidiary of such specified Person
and (ii) Debt secured by a Lien encumbering any asset acquired by such specified
Person, which Debt was not Incurred in anticipation of, and was outstanding
prior to, such merger, consolidation or acquisition.
"Acquiring Entity" means the entity that is a constituent party to
a transaction covered by paragraph (f)(iii) and that thereafter is the parent
entity of the Corporation or its successor and whose shares of Capital Stock the
holders of Class A Common Stock receive in a transaction in exchange for or in
consideration of their shares of Class A Common Stock.
"Affiliate" of any Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such Person. For the purposes of this definition, "control" when
used with respect to any Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Applicable Price" means (i) in the event of a Non-Stock Change in
Control in which the holders of the Class A Common Stock receive only cash, the
amount of cash received by the holder of one share of Class A Common Stock and
(ii) in the event of any other Non-Stock Change in Control or any Common Stock
Change in Control, the average of the Closing Price for the Class A Common Stock
during the 10 Trading Days prior to and including the record date for the
determination of the holders of Class A Common Stock entitled to receive cash,
securities, property or other assets in connection with such Non-Stock Change in
Control or Common Stock Change in Control or, if there is no such record date,
the date upon which the holders of the Class A Common Stock shall have the right
to receive such cash, securities, property or other assets or the date upon
which such Non-Stock Change in Control is deemed to have occurred, as the case
may be, in each case as adjusted in good faith by the Board of Directors to
appropriately reflect any of the events referred to in paragraph (k)(vi).
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in the Borough of
Manhattan, The City of New York, New York are authorized or obligated by law or
executive order to close.
"Capital Lease Obligation" of any Person means the obligation to
pay rent or other payment amounts under a lease of (or other Debt arrangements
conveying the right to use) real or personal property of such Person which is
required to be classified and accounted for as a capital lease or a liability on
the face of a balance sheet of such Person in accordance with
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generally accepted accounting principles (a "Capital Lease"). The stated
maturity of such obligation shall be the date of the last payment of rent or any
other amount due under such lease prior to the first date upon which such lease
may be terminated by the lessee without payment of a penalty. The principal
amount of such obligation shall be the capitalized amount thereof that would
appear on the face of a balance sheet of such Person in accordance with
generally accepted accounting principles.
"Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of corporate stock or
other equity participations, including partnership interests, whether general or
limited, of such Person.
"Change in Control" will be deemed to have occurred at such time
as (i) the sale, lease, transfer, conveyance or other disposition (other than by
way of merger or consolidation), in one or a series of related transactions, of
all or substantially all the assets of the Corporation and its Subsidiaries
taken as a whole to any "person" (as such term is used in Section 13(d)(3) of
the Exchange Act), (ii) the adoption of a plan relating to the liquidation or
dissolution of the Corporation, (iii) the consummation of any transaction
(including any merger or consolidation) the result of which is that any Person
or any Persons acting together that would constitute a "group" (a "Group") for
purposes of Section 13(d) of the Exchange Act, or any successor provision
thereto (other than Eagle River, Mr. Craig O. McCaw and their respective
Affiliates or an underwriter engaged in a firm commitment underwriting on behalf
of the Corporation), shall beneficially own (within the meaning of Rule 13d-3
under the Exchange Act, or any successor provision thereto) more than 50% of the
aggregate voting power of all classes of Voting Stock of the Corporation, (iv)
neither Mr. Craig O. McCaw nor any person designated by him to the Corporation
as acting on his behalf shall be a director of the Corporation; or (v) during
any period of two consecutive years, individuals who at the beginning of such
period constituted the Board of Directors (together with any new directors whose
election by the Board of Directors or whose nomination for election by the
shareholders of the Corporation was proposed by a vote of a majority of the
directors of the Corporation then still in office who were either directors at
the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the
Board of Directors then in office.
"Class A Common Stock" means the Class A Common Stock, par value
$0.02 per share, of the Corporation.
"Closing Price" means, with respect to the Class A Common Stock of
the Corporation, for any day, the closing sale price (or, if no closing sale
price is reported, the last reported sale price) per share of the Class A Common
Stock as reported by the Nasdaq National Market, or, if the Class A Common Stock
is not so reported, on the principal national securities exchange or
inter-dealer quotation system on which the Class A Common Stock is listed or
admitted to trading, or if not listed or admitted to trading on any national
securities exchange or inter-dealer quotation system, the average of the closing
bid and asked prices per share in the over-the-counter market as reported by the
National Quotation Bureau or similar organization or as furnished by any New
York Stock Exchange member firm selected from time to time by the Corporation
for that purpose.
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"Common Stock" means the Class A Common Stock and the Class B
Common Stock, par value $0.02 per share, of the Corporation.
"Common Stock Change in Control" means any Change in Control in
which more than 50% of the value (as determined in good faith by the Board of
Directors of the Corporation) of the consideration received by holders of Class
A Common Stock consists of common stock of another company that for each of the
10 consecutive Trading Days referred to in the definition of "Applicable Price"
above has been admitted for listing or admitted for listing subject to notice of
issuance on a national securities exchange or quoted on the Nasdaq National
Market; provided, however, that a Change in Control shall not be a Common Stock
Change in Control unless either (i) the Corporation continues to exist after the
occurrence of such Change in Control and the outstanding shares of Convertible
Preferred Stock continue to exist as outstanding shares of Convertible Preferred
Stock (or are converted into or exchanged for shares of Capital Stock of an
Acquiring Entity, having the same powers, preferences and relative,
participating, optional or other special rights and the qualifications,
limitations or restrictions thereon that the shares of Convertible Preferred
Stock had immediately prior to such transaction), or (ii) not later than the
occurrence of such Change in Control, the outstanding shares of Convertible
Preferred Stock are converted into or exchanged for shares of convertible
preferred stock of a corporation succeeding to the business of the Corporation
or the Acquiring Entity, which convertible preferred stock has powers,
preferences and relative, participating, optional or other rights, and
qualifications, limitations and restrictions, substantially similar to those of
the Convertible Preferred Stock.
"Conversion Agent" means the conversion agent for the Convertible
Preferred Stock designated by the Company from time to time.
"Corporation" means NM Acquisition Corp. a Delaware corporation,
an successor by merger to NETLINK Communications, Inc.
"Current Market Price" per Junior Share or any other security at
any date means (i) if the security is not registered under the Exchange Act, (a)
the value of the security, determined in good faith by the Board of Directors of
the Corporation, based on the most recently completed arm's-length transaction
between the Corporation and a person other than an Affiliate of the Corporation
and the closing of which occurs on such date or shall have occurred within the
six-month period preceding such date, or (b) if no such transaction shall have
occurred on such date or within such six-month period, the value of the security
as determined by an independent financial expert (provided that, in the case of
the calculation of Current Market Price for determining the cash value of
fractional shares, any such determination within six months that is, in the good
faith judgment of the Board of Directors of the Corporation, a reasonable
determination, may be utilized) or (ii) (a) if the security is registered under
the Exchange Act, the average of the daily market prices of the security for the
20 consecutive trading days immediately preceding such date, or (b) if the
security has been registered under the Exchange Act for less than 20 consecutive
trading days before such date, then the average of the closing sales prices for
all of the trading days before such date for which closing sales prices are
available, in the case of each of (ii) (a) and (ii) (b), as certified to the
Conversion Agent by the President, any Vice President or the Chief Financial
Officer of the Corporation. The market price for each such trading day shall be:
(A) in the case of a security listed or admitted to trading on any national
securities exchange or quotation system, the closing sales price, regular way,
on
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such day, or if no sale takes place on such day, the average of the closing bid
and asked prices on such day, (B) in the case of a security not then listed or
admitted to trading on any national securities exchange or quotation system, the
last reported sale price on such day, or if no sale takes place on such day, the
average of the closing bid and asked prices on such day, as reported by a
reputable quotation source designated by the Corporation, (C) in the case of a
security not then listed or admitted to trading on any national securities
exchange or quotation system and as to which no such reported sale price or bid
and asked prices are available, the average of the reported high bid and low
asked prices on such day, as reported by a reputable quotation service, or a
newspaper of general circulation in the Borough of Manhattan, City and State of
New York, customarily published on each Business Day, designated by the
Corporation, or, if there shall be no bid and asked prices on such day, the
average of the high bid and low asked prices, as so reported, on the most recent
day (not more than 30 days prior to the date in question) for which prices have
been so reported and (D) if there are no bid and asked prices reported during
the 30 days prior to the date in question, the Current Market Price shall be
determined as if the securities were not registered under the Exchange Act.
"Debt" means (without duplication), with respect to any Person,
whether recourse is to all or a portion of the assets of such Person and whether
or not contingent, (i) every obligation of such Person for money borrowed, (ii)
every obligation of such Person evidenced by bonds, debentures, notes or other
similar instruments, including any such obligations Incurred in connection with
the acquisition of property, assets or businesses, (iii) every reimbursement
obligation of such Person with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of such Person, (iv)
every obligation of such Person issued or assumed as the deferred purchase price
of property or services (including securities repurchase agreements but
excluding, trade accounts payable or accrued liabilities arising in the ordinary
course of business which are not overdue or which are being contested in good
faith), (v) every Capital Lease Obligation of such Person, (vi) all Receivables
Sales of such Person, together with any obligation of such Person to pay any
discount, interest, fees, indemnities, penalties, recourse, expenses or other
amounts in connection therewith, (vii) all obligations to redeem Disqualified
Stock issued by such Person, (viii) every obligation under Interest Rate or
Currency Protection Agreements of such Person, and (ix) every obligation of the
type referred to in clauses (i) through (viii) of another Person and all
dividends of another Person the payment of which, in either case, such Person
has Guaranteed. The "amount" or "principal amount" of Debt at any time of
determination as used herein represented by (a) any Debt issued at a price that
is less than the principal amount at maturity thereof, shall be the amount of
the liability in respect thereof determined in accordance with generally
accepted accounting principles, (b) any Receivables Sale, shall be the amount of
the unrecovered capital or principal investment of the purchaser (other than the
Corporation or a Wholly-Owned Restricted Subsidiary of the Corporation) thereof,
excluding amounts representative of yield or interest earned on such investment,
(c) any Disqualified Stock, shall be the maximum fixed redemption or repurchase
price in respect thereof, (d) any Capital Lease Obligation, shall be determined
in accordance with the definition thereof, or (e) any Permitted Interest Rate or
Currency Protection Agreement shall be zero. In no event shall Debt include any
liability for taxes.
"Depositary" means, with respect to the shares of Convertible
Preferred Stock issuable or issued in whole or in part in the form of a Global
Share Certificate, DTC for so long as it shall be a clearing agency registered
under the Exchange Act, or such successor (which shall
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be a clearing agency registered under the Exchange Act) as the Corporation shall
designate from time to time in an Officer's Certificate delivered to the
Transfer Agent.
"Disqualified Stock" of any Person means any Capital Stock of such
Person which, by its terms (or by the terms of any security into which it is
convertible or for which it is exchangeable), or upon the happening of any
event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or is redeemable at the option of the holder thereof,
in whole or in part, on or prior to March 31, 2010; provided, however, that any
Convertible Preferred Stock which would not constitute Disqualified Stock but
for provisions thereof giving holders thereof the right to require the
Corporation to repurchase or redeem such Convertible Preferred Stock upon the
occurrence of a Change in Control occurring prior to March 31, 2010 shall not
constitute Disqualified Stock.
"Dividend Payment Date" means March 31, June 30, September 30 and
December 31, of each year.
"Dividend Period" means the Initial Dividend Period, and
thereafter, each Quarterly Dividend Period.
"Dividend Record Date" means March 15, June 15, September 15 and
December 15 of each year.
"DTC" means The Depository Trust Company.
"Eagle River" means Eagle River Investments, L.L.C., a limited
liability company formed under the laws of the State of Washington.
"Exchange Act" means the Securities Exchange Act of 1934, and the
rules and regulations promulgated thereunder.
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person guaranteeing, or having the economic effect of
guaranteeing, any Debt of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, and including, without limitation, any
obligation of such Person, (i) to purchase or pay (or advance or supply funds
for the purchase of) such Debt or to purchase (or to advance or supply funds for
the purchase of) any security for the payment of such Debt, (ii) to purchase
property, securities or services for the purpose of assuring the holder of such
Debt of the payment of such Debt, or (iii) to maintain working capital, equity
capital or other financial statement condition or liquidity of the primary
obligor so as to enable the primary obligor to pay such Debt (and "Guaranteed",
"Guaranteeing" and "Guarantor" shall have meanings correlative to the
foregoing); provided, however, that the Guarantee by any Person shall not
include endorsements by such Person for collection or deposit, in either case,
in the ordinary course of business; and provided further, that the incurrence by
a Restricted Subsidiary of the Corporation of a lien on real or personal
property of such Restricted Subsidiary acquired, constructed or constituting
improvements made after the Issue Date to secure Purchase Money Debt which is
Incurred for the construction, acquisition and improvement of Telecommunications
Assets, shall not be deemed to constitute a Guarantee by such Restricted
Subsidiary of any Purchase Money Debt of the Corporation secured thereby;
provided, however, that (a) the net proceeds of any Debt secured by such a Lien
does not exceed
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100% of such purchase price or cost of construction or improvement of the
property subject to such Lien; (b) such Lien attaches to such property prior to,
at the time of or within 180 days after the acquisition, completion of
construction or commencement of operation of such property; and (c) such Lien
does not extend to or cover any property (or identifiable portions thereof)
acquired, constructed or constituting improvements made with the proceeds of
such Purchase Money Debt (it being understood and agreed that all Debt owed to
any single lender or group of lenders or outstanding under any single credit
facility shall be considered a single Purchase Money Debt, whether drawn at one
time or from time to time).
"Holder" means a holder of shares of Convertible Preferred Stock
as reflected in the share books of the Corporation.
"Implied Conversion Price" means the quotient obtained by dividing
$50.00 by the Conversion Rate.
"Incur" means, with respect to any Debt or other obligation of any
Person, to create, issue, incur (by conversion, exchange or otherwise), assume,
Guarantee or otherwise become liable in respect of such Debt or other obligation
including by acquisition of Subsidiaries or the recording, as required pursuant
to generally accepted accounting principles or otherwise, of any such Debt or
other obligation on the balance sheet of such Person (and "Incurrence",
"Incurred", "Incurrable" and "Incurring" shall have meanings correlative to the
foregoing): provided, however, that a change in generally accepted accounting
principles that results in an obligation of such Person that exists at such time
becoming Debt shall not be deemed an Incurrence of such Debt and that neither
the accrual of interest nor the accretion of original issue discount shall be
deemed an Incurrence of Debt; provided, further, however, that the Corporation
may elect to treat all or any portion of revolving credit debt of the
Corporation or a Subsidiary as being Incurred from and after any date beginning
the date the revolving credit commitment is extended to the Corporation or a
Subsidiary, by furnishing notice thereof to the Trustee or the Transfer Agent,
as applicable, and any borrowings or reborrowings by the Corporation or a
Subsidiary under such commitment up to the amount of such commitment designated
by the Corporation as Incurred shall not be deemed to be new Incurrence of Debt
by the Corporation or such Subsidiary.
"Initial Dividend Period" means the dividend period commencing on
the Issue Date and ending on the first Dividend Payment Date to occur
thereafter.
"Interest Rate or Currency Protection Agreement" of any Person
means any forward contract, futures contract, swap, option or other financial
agreement or arrangement (including, without limitation, caps, floors, collars
and similar agreements) relating to, or the value of which is dependent upon,
interest rates or currency exchange rates or indices.
"Issue Date" means the date of original issuance of the
Convertible Preferred Stock by NEXTLINK.
"Junior Shares" shall have the meaning ascribed to it in paragraph
(b) hereof.
"Lien" means, with respect to any property or assets, any mortgage
or deed of trust, pledge, hypothecation, assignment, Receivables Sale, deposit
arrangement, security
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interest, lien, charge, easement (other than any easement not materially
impairing usefulness or marketability), encumbrances, preference, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever on or with respect to such property or assets (including, without
limitation, any conditional sale or other title retention agreement having
substantially the same economic effect as any of the foregoing).
"Merger Date" means the date of effectiveness of the merger of
NEXTLINK with and into the Corporation.
"NEXTLINK" means NEXTLINK Communications, Inc., a Delaware
corporation and a predecessor to the Corporation.
"Non-Stock Change in Control" means any Change in Control other
than a Common Stock Change in Control.
"Officers' Certificate" means a certificate signed by (i) the
Chief Executive Officer, President, an Executive Vice President or a Vice
President, and (ii) the Treasurer, Assistant Treasurer, Secretary or an
Assistant Secretary, of the Corporation and delivered to the Transfer Agent and
containing the following:
(a) a statement that each individual signing such
certificate has read such covenant or condition and the
definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statement or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of each such
individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to
whether or not such covenant or condition has been complied with;
and
(d) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been complied
with.
"Opinion of Counsel" means a written opinion of legal counsel, who
may be counsel for the Corporation and containing the following statements:
(a) a statement that such counsel has read such covenant
or condition and the definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(c) a statement that, in the opinion of each such
individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to
whether or not such covenant or condition has
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been complied with; and
(d) a statement as to whether, in the opinion of each
such individual, such condition or covenant has been complied
with.
"Parity Shares" shall have the meaning ascribed to it in paragraph
(b) hereof.
"Permitted Interest Rate or Currency Protection Agreement" of any
Person means any Interest Rate or Currency Protection Agreement entered into
with one or more financial institutions in the ordinary course of business that
is designed to protect such Person against fluctuations in interest rates or
currency exchange rates with respect to Debt Incurred and which shall have a
notional amount no greater than the payments due with respect to the Debt being
hedged thereby and not for purposes of speculation.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof or any other entity.
"Preferred Stock" of any Person means Capital Stock of such Person
of any class or classes (however designated) that ranks prior, as to the payment
of dividends or as to the distribution of assets upon any voluntary or
involuntary liquidation, dissolution or winding up of such Person, to shares of
Capital Stock of any other class of such Person.
"Purchase Money Debt" means (i) Acquired Debt Incurred in
connection with the acquisition of Telecommunications Assets and (ii) Debt of
the Corporation or of any Restricted Subsidiary of the Corporation (including,
without limitation, Debt represented by Capital Lease Obligations, Vendor
Financing Facilities, mortgage financings and purchase money obligations)
Incurred for the purpose of financing all or any part of the cost of
construction, acquisition or improvement by the Corporation or any Restricted
Subsidiary of the Corporation or any Joint Venture of any Telecommunications
Assets of the Corporation, any Restricted Subsidiary of the Corporation or any
Joint Venture, and including any related notes, Guarantees, collateral
documents, instruments and agreements executed in connection therewith, as the
same may be amended, supplemented, modified or restated from time to time.
"Purchaser Stock Price" means, with respect to any Common Stock
Change in Control, the average of the per share Closing Prices for the common
stock received as consideration in such Common Stock Change in Control for the
10 consecutive Trading Days prior to and including the record date for the
determination of the holders of Class A Common Stock entitled to receive such
common stock, or if there is no such record date, the date upon which the
holders of the Class A Common Stock shall have the right to receive such common
stock, in each case, as adjusted in good faith by the Board of Directors to
appropriately reflect any of the events referred to in paragraph (k)(vi);
provided, however, that if no such Closing Prices exist, then the Purchaser
Stock Price shall be set at a price determined in good faith by the Board of
Directors of the Corporation.
"Quarterly Dividend Period" shall mean the quarterly period
commencing on each March 31, June 30, September 30 and December 31 and ending on
the next succeeding Dividend Payment Date, respectively.
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"Receivables" means receivables, chattel paper, instruments,
documents or intangibles evidencing or relating to the right to payment of money
in respect of the sale of the goods or services.
"Receivables Sale" of any Person means any sale of Receivables of
such Person (pursuant to a purchase facility or otherwise), other than in
connection with a disposition of the business operations of such Person relating
thereto or a disposition of defaulted Receivables for purpose of collection and
not as a financing agreement.
"Redemption Date", with respect to any share of Convertible
Preferred Stock, means the date on which such share of Convertible Preferred
Stock is redeemed by the Corporation.
"Redemption Notice" shall have the meaning ascribed to it in
paragraph (e) hereof.
"Reference Market Price" shall initially mean $23.33, and in the
event of any adjustment to the Conversion Rate other than as a result of a
Change in Control, the Reference Market Price shall also be adjusted so that the
ratio of the Reference Market Price to the Implied Conversion Price after giving
effect to any such adjustment shall always be the same as the ratio of $23.33 to
$43.67.
"Registration Rights Agreement" means the Registration Rights
Agreement dated as of March 31, 1998 among the Corporation, Smith Barney, Inc.
and Goldman, Sachs & Co. (for the benefit of Holders from time to time).
"Restricted Period Termination Date" means the date that is two
years after the later of the Issue Date or the last date on which the
Corporation or an Affiliate of the Corporation was the owner thereof.
"Restricted Subsidiary" of the Corporation means any Subsidiary,
whether existing on or after the Issue date, other than an Unrestricted
Subsidiary.
"Senior Shares" shall have the meaning ascribed to it in paragraph
(b) hereof.
"Subsidiary" of any Person means (i) a corporation more than 50%
of the combined voting power of the outstanding Voting Stock of which is owned,
directly or indirectly, by such Person or by one or more other Subsidiaries of
such Person or by such Person and one or more Subsidiaries thereof or (ii) any
other Person (other than a corporation) in which such Person, or one or more
other Subsidiaries of such Person or such Person and one or more other
Subsidiaries thereof, directly or indirectly, has at least a majority ownership
and power to direct the policies, management and affairs thereof.
"Telecommunications Assets" means all assets, rights (contractual
or otherwise) and properties, whether tangible or intangible, used or intended
for use in connection with a Telecommunications Business."
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"Telecommunications Business" means the business of (i)
transmitting, or providing services relating to the transmission of, voice,
video or data through owned or leased transmission facilities, (ii) creating,
developing or marketing communications related network equipment, software and
other devices for use in a Telecommunication Business or (iii) evaluating,
participating or pursuing any other activity or opportunity that is primarily
related to those identified in (i) or (ii) above and shall, in any event,
include all businesses in which the Company or any of its Subsidiaries are
engaged on the Issue Date; provided that the determination of what constitutes a
Telecommunications Business shall be made in good faith by the Board of
Directors of the Company, which determination shall be conclusive.
"Trading Day" means (i) if the Class A Common Stock is admitted to
trading on the Nasdaq National Market or any other system of automated
dissemination of quotations of securities prices, a day on which trades may be
effected through such system; (ii) if the Class A Common Stock is not so
admitted for trading but is listed or admitted for trading on the American Stock
Exchange or any other national securities exchange, a day on which such exchange
is open for business; or (iii) if the Class A Common Stock is not listed or
admitted for trading on any national securities exchange or admitted to trading
on the Nasdaq National Market or any other system of automated dissemination of
quotation of securities prices, a day on which the Common Stock is traded
regular way in the over-the-counter market and for which a closing bid and a
closing asked price for the Class A Common Stock are available.
"Transfer Agent" means the transfer agent for the Convertible
Preferred Stock designated by the Corporation from time to time.
"Unrestricted Subsidiary" means (1) any Subsidiary of the
Corporation or admitted for trading on any national securities exchange or
admitted to trading on the Nasdaq National Market or any other system of
automated dissemination of quotation of securities prices, a day on which the
Common Stock is traded regular way in the over-the-counter market and for which
a closing bid and a closing asked price for the Class A Common Stock are
available. "Transfer Agent" means the transfer agent for the Convertible
Preferred Stock designated by the Corporation from time to time. "Unrestricted
Subsidiary" means (1) any Subsidiary of the Corporation of such Subsidiary
(including any right which the holders thereof may have to take enforcement
action against such Subsidiary) would permit (upon notice, lapse of time or
both) any holder of any other Debt of the Corporation and its Restricted
Subsidiaries to declare a default on such other Debt or cause the payment
thereof to be accelerated or payable prior to its final scheduled maturity and
(2) any Subsidiary of an Unrestricted Subsidiary. The Board of Directors of the
Corporation may designate any Subsidiary to be an Unrestricted Subsidiary unless
such Subsidiary owns any Capital Stock of, or owns or holds any Lien on any
property of, any other Subsidiary of the Corporation which is not a Subsidiary
of the Subsidiary to be so designated or otherwise an Unrestricted Subsidiary,
provided that either (x) the Subsidiary to be so designated has total assets of
$1,000 or less or (y) immediately after giving effect to such designation, the
Corporation could incur at least $1.00 of additional Debt pursuant to certain
covenants under the 12 1/2% Notes, the 9 % Notes and the 9% Notes. The Board of
Directors of the Corporation may designate any Unrestricted Subsidiary to be a
Restricted Subsidiary, provided that, immediately after giving effect to such
designation, the Corporation could incur at least $1.00 of additional Debt
pursuant to certain covenants under the 12 1/2% Notes, the 9 % Notes and the 9%
Notes, as applicable.
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"Vice President", when used with respect to the Corporation means
any vice president, whether or not designated by a number or a word or words
added before or after the title "Vice President".
"Voting Rights Triggering Event" shall have the meaning ascribed
to it in paragraph (f)(iv) hereof.
"Voting Stock" of any Person means Capital Stock of such Person
which ordinarily has voting power for the election of directors (or persons
performing similar functions) of such Person, whether at all times or only so
long as no senior class of securities has such voting power by reason of any
contingency.
"Wholly-Owned Restricted Subsidiary" of any Person means a
Restricted Subsidiary of such Person 99% or more of the outstanding Capital
Stock or other ownership interests of which (other than directors' qualifying
shares) shall at the time be owned by such Person or by one or more Wholly-Owned
Restricted Subsidiaries of such Person or by such Person and one or more
Wholly-Owned Restricted Subsidiaries of such Person.
(k) Conversion Rights.
(i) The Convertible Preferred Stock will be convertible
at the option of the Holder, into shares of Class A Common Stock
at any time, unless previously redeemed or repurchased, at a
conversion rate of 1.145 shares of Class A Common Stock per share
of the Convertible Preferred Stock (as adjusted pursuant to the
provisions hereof, the "Conversion Rate") (subject to the
adjustments described below). The right to convert a share of the
Convertible Preferred Stock called for redemption will terminate
at the close of business on the Redemption Date for such share of
Convertible Preferred Stock. In addition, at any time from and
after April 15, 2001, through and including April 15, 2006, the
Corporation may elect to cause such conversion right to expire,
upon not less than 30 nor more than 60 days' notice to the holders
of shares of Convertible Preferred Stock, if the Closing Price of
the Class A Common Stock exceeds 120% of the Implied Conversion
Price for 20 Trading Days in any period of 30 consecutive Trading
Days, including the last Trading Day of such period; provided that
such conversion right shall expire only if the Corporation is
current in the payment of accrued dividends on the Convertible
Preferred Stock at such expiration date.
(ii) The right of conversion attaching to any shares of
Convertible Preferred Stock may be exercised by the Holder thereof
by delivering the shares to be converted to the office of the
Conversion Agent, accompanied by a duly signed and completed
notice of conversion in form reasonably satisfactory to the
Conversion Agent. The conversion date will be the date on which
the shares of Convertible Preferred Stock and the duly signed and
completed notice of conversion are so delivered. The Person or
Persons entitled to receive the Class A Common Stock
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issuable upon such conversion shall be treated for all purposes as
the record holder or holders of such Class A Common Stock as of
such conversion date and such Person or Persons will cease to be a
record Holder or record Holders of the Convertible Preferred Stock
on that date. As promptly as practicable on or after the
conversion date, the Corporation will issue and deliver to the
Conversion Agent a certificate or certificates for the number of
full shares of Class A Common Stock issuable upon conversion, with
any fractional shares rounded up to full shares or, at the
Corporation's option, payment in cash in lieu of any fraction of a
share, based on the Closing Price of the Class A Common Stock on
the Trading Day preceding the conversion date. Such certificate or
certificates will be delivered by the Conversion Agent to the
appropriate Holder on a book-entry basis or by mailing
certificates evidencing the additional shares to the Holders at
their respective addresses set forth in the register of Holders
maintained by the Transfer Agent. Any shares of Convertible
Preferred Stock surrendered for conversion during the period from
the close of business on any Record Date to the opening of
business on the next succeeding Dividend Payment Date must be
accompanied by payment of an amount equal to the dividends payable
on such Dividend Payment Date on the shares of Convertible
Preferred Stock being surrendered for conversion. In the case of
any shares of Convertible Preferred Stock that have been converted
after any Record Date but before the next Dividend Payment Date,
dividends that are payable on such Dividend Payment Date will be
payable on such Dividend Payment Date notwithstanding such
conversion, and such dividends will be paid to the Holder of such
shares of Convertible Preferred Stock on such Record Date. No
other payment or adjustment for dividends, or for any dividends in
respect of shares of Class A Common Stock, will be made upon
conversion. Holders of Class A Common Stock issued upon conversion
will not be entitled to receive any dividends payable to holders
of Class A Common Stock as of any record time before the close of
business on the conversion date.
(iii) All shares of Class A Common Stock delivered upon
any conversion of Convertible Preferred Stock prior to the
Restricted Period Termination Date shall bear a legend
substantially in the form of the legend required to be set forth
on the Convertible Preferred Stock and shall be subject to the
restrictions on transfer provided in such legend.
(iv) The Corporation shall at all times reserve and keep
available out of its authorized and unissued Class A Common Stock,
solely for issuance upon the conversion of the Convertible
Preferred Stock, such number of shares of Class A Common Stock as
shall from time to time be issuable upon the conversion of all the
shares of Convertible Preferred Stock then outstanding. Whenever
the Corporation issues shares of Class A Common Stock upon
conversion of shares of Convertible Preferred Stock and the
Corporation has in effect at such time a share purchase rights
agreement under which holders of Class A
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Common Stock are issued rights ("Rights") entitling the holders
under certain circumstances to purchase an additional share or
shares of stock, the Corporation will issue, together with each
such share of Class A Common Stock, such number of Rights (which
number may be a fraction) as shall at that time be issuable with a
share of Class A Common Stock pursuant to such share purchase
rights agreement. Any shares of Class A Common Stock issued upon
conversion of the Convertible Preferred Stock shall be duly
authorized, validly issued and fully paid and nonassessable and
shall rank pari passu with the other shares of Class A Common
Stock outstanding from time to time. The Conversion Agent shall
deliver the shares of Class A Common Stock received upon
conversion of the Convertible Preferred Stock to the converting
Holder free and clear of all liens, charges, security interests
and encumbrances, except for United States withholding taxes. The
Corporation shall use its best efforts to obtain and keep in force
such governmental or regulatory permits or other authorizations as
may be required by law, and shall comply with all applicable
requirements as to registration or qualification of the Class A
Common Stock (and all requirements to list the Class A Common
Stock issuable upon conversion of the Convertible Preferred Stock
that are at the time applicable), in order to enable the
Corporation to lawfully issue Class A Common Stock upon conversion
of the Convertible Preferred Stock and to lawfully deliver the
Class A Common stock to each Holder upon conversion of the
Convertible Preferred Stock.
(v) The Corporation will pay any and all taxes that may
be payable in respect of the issue or delivery of shares of Class
A Common Stock on conversion of Convertible Preferred Stock. The
Corporation shall not, however, be required to pay any tax which
may be payable in respect of any transfer involved in the issue
and delivery of shares of Class A Common Stock in a name other
than that in which the Convertible Preferred Stock so converted
were registered, and no such issue or delivery shall be made
unless and until the Person requesting such issue has paid to the
Conversion Agent the amount of any such tax, or has established to
the satisfaction of the Conversion Agent that such tax has been
paid.
(vi) The Conversion Rate shall be subject to adjustment
(without duplication) from time to time as follows:
(1) In case the Corporation shall pay or make a
dividend or other distribution on any class of Capital
Stock of the Corporation payable in shares of Common stock,
the Conversion Rate in effect at the opening of business on
the day following the date fixed for the determination of
shareholders entitled to receive such dividend or other
distribution shall be increased by dividing such Conversion
Rate by a fraction of which the numerator shall be the
number of shares of Common Stock outstanding at the close
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of business on the date fixed for such determination and
the denominator shall be the sum of such number of shares
and the total number of shares constituting such dividend
or other distribution, such increase to become effective
immediately after the opening of business on the day
following the date fixed for such determination. If, after
any such date fixed for determination, any dividend or
distribution is not in fact paid, the Conversion Rate shall
be immediately readjusted, effective as of the date the
Board of Directors determines not to pay such dividend or
distribution, to the Conversion Rate that would have been
in effect if such determination date had not been fixed.
For the purposes of this paragraph (1), the number of
shares of Common Stock at any time outstanding shall not
include shares held in the treasury of the Corporation but
shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of
Common Stock. The Corporation will not pay any dividend or
make any distribution on shares of Common Stock held in the
treasury of the Corporation.
(2) In case outstanding shares of Common Stock
shall be subdivided into a greater number of shares of
Common Stock, the Conversion Rate in effect at the opening
of business on the day following the day upon which such
subdivision becomes effective shall be proportionately
increased, and, conversely, in case outstanding shares of
Common Stock shall be combined into a smaller number of
shares of Common Stock, the Conversion Rate in effect at
the opening of business on the day following the day upon
which such combination becomes effective shall be
proportionately reduced, such increase or reduction, as the
case may be, to become effective immediately after the
opening of business on the day following the day upon which
such subdivision or combination becomes effective.
(3) In case the Company shall issue rights,
options or warrants to holders of its Common Stock (by
reason of such holder's ownership of such stock) entitling
them to subscribe for or purchase shares of Common Stock at
a price per share less than the Current Market Price per
share of the Class A Common Stock on the date fixed for the
determination of stockholders entitled to receive such
rights, options or warrants (other than any rights, options
or warrants that by their terms will also be issued to any
Holder upon conversion of a share of Convertible Preferred
Stock into shares of Class A Common Stock without any
action required by the Corporation or any other Person),
the Conversion Rate in effect at the opening of business on
the day following the date fixed for such determination
shall be increased by dividing such Conversion Rate by a
fraction of which the numerator shall be the
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number of shares of Common Stock outstanding at the close
of business on the date fixed for such determination plus
the number of shares of Common Stock which the aggregate of
the offering price of the total number of shares of Common
Stock so offered for subscription or purchase would
purchase at such Current Market Price and the denominator
shall be the number of shares of Common Stock outstanding
at the close of business on the date fixed for such
determination plus the number of shares of Common Stock so
offered for such subscription or purchase, such increase to
become effective immediately after the opening of business
on the day following the date fixed for such determination.
If, after any such date fixed for determination, any such
rights, options or warrants are not in fact issued, the
Conversion Rate shall be immediately readjusted, effective
as of the date the Board of Directors determines not to
issue such rights, options or warrants, to the Conversion
Rate that would have been in effect if such determination
date had not been fixed. For the purposes of this paragraph
(3), the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury
of the Corporation but shall include shares issuable in
respect of scrip certificates issued in lieu of fractions
of shares of Common Stock. The Corporation will not issue
any rights, options or warrants in respect of shares of
Common Stock held in the treasury of the Corporation.
(4) In case the Corporation shall, by dividend or
otherwise, distribute to holders of its Common Stock
evidences of its indebtedness, shares of any class of
Capital Stock, or other property (including securities, but
excluding (i) any rights, options or warrants referred to
in paragraph (3) of this Section, (ii) any dividend or
distribution paid exclusively in cash, (iii) any dividend
or distribution referred to in paragraph (1) of this
paragraph (k)(vi) and (iv) any merger or consolidation to
which paragraph (k)(ix) applies), the Conversion Rate shall
be adjusted so the same shall equal the rate determined by
dividing the Conversion Rate in effect immediately prior to
the close of business on the date fixed for the
determination of stockholders entitled to receive such
distribution by a fraction of which the numerator shall be
the Current Market Price per share of the Common Stock on
the date fixed for such determination less the then fair
market value (as determined by the Board of Directors,
whose determination shall be conclusive) of the portion of
the assets, shares or evidences of indebtedness so
distributed applicable to one share of Common Stock
entitled to such distribution and the denominator shall be
such Current Market Price per share of the Class A Common
Stock, such adjustment to become effective immediately
prior to the opening of business on the day following the
date fixed for the
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determination of stockholders entitled to receive such
distribution. If, after any such date fixed for
determination, any such distribution is not in fact made,
the Conversion Rate shall be immediately readjusted,
effective as of the date of the Board of Directors
determines not to make such distribution, to the Conversion
Rate that would have been in effect if such determination
date had not been fixed.
(5) In case the Corporation shall, by dividend or
otherwise, distribute to holders of its Common Stock cash
(excluding any cash that is distributed upon a merger or
consolidation to which paragraph (k)(ix) applies or as part
of a distribution referred to in paragraph (4) of this
paragraph (k)(vi)) in an aggregate amount that, combined
together with (I) the aggregate amount of any other cash
distributions to all holders of its Common Stock made
exclusively in cash within the 12 months preceding the date
of payment of such distribution and in respect of which no
adjustment pursuant to this paragraph (5) has been made and
(II) the aggregate of any cash plus the fair market value
(as determined by the Board of Directors, whose
determination shall be conclusive) of consideration payable
in respect of any tender offer or other stock repurchase
program by the Corporation or any of its Subsidiaries for
all or any portion of the Common Stock concluded within the
12 months preceding the date of payment of such
distribution and in respect of which no adjustment pursuant
to paragraph (6) of this paragraph (k)(vi) has been made
(the "combined cash and tender amount"), exceeds 12.5% of
the product of the Current Market Price per share of the
Class A Common Stock on the date for the determination of
holders of shares of Common Stock entitled to receive such
distribution times the number of shares of Common Stock
outstanding on such date (the "Aggregate Current Market
Price"), then, and in each such case, immediately after the
close of business on such date for determination, the
Conversion Rate shall be adjusted so that the same shall
equal the rate determined by dividing the Conversion Rate
in effect immediately prior to the close of business on the
date fixed for determination of the stockholders entitled
to receive such distribution by a fraction (i) the
numerator of which shall be equal to the Current Market
Price per share of the Class A Common Stock on the date
fixed for such determination less an amount equal to the
quotient of (x) the excess of such combined cash and tender
amount over such Aggregate Current Market Price divided by
(y) the number of shares of Common Stock outstanding on
such date for determination and (ii) the denominator of
which shall be equal to the Current Market Price per share
of the Class A Common Stock on such date for determination.
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(6) In case a tender offer made by the
Corporation or any Subsidiary for all or any portion of the
Common Stock shall expire and such tender offer (as amended
upon the expiration thereof) shall require the payment to
stockholders (based on the acceptance (up to any maximum
specified in the terms of the tender offer) of Common Stock
(as defined below) of an aggregate consideration having a
fair market value (as determined by the Board of Directors,
whose determination shall be conclusive) that combined
together with (I) the aggregate of the cash plus the fair
market value (as determined by the Board of Directors,
whose determination shall be conclusive) as of the
expiration of such tender offer, of consideration payable
in respect of any other tender offer or other stock
repurchase program by the Corporation or any Subsidiary for
all or any portion of the Common Stock expiring within the
12 months preceding the expiration of such tender offer and
in respect of which no adjustment pursuant to this
paragraph (6) has been made and (II) the aggregate amount
of any cash distributions to all holders of the
Corporation's Common Stock within 12 months preceding the
expiration of such tender offer and in respect of which no
adjustment pursuant to paragraph (5) of this paragraph
(k)(vi) has been made (the "combined tender and cash
amount") exceeds 12.5 % of the product of the Current
Market Price per share of the Class A Common Stock as of
the last time (the "Expiration Time") tenders could have
been made pursuant to such tender offer (as it may be
amended) times the number of shares of Common Stock
outstanding (including any tendered shares) as of the
Expiration Time, then, and in each such case, immediately
prior to the opening of business on the day after the date
of the Expiration Time, the Conversion Rate shall be
adjusted so that the same shall equal the rate determined
by dividing the Conversion Rate immediately prior to close
of business on the date of the Expiration Time by a
fraction (i) the numerator of which shall be equal to (A)
the product of (I) the Current Market Price per share of
Common Stock on the date of the Expiration Time multiplied
by (II) the number of shares of Common Stock outstanding
(including any tendered shares) on the Expiration Time less
(B) the combined tender and cash amount, and (ii) the
denominator of which shall be equal to the product of (A)
the Current Market Price per share of the Class A Common
Stock as of the Expiration Time multiplied by (B) the
number of shares of Common Stock outstanding (including any
tendered shares) as of the Expiration Time less the number
of all shares validly tendered and not withdrawn as of the
Expiration Time (the shares deemed so accepted up to any
such maximum, being referred to as the "Purchased Shares").
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(7) The reclassification of Common Stock into
securities including other than Common Stock (other than
any reclassification upon a consolidation or merger to
which paragraph (k)(ix) applies) shall be deemed to involve
(a) a distribution of such securities other than Common
Stock to all holders of Common Stock (and the effective
date of such reclassification shall be deemed to be "the
date fixed for the determination of stockholders entitled
to receive such distribution" and "the date fixed for such
determination" within the meaning of paragraph (4) of this
paragraph (k)(vi), and (b) a subdivision or combination, as
the case may be, of the number of shares of Common Stock
outstanding immediately prior to such reclassification into
the number of shares of Common Stock outstanding
immediately thereafter (and the effective date of such
reclassification shall be deemed to be "the day upon which
such subdivision becomes effective" or "the day upon which
such combination becomes effective", as the case may be,
and "the day upon which such subdivision or combination
becomes effective" within the meaning of paragraph (2) of
this paragraph (k)(vi).
(8) For the purpose of any computation under
paragraphs (2), (4), (5) or (6) of this paragraph (k)(vi),
the Current Market Price per share of Class A Common Stock
on any date shall be calculated by the Company and be based
on a period of Trading Days ending not later than the
earlier of the day in question and the day before the "`ex"
date with respect to the issuance or distribution requiring
such computation. For purposes of this paragraph, the term
"`ex" date", when used with respect to any issuance or
distribution, means the first date on which the Common
Stock trades regular way in the applicable securities
market or on the applicable securities exchange without the
right to receive such issuance or distribution.
(9) No adjustment in the Conversion Rate shall be
required unless such adjustment (plus any adjustments not
previously made by reason of this paragraph (9)) would
require an increase or decrease of at least one percent
(1%) in such rate; provided, however, that any adjustments
which by reason of this paragraph (9) are not required to
be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this
paragraph (f) shall be made to the nearest cent or to the
nearest one-hundredth of a share, as the case may be. (10)
The Corporation may make voluntary increases in the
Conversion Rate, for the remaining term of the Convertible
Preferred Stock or any shorter term, in addition to those
required by paragraphs (1), (2), (3), (4), (5) and (6) of
this paragraph (f)(vi),
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provided that each such increase is in effect for at least
20 calendar days.
(vii) Whenever the Conversion Rate is adjusted as herein
provided:
(1) the Corporation shall compute the adjusted
Conversion Rate in accordance with paragraph (f)(vi) and
shall prepare a certificate signed by the Chief Financial
Officer of the Corporation setting forth the adjusted
Conversion Rate and showing in reasonable detail the facts
upon which such adjustment is based, and such certificate
shall promptly be filed with the Conversion Agent; and
(2) upon each such adjustment, a notice stating
that the Conversion Rate has been adjusted and setting
forth the adjusted Conversion Rate shall be required, and
as soon as practicable after it is required, such notice
shall be provided by the Company to all Holders.
The Conversion Agent shall not be under any duty or responsibility
with respect to any such certificate or the information and calculations
contained therein, except to exhibit the same to any Holder of Convertible
Preferred Stock desiring inspection thereof at its office during normal business
hours.
(viii) In case:
(a) the Corporation shall declare a dividend (or any
other distribution) on its Class A Common Stock payable (i) otherwise
than exclusively in cash or (ii) exclusively in cash in an amount that
would require any adjustment pursuant to paragraph (f)(vi); or
(b) the Corporation shall authorize the granting to
holders of its Class A Common Stock (by reason of such holders' ownership
of such stock) of rights, options or warrants to subscribe for or
purchase any shares of capital stock of any class or of any other rights;
or
(c) of any reclassification of the Class A Common Stock
of the Corporation, or of any consolidation, merger or share exchange to
which the Corporation is a party and for which approval of any
stockholders of the Corporation is required, or of the conveyance, sale,
transfer or lease of all or substantially all of the assets of the
Corporation; or
(d) of the voluntary or involuntary dissolution,
liquidation or winding up of the Corporation;
then the Corporation shall cause to be filed at the office of the
Conversion Agent, and shall cause to be provided to all Holders,
at least 20 days (or 10 days in any
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case specified in clause (a) or (b) above) prior to the applicable
record or effective date hereinafter specified, a notice stating
(x) the date on which a record is to be taken for the purpose of
such dividend, distribution, rights, options or warrants, or, if a
record is not to be taken, the date as of which the holders of
Class A Common Stock of record to be entitled to such dividend,
distribution, rights, options or warrants are to be determined or
(y) the date on which such reclassification, consolidation,
merger, conveyance, transfer, sale, lease, dissolution,
liquidation or winding up is expected to become effective, and the
date as of which it is expected that holders of Common Stock of
record shall be entitled to exchange their shares of Common Stock
for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, conveyance, transfer,
sale, lease, dissolution, liquidation or winding up. Neither the
failure to give such notice referred to in the following paragraph
nor any defect therein shall affect the legality or validity of
the proceedings described in clauses (a) through (d) of this
paragraph (f)(viii). The Company shall cause to be filed at the
office of the Conversion Agent and shall cause to be provided to
all Holders, notice of any tender offer by the Corporation or any
Subsidiary for all or any portion of the Class A Common Stock at
or about the time that such notice of tender offer is provided to
the public generally.
(ix) In the event that the Corporation is a party to any
transaction including, without limitation, a merger (other than a
merger that does not result in a reclassification, conversion,
exchange or cancellation of Class A Common Stock), consolidation,
sale of all or substantially all of the assets of the Corporation,
recapitalization or reclassification of Class A Common Stock
(other than a change in par value, or from par value to no par
value, or from no par value to par value or as a result of a
subdivision or combination of Class A Common Stock) or any
compulsory share exchange (each of the foregoing being referred to
as a "Transaction"), in each case, as a result of which shares of
Class A Common Stock shall be converted into the right to receive,
or shall be exchanged for, (i) in the case of any Transaction
other than a Transaction involving a Common Stock Change in
Control (and subject to funds being legally available for such
purpose under applicable law at the time of such conversion),
securities, cash or other property, each share of Convertible
Preferred Stock shall thereafter be convertible solely into the
kind and amount of securities, cash and other property receivable
upon the consummation of such Transaction by a holder of that
number of shares of Class A Common Stock into which a share of
Convertible Preferred Stock was convertible immediately prior to
such Transaction (but after giving effect to any adjustment
discussed in paragraphs (b) and (c) relating to Change in Control
if such Transaction constitutes a Change in Control), or (ii) in
the case of a Transaction involving a Common Stock Change in
Control, common stock, each share of Convertible Preferred Stock
shall thereafter be convertible solely (in the manner described
herein) into common stock of the kind received by holders of Class
A Common Stock (but after giving effect to any adjustment
discussed in paragraphs (b) and
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(c) relating to Change in Control if such Transaction constitutes
a Change in Control). The Holders of Convertible Preferred Stock
will have no voting rights with respect to any Transaction
described in this section. Shares of Convertible Preferred Stock
issued in a Transaction by the successor transferee or resulting
Person or an Acquiring Entity as provided in paragraph (f)(iii)
will be subject to this paragraph k(ix)(a) and will be convertible
solely into the consideration provided for herein.
(a) If any Change in Control occurs, then the Conversion
Rate in effect will be adjusted immediately after such Change in Control
as described in paragraph (c) below.
(b) For purposes of calculating any adjustment to be
made in the event of a Change in Control, immediately after such Change
in Control:
(i) in the case of a Non-Stock Change in
Control, the Conversion Rate will thereupon become the higher of
(A) the Conversion Rate in effect immediately prior to such
Non-Stock Change in Control, but after giving effect to any other
prior adjustments, and (B) a fraction, the numerator of which is
the then-current deemed redemption price per share, which shall be
equal to the product of the liquidation preference per share of
$50.00 and 105.20% in year one, 104.55% in year 2, 103.9% in year
3, 103.25% in year 4, 102.6% in year 5, 101.95% in year 6, 101.3%
in year 7, 100.65% in year 8 and 100.00 in year 9 and thereafter,
respectively and the denominator of which is the greater of the
Applicable Price or the then applicable Reference Market Price;
and
(ii) in the case of a Common Stock Change
in Control, the Conversion Rate in effect immediately prior to
such Common Stock Change in Control, but after giving effect to
any other prior adjustments, will thereupon be adjusted by
multiplying such Conversion Rate by a fraction, of which the
numerator will be the Applicable Price and the denominator will be
the Purchaser Stock Price (as defined); provided, however, that in
the event of a Common Stock Change in Control in which
(B) 100% of the value of the consideration
received by a holder of Class A Common Stock is common
stock of the successor, acquiror or other third party (and
cash, if any, with respect to any fractional interests) and
(B) all the Class A Common Stock (other than shares of
Class A Common Stock for which cash was paid pursuant to
rights of dissent and appraisal) will have been exchanged
for, converted into, or acquired for, common stock (and
cash with respect to fractional interests) of the
successor, acquiror or other third party, the Conversion
Rate in effect immediately prior to such Common Stock
Change in Control will thereupon be adjusted by multiplying
such Conversion Rate by the number of shares of common
stock of the successor, acquiror, or other third
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party received by a holder of one share of Class A Common
Stock as a result of such Common Stock Change in Control.
(1) Restrictions on Transfer.
(i) Each share of Convertible Preferred
Stock shall contain a legend substantially to the following effect
until the date that is two years after the later of the Issue Date
or the last date on which the Corporation or any Affiliate of the
Corporation was the owner thereof, unless the Corporation
determines otherwise:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933 (THE "SECURITIES ACT") AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT (1) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2)
IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), OR (4)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND IN
EACH CASE, IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF
THE UNITED STATES.
(l) Book Entry Delivery and Form.
The Convertible Preferred Stock sold will be issued in the form of
a Global Share Certificate. The Global Share Certificate will be deposited with,
or on behalf of, the Depositary and registered in the name of the Depositary or
its nominee. Except as set forth below, the Global Share Certificate may be
transferred, in whole and not in part, only to the Depositary or other nominee
of the Depositary. Holders may hold their beneficial interests in the Global
Share Certificate directly through the Depositary if they have an account with
the Depositary or indirectly through organizations which have accounts with the
Depositary. The Convertible Preferred Stock represented by the Global Share
Certificate is exchangeable for certificated Convertible Preferred Stock in
definitive form of like tenor as such Convertible Preferred Stock if (i) the
Depositary notifies the Company that it is unwilling or unable to continue as
Depositary for the Global Share Certificate and a successor is not promptly
appointed or if at any time the Depositary ceases to be a clearing agency
registered under the Exchange Act or (ii) the Company in its discretion at any
time determines not to have all of the Convertible Preferred Stock represented
by the Global Share Certificate. Any Convertible Preferred Stock that is
exchangeable pursuant to the preceding sentence is exchangeable for certificated
Convertible Preferred Stock 33 issuable in authorized denominations and
registered in such names as the Depositary shall direct. Subject to the
foregoing, the Global Share Certificate is not exchangeable, except for a Global
Share Certificate of the same aggregate denomination to be registered in the
name of the Depositary or its nominee.
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(m) Amendments Without Consent of Holders.
Without the Consent of any Holders, the Company, when authorized
by Board Resolution may amend this Certificate of Designation to cure any
ambiguity, correct or supplement any provision herein which may be inconsistent
with any other provision herein, make any other provisions with respect to
matters or questions arising under this Certificate of Designation that are not
inconsistent with the provisions of this Certificate of Designation, provided
that such action pursuant to this paragraph (n) shall not adversely affect the
legal rights of the Holders.
IN WITNESS WHEREOF, said NM ACQUISITION CORP. has caused this
Certificate to be signed by its Vice President, this 16th day of June, 2000.
NM ACQUISITION CORP.
By: /s/ Gary D. Begeman
------------------------------------------
Name: Gary D. Begeman
Title: Vice President
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