EXHIBIT 99.4
COMMON STOCK PURCHASE WARRANT
OF
CABLETEL COMMUNICATIONS CORP.
Cabletel Communications Corp., an Ontario, Canada corporation (the
"COMPANY"), hereby agrees that, for value received, CommScope, Inc. of North
Carolina, or assigns, is entitled, subject to the terms set forth herein, to
purchase from the Company at any time or from time to time from the date hereof
(the "INITIAL EXERCISE DATE") and before 5:00 p.m., Central Daylight Time, on
May 31, 2007 (the "EXPIRATION DATE"), 200,000 shares of Common Stock, subject to
adjustment in the number of such shares as set forth herein, at a price per
share of $1.640.
1. DEFINITIONS. The following terms when used in this Warrant will have
the following meanings:
"ACT" shall mean the United States Securities Act of 1933, as amended.
"COMMON STOCK" is the authorized common shares of the Company, no par
value.
"DOLLARS" and the sign "$" each mean the lawful currency of Canada.
"EXERCISE PRICE" shall mean $1.640 per share of Common Stock, subject
to adjustment as provided in this Warrant.
"HOLDER" is the registered holder of this Warrant.
"REGISTRATION STATEMENT" shall mean a registration statement filed
under the Act.
"SECURITIES" are all or any part of the Common Stock purchased by the
Holder or purchasable by the Holder upon the exercise of the Warrant.
"SEC" shall mean the United States Securities and Exchange Commission.
"WARRANT" shall mean the warrant evidenced by this document.
"WARRANT SHARES" shall mean the shares of Common Stock issuable upon
exercise of this Warrant.
2. EXERCISE OF WARRANT.
(a) The purchase rights exercisable under this Warrant shall be
exercised by the Holder surrendering this Warrant with the
form of subscription attached hereto duly executed by such
Holder, to the Company at its principal office, accompanied by
payment, in cash or by certified or cashier's check payable to
the
order of the Company, of the purchase price payable in respect
of the Common Stock being purchased, and accompanied by any
other document reasonably required by the Company to be
executed by Holder acknowledging the applicable restrictions
on the transfer of the Common Stock being purchased as set
forth in Section 10 hereof. Such duly executed subscription
shall constitute the Holder's acknowledgment of and
undertaking to comply to the satisfaction of the Company and
its counsel, acting reasonably, with all applicable laws and
all rules, regulations and policies of each stock exchange
upon which the Common Stock may from time to time be listed or
traded and of any other applicable regulatory authorities
(b) At the option of Holder, this Warrant may be exercised, at any
time or from time to time, in the following "cashless
exercise" transactions:
(i) The Holder shall have the right to convert, in whole
or in part, the Warrants (the "Conversion Right") at
any time prior to the Expiration Date, into shares of
Common Stock in accordance with the provisions of
this paragraph by the Holder tendering to the Company
written notice of exercise together with advice of
the delivery of an order to a broker to sell part or
all of the shares of Common Stock underlying the
Warrants, subject to such exercise notice and an
irrevocable order to, and an irrevocable commitment
by, such broker to deliver to the Company (or its
transfer agent) sufficient proceeds from the sale of
such shares to pay the aggregate Purchase Price of
such Warrants and any withholding taxes. All
documentation and procedures to be followed in
connection with such "cashless exercise" shall be
approved in advance by the Company, which approval
shall be expeditiously provided and not unreasonably
withheld; or
(ii) Upon written notice of exercise from the Holder to
the Company that the Holder is exercising this
Warrant in whole or in part and as consideration of
such exercise is authorizing the Company to withhold
from issuance a number of shares of Common Stock
issuable upon exercise of this Warrant, the Company
shall deliver to the Holder (without payment by the
Holder of the aggregate Purchase Price) that number
of shares of Common Stock equal to the quotient
obtained by dividing (x) the Spread Value by (y) the
Fair Market Value of one share of Common Stock
immediately prior to the exercise of the Conversion
Right. The shares withheld by the Company shall no
longer be issuable under this Warrant.
(iii) Fair Market Value of a share of Warrant Shares as of
a particular date (the "Determination Date") shall
mean:
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a. If the Warrant Shares are principally traded
on a U.S. exchange or are quoted on the
Nasdaq National Market or the Nasdaq
SmallCap Market ("Nasdaq"), then the average
of the closing or last sale price,
respectively, reported for the five trading
days during which there is any trading
activity in the Warrant Shares immediately
preceding the Determination Date.
b. If the Warrant Shares are principally traded
on the Toronto Stock Exchange, then the
average of the closing prices reported for
the five days during which there is any
trading activity in the Warrant Shares
immediately preceding the Determination
Date.
c. If the Warrant Shares are not traded on an
exchange or on Nasdaq but are traded in the
over-the-counter market or other similar
organization (including the OTC Bulletin
Board), then the average of the closing bid
and ask prices reported for the five trading
days during which there is any trading
activity in the Warrant Shares immediately
preceding the Determination Date.
d. If the Warrant Shares are not traded as
provided above, then the price determined in
good faith by the Board of Directors of the
Company, provided that (A) the basis or
bases of each such determination shall be
set forth in the corporate records of the
Company pertaining to meetings and other
actions of such board, and (B) such records
are available to the Holder for inspection
during normal business hours of the Company
upon the giving of reasonable prior notice.
e. If the Determination Date is the date of a
liquidation, dissolution or winding up, or
any event deemed to be a liquidation,
dissolution or winding up pursuant to the
Company's certificate of incorporation, then
all amounts to be payable per share to
Holders of the securities then comprising
Warrant Shares pursuant to the charter in
the event of such liquidation, dissolution
or winding up, plus all other amounts to be
payable per share in respect of the Warrant
Shares in liquidation under the certificate
of incorporation, assuming for the purposes
of this clause (d) that all of the shares of
Warrant Shares then issuable upon exercise
of all of the Warrants are outstanding at
the Determination Date.
(iv) The term "Spread Value" shall mean (i) the number of
shares exercised at a given time multiplied by the
Fair Market Value of one share of Common Stock, less
(ii) aggregate applicable
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Exercise Price.
(c) In case of the purchase of less than all of the Common Stock
purchasable under this Warrant, the Warrant shall remain
exercisable in respect of the balance of the Common Stock on
the terms and conditions set forth herein. Alternatively, if
less than all of the Common Stock purchasable under this
Warrant is purchased, the Company may, upon such exercise,
execute and deliver to the Holder a new Warrant (dated the
date thereof but otherwise containing terms identical to this
Warrant) evidencing the number of shares of the Common Stock
not so purchased.
(d) As soon as practical after the exercise of this Warrant and
payment of the purchase price, the Company will cause to be
issued in the name of and delivered to the Holder, or as such
Holder may direct, a certificate or certificates representing
the shares purchased, provided that if any law or regulation
requires the Company to take any action with respect to the
Common Stock to be purchased before the issuance thereof, then
the date of delivery of such shares of Common Stock shall be
extended for the period necessary to take such action. The
Company may require that such certificate or certificates
contain on the face thereof a legend substantially as follows:
"No sale, offer to sell or transfer of the shares represented
by this certificate shall be made unless a Registration
Statement under the Federal Securities Act of 1933, as
amended, with respect to such shares is then in effect or an
exemption from the registration requirements of such Act and
any applicable state law is then in fact applicable to such
shares."
3. RESERVATION OF COMMON STOCK. A number of shares of Common Stock
sufficient to provide for the exercise of the Warrant upon the basis
herein set forth shall at all times be reserved by the Company for the
exercise thereof.
4. FRACTIONAL SHARES. No fractional shares of Common Stock are to be
issued upon the exercise of the Warrant, but the Company shall pay a
cash adjustment in respect of any fraction of a share which would
otherwise be issuable in an amount equal to the same fraction of the
market price per share of Common Stock on the day of exercise as
determined in good faith by the Company.
5. EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. The rights and
obligations of Holder hereunder are assignable with respect to all or
any portion of the shares of Common Stock purchasable hereunder to any
person. Notwithstanding the foregoing, no right or obligation under
this Warrant is assignable unless the Company has received an opinion
of counsel reasonably satisfactory in form and substance to counsel for
the Company that such transaction will not violate the registration
requirements of the Act or any applicable state or provincial law
governing the sale of securities. Upon surrender of this Warrant to the
Company or at the office of its stock transfer agent, if any, with the
Assignment Form annexed hereto duly executed and funds sufficient to
pay any transfer
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tax, the Company will prepare and deliver to the assignor and assignee,
a new warrant covering the warrants to purchase shares of Common Stock
assigned and retained, under the same terms and conditions as this
Warrant, with the name of Holder substituted for the assignee with
respect to assigned warrants to purchase shares of Common Stock. This
Warrant may be divided or combined with other Warrants which carry the
same rights upon presentation hereof at the office of the Company or at
the office of its stock transfer agent, if any, together with a written
notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as
used herein includes any Warrants into which this Warrant may be
divided or exchanged. Upon receipt by the Company of evidence
reasonably satisfactory to it of the loss, theft, destruction or
mutilation of this Warrant, and (in the case of loss, theft or
destruction) of an indemnification agreement reasonably satisfactory to
the Company, and upon surrender and cancellation of this Warrant, if
mutilated, the Company will execute and deliver a new Warrant of like
tenor.
6. RIGHTS OF THE HOLDER. The Holder shall not, by virtue of this Warrant,
be entitled to any rights of a stockholder in the Company, either at
law or equity, and the rights of the Holder are limited to those
expressed in the Warrant and are not enforceable against the Company
except to the extent set forth herein.
7. ANTI-DILUTION PROVISIONS. The Exercise Price in effect at any time and
the number and kind of securities purchasable upon exercise of each
Warrant shall be subject to adjustment as follows:
(a) In case the Company shall (1) pay a dividend or make a
distribution on its shares of Common Stock in shares of Common
Stock (2) subdivide or reclassify its outstanding Common Stock
into a greater number of shares, or (3) combine or reclassify
its outstanding Common Stock into a smaller number of shares
or otherwise effect a reverse split, the Exercise Price in
effect at the time of the record date for such dividend or
distribution or of the effective date of such subdivision,
combination or reclassification shall be proportionately
adjusted so that the Holder of this Warrant exercised after
such date shall be entitled to receive the aggregate number
and kind of shares which, if this Warrant had been exercised
immediately prior to such time, he would have owned upon such
exercise and been entitled to receive upon such dividend,
subdivision, combination or reclassification. Such adjustment
shall be made successively whenever any event listed in this
Section 7(a) shall occur.
(b) In case the Company shall distribute to all holders of Common
Stock evidences of its indebtedness or assets (excluding cash
dividends or distributions paid out of current earnings and
dividends or distributions referred to in Section 7(a) of this
Warrant) or subscription rights or warrants, then in each such
case the Exercise Price in effect thereafter shall be
determined by multiplying the Exercise Price in effect
immediately prior thereto by a fraction, of which the
numerator shall be the total number of shares of Common Stock
outstanding as of the date of such distribution multiplied by
the Fair Market Value per share of Common Stock on
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such date, less the fair market value (as determined by the
Company's Board of Directors in good faith) of said assets or
evidences of indebtedness so distributed or of such rights or
warrants, and of which the denominator shall be the total
number of shares of Common Stock outstanding multiplied by the
Fair Market Value per share of Common Stock. Such adjustment
shall be made successively whenever such a record date is
fixed. Such adjustment shall be made whenever any such
distribution is made and shall become effective immediately
after the record date for the determination of stockholders
entitled to receive such distribution.
(c) Whenever the Exercise Price payable upon exercise of each
Warrant is adjusted pursuant to Section 7(a) of this Warrant,
the number of shares of Common Stock purchasable upon exercise
of each Warrant shall simultaneously be adjusted by
multiplying the number of shares of Common Stock issuable upon
exercise of each Warrant in effect on the date thereof by the
Exercise Price in effect on the date thereof and dividing the
product so obtained by the Exercise Price, as adjusted.
(d) The Company may retain a firm of independent public
accountants of recognized standing selected by the Board of
Directors (who may be the regular accountants employed by the
Company) to make any computation required by this Section 7,
and a certificate signed by such firm shall be conclusive
evidence of the correctness of such adjustment.
(e) Irrespective of any adjustments in the Exercise Price or the
number or kind of shares purchasable upon exercise of
Warrants, Warrants theretofore or thereafter issued may
continue to express the same price and number and kind of
shares as are stated in this and similar Warrants initially
issued by the Company.
8. REORGANIZATION, RECLASSIFICATION OR MERGER. In case of any capital
reorganization or any reclassification of the shares of Common Stock of
the Company, or in the case of any consolidation with or merger or
amalgamation of the Company into or with another corporation, or the
sale of all or substantially all of its assets to another corporation
effected in such a manner that the holders of Common Stock shall be
entitled to receive stock, securities or assets with respect to or in
exchange for Common Stock, then, as a part of such reorganization,
reclassification, consolidation, merger, amalgamation or sale, as the
case may be, lawful provision shall be made so that the Holder shall
have the right thereafter to receive, upon the exercise hereof, the
kind and amount of shares of stock or other securities or property
which the Holder would have been entitled to receive if, immediately
prior to such reorganization, reclassification, consolidation or
merger, the Holder had held the number of shares of Common Stock which
were then purchasable upon the exercise of the Warrant had the Warrant
been exercised. In any such case, appropriate adjustment (as determined
in good faith by the Board of Directors of the Company) shall be made
in the application of the provisions set forth herein with respect to
the rights and interest thereafter of the Holder, to the end that the
provisions set forth herein (including provisions with respect to
adjustments of the exercise price) shall
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thereafter be applicable, as nearly as reasonably may be, in relation
to any shares of stock or other property thereafter deliverable upon
the exercise of the Warrant.
9. CERTAIN EVENTS; ADJUSTMENTS. If any change in the outstanding Common
Stock of the Company or any other event occurs as to which the
provisions of Section 7 or Section 8 are not strictly applicable or if
strictly applicable would not fairly protect the purchase rights of the
Holder in accordance with such provisions, then the Board of Directors
of the Company shall make an adjustment in the number and class of
shares available under the Warrant, the Exercise Price or the
application of such provisions, so as to protect such purchase rights
as aforesaid. The adjustment shall be such as will give the Holder upon
exercise for the same aggregate Exercise Price the total number, class
and kind of shares as he would have owned had the Warrant been
exercised prior to the event and had he continued to hold such shares
until after the event requiring adjustment. All calculations under this
Warrant shall be made to the nearest one-tenth of a cent.
10. RESTRICTION ON DISPOSITION. Neither the issuance of the Warrant nor the
issuance of the shares of Common Stock issuable upon exercise of the
Warrant has been registered under the Act or any applicable state law
and no prospectus has been filed in respect thereof under any Canadian
provincial securities law. The Warrant is issued to the Holder on the
condition that the Warrant and any Common Stock purchased upon exercise
of the Warrant (excepting Common Stock for which a Notification under
Regulation A or a Registration Statement has been filed and declared
effective and for which such exercise may be effected pursuant to
registration or an exemption from registration under any applicable
state law) are or will be purchased for investment purposes and not
with an intent to distribute the same. All shares of Common Stock
acquired by Holder upon exercise of this Warrant shall be subject to
the restrictions on sale, encumbrance and other disposition contained
in the Company's By-laws, or imposed by applicable state, provincial
and federal laws or regulations regarding the registration or
qualification of such acquisition of shares of Common Stock, and may
not be sold or otherwise disposed of unless the Company has received an
opinion of counsel reasonably satisfactory in form and substance to
counsel for the Company that such transaction will not violate the
registration requirements of the Act or any applicable state or
provincial law regulating the sale of securities. Without limiting the
foregoing, by acceptance of this Warrant, the Holder covenants and
agrees not to transfer or sell the Warrant or the Warrant Shares in
Canada for a period of three (3) months following the Initial Exercise
Date.
11. OFFICER'S CERTIFICATE. Whenever the Exercise Price shall be adjusted as
required by the provisions of Section 7, Section 8, or Section 9 of
this Warrant, the Company shall forthwith file in the custody of its
Secretary or an Assistant Secretary at its principal office and with
its transfer agent, if any, an officer's certificate showing the
adjusted Exercise Price and the adjusted number of shares of Common
Stock issuable upon exercise of each Warrant, determined as herein
provided, setting forth in reasonable detail the facts requiring such
adjustment, including a statement of the number of additional shares of
Common Stock, if any, and such other facts as shall be necessary to
show the reason for and the manner of computing such adjustment. Each
such officer's certificate
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shall be made available at all reasonable times for inspection by the
Holder or any holder of a Warrant.
12. NOTICES TO WARRANT HOLDERS. So long as this Warrant shall be
outstanding, (1) if the Company shall pay any dividend or make any
distribution upon Common Stock (other than a regular cash dividend
payable out of retained earnings) or (2) if the Company shall offer to
the holders of Common Stock for subscription or purchase by them any
share of any class or any other rights or (3) if any capital
reorganization of the Company, reclassification of the capital stock of
the Company, consolidation or merger of the Company with or into
another corporation, sale, lease or transfer of all or substantially
all of the property and assets of the Company to another corporation,
or voluntary or involuntary dissolution, liquidation or winding up of
the Company shall be effected, then in any such case, the Company shall
cause to be mailed by certified mail to the Holder, at least fifteen
days prior to the date specified in clauses (i) and (ii), as the case
may be, of this Section 12 a notice containing a brief description of
the proposed action and stating the date on which (i) a record is to be
taken for the purpose of such dividend, distribution or rights, or (ii)
such reclassification, reorganization, consolidation, merger,
conveyance, lease, dissolution, liquidation or winding up is to take
place and the date, if any is to be fixed, as of which the holders of
Common Stock or other securities shall receive cash or other property
deliverable upon such reclassification, reorganization, consolidation,
merger, conveyance, dissolution, liquidation or winding up. Mailed or
telecopied communications shall be directed as follows unless written
notice of a change of address or telecopier number has been given in
writing in accordance with this Section:
If to Holder: Holder's Address appearing on the books of
the Company
If to Company: Cabletel Communications Corp.
230 Travail Road, Markham, Ontario, Canada L3S 3J1
Telecopier No. (905) 475-9571
13. MISCELLANEOUS. Whenever reference is made herein to the issue or sale
of shares of Common Stock, the term "Common Stock" shall include any
stock of any class of the Company other than preferred stock with a
fixed limit on dividends and a fixed amount payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the
Company. The Company will not, by amendment of its Articles of
Incorporation or through reorganization, consolidation, merger,
dissolution or sale of assets, or by any other voluntary act or deed,
avoid or seek to avoid the observance or performance of any of the
covenants, stipulations or conditions to be observed or performed
hereunder by the Company, but will, at all times in good faith, assist,
insofar as it is able, in the carrying out of all provisions hereof and
in the taking of all other action which may be necessary in order to
protect the rights of the Holder against dilution.
The representations, warranties and agreements herein contained shall
survive the exercise of this Warrant. References to the "Holder"
includes the immediate Holder of shares of Common Stock purchased on
the exercise of this Warrant.
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All shares of Common Stock or other securities issued upon the exercise
of the Warrant shall be validly issued, fully paid and nonassessable.
14. BINDING EFFECT. This Warrant shall inure to the benefit of and be
binding upon the parties hereto and their respective heirs, executors,
administrators, successors and assigns. If possible, this Warrant shall
be construed along with and in addition to any other agreement which
the Company and Holder may enter into, but any provisions in this
Warrant which contradicts any provision of any other agreement shall
take precedence and be binding over such other provision.
15. GOVERNING LAW; WAIVER OF JURY TRIAL. This Warrant shall be governed by
and construed in accordance with the laws of Ontario, Canada without
regard to conflicts of laws principles or provisions. The Company and
the Holder waive all right to trial by jury in any action, suit or
proceeding brought to enforce or defend any rights or remedies arising
under or in connection with this Warrant, whether grounded in tort,
contract or otherwise.
16. DESCRIPTIVE HEADINGS. Descriptive headings of the sections of this
Warrant are inserted for convenience only and shall not control or
effect the meaning or construction of any of the provisions hereof.
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IN WITNESS WHEREOF, this Warrant has been duly executed by Cabletel
Communications Corp., as of the 15th day of May, 2002.
CABLETEL COMMUNICATIONS CORP.
By:
-------------------------------------------
Name:
Title:
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EXERCISE FORM
(TO BE SIGNED ONLY UPON EXERCISE OF WARRANT)
To Cabletel Communications Corp.:
The undersigned, the holder of the within warrant, hereby irrevocably
elects to exercise the purchase right represented by such warrant for, and to
purchase thereunder *_______________ shares of the common stock of Cabletel
Communications Corp., and herewith makes payment of $____________________
therefor, and requests that the certificates for such shares be issued in the
name of, and be delivered to, whose address is______________________ and social
security or tax identification number is _____________________.
Dated:
-------------------- ------------------------------------------------
(Signature must conform in all respects to the
name of holder as specified on the face of the
warrant)
------------------------------------------------
Address
------------------------------------------------
City State Zip Code
In the presence of:
- --------------------------------
* Insert here all or such portion of the number of shares called for on
the face of the within Warrant in 500 or more share increments with
respect to which the holder desires to exercise the purchase right
represented thereby, without adjustment for any other or additional
stock, other securities, property or cash which may be deliverable on
such exercise.
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ASSIGNMENT FORM
(TO BE SIGNED ONLY UPON TRANSFER OF THE WARRANT)
For value received, the undersigned hereby sells, assigns and transfers
unto ________________________________ whose address
is_________________________________________________ and social security or tax
identification number is___________________________________________ the right
represented by the within warrant to purchase________________________________ of
the shares of common stock of Cabletel Communications Corp. to which the within
warrant relates, and appoints__________________________________________ ,
attorney to transfer said right on the books of Cabletel Communications Corp.
with full power of substitution in the premises.
Dated:
-------------------- ------------------------------------------------
(Signature must conform in all respects to the
name of holder as specified on the face of the
warrant)
------------------------------------------------
Address
------------------------------------------------
City State Zip Code
In the presence of:
- --------------------------------
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