<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 29, 1997
REGISTRATION NO. 333-24177
================================================================================
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 4
TO
FORM SB-2
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
RUSSIAN WIRELESS TELEPHONE COMPANY, INC.
(NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)
<TABLE>
<S> <C> <C>
DELAWARE 4813 13-3769217
(STATE OR OTHER JURISDICATION OF (PRIMARY STANDARD INDUSTRIAL (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) CLASSIFICATION CODE NUMBER) IDENTIFICATION NUMBER)
</TABLE>
575 LEXINGTON AVENUE, SUITE 410,
NEW YORK, NEW YORK 10022
(212) 486-2900
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES AND PRINCIPAL PLACE OF BUSINESS AND
TELEPHONE NUMBER)
------------------------
RONALD G. NATHAN
PRESIDENT
RUSSIAN WIRELESS TELEPHONE COMPANY, INC.
575 LEXINGTON AVENUE, SUITE 410,
NEW YORK, NEW YORK 10022
(212) 486-2900
(NAME, ADDRESS AND TELEPHONE NUMBER OF AGENT FOR SERVICE)
------------------------
COPIES TO:
<TABLE>
<S> <C>
STEVEN D. DREYER, ESQ. LAWRENCE G. NUSBAUM III, ESQ.
HALL DICKLER KENT FRIEDMAN & WOOD, LLP GUSRAE, KAPLAN & BRUNO
909 THIRD AVENUE 120 WALL STREET
NEW YORK, NEW YORK 10022 NEW YORK, NEW YORK 10005
TELEPHONE NO. (212) 339-5400 TELEPHONE NO. (212) 269-1400
TELECOPIER NO. (212) 935-3121 TELECOPIER NO. (212) 809-5449
</TABLE>
APPROXIMATE DATE OF PROPOSED SALE TO THE PUBLIC: As soon as practicable
after the effective date of the registration statement.
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration number of the earlier effective
registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration number of the earlier effective registration statement for the same
offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
Continued on following page
================================================================================
<PAGE> 2
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
========================================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED PER SECURITY OFFERING PRICE FEE
- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.01 Par Value (the
"Common Stock") to be Sold by the
Registrant......................... 1,867,500(1) $ 7.00 $13,072,500 $ 3,961.36
- --------------------------------------------------------------------------------------------------------
Common Stock to be Sold by Certain
Selling Securityholders............ 1,185,000(2) 7.00 8,295,000 2,513.64
- --------------------------------------------------------------------------------------------------------
Warrants Expiring April 18, 1999 to
be sold by Certain Selling Security
Holders (the "Second Private
Placement Warrants")............... 462,500 n/a n/a 0.00(4)
- --------------------------------------------------------------------------------------------------------
Common Stock Issuable Upon Exercise
of the Second Private Placement
Warrants........................... 462,500(3) 7.70 3,561,250 1,079.17(4)
- --------------------------------------------------------------------------------------------------------
Warrants Expiring Five Years After
the Effective Date of this
Registration Statement to be sold
by Certain Selling Security Holders
(the "Third Private Placement
Warrants")......................... 2,000,015 n/a n/a 0.00(4)
- --------------------------------------------------------------------------------------------------------
Common Stock Issuable Upon Exercise
of Third Private Placement
Warrants........................... 2,000,015(3) 5.75 11,500,086 3,484.87(4)
- --------------------------------------------------------------------------------------------------------
Common Stock Issuable Upon Exercise
of an Option Held by a Selling
Securityholder..................... 25,000 2.00(5) 50,000 15.15
- --------------------------------------------------------------------------------------------------------
Representative's Warrant............. 1 10.00 10 n/a
- --------------------------------------------------------------------------------------------------------
Common Stock Issuable Upon Exercise
of Representative's Warrant........ 165,000(3) 11.55(6) 1,905,750 577.50
- --------------------------------------------------------------------------------------------------------
Totals..................... -- -- $38,384,596 $ 11,631.70*
========================================================================================================
</TABLE>
* $18,996.44 was previously paid. Accordingly no further fee payment is due
with respect to the filing of this amendment.
(1) Includes 247,500 shares of Common Stock which the Underwriters have the
option to purchase to cover over-allotments, if any.
(2) Includes 30,000 shares of Common Stock which the Underwriters have agreed to
purchase from a selling stockholder, and 1,155,000 shares of Common Stock to
be offered on a delayed basis in non-underwritten transactions by certain
selling securityholders.
(3) Pursuant to Rule 416, there are also being registered such additional shares
of Common Stock as may be issued pursuant to the anti-dilution provisions of
the warrants and the Representative's Warrants.
(4) Pursuant to Rule 457(g), no fee is due with respect to registration of the
Second Private Placement Warrants or the Third Private Placement Warrants.
Instead, such fees are due with respect to the registration of the Common
Stock issuable upon exercise thereof.
(5) Based upon the exercise price of the Option.
(6) Based upon 165% of the maximum offering price of the Common Stock.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
<PAGE> 3
PART II -- INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 24. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article VIII of the bylaws of Russian Wireless Telephone Company, Inc. (the
"Company") provides for the indemnification of directors and officers to the
fullest extent permitted by law.
Section 102(b)(7) of the General Corporation Law of the State of Delaware
grants corporations the right to limit or eliminate the personal liability of
their Directors in certain circumstances in accordance with provisions therein
set forth. Article 10 of the Company's Certificate of Incorporation, a copy of
which is filed as an exhibit to this Registration Statement, and incorporated
herein by reference, provides for the elimination of personal liability of a
Director to the Corporation or its stockholders for monetary damages for the
breach of the Director's fiduciary duty to the full extent allowable under
Section 102(b)(7).
Section 145 of the General Corporation Law of the State of Delaware grants
corporations the right to indemnify their Directors, officers, employees and
agents in accordance with the provisions therein set forth. Article 8 of the
Company's Bylaws, filed as an exhibit to this Registration Statement, and
incorporated herein by reference, provides for indemnification of such person to
the full extent allowable under applicable law.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended (the "Securities Act") may be permitted to directors,
officers and controlling persons of the Company pursuant to the foregoing
provisions, or otherwise, the Company has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable.
The Company has applied for directors' and officers' liability insurance
coverage with limits of $1,000,000 per occurrence.
In the Underwriting Agreement relating to the Common Stock and Warrants
being offered hereunder, the underwriters have agreed to indemnify the Company's
directors and certain of its officers, upon the terms and under the
circumstances described therein, as to certain civil liabilities, including
liabilities under the Securities Act. The Company has also entered into
indemnification agreements with each of its directors and officers which provide
for indemnification to the fullest extent permitted by law.
ITEM 25. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, payable in connection with the sale of
Common Stock being registered. All amounts are estimates except the registration
fee and the NASD fee.
<TABLE>
<CAPTION>
AMOUNT TO
BE PAID
---------
<S> <C>
SEC Registration fee.............................................. $ 11,632
NASD Filing fee................................................... 4,338
Printing expenses................................................. 170,000
Legal fees and expenses........................................... 300,000
Accounting fees and expenses...................................... 300,000
Blue sky fees and expenses........................................ 95,000
Stock certificates................................................ 5,000
Miscellaneous..................................................... 34,030
--------
Total................................................... $920,000
========
</TABLE>
II-1
<PAGE> 4
ITEM 26. RECENT SALES OF UNREGISTERED SECURITIES.
During the three year period which ended on the date of filing of this
Registration Statement, the Registrant sold the unregistered securities
hereinbelow described.
April 26, 1994 -- issuance of 550,000 shares of Registrant's Common Stock,
$.01 par value (the "Common Stock") to Ronald G. Nathan in consideration for
payment of $11,600. No underwriter, no discounts, no commissions. Exempt from
registration pursuant to Rule 506 of Regulation D promulgated under the
Securities Act ("Rule 506"). Mr. Nathan was considered to be an accredited
investor, as such term is defined by Rule 501 of Regulation D promulgated under
the Securities Act (an "Accredited Investor"), at the time when such transaction
was consummated.
June 15, 1994 -- issuance of 488,000 shares of Common Stock to Harvey Block
at inception for financial consulting services rendered prior to inception and
for services rendered through June 15, 1994 in the amount of $11,600. Exempt
from registration pursuant to Rule 506. Mr. Bloch was considered to be an
Accredited Investor at the time when such transaction was consummated.
June 1994 -- Registrant issued 12% unsecured promissory notes in the
aggregate principal amount of $735,000, and warrants to purchase 750,000 shares
of Common Stock to the investors identified below in connection with a private
placement of 7.5 units consisting of such securities at an offering price of
$100,000 per unit which was exempt from registration pursuant to Rule 506. Each
of such investors was considered to be an Accredited Investor at the time of
issuance of such securities. White Rock Partners & Co., Inc. served as placement
agent in connection with said placement and received a consulting fee and
non-accountable expense allowance of $75,000 and $22,500, respectively, in
connection therewith.
<TABLE>
<CAPTION>
NUMBER OF NUMBER OF
NAME UNITS WARRANTS
--------------------------------------------------------------- --------- ---------
<S> <C> <C>
Hilda O'Connor................................................. 1/4 25,000
Timothy Martin................................................. 1 1/2 150,000
Elliot Braun................................................... 1/2 50,000
Jeffrey Mulgeier............................................... 1/2 50,000
James Noonan................................................... 1/2 50,000
Jai Guar....................................................... 1/2 50,000
Leah Hammerman................................................. 1/4 25,000
George Rutland................................................. 1 1/2 150,000
Charles Burkridge.............................................. 1/2 50,000
Zoger Investment Corp.......................................... 1 100,000
Sean Leahy..................................................... 1/2 50,000
--- -------
Total................................................ 7 1/2 750,000
</TABLE>
October 1994 -- Registrant issued 12% unsecured promissory notes in the
aggregate principal amount of $980,000, and warrants to purchase 500,000 shares
of Common Stock to the investors identified below in connection with a private
placement of 10 units consisting of such securities at an offering price of
$100,000 per unit which was exempt from registration pursuant to Rule 506. Each
of such investors was considered to be an Accredited Investor at the time of
issuance of such securities. The Registrant's obligations pursuant to such notes
shall become due and payable on the earlier to occur of (i) the date of closing
of its initial public offering of securities, or (ii) October 31, 1997. White
Rock Partners & Co., Inc. and CMA Analytical Service, Inc. served as placement
agents in connection with said placement and received a consulting fee and non-
accountable expense allowance of $100,000 and $30,000, respectively, in
connection therewith.
II-2
<PAGE> 5
<TABLE>
<CAPTION>
NAME NUMBER OF UNITS NUMBER OF WARRANTS
--------------------------------------------------- --------------- ------------------
<S> <C> <C>
Slate Daiagi Realty................................ 1/2 25,000
Lawrence T. Dunn III............................... 1/2 25,000
Michael Ciasulli................................... 1 50,000
Lehman Brothers.................................... 7 350,000
Colonial Electric Consultant Corp.................. 1 50,000
-- -------
Total.................................... 10 500,000
</TABLE>
December 15, 1994 -- issuance of 600,000 shares of Common Stock to Ronald
G. Nathan in consideration for Registrant in the amount of $180,000. Exempt from
registration pursuant to Rule 506. Mr. Nathan was considered to be an Accredited
Investor at the time when such transaction was consummated.
December 19, 1994 -- issuance of 285,000 shares of Common Stock to J.P.
Downey in consideration for services rendered to the Registrant in the amount of
$1,850. Exempt from registration pursuant to Rule 506. Mr. Downey was considered
to be an Accredited Investor at the time when such transaction was consummated.
December 19, 1994 -- issuance of 285,000 shares of Common Stock to Ernest
Ferrante in consideration for services rendered to the Registrant in the amount
of $1,850. Exempt from registration pursuant to Rule 506. Mr. Ferrante was
considered to be an Accredited Investor at the time when such transaction was
consummated.
December 19, 1994 -- issuance of 285,000 shares of Common Stock to Paul
Signoracci in consideration for services rendered to the Registrant in the
amount of $1,850. Exempt from registration pursuant to Rule 506. Mr. Signoracci
was considered to be an Accredited Investor at the time when such transaction
was consummated.
December 23, 1994 -- issuance of 800,000 shares of Common Stock to
Inversiones Santa Catalina, N.V. in consideration for payment in the amount of
$8,000. Exempt from registration pursuant to Rule 506. Said investor was
considered to be an Accredited Investor at the time when such transaction was
consummated.
December 23, 1994 -- issuance of 25,000 shares of Common Stock to Solomon
Klotz in consideration for payment in the amount of $50.00. Exempt from
registration pursuant to Rule 506. Mr. Klotz was considered to be an Accredited
Investor at the time when such transaction was consummated.
December 23, 1994 -- issuance of 5,000 shares of Common Stock to James
Staff in consideration for payment in the amount of $50.00. Exempt from
registration pursuant to Rule 506. Mr. Staff was considered to be an Accredited
Investor at the time when such transaction was consummated.
December 23, 1994 -- issuance of 5,000 shares of Common Stock to Thomas
Turnure in consideration for payment in the amount of $50.00. Exempt from
registration pursuant to Rule 506. Mr. Tenure was considered to be an Accredited
Investor at the time when such transaction was consummated.
February 1996 -- Registrant issued 8% unsecured promissory notes in the
aggregate principal amount of $1,050,000, 300,000 shares of Common Stock and
warrants to purchase 2,000,015 shares of Common Stock to the investors
identified below in connection with a private placement of 30 units consisting
of such securities at an offering price of $35,000 per unit which was exempt
from registration pursuant to Rule 506. Each of such investors was considered to
be an Accredited Investor at the time of issuance of such securities. The
Registrant's obligations pursuant to such notes shall become due and payable on
the earlier to occur of (i) the date of closing of its initial public offering
of securities, or (ii) October 31, 1997. J.W. Barclay & Co., Inc. served as
placement agent in connection with said placement and received a consulting fee
and non-accountable expense allowance of $105,000 and $31,500, respectively, in
connection therewith.
II-3
<PAGE> 6
<TABLE>
<CAPTION>
NAME NO. OF UNITS NO. OF SHARES NO. OF WARRANTS
- ---------------------------------------------------- ------------ ------------- ---------------
<S> <C> <C> <C>
Dale Bertling....................................... 1 10,000 66,667
Howard Pack......................................... 1 10,000 66,667
Thomas Zenick....................................... 1/2 5,000 33,334
Royal Bank of Scotland.............................. 15 150,000 1,000,005
David Hanos, Jr..................................... 1/2 5,000 33,334
Charles Leithauser.................................. 1/2 5,000 33,334
Bernard Kolkana..................................... 1/2 5,000 33,334
Richard David....................................... 1/2 5,000 33,334
Leon Feldan......................................... 1/2 5,000 33,334
Jerome and Ann Coppola.............................. 4 40,000 266,668
E. Dale Miller...................................... 1/2 5,000 33,334
Boyd Corliss........................................ 1/2 5,000 33,334
Wayne Adams and Lovella Adams....................... 1/2 5,000 33,334
Kenneth A. DeLonge.................................. 1 10,000 66,667
Harold H. Singer.................................... 3 30,000 200,001
Christopher Cirillo................................. 1/2 5,000 33,334
--
------- ---------
Total..................................... 30 300,000 2,000,015
</TABLE>
December 19, 1996 -- Registrant borrowed the principal amount of $250,000
from each of Messrs. L.W. Cave, James Condakes and Howard M. Pack pursuant to
agreements which provided for the repayment of such principal, together with
interest accruing thereon at the rate of 8% per annum at the time of closing of
the offering being made pursuant to the prospectus contained in this
Registration Statement, or October 31, 1998. As an inducement to such lenders to
make such loans, the Registrant issued 150,000 shares of Common Stock to each of
them, for no additional consideration. The Registrant paid a commission of
$75,000 to a registered representative of J.W. Barclay & Co., Inc., on behalf of
said firm, in connection with consummation of such financings. Such transactions
were exempt from registration pursuant to Rule 506. Said investors were
considered to be Accredited Investors at the time when such transactions were
consummated.
February 10, 1997 -- Registrant issued 250,000 shares of Common Stock to
Ronald G. Nathan and 500,000 shares of Common Stock to Mikhail Leibov pursuant
to the merger of Russian Wireless Telephone Company, Inc. ("Russian Wireless")
with and into the Registrant, and in consideration for the receipt and
cancellation of 250,000 and 500,000 shares, respectively, of the common stock of
Russian Wireless from them. Such transactions were exempt from registration
pursuant to Rule 506. Messrs. Nathan and Leibov were considered to be Accredited
Investors at the time when such transaction was consummated.
ITEM 27. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------- -----------------------------------------------------------------------------------
<C> <S>
1.1 Form of Underwriting Agreement.****
1.2 Form of Agreement Among Underwriters.****
1.3 Form of Selected Dealers Agreement.****
2.1 Certificate of Merger Between the Company and Russian Wireless Telephone Company,
Inc.*
3.1 Certificate of Incorporation of the Company.*
3.2 Bylaws of the Company.*
4.1 The Company's Omnibus Stock Incentive Plan.*
4.2 Specimen Stock Certificate of the Company's Common Stock.*
4.3 Form of Second Private Placement Warrant.****
4.4 Form of Third Private Placement Warrant.****
</TABLE>
II-4
<PAGE> 7
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------- -----------------------------------------------------------------------------------
<C> <S>
4.5 Form of Lockup Agreement.**
4.6 Form of Representative's Warrant.
4.7 Custodial Agreement and Power of Attorney.
5 Opinion of Hall Dickler Kent Friedman & Wood, regarding the legality of the Common
Stock and the Warrants.****
10.1 Option Agreement Between the Company and Mikhail Leibov.*
10.2 Option Exercise Agreement Between the Company and Mikhail Leibov.*
10.3 Employment Agreement Between the Company and Ronald G. Nathan.*
10.4 Extension of Employment Agreement Between the Company and Ronald G. Nathan.*
10.5 Employment Agreement Between the Company and Mikhail Leibov.*
10.6 Lease Between 780 Third Avenue Associates and the Company.**
10.7 Lease Between Public Joint Stock Company PKB Proyektenergomash and Corbina
Telecommunications.**
10.8 Lease between Public Joint Stock Company PKB Proyektenergomash and
Investelektrosvyaz.**
10.9 Financial Consulting Agreement Between the Company and the Representative.
10.10 Form of Indemnity Agreement to be entered into between the Company and its
Directors and Officers.*
10.11 Redemption Agreement between the Company and Harvey Bloch.**
10.12 Distributor Agreement between Corbina Telecommunications ("Corbina") and
Rustelnet.**
10.13 International value added services distributor agreement between Sprint Networks
and Corbina Telecommunications.**
10.14 Service Agreement between Macomnet and Corbina.**
10.15 Amendment dated June 16, 1997 to employment agreement between the Company and
Ronald G. Nathan.**
10.16 Amendment dated June 16, 1997 to employment agreement between the Company and
Mikhail Leibov.**
10.17 Redemption Agreement and promissory note between the Company and Inversiones Santa
Catalina, N.V.**
10.18 Amendment dated as of August 1, 1997, by and between the Company and Wayne Adams
and Lovella Adams to Promissory Note and Warrant dated February 2, 1996.***
10.19 Amendment dated as of August 1, 1997, by and between the Company and Dale Bertling
to Promissory Note and Warrant dated February 2, 1996.***
10.20 Rescission Agreement dated as of February 6, 1997, between the Company and Colonial
Electric Consulting Corp.**
10.21 Amendment dated June 18, 1997 to Rescission Agreement between the Company and
Colonial Electric Consulting Corp.**
10.22 Agreement dated March 15, 1996 between Corbina and ZAO Rustelnet.**
10.23 Agreement dated December 21, 1995 Between Corbina and MACOMNET.**
10.24 Agreement between Sprint Networks and Corbina.**
10.25 Amendment No. 3 dated as of June 19, 1997 between the Company and Michael Ciasulli
to that certain Promissory Note dated November 3, 1994.**
</TABLE>
II-5
<PAGE> 8
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------- -----------------------------------------------------------------------------------
<C> <S>
10.26 Amendment No. 3 dated as of June 19, 1997 between the Company and Per Eric Dahl to
that certain Promissory Note dated November 3, 1994.**
10.27 Amendment No. 3 dated as of June 19, 1997 between the Company and Larry Dunn to
that certain Promissory Note dated November 3, 1994.**
10.28 Amendment No. 3 dated as of June 19, 1997 between the Company and Slate Daiagi
Realty, Inc. to that certain Promissory Note dated November 3, 1994.**
10.29 License issued to ZAO Investelektrosvyaz by the Ministry of Communications of the
Russian Federation.**
10.30 Agreement between Corbina and ZAO Kortek.**
10.31 Amendment dated as of August 1, 1997, by and between the Company and Christopher
Cirillo to Promissory Note and Warrant dated February 2, 1996.***
10.32 Amendment dated as of August 1, 1997, by and between the Company and Jerome and Ann
Coppola to Promissory Note and Warrant dated February 2, 1996.***
10.33 Amendment dated as of August 1, 1997, by and between the Company and Boyd Corliss
to Promissory Note and Warrant dated February 2, 1996.***
10.34 Amendment dated as of August 1, 1997, by and between the Company and Richard David
to Promissory Note and Warrant dated August 5, 1997.***
10.35 Amendment dated as of August 1, 1997, by and between the Company and Kenneth A.
DeLonge to Promissory Note and Warrant dated May 5, 1997.***
10.36 Amendment dated as of August 1, 1997, by and between the Company and Leon Feldan to
Promissory Note and Warrant dated February 2, 1996.***
10.37 Amendment dated as of August 1, 1997, by and between the Company and David Hanos,
Jr. to Promissory Note and Warrant dated February 2, 1996.***
10.38 Amendment dated as of August 1, 1997, by and between the Company and Bernard
Kolkana to Promissory Note and Warrant dated February 2, 1996.***
10.39 Amendment dated as of August 1, 1997, by and between the Company and Charles
Leithauser to Promissory Note and Warrant dated February 2, 1996.***
10.40 Amendment dated as of August 1, 1997, by and between the Company and E. Dale Miller
to Promissory Note and Warrant dated February 2, 1996.***
10.41 Amendment dated as of August 1, 1997, by and between the Company and Howard Pack to
Promissory Notes and Warrant dated February 2, 1996.***
10.42 Amendment dated as of August 1, 1997, by and between the Company and The Royal Bank
of Scotland International Limited to Promissory Note and Warrant dated May 5,
1997.***
10.43 Amendment dated as of August 1, 1997, by and between the Company and Harold H.
Singer to Promissory Note and Warrant dated February 2, 1996.***
10.44 Amendment dated as of August 1, 1997, by and between the Company and Thomas Zenick
to Promissory Note and Warrant dated February 2, 1996.***
11 Computations of Earnings (Loss) Per Share.***
21 Subsidiaries of the Company.***
23.1 Consent of Independent Auditors (See Part II, Page 10).
23.2 Consent of Independent Auditors (See Part II, Page 10).
23.3 Consent of Counsel (See Part II, Page 10).
</TABLE>
II-6
<PAGE> 9
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------- -----------------------------------------------------------------------------------
<C> <S>
23.4 Consent of Counsel (See Part II, Page 10).
24 Power of Attorney.*
</TABLE>
- ---------------
* Filed on March 28, 1997 as an exhibit to the Company's Registration
Statement on Form SB-2 (Reg. No. 333-24177).
** Filed on July 3, 1997 as an exhibit to Amendment No. 1 to the Company's
Registration Statement on Form SB-2.
*** Filed on September 16, 1997 as an Exhibit to Amendment No. 2 to the
Company's Registration Statement on Form SB-2.
**** Filed on October 29, 1997 as an Exhibit to Amendment No. 3 to the
Company's Registration Statement on Form SB-2.
ITEM 28. UNDERTAKINGS.
A. Certificates
The Registrant hereby undertakes to provide to the Underwriter at the
closing specified in the underwriting agreement, certificates in such
denominations and registered in such names as required by the Underwriter to
permit prompt delivery to each purchaser.
B. Rule 415 Offering
The Registrant hereby undertakes:
(1) To file, during any period in which it offers or sells any of the
securities which are the subject of the prospectus included within this
Registration Statement, a post-effective amendment to this Registration
Statement: (i) to include any prospectus required by Section 10(a)(3) of the
Securities Act; (ii) to reflect in the prospectus any facts or events which,
individually or together, represent fundamental change in the information set
forth in the Registration Statement; (iii) to include any additional or changed
material information with respect to the plan of distribution.
(2) For purposes of determining any liability under the Securities Act, the
Registrant will treat each post-effective amendment as a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
C. Request for Acceleration of Effective Date
The Company may elect to request acceleration of the effective date of the
Registration Statement under Rule 461 of the Securities Act of 1933.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 (the "Act") may be permitted to directors, officers and controlling
persons of the small business issuer pursuant to the foregoing provisions, or
otherwise, the small business issuer has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses incurred or paid by a
director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
II-7
<PAGE> 10
D. Reliance on Rule 430A
(1) For purposes of determining liability under the Securities Act, the
Registrant will treat the information omitted from the form of prospectus filed
as part of this Registration Statement in reliance upon Rule 430A and contained
in a form of prospectus filed by the Registrant under Rule 424(b)(1) or (4) or
497(h) under the Securities Act (Section 230.424(b)(1), (4) or 230.497(h)) as
part of this Registration Statement as of the time the Commission declared it
effective.
(2) For purposes of determining liability under the Securities Act, the
Registrant will treat each post-effective amendment as a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
II-8
<PAGE> 11
SIGNATURES
In accordance with the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements of filing on Form SB-2 and authorized this amendment to its
registration statement to be signed on its behalf by the undersigned, in the
City, County and State of New York on the 29th day of October, 1997.
Russian Wireless Telephone Company,
Inc.
By: /s/ RONALD G. NATHAN
-----------------------------------
Ronald G. Nathan, President
(Principal Executive Officer)
In accordance with the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement was signed by the following persons in
the capacities and on the dates stated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------------------------------------------- ------------------------------ -----------------
<C> <S> <C>
/s/ JACK W. BUECHNER Director, Chairman of the October 29, 1997
- --------------------------------------------- Board
Jack W. Buechner
/s/ RONALD G. NATHAN Director, President, Treasurer October 29, 1997
- --------------------------------------------- (Principal Executive and
Ronald G. Nathan Principal Financial and
Accounting Officer)
/s/ RICHARD N. HOLWILL Director October 29, 1997
- ---------------------------------------------
Richard N. Holwill
/s/ STEVEN D. DREYER Director, Secretary October 29, 1997
- ---------------------------------------------
Steven D. Dreyer
</TABLE>
II-9
<PAGE> 12
CONSENT OF INDEPENDENT AUDITORS
Russian Wireless Telephone Company, Inc.
We consent to the reference to our firm under the caption "Experts" and to
the use of our report dated February 28, 1997 in Amendment No. 3 to the
Registration Statement (Form SB-2, No. 333-24177) and related prospectus of
Russian Wireless Telephone Company, Inc. dated October 29, 1997.
ERNST & YOUNG LLP
New York, New York
October 29, 1997
CONSENT OF INDEPENDENT AUDITORS
Corbina Telecommunications
We consent to the reference to our firm under the caption "Experts" and to
the use of our report dated January 24, 1997 with respect to the financial
statements of Corbina Telecommunications included in Amendment No. 3 to the
Registration Statement (Form SB-2, No. 333-24177) and related prospectus of
Russian Wireless Telephone Company, Inc. dated October 29, 1997.
ERNST & YOUNG (CIS) LIMITED
Moscow, Russian Federation
October 29, 1997
CONSENT OF COUNSEL
We consent to the use of our firm's name and to the statements made with
respect to our Firm, as they appear under the heading "Legal Matters" in the
Prospectus which is included in Part I of this amendment to the Registration
Statement.
HALL DICKLER KENT FRIEDMAN & WOOD LLP
New York, New York
October 29, 1997
CONSENT OF COUNSEL
I consent to the use of my name and to the statements made with respect to
me, as they appear under the heading "Legal Matters" in the Prospectus which is
included in Part I of this amendment to the Registration Statement.
IRINA IGITOVA
Moscow, Russian Federation
October 29, 1997
II-10
<PAGE> 13
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------- --------------------------------------------------------------------------------
<C> <C> <S>
4.6 -- Form of Representative's Warrant.
4.7 -- Custodial Agreement and Power of Attorney.
</TABLE>
<PAGE> 1
Exhibit 4.6
NO SALE OR TRANSFER OF THIS WARRANT OR THE SECURITIES
UNDERLYING THIS WARRANT MAY BE MADE UNTIL
THE EFFECTIVENESS OF A REGISTRATION STATEMENT
OR OF A POST-EFFECTIVE AMENDMENT THERETO
UNDER THE SECURITIES ACT OF 1933 (THE "ACT"),
COVERING THIS WARRANT OR THE SECURITIES UNDERLYING
THIS WARRANT, OR UNTIL THE COMPANY IS IN RECEIPT OF AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM
THE REGISTRATION REQUIREMENTS OF THE ACT. TRANSFER OF
THIS WARRANT IS RESTRICTED UNDER PARAGRAPH 2 BELOW.
REPRESENTATIVE'S WARRANT TO PURCHASE
COMMON STOCK AND/OR REDEEMABLE WARRANTS
RUSSIAN WIRELESS TELEPHONE COMPANY, INC.
(a Delaware corporation)
Dated:______________ ___, 1997
<PAGE> 2
THIS CERTIFIES THAT J.W. Barclay & Co., Inc. (the representative of the
Underwriters (the "Representative"), and together with its assigns, the
"Holder") is entitled to purchase from Russian Wireless Telephone Company, Inc.,
a Delaware corporation (the "Company"), for an aggregate price of $10, an option
("Purchase Option"), during the period as hereinafter specified, for up to
165,000 shares of the Company's common stock, $.01 par value per share (the
"Common Stock"), and 220,000 redeemable warrants (the "Warrants" and
collectively with the Common Stock, the "Securities"), at a purchase price of
$11.55 per share of Common Stock and $.83 per Warrant which Warrant is
exercisable at $7.25 per share of Common Stock (the "Exercise Price") (the
"Representative's Warrant").
This Representative's Warrant is issued pursuant to an Underwriting
Agreement dated , 1997, between the Company and the Representative in connection
with a public offering through the Representative (the "Public Offering") of
1,650,000 shares of Common Stock and 2,200,000 Warrants.
1. Exercise of the Representative's Warrant.
(a) The rights represented by this Representative's Warrant shall
be exercised at the prices and during the periods as follows:
(i) During the period from __________ __, 1997 to __________ __,
1998, inclusive, the Holder shall have no right to purchase any Securities
hereunder.
(ii) Between __________ __, 1998 and __________ __, 2002,
inclusive, the Holder shall have the option to purchase shares of Common Stock
and Warrants hereunder at a price of $11.55 and $.83, respectively, the purchase
price of the Common Stock and the Warrant being 165% of the public offering
price for the Securities set forth in the Prospectus forming a part of the
registration statement on Form SB-2 (File No. 333-24177) of the Company, as
amended (the "Registration Statement").
(iii) After ________ __, 2002, the Holder shall have no right to
purchase any Securities hereunder and this Representative's Warrant shall expire
effective at 5:00 p.m., New York time.
(b) The rights represented by this Representative's Warrant may
be exercised at any time within the period above specified, in whole or in part,
by (i) the surrender of this Representative's Warrant (with the purchase form at
the end hereof properly executed) at the principal executive of office of the
Company (or such other of office or agency of the Company as it may designate by
notice in writing to the Holder at the address of the Holder appearing on the
books of the Company); (ii) payment to the Company of the Exercise Price then in
effect for the number of
<PAGE> 3
shares of Common Stock and Warrants specified in the above-mentioned purchase
form together with applicable stock transfer taxes, if any; and (iii) delivery
to the Company of a duly executed agreement signed by the person(s) designated
in the purchase form to the effect that such person(s) agree(s) to be bound by
the provisions of Paragraph 5 and subparagraphs (b), (c) and (d) of Paragraph 6
hereof. This Representative's Warrant shall be deemed to have been exercised, in
whole or in part to the extent specified, immediately prior to the close of
business on the date this Representative's Warrant is surrendered and payment is
made in accordance with the foregoing provisions of this Paragraph 1, and the
person or persons in whose name or names the certificates for the Securities
shall be issuable upon such exercise shall become the Holder or Holders of
record of such Common Stock and Warrants at that time and date. The Common Stock
and Warrants so purchased shall be delivered to the Holder within a reasonable
time, not exceeding ten (10) business days, after the rights represented by this
Representative's Warrant shall have been so exercised.
2. Restrictions on Transfer.
This Representative's Warrant shall not be transferred, sold,
assigned, or hypothecated for a period of one year commencing _______ __, 1997,
except that it may be transferred to successors of the Holder, and may be
assigned in whole or in part to any person who is an of officer of the
Representative or an officer or partner of any other member of the underwriting
syndicate or selling group member during such period; and after such one-year
period, such a transfer may occur providing the Representative's Warrant is
exercised immediately upon transfer, and if not exercised immediately on
transfer, the Representative's Warrant shall lapse. Any such assignment shall be
effected by the Holder by (i) completing and executing the form of assignment at
the end hereof and (ii) surrendering this Representative's Warrant with such
duly completed and executed assignment form for cancellation, accompanied by
funds sufficient to pay any transfer tax, at the office or agency of the Company
referred to in Paragraph 1 hereof, accompanied by a certificate (signed by a
duly authorized representative of the Holder), stating that each transferee is a
permitted transferee under this Paragraph 2 hereof; whereupon the Company shall
issue, in the name or names specified by the Holder (including the Holder) a new
Representative's Warrant or Representative's Warrants of like tenor and
representing in the aggregate rights to purchase the same number of Securities
as are then purchasable hereunder.
2
<PAGE> 4
3. Covenants of the Company.
(a) The Company covenants and agrees that all Common Stock and
Common Stock issuable upon exercise of the Warrants will, upon issuance, be duly
and validly issued, fully paid and nonassessable and no personal liability will
attach to the holder thereof by reason of being such a holder, other than as set
forth herein.
(b) The Company covenants and agrees that during the period within
which this Representative's Warrant may be exercised, the Company will at all
times have authorized and reserved a sufficient number of shares of Common Stock
to provide for the exercise of this Representative's Warrant and the Warrants
included therein.
(c) The Company covenants and agrees that for so long as the
Securities shall be outstanding, the Company shall use its best efforts to cause
all shares of Common Stock issuable upon the exercise of the Representative's
Warrant and the Warrants contained therein, to be listed on or quoted by the
Nasdaq National Market System or on the Nasdaq SmallCap Market.
4. No Rights of Stockholder.
This Representative's Warrant shall not entitle the Holder to any
voting rights or other rights as a stockholder of the Company, either at law or
in equity, and the rights of the Holder are limited to those expressed in this
Representative's Warrant and are not enforceable against the Company except to
the extent set forth herein.
5. Registration Rights.
(a) The Company shall advise the Holder or its transferee, whether
the Holder holds this Representative's Warrant or has exercised this
Representative's Warrant and holds Common Stock and Warrants, or Common Stock
underlying the Warrants (the "Warrant Shares"), by written notice at least 30
days prior to the filing of any post-effective amendment to the Registration
Statement or of any new registration statement or post-effective amendment
thereto under the Act, covering any securities of the Company, for its own
account or for the account of others, and will for a period of six years from
__________ ___, 1998 upon the request of the Holder, include in any such
post-effective amendment or registration statement such information as may be
required to permit a public offering of any of the Common Stock or Warrants
issuable hereunder, and/or the Warrant Shares (the "Registerable Securities"),
provided however that this Section 5(a) is not applicable to any registration
statement by the Company on Forms
3
<PAGE> 5
S-4 or S-8 (including any Form S-3 related to such Form S-8) or any other
comparable form. The Company shall supply prospectuses in order to facilitate
the public sale or other disposition of the Registerable Securities, use its
best efforts to register and qualify any of the Registerable Securities for sale
in such states as such Holder reasonably designates, provided such qualification
is not solely for the purpose of subjecting the Company to jurisdiction in that
state or is not unduly burdensome, and do any and all other acts and things
which may be necessary to enable such Holder to consummate the public sale of
the Registerable Securities, and furnish indemnification in the manner provided
in Paragraph 6 hereof. The Holder shall furnish information reasonably requested
by the Company in accordance with such post-effective amendments or registration
statements, including its intentions with respect thereto, and shall furnish
indemnification as set forth in Paragraph 6. The Company shall continue to
advise the Holders of the Registerable Securities of its intention to file a
registration statement or amendment pursuant to this Paragraph 5(a) until the
earlier of (i) __________ ___, 2004; or (ii) such time as all of the
Registerable Securities have been registered and sold under the Act.
(b) If any fifty-one (51%) percent holder (as defined below) shall
give notice to the Company at any time during the four (4) year period beginning
one (1) year from __________ ___, 1997 to the effect that such holder desires to
register under the Act any Registerable Securities, under such circumstances
that a public distribution (within the meaning of the Act) of any such
Registerable Securities will be involved, then the Company will as promptly as
practicable after receipt of such notice, but not later than thirty (30) days
after receipt of such notice, file a post effective amendment to the current
Registration Statement or a new registration statement pursuant to the Act to
the end that the Registerable Securities may be publicly sold under the Act as
promptly as practicable thereafter and the Company will use its best efforts to
cause such registration to become and remain effective as provided herein
(including the taking of such steps as are necessary to obtain the removal of
any stop order); provided, that such fifty-one (51%) percent holder shall
furnish the Company with appropriate information in connection therewith as the
Company may reasonably request; and provided, further, that the Company shall
not be required to file such a post effective amendment or registration
statement on more than one occasion at its expense. The Company will maintain
such registration statement or post-effective amendment current under the Act
for a period of at least six (6) months from the effective date thereof. The
Company shall supply prospectuses in order to facilitate the public sale of the
Registerable Securities, use its best efforts to register and qualify any of the
Registerable Securities for sale in such states as such holder reasonably
designates, provided such qualification
4
<PAGE> 6
is not solely for the purpose of subjecting the Company to jurisdiction in that
state or is not unduly burdensome, and furnish indemnification in the manner
provided in Paragraph 6 hereof.
(c) The Holder may, in accordance with Paragraphs 5(a) or (b), at
his or its option, and subject to the limitations set forth in Paragraph 1(a)
hereof, request the registration of any of the Registerable Securities in a
filing made by the Company prior to the acquisition of the Securities upon
exercise of this Representative's Warrant. The Holder may thereafter exercise
the Warrants at any time or from time to time subsequent to the effectiveness
under the Act of the registration statement in which the Common Stock underlying
the Representative's Warrants and Warrants were included.
(d) The term "51% holder," as used in this Paragraph 5, shall
include any owner or combination of owners of Representative's Warrants or
Registerable Securities if the aggregate number of Common Shares and Warrant
Shares included in and underlying the Representative's Warrants and Registerable
Securities held of record by it or them, would constitute a majority of the
aggregate of such Common Shares and Warrant Shares.
(e) The following provisions of this Paragraph 5 shall also be
applicable:
(i) Within ten (10) days after receiving any notice pursuant to
Paragraph 5(b), the Company shall give notice to the other Holders of
Representative's Warrants or Registerable Securities, advising that the Company
is proceeding with such post-effective amendment or registration and offering to
include therein the Registerable Securities of such other Holders, provided that
they shall furnish the Company with all information in connection therewith as
shall be necessary or appropriate and as the Company shall reasonably request in
writing. Following the effective date of such post-effective amendment or
registration, the Company shall, upon the request of any Holder of Registerable
Securities, forthwith supply such number of prospectuses meeting the
requirements of the Act, as shall be reasonably requested by such Holder. The
Company shall use its best efforts to qualify the Registerable Securities for
sale in such states as the 51% holder shall designate, provided such
qualification is not solely for the purpose of subjecting the Company to
jurisdiction in that state or is not unduly burdensome, at such times as the
registration statement is effective under the Act.
(ii) The Company shall bear the entire cost and expense of any
registration of securities initiated by it under Paragraph 5(a) hereof
notwithstanding that the Registerable Securities subject to this
Representative's Warrant may be included in any
5
<PAGE> 7
such registration. The Company shall also comply with one request for
registration made by the 51% holder pursuant to Paragraph 5(b) hereof at the
Company's own expense and without charge to any holder of the Registerable
Securities, and with one request at the expense of the Holders thereof.
Notwithstanding the foregoing, any Holder whose Registerable Securities are
included in any such registration statement pursuant to this Paragraph 5 shall,
however, bear the fees of any counsel retained by him and any transfer taxes or
underwriting discounts or commissions applicable to the Registerable Securities
sold by him pursuant thereto and, in the case of a registration pursuant to
Paragraph 5(a) hereof, any additional registration fees attributable to the
registration of such Holder's Registerable Securities.
(iii) If the managing underwriter in any such underwritten offering
shall advise the Company that it declines to include a portion or all of the
Registerable Securities requested by the Holders to be included in the
registration statement, then distribution of all or a specified portion of the
Registerable Securities shall be excluded from such registration statement (in
case of an exclusion as to a portion of such Registerable Securities, such
portion to be allocated among such Holders in proportion to the respective
numbers of Registerable Securities requested to be registered by each such
Holder). In such event the Company shall give the Holder prompt notice of the
number of Registerable Securities excluded. Further, in such event the Company
shall, within six (6) months of the completion of such subsequent offering, file
and use its best efforts to have declared effective, at its sole expense, a
registration statement relating to such excluded securities.
6. Indemnification.
(a) Whenever pursuant to Paragraph 5, a registration statement
relating to any Registerable Securities is filed under the Act, amended or
supplemented, the Company will indemnify and hold harmless each Holder of the
Registerable Securities covered by such registration statement, amendment or
supplement (such holder hereinafter referred to as the "Distributing Holder"),
each person, if any, who controls (within the meaning of the Act) the
Distributing Holder, and each officer, employee, partner or agent of the
Distributing Holder, if the Distributing Holder is a broker or dealer, against
any losses, claims, damages or liabilities, joint or several, to which the
Distributing Holder may become subject under the Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of any material fact contained in any such registration statement or any
preliminary prospectus or final prospectus constituting a part thereof or any
amendment or supplement thereto, or arise out
6
<PAGE> 8
of or are based upon the omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading;
and will reimburse the Distributing Holder for any legal or other expenses
reasonably incurred by the Distributing Holder, in connection with investigating
or defending any such loss, claim, damage, liability or action; provided,
however, that the Company will not be liable in any such case (i) to the extent
that any such loss, claim, damage or liability arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in said registration statement, said preliminary prospectus, said final
prospectus or said amendment or supplement in reliance upon and in conformity
with written information furnished by such Distributing Holder, any other
Distributing Holder or any such underwriter for use in the preparation thereof,
and (ii) such losses, claims, damages or liabilities arise out of or are based
upon any actual or alleged untrue statement or omission made in or from any
preliminary prospectus, but corrected in the final prospectus, as amended or
supplemented.
(b) Whenever pursuant to Paragraph 5 a registration statement
relating to the Registerable Securities is filed under the Act, or is amended or
supplemented, the Distributing Holder will indemnify and hold harmless the
Company, each of its directors, each of its of officers who have signed said
registration statement and such amendments and supplements thereto, and each
person, if any, who controls the Company (within the meaning of the Act) against
any losses, claims, damages or liabilities to which the Company or any such
director, officer or controlling person may become subject under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue or alleged untrue
statement of any material fact contained in any such registration statement or
any preliminary prospectus or final prospectus constituting a part thereof, or
any amendment or supplement thereto, or arise out of or are based upon the
omission or the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent that such untrue statement or
alleged untrue statement or omission was made in said registration statement,
said preliminary prospectus, said final prospectus or said amendment or
supplement in reliance upon and in conformity with written information furnished
by such Distributing Holder for use in the preparation thereof; and will
reimburse the Company or any such director, officer or controlling person for
any legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action.
7
<PAGE> 9
(c) Promptly after receipt by an indemnified party under this
Paragraph 6 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against any indemnifying
party, give the indemnifying party notice of the commencement thereof; but the
omission to so notify the indemnifying party will not relieve it from any
liability which it may have to any indemnified party otherwise than under this
Paragraph 6.
(d) In case any such action is brought against any indemnified
party, and it notifies an indemnifying party of the commencement thereof, the
indemnifying party will be entitled to participate in, and, to the extent that
it may wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election to so assume the defense thereof, the
indemnifying party will not be liable to such indemnified party under this
Paragraph 6 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation.
7. Adjustments of Exercise Price and Number of Securities.
(a) The Warrant Price shall be subject to adjustment from time to
time as follows:
(1) In case the Company shall at any time after the date hereof pay
a dividend in shares of Common Stock or make a distribution in shares of Common
Stock, then upon such dividend or distribution the Warrant Price in effect
immediately prior to such dividend or distribution shall forthwith be reduced to
a price determined by dividing:
(a) an amount equal to the total number of shares of Common
Stock outstanding immediately prior to such dividend or distribution multiplied
by the Warrant Price in effect immediately prior to such dividend or
distribution, by
(b) the total number of shares of Common Stock outstanding
immediately after such issuance or sale.
For the purposes of any computation to be made in accordance with the
provisions of this clause (i), the following provisions shall be applicable:
Common Stock issuable by way of dividend or other distribution on any stock of
the Company shall he deemed to have been issued immediately after the opening of
business on the date following the date fixed for the determination of
stockholders entitled to receive such dividend or other distribution.
8
<PAGE> 10
(2) In case the Company shall at any time subdivide or combine the
outstanding Common Stock, the Warrant Price shall forthwith be proportionately
decreased in the case of subdivision or increased in the case of combination to
the nearest one cent. Any such adjustment shall become effective at the time
such subdivision or combination shall become effective.
(3) Within a reasonable time after the close of each quarterly fiscal
period of the Company during which the Warrant Price has been adjusted as herein
provided, the Company shall:
(a) Deliver to the Representative a certificate signed by the
President or Vice President of the Company and by the Treasurer or Assistant
Treasurer or the Secretary or an Assistant Secretary of the Company, showing in
detail the facts requiring all such adjustments occurring during such period and
the Warrant Price after each such adjustment.
(b) Notwithstanding anything contained herein to the contrary, no
adjustment of the Warrant Price shall be made if the amount of such adjustment
shall be less than $.05, but in such case any adjustment that would otherwise be
required then to be made shall be carried forward and shall be made at the time
and together with the next subsequent adjustment which, together with any
adjustment so carried forward, shall amount to not less than $.05.
(b) In the event that the number of outstanding shares of Common Stock
is increased by a stock dividend payable in Common Stock or by a subdivision of
the outstanding Common Stock, then, from and after the time at which the
adjusted Warrant Price becomes effective pursuant to Subsection (b) of this
Section by reason of such dividend or subdivision, the number of shares of
Common Stock issuable upon the exercise of each Warrant shall be increased in
proportion to such increase in outstanding shares. In the event that the number
of shares of Common Stock outstanding is decreased by a combination of the
outstanding Common Stock, then, from and after the time at which the adjusted
Warrant Price becomes effective pursuant to Subsection (b) of this Section by
reason of such combination, the number of shares of Common Stock issuable upon
the exercise of each Warrant shall be decreased in proportion to such decrease
in the outstanding shares of Common Stock.
(c) In case of any reorganization or reclassification of the
outstanding Common Stock (other than a change in par value, or from par value to
no par value, or as a result of a subdivision or combination), or in case of any
consolidation of the Company with, or merger of the Company into, another
corporation (other than a consolidation or merger in which the Company is the
continuing corporation and which does not result in any reclassification of
9
<PAGE> 11
the outstanding Common Stock), or in case of any sale or conveyance to another
corporation of the property of the Company as an entirety or substantially as an
entirety, the holder of each Warrant then outstanding shall thereafter have the
right to purchase the kind and amount of shares of Common Stock and other
securities and property receivable upon such reorganization, reclassification,
consolidation, merger, sale or conveyance by a holder of the number of shares of
Common Stock which the holder of such Warrant shall then be entitled to
purchase; such adjustments shall apply with respect to all such changes
occurring between the date of this Warrant Agreement and the date of exercise of
such Warrant.
(d) Subject to the provisions of this Section, in case the Company
shall, at any time prior to the exercise of the Warrants, make any distribution
of its assets to holders of its Common Stock as a liquidating or a partial
liquidating dividend, then the holder of Warrants who exercises his Warrants
after the record date for the determination of those holders of Common Stock
entitled to such distribution of assets as a liquidating or partial liquidating
dividend shall be entitled to receive for the Warrant Price per Warrant, in
addition to each share of Common Stock, the amount of such distribution (or, at
the option of the Company, a sum equal to the value of any such assets at the
time of such distribution as determined by the Board of Directors of the Company
in good faith), which would have been payable to such holder had he been the
holder of record of the Common Stock receivable upon exercise of his Warrant on
the record date for the determination of those entitled to such distribution.
(e) In case of the dissolution, liquidation or winding-up of the
Company, all rights under the Warrants shall terminate on a date fixed by the
Company, such date to be no earlier than ten (10) days prior to the
effectiveness of such dissolution, liquidation or winding-up and not later than
five (5) days prior to such effectiveness. Notice of such termination of
purchase rights shall be given to the last registered holder of the Warrants, as
the same shall appear on the books of the Company maintained by the Warrant
Agent, by registered mail at least thirty (30) days prior to such termination
date.
(f) In case the Company shall, at any time prior to the expiration
of the Warrants and prior to the exercise thereof, offer to the holders of its
Common Stock any rights to subscribe for additional shares of any class of the
Company, then the Company shall give written notice thereof to the last
registered holder thereof not less than thirty (30) days prior to the date on
which the books of the Company are closed or a record date is fixed for the
determination of the stockholders entitled to such subscription rights. Such
notice shall specify the date as to which the books
10
<PAGE> 12
shall be closed or record date fixed with respect to such offer of subscription
and the right of the holder thereof to participate in such offer of subscription
shall terminate if the Warrant shall not be exercised on or before the date of
such closing of the books or such record date.
(g) Any adjustment pursuant to the aforesaid provisions shall be
made on the basis of the number of shares of Common Stock which the holder
thereof would have been entitled to acquire by the exercise of the Warrant
immediately prior to the event giving rise to such adjustment.
(h) Irrespective of any adjustments in the Warrant Price or the
number or kind of shares purchasable upon exercise of the Warrants, Warrants
previously or thereafter issued may continue to express the same price and
number and kind of shares as are stated in the similar Warrants initially
issuable pursuant to this Warrant Agreement.
(i) The Company may retain a firm of independent public accountants
(who may be any such firm regularly employed by the Company) to make any
computation required under this Section, and any certificate setting forth such
computation signed by such firm shall be conclusive evidence of the correctness
of any computation made under this Section.
(j) If at any time, as a result of an adjustment made pursuant to
paragraph (d) above, the holders of a Warrant or Warrants shall become entitled
to purchase any securities other than shares of Common Stock, thereafter the
number of such securities so purchasable upon exercise of each Warrant and the
Warrant Price for such shares shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable to the provisions
with respect to the Common Stock contained in paragraphs (b) and (c).
(k) No adjustment to the Warrant Price or to the number of shares
of Common Stock purchasable upon the exercise of such Warrants will be made,
however under the following circumstances:
(i) upon the grant or exercise of any of the options presently
outstanding (or options which may hereafter be granted and/or exercised) under
the Company's Omnibus Stock Incentive Plan for officers, directors and/or
employees, consultants and similar situated parties of the Company; or
(ii) upon the sale or exercise of the Warrants issued to the public
pursuant to the ________ __, 1997 Prospectus; or
11
<PAGE> 13
(iii) upon exercise of this Warrant; or
(iv) upon exercise or sale of the Warrants issuable upon exercise
of the Representative's Warrants; or
(v) upon any amendment to or change in the term of any rights or
warrants to subscribe for or purchase, or options for the purchase of Common
Stock or convertible securities, including, but not limited to, any extension of
any expiration date of any such right, warrant or option, any change in any
exercise or purchase price provided for in any such right, warrant or option,
any extension of any date through which any convertible securities are
convertible into or exchangeable for Common Stock or any change in the rate at
which any convertible securities are convertible into or exchangeable for Common
Stock (other than rights, warrants, options or convertible securities issued or
sold after the close of business on the date of the original issue of the Common
Stock, (i) for presently outstanding securities, or (ii) for which an adjustment
in the Warrant Price then in effect was theretofore made or required to be made,
upon issuance or sale thereof).
8. Fractional Shares.
(a) The Company shall not be required to issue fractions of shares
of Common Shares on the exercise of the Warrants subject to this
Representative's Warrant. The Company shall not be obligated to issue any
fractional share interests or fractional warrant interests upon the exercise of
any Warrant or Warrants, nor shall it be obligated to issue scrip or pay cash in
lieu of fractional interests, provided, however, that if a holder exercises all
the Warrants held of record by such holder, the fractional interests shall be
eliminated by rounding any fraction up to the nearest whole number of shares.
(b) The Holder of this Representative's Warrant, by acceptance
hereof, expressly waives his right to receive any fractional share of Common
Stock upon exercise of the Warrants subject to this Underwriter's Warrant.
9. Redemption of Warrants underlying the Representative's Warrant.
The Warrants underlying the Representative's Warrant shall not be
subject to redemption by the Company until they have been exercised and the
underlying Warrants are outstanding.
12
<PAGE> 14
10. Miscellaneous.
(a) This Representative's Warrant shall be governed by and in
accordance with the laws of the State of New York.
(b) All notices, requests, consents and other communications
hereunder shall be made in writing and shall be deemed to have been duly made
when delivered, or mailed by registered or certified mail, return receipt
requested: (i) if to a Holder, to the address of such Holder as shown on the
books of the Company, or (ii) if to the Company, 780 Third Avenue, New York, New
York 10017.
(c) The Company and the Representative may from time to time
supplement or amend this Representative's Warrant without the approval of any
other Holders in order to cure any ambiguity, to correct or supplement any
provision contained herein which may be defective or inconsistent with any
provisions herein, or to make any other provisions in regard to matters or
questions arising hereunder which the Company and the Representative may deem
necessary or desirable and which the Company and the Representative deem not to
adversely affect the interest of the Holders.
(d) All the covenants and provisions of this Representative's
Warrant by or for the benefit of the Company and the Holders inure to the
benefit of their respective successors and assigns hereunder.
(e) Nothing in this Underwriter's Warrant shall be construed to
give to any person or corporation other than the Company and the Representative
and any other registered Holder or Holders, any legal or equitable right and
that any such right is for the sole and exclusive benefit of the Company and the
Underwriter and any other Holder or Holders.
(f) This Representative's Warrant may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and such counterparts shall together constitute but one and the
same instrument.
IN WITNESS WHEREOF, Russian Wireless Telephone Company, Inc. has
caused this Representative's Warrant to be signed by its duly authorized officer
and this Representative's Warrant to be dated __________ ___, 1997.
RUSSIAN WIRELESS TELEPHONE
COMPANY, INC.
By:___________________________
Ronald G. Nathan, President
<PAGE> 15
PURCHASE FORM
(To be signed only upon exercise of the Representative's Warrant)
The undersigned, the Holder of the foregoing Representative's Warrant,
hereby irrevocably elects to exercise the purchase rights represented by such
Representative's Warrant for, and to purchase thereunder, ________ shares of
Common Stock and/or ___ Warrants of Russian Wireless Telephone Company, Inc. and
herewith makes payment of $______ thereof, and requests that the certificates
for Common Stock/or Warrants be issued in the name(s) of, and delivered to
____________ whose address(es) is (are) ___________________________
Dated: __________________
_________________________
_________________________
Address
<PAGE> 16
TRANSFER FORM
(To be signed only upon transfer of the Representative's Warrant)
For value received, the undersigned hereby sells, assigns, and
transfers unto _______________________ the right to purchase shares of Common
Stock and/or Warrants of Russian Wireless Telephone Company, Inc. represented by
the foregoing Representative's Warrant to the extent of _____________ shares of
Common Stock and/or ____ Warrants, and appoints ______________, attorney to
transfer such rights on the books of Russian Wireless Telephone Company, Inc.,
with full power of substitution in the premises.
Dated:__________________
_________________________
(name of holder)
_________________________
Address
_________________________
In the presence of:
_________________________
_________________________
<PAGE> 1
Exhibit 4.7
RUSSIAN WIRELESS TELEPHONE COMPANY, INC.
INSTRUCTIONS
FOR COMPLETING THE CUSTODY AGREEMENT AND POWER OF ATTORNEY
ATTACHED AGREEMENT MUST BE COMPLETED AND SIGNED BY EACH STOCKHOLDER
WHO WISHES TO SELL SHARES IN THE PROPOSED OFFERING. ALL SIGNATURES
MUST BE GUARANTEED BY A BANK OR TRUST COMPANY OR MEMBER OF THE NEW
YORK OR AMERICAN STOCK EXCHANGE (SEE INSTRUCTION "D").
A. You have been sent four copies of the Custody Agreement and Power
of Attorney (the "Custody Agreement"). Please complete and return three copies
of the Custody Agreement to the address listed in paragraph F below together
with your endorsed stock certificate(s). One completed copy of the Custody
Agreement will be retained by the Custodian, one will be sent to the
Attorney-In-Fact and one will be returned to you.
B. The Custody Agreement includes a questionnaire on pages 10 through
15, which will be used to prepare any amendments to a Registration Statement on
Form SB-2 (No. 333-24177) which was filed by Russian Wireless Telephone Company,
Inc. (the "Company") with the Securities and Exchange Commission on March 28,
1997. You must answer each question fully and carefully.
C. You must indicate the number of shares you wish to sell by
completing page 18 of the Custody Agreement.
D. YOU MUST SIGN EACH COPY OF THE CUSTODY AGREEMENT ON PAGE 17, AND
YOU ALSO MUST SIGN EACH STOCK CERTIFICATE (OR THE ACCOMPANYING STOCK POWER)
DEPOSITED HEREUNDER. YOUR SIGNATURE MUST APPEAR ON THE CUSTODY AGREEMENT AND THE
STOCK CERTIFICATE OR THE ACCOMPANYING STOCK POWER GUARANTEED BY ANY BANK OR
TRUST COMPANY OR ANY BROKER WHO IS A MEMBER OF THE NEW YORK OR AMERICAN STOCK
EXCHANGE. PLEASE SIGN THE STOCK CERTIFICATE (OR THE ACCOMPANYING STOCK POWER)
AND EACH COPY OF THE CUSTODY AGREEMENT EXACTLY AS YOUR NAME APPEARS ON YOUR
STOCK CERTIFICATE.
E. IF STOCK CERTIFICATES TO BE DEPOSITED ARE ISSUED IN THE NAME OF
TRUSTEES, EXECUTORS, ADMINISTRATORS, GUARDIANS, PARTNERS, ATTORNEYS-IN-FACT,
NOMINEES, OR OTHERS ACTING IN A FIDUCIARY OR REPRESENTATIVE CAPACITY, THE
CUSTOMARY EVIDENCE OF AUTHORITY OF THE PERSON OR PERSONS MAKING THE DEPOSIT MUST
ACCOMPANY THE STOCK CERTIFICATES, TOGETHER WITH TRUE AND COMPLETE COPIES OF ANY
TRUST INSTRUMENT. EACH NOMINEE SHOULD ATTACH A CERTIFIED COPY OF HIS APPOINTMENT
AS NOMINEE OR A CERTIFIED AUTHORIZATION OF SUCH NOMINEE STATUS.
<PAGE> 2
F. Endorsed stock certificates or stock certificates with stock powers
attached along with fully executed copies of the completed Custody Agreement,
and any other documents you are executing in connection with this transaction,
should be promptly forwarded to:
Hall Dickler Kent Friedman & Wood, LLP
909 Third Avenue
New York, New York 10022
Attention: Steven D. Dreyer, Esq.
G. If any certificate which you submit represents a greater number
than the Shares to be sold by you, the Custodian will cause to be delivered to
you a certificate for the excess number of shares within 10 days after the
closing of the sale by the Underwriters.
H. PLEASE CONTACT MR. RONALD G. NATHAN, PRESIDENT OF THE COMPANY, IF
ANY INFORMATION OR REPRESENTATION INCLUDED IN THE ENCLOSED CUSTODY AGREEMENT
SHOULD CHANGE PRIOR TO THE SALE OF YOUR SHARES.
2
<PAGE> 3
CUSTODY AGREEMENT AND POWER OF ATTORNEY
for
Sale of Shares of Common Stock, $.01 Par Value
RUSSIAN WIRELESS TELEPHONE COMPANY
Hall Dickler Kent Friedman & Wood, LLP
909 Third Avenue
New York, New York 10022
Attention: Steven D. Dreyer, Esq.
("Attorney-In-Fact" and "Custodian")
Dear Sirs:
The undersigned stockholder (the "Selling Stockholder") of Russian
Wireless Telephone Company, Inc., a Delaware corporation (the "Company"), and
the Company desire to sell certain shares of the Common Stock of the Company,
$.01 par value (the "Common Stock"), to J.W. Barclay & Co. Inc. as the
representative of the underwriters (the "Representative") for distribution under
a Registration Statement on Form SB-2 (File No. 333-24177) (the "Registration
Statement") to the public at a price and on terms to be determined as
hereinafter set forth. The Company proposes to issue and sell an aggregate of
1,620,000 shares of its authorized and unissued Common Stock and 2,200,000
redeemable Common Stock Purchase Warrants (the "Warrants"), and has granted the
Underwriters an option to purchase up to an additional 247,500 shares of its
authorized and unissued Common Stock and 330,000 additional Warrants on the
terms and conditions of the Underwriting Agreement, as defined below. The
Selling Stockholder proposes to sell an aggregate of 30,000 shares of Common
Stock. The aggregate number of shares or any portion thereof to be sold are
referred to hereinafter as the "Purchased Shares"; the aggregate number of
shares or any portion thereof included in the option granted the Underwriters
are referred to hereinafter as the "Option Shares"; and the Purchased Shares and
the Option Shares together sometimes are referred to hereinafter as the
"Shares". It is understood that such sale to the Underwriters shall be entered
into only if, as and when the Attorney-In-Fact (as hereinafter defined), acting
for the Selling Stockholder in his discretion determines that such sale is in
the best interests of the Selling Stockholder.
3
<PAGE> 4
A. Power of Attorney
The undersigned hereby irrevocably constitutes and appoints Steven D.
Dreyer his true and lawful agent and attorney ("Attorney-In-Fact") with respect
to all matters arising in connection with the public offering and sale of the
Shares to be sold by the undersigned to the Underwriters, including, but not
limited to, the power and authority on behalf of the undersigned to do any and
all of the following things:
1. To make, execute and deliver an underwriting agreement (the
"Underwriting Agreement") substantially in the form of the draft
thereof which the undersigned has received and which was filed as
Exhibit 1.1 to the Registration Statement, but with such insertions,
changes, additions or deletions as the Attorney-In-Fact shall determine
to be not materially adverse to the undersigned, and not inconsistent
with the draft thereof, such approval to be conclusively evidenced by
his execution and delivery thereof, and to carry out and comply in his
sole discretion with all the provisions of the Underwriting Agreement,
including the making of all representations and agreements provided in
the Underwriting Agreement to be made by, and to exercise all authority
thereunder vested in, the undersigned.
2. To sell, assign and transfer to the Underwriters pursuant to
Section 4 of the Underwriting Agreement the aggregate number, but not
less than the aggregate number, of Purchased Shares listed in Schedule
A hereto and deposited hereunder for sale by the undersigned.
3. To negotiate, determine and agree upon (a) the price at which
the Shares (including the Shares to be sold by the undersigned) will be
sold by the Selling Stockholders to the Underwriters pursuant to the
Underwriting Agreement, and (b) the price at which the Shares
(including the Shares to be sold by the undersigned) initially will be
offered to the public by the Underwriters, such price to be not less
than $7.00 per share and to include an Underwriters' discount and
commission of not more than 9%. The difference between the price paid
by the Underwriters to the Company and the price at which the Shares
are offered and sold to the public represents a portion of the
Underwriters' compensation for its services.
4. To take any and all steps deemed necessary or desirable by the
Attorney-In-Fact in connection with the registration with the
Securities and Exchange Commission (the "Commission") of the Shares
under the Securities Act of 1933, as amended (the "Securities Act"),
and the registration or
4
<PAGE> 5
qualification of the Shares under the securities or blue sky laws of
any jurisdiction, including the requesting of acceleration of
effectiveness of the Registration Statement, the filing of letters with
the Commission and such other steps as the Attorney-In-Fact may deem
necessary or advisable.
5. To represent to the Commission, if requested by the
Commission, that the undersigned is selling the Shares owned by him for
the purposes of raising funds or diversifying the investment portfolio
of the undersigned.
6. To accept and deliver to the Custodian, on behalf of the
undersigned, any certificates for shares of stock of the Company issued
in the name of the undersigned after the date hereof but prior to the
sale of the Shares to the Underwriters.
7. If necessary, to endorse (in blank or otherwise) on behalf of
the undersigned the certificate or certificates representing the Shares
to be sold by the undersigned, or a stock power or powers attached to
such certificate or certificates, and to transfer and deliver such
certificate or certificates representing such Shares to or upon the
order of the Underwriters.
8. To instruct the Company's transfer agent with respect to all
matters pertaining to the certificates representing the Shares; to
cause the Company's transfer agent to issue and register a certificate
or certificates representing the Shares in accordance with the
directions of the Underwriters; and to permit inspection and packaging
of such certificates by the Underwriters, in each case as provided in
the Underwriting Agreement.
9. To retain Messrs. Hall Dickler Kent Friedman & Wood, LLP, as
legal counsel for the Selling Stockholder.
10. Subject to the terms and conditions of Section 1 hereof,
otherwise to take all actions and do all things, in his discretion,
including the execution and delivery of all documents necessary or
proper, required, contemplated or deemed advisable by the Selling
Stockholder and generally to act for and in the name of the undersigned
with respect to the sale of the Shares to the Underwriters and
re-offering of the Shares by the Underwriters as fully as could the
undersigned if then personally present and acting.
The Attorney-In-Fact hereby is empowered to determine in his sole
discretion the time or times when, and the purposes for and the manner in which,
any power herein conferred upon him by the
5
<PAGE> 6
Selling Stockholder shall be exercised and to exercise any such power.
This Power of Attorney shall terminate (other than as provided in
Section H hereof) when the Shares to be sold by the Selling Stockholder have
been delivered and paid for as provided in the Underwriting Agreement and any
and all actions required to be taken by the Custodian under this Agreement and
the Underwriting Agreement have been completed.
B. Deposit of Shares
For the purposes hereof, the undersigned herewith transmits to the
Custodian, one or more certificates representing not less than the aggregate
number of Shares set forth with respect to the undersigned in Schedule A
attached hereto. Each such certificate so delivered (i) is in negotiable and
proper deliverable form with the signature of the undersigned to the endorsement
thereon guaranteed by a bank or trust company having an office or a
correspondent in New York City or by a member of the New York Stock Exchange or
American Stock Exchange, or (ii) is accompanied by a duly executed stock power
or powers, in blank, bearing the signature of the undersigned so guaranteed. The
Custodian is hereby authorized and directed, subject to the instructions of the
Attorney-In-Fact: (i) to hold the Shares represented by the certificate or
certificates referred to above in custody; (ii) to make such other appropriate
arrangements as may be necessary for the safekeeping of said certificate or
certificates and the delivery thereof for sale to the Underwriters at the date
of delivery; and (iii) to deliver to the undersigned new certificates for the
untransferred balance, if any, of the shares of Common Stock evidenced by the
enclosed certificate or certificates.
If acting as a trustee or in any other fiduciary or representative
capacity, the undersigned has delivered duly certified copies of each trust
agreement, will, letters testamentary or other instrument pursuant to which the
undersigned is authorized to act as a Selling Stockholder. The undersigned
agrees to deliver to the Attorney-In-Fact or the Custodian such additional
documentation as the Company or the Underwriters may request to effectuate any
of the provisions hereof or of the Underwriting Agreement.
C. Sale of Shares
The Custodian hereby is authorized and directed to deliver to the
Underwriters certificates for the Shares to be sold by the undersigned as
provided in the Underwriting Agreement against delivery to the Custodian for the
account of the undersigned of the purchase price payable by the Underwriters in
the form of a
6
<PAGE> 7
certified check of J.W. Barclay & Co., Inc., or by bank cashier's check in New
York Clearing House funds payable to the order of each of the Selling
Stockholders for their respective amounts. The Custodian is authorized, on
behalf of the undersigned, to accept and acknowledge receipt of the payment of
the purchase price for the Shares to be sold by the undersigned.
D. Representations, Warranties and Agreements
The undersigned represents and warrants to, and agrees with the Company
and the Underwriters that (i) the undersigned has reviewed carefully the proof
of the Underwriting Agreement, including without limitation, the representations
and warranties to be made by the undersigned as a Selling Stockholder contained
in Section 2.B, the certificate referred to in Section 9(i), and the indemnity
and contribution provisions contained in Section 10; (ii) such representations
and warranties are true and correct as of the date hereof and will be true and
correct at the time of the execution of the Underwriting Agreement and the time
of the sale of the Shares to the Under-writers; and (iii) such covenants and
agreements are valid and binding as of the date hereof and will be valid and
binding at the time of the execution of the Underwriting Agreement and the time
of the sale of the Shares to the Underwriters. This Agreement constitutes a
representation that the undersigned has received the Preliminary Prospectus of
the Company and, except as set forth under "Exceptions" below, the information
contained in such Preliminary Prospectus with respect to the undersigned is true
and correct.
The foregoing representations, warranties and agreements, as well as
those contained in the Questionnaire which comprises Section I of this
Agreement, and those contained in the Underwriting Agreement, are and will be
made for the benefit of, and may be relied upon by, the Underwriter, the
Attorney-in-Fact, and the Custodian and their respective representatives, agents
and counsel.
EXCEPTIONS:
E. Irrevocability of Instruments
This Agreement, the deposit pursuant hereto of certificates
representing the Shares, and all authority herein conferred, is granted, made
and conferred subject to and in consideration of the interest of the
Underwriters and the Company, for the purpose of completing the transactions
contemplated hereunder and by the Underwriting Agreement; and the
Attorney-In-Fact further is vested hereby with an estate, right, title and
interest in and to the Shares for the purpose of irrevocably empowering and
securing to him authority sufficient to consummate said transactions at the time
of purchase. Accordingly, this Agreement shall be irrevocable prior to August
31, 1997 and shall remain in full force and effect
7
<PAGE> 8
until that date. Furthermore, for the consideration herein referred to and in
consideration of the said interest in the Shares, the undersigned agrees that
this Agreement is irrevocable and shall not be terminated by operation of law
upon the occurrence of any event whatsoever.
F. Rights and Obligations of the Selling Stockholder
Until payment in full for the Shares has been made by or for the
account of the Underwriters, as above provided, the undersigned Selling
Stockholder shall remain the owner of his Shares and shall retain all rights of
ownership with respect to the Shares, including the right to vote and to receive
any dividends and payment thereon, except the right to dispose of the Shares,
which is subject to the Attorney-In-Fact's, rights pursuant hereto and subject
to the Underwriting Agreement. However, until such payment in full has been
made, or until the Underwriting Agreement has been terminated, the undersigned
agrees not to give, pledge, hypothecate, grant liens on, transfer, deal with or
contract with respect to, the Shares, or any interest therein, except in
accordance with the Underwriting Agreement, and the Custodian shall not seek,
request or demand any transfer, or transfer any, of the Shares except pursuant
to the Underwriting Agreement.
G. Liability and Indemnification of
the Attorney-In-Fact and Custodian
Subject to the terms and conditions of Section A.1 hereof, the
Attorney-In-Fact and the Custodian are authorized to accept this Agreement and
take any and all actions hereunder as the Attorney-In-Fact, in his sole
discretion, shall determine. The Attorney-In-Fact and Custodian assume no
responsibility or liability to the undersigned or to any other person, other
than to deal with the Shares and any other shares of Common Stock held and
received by the Attorney-In-Fact or deposited with the Custodian pursuant to the
terms of this Agreement in accordance with the provisions hereof. The
undersigned hereby does agree to indemnify and hold harmless the
Attorney-In-Fact and the Custodian with respect to anything done by them in good
faith in connection with any and all matters contemplated by this Agreement or
the Underwriting Agreement.
H. Return of Undelivered Shares
If the Underwriting Agreement is not executed and delivered prior to
October 31, 1997, or if the Underwriting Agreement shall be executed and
delivered and then terminated pursuant to the provisions thereof without
purchase of the Shares, this Custody Agreement (and the Power of Attorney
included herein) shall terminate, and the Attorney-In-Fact, after all
obligations
8
<PAGE> 9
hereunder or under the Underwriting Agreement have been fulfilled, shall
instruct the Custodian to return to the undersigned the Shares held in custody
for the account of the undersigned, together with any applicable stock powers,
unless this Agreement is extended by written notice from the Selling
Stockholder.
I. Questionnaire
In connection with the preparation of the Registration Statement it is
necessary that the Company obtain from you the information called for by the
following questions. The information supplied in response to this Questionnaire
will be used to assure that certain of the information included in the
Registration Statement is correct. Accordingly, great care should be exercised
in the completion of the following questions,
If the answer to any item is negative, or if such item is inapplicable,
please so state in the space provided. If the space provided is insufficient for
a complete answer, additional sheets may be attached to this Agreement.
Question 1. Before answering this question, please read the explanatory
information concerning "beneficial ownership" which follows this question.
Please state as of (I) September 30, 1997, and (II) immediately
following the sale of the Shares by you to the Underwriters:
<TABLE>
<CAPTION>
I II
As of
Sept. 30, 1997 After sale
-------------- ----------
<S> <C> <C>
A.1. The number of shares
of the Company's Common Stock
beneficially owned, directly or
indirectly, by you:
2. The number of shares
listed in A.1 as to which you
have sole voting power: _____ shares _____ shares
share voting power: _____ shares _____ shares
have sole investment/
disposition power: _____ shares _____ shares
</TABLE>
9
<PAGE> 10
<TABLE>
<S> <C> <C>
share investment/
disposition power: _____ shares _____ shares
</TABLE>
<TABLE>
<CAPTION>
I II
As of
Sept. 30, 1997 After sale
-------------- ----------
<S> <C> <C>
3. The number of shares
of the Company's Common Stock
owned of record by you: _____ shares _____ shares
4. Whether the shares
listed in A.3 are included in
those listed in A.1: Yes____No____ Yes____No____
B.1. The number of shares
of Company Common Stock that
are owned by a partnership, firm,
corporation, trust, estate or
voting trust of which you are a
partner, director, officer,
principal stockholder, trustee,
executor or participant: _____ shares _____ shares
2. The name (or other
identification) of any such
partnership, firm, corporation,
trust, estate or voting trust:
3. Whether the shares
listed in B.1 are included in
those listed in A.1: Yes____No____ Yes____No____
C.1. The number of shares of
Company Common Stock with
respect to which you have the
right to acquire beneficial
ownership, directly or
indirectly, within 60 days
pursuant to the power to
revoke or the automatic
termination of a trust,
discretionary account or
similar arrangement: _____ shares _____ shares
</TABLE>
10
<PAGE> 11
<TABLE>
<S> <C> <C>
through the exercise of
any option, warrant or
right _____ shares _____ shares
</TABLE>
<TABLE>
<CAPTION>
I II
As of
Sept. 30, 1997 After sale
-------------- ----------
<S> <C> <C>
2. Whether the shares
listed in C.1 are included
in those listed in A.1: Yes____No____ Yes____No____
</TABLE>
Note: Items A, B and C are intended to elicit information as to the nature of
your beneficial ownership of shares (such as record ownership, beneficial
ownership by virtue of your having or sharing voting or investment powers,
beneficial ownership by reason of your right to acquire, etc.). If you do not
believe that the nature of your beneficial ownership is apparent from your
responses to items A, B and C, please further explain below:
<TABLE>
<S> <C> <C>
D. The number of shares
reported as beneficially owned
by you under Question A.1 that
are subject to any put, call,
straddle or other option, or to
any pledge, hypothecation or other
agreement which may affect your
ownership thereof, and the nature
of the option or agreement
involved: _____ shares _____ shares
E.1. The number of shares
reported as beneficially owned
by you under Question A.1 as to
which you disclaim beneficial
ownership: _____ shares _____ shares
2. If you disclaim beneficial
ownership of any shares, please
briefly identify such shares and
state the reasons for such disclaimer:
</TABLE>
Beneficial ownership: A beneficial owner of a security includes any person who,
directly or indirectly, through any contract, arrangement, understanding,
relationship or otherwise has or shares (1) voting power, including the power to
direct the voting of such security or (2) disposition power, including the power
to dispose
11
<PAGE> 12
of or direct the disposition of such security. In addition, a person is deemed
to have "beneficial ownership" of any securities as to which such person has the
right to acquire beneficial ownership at any time within 60 days, including, but
not limited to, any right to acquire:
(i) through the exercise of any option, warrant or right;
(ii) through the conversion of any security;
(iii) pursuant to the power to revoke a trust, discretionary
account or similar arrangement; or
(iv) pursuant to the automatic termination of a trust,
discretionary account or similar arrangement.
It is possible that a security may have more than one "beneficial
owner," such as a trust, with two co-trustees sharing voting power, and the
settler or another third party having investment power, and the settler or
another third party having investment power, in which case each of the three
would be the "beneficial owner" of the securities in the trust. The power to
vote or direct the voting, or to invest or dispose of, or direct the investment
or disposition of, a security may be indirect and arise from legal, economic,
contractual or other rights, and the determination of beneficial ownership
depends on who ultimately possesses or shares the power to direct the voting or
the disposition of the security.
The final determination of the existence of beneficial ownership
depends on the facts of each case; you may, in the space provided after Question
1.E.2, disclaim beneficial ownership of securities held in the name of another,
although indicating the holdings of such other person. Since beneficial
ownership by you of securities registered in the name of another may have
serious consequences, financial or otherwise, to you, you should use great care,
and if necessary consult your attorney, before reporting such shares as
beneficially owned.
Question 2. Describe briefly and state the approximate amount of any
interest, direct or indirect, which you or any of your associates had or have in
any transaction, or series of similar transactions, occurring in whole or in
part since April 1994 or in any proposed transaction, or series of similar
transactions, to which the Company was, or is to be, a party. You may merely
affirm the statements made in the Preliminary Prospectus dated September 16,
1997 under the heading "Certain Relationships and Related Transactions." (You
need not describe transactions in which you or any associate did not have an
aggregate interest
12
<PAGE> 13
exceeding $10,000 or any transaction in which your interest arose solely from
your ownership of securities of the Company provided that you received no extra
or special benefit not shared on a pro rata basis by all other security
holders.) For purposes of the foregoing, your "associates" include:
(1) Any corporation or other organization (other than the Company)
of which you are an officer or partner or of which you
beneficially own, directly or indirectly, 10% or more of any
class of equity securities;
(2) Any trust or estate in which you have a
substantial beneficial interest or as to which
you serve as trustee, executor or in a similar
fiduciary capacity; and
(3) Your spouse and any relative of yours or of your spouse if
such relative either lives with you or is a director or
officer of the Company or any of its subsidiaries.
ANSWER:
Question 3. Please describe briefly any material legal proceeding
pending or known to be contemplated in which you or any of your associates (as
defined in the previous question) has an interest adverse to the Company,
including the name of the court or agency in which any proceeding is pending or
known to be contemplated, the date instituted or the date you anticipate it will
be instituted, the principal parties thereto, a description of the factual basis
alleged to underly the proceeding or contemplated proceeding and the relief
sought or to be sought.
ANSWER:
Question 4. Do you know of any arrangement (other than the proposed
Underwriting Agreement) made or to be made by any person for any of the
following purposes: (a) to limit or restrict the sale of shares of the Company's
Common Stock during the period of distribution; (b) to stabilize the market for
any shares of the Company's Common Stock to be offered; or (c) to withhold
commissions, or otherwise to hold the Underwriters or each dealer
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<PAGE> 14
responsible for the distribution of his participation in connection with the
proposed offering?
Yes_________ No_________
If yes, please summarize your knowledge of such arrangement:
Question 5. Please state whether (a) you are, directly or indirectly,
affiliated or associated with any member of the National Association of
Securities Dealers, Inc. or (b) you have been or might be an underwriter, or a
controlling person or member of any investment banking or brokerage firm which
has been or might be an underwriter, for securities of the Company including the
securities now being registered. If your answer to (a) is in the affirmative,
please state the name of such member and the nature of the relationship. If your
answer to (b) is in the affirmative, please state any underwriting discounts and
commissions received or which might be received by you or such firm upon the
sale of securities by the Company.
ANSWER:
Question 6. Please state each person or specify each class of persons
(other than underwriters or dealers, as such) to whom any shares of Common Stock
of the Company have been sold by you or any associate (as defined in Question 2)
of yours, since April 1, 1982 or are to be sold by you or any such associate of
yours. In answering this question, please make a separate statement with respect
to each sale of Common Stock, giving the number of shares of Common Stock sold,
the price at which such shares were sold and the consideration given for the
shares so sold.
ANSWER:
Question 7. Do you or does any associate (as defined in Question 2) of
yours have any understanding or agreement to sell to anyone shares of Common
Stock other than pursuant to the Underwriting Agreement? If yes, please give
details of any such sale, undertaking or agreement, including the date(s),
number of shares, sale price and party to whom sold or to be sold.
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<PAGE> 15
ANSWER:
J. Miscellaneous
This Agreement may be executed in any number of counterparts, each of
which shall be deemed to be an original and all of which together shall be
deemed to be one and the same instrument.
Receipt by the Attorney-In-Fact and the Custodian of executed
counterparts of this Agreement, or any certificate representing Shares deposited
hereunder, shall constitute acceptance by each of the Attorney-In-Fact and the
Custodian of the authorizations herein conferred and evidence the agreement of
each of the Attorney-In-Fact and the Custodian to carry out and to perform this
Agreement in accordance with the provisions hereof.
The validity, enforceability, interpretation and construction of this
Agreement shall be determined in accordance with the laws of the State of New
York and shall inure to the benefit of, and this Agreement shall be binding
upon, the undersigned and the undersigned's heirs, executors, administrators,
successors end assigns, as the case may be.
If any word, phrase, clause, portion or provision of this Agreement
shall be held or deemed to be, or shall in fact be, inoperative or unenforceable
as applied in any particular case or circumstance in any applicable jurisdiction
or jurisdiction because if conflicts with any other provision hereof, or any
constitution, statute or rule of public policy, or for any other reason, such
eventuality shall not render any of the aforesaid inoperative or unenforceable
in any other case or circumstance, or render any one or more or combination of
any words, phrases, clauses, portions, or provisions herein invalid,
inoperative, ultra vires or unenforceable to any extent whatsoever.
The undersigned hereby ratifies and confirms all that the
Attorney-In-Fact shall do by virtue hereof.
15
<PAGE> 16
IN WITNESS WHEREOF, the undersigned has executed this Agreement on this
__________ day of ___, 1997.
Signature:
____________________________________
Signature of Selling ____________________________________
Stockholder Guaranteed Please sign exactly as your
by: name appears on your stock
certificate.
Name and address to which
___________________________ notices and funds shall be
*(See Note below) sent (please print or type),
____________________________________
(Name)
____________________________________
(Street)
____________________________________
(City) (State) (Zip Code, if
in USA)
*(NOTE: The Stockholder's signature must be guaranteed by a bank or trust
company or by a member of the New York or American Stock Exchange.)
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<PAGE> 17
SCHEDULE A
Certificate for Shares of Common Stock of
RUSSIAN WIRELESS TELEPHONE COMPANY, INC.
Deposited Herewith
1. Your exact name and address:
2. Certificates for Shares of Common Stock Deposited
<TABLE>
<CAPTION>
A B C
No. of Shares
No. of Shares of Common Stock
of Common Stock from This
Certificate represented by Certificate
Number Certificate* To Be Sold**
--------------- --------------- ---------------
<S> <C> <C>
--------------- --------------- ---------------
--------------- --------------- ---------------
--------------- --------------- ---------------
</TABLE>
- --------------------
* The number to be inserted in this column is the number appearing on the
stock certificate you are submitting for sale.
** The number to be inserted in this column is the number of shares from
the certificate that you want to sell. If you deposit a certificate or
certificates representing more shares than you plan to sell, the
Custodian will cause to be delivered to you a new certificate
representing the number of shares to be retained by you within ten days
after the closing of the sale to the Underwriters.
17
