Form of Amendment No. 1 to Stockholder's Agreement
WHEREAS, the undersigned (the "Stockholder") and Winstar Communications,
Inc. (the "Company") previously entered into a Stockholder's Agreement.
WHEREAS, the Company has amended the terms of the Subordinated Notes
Exchange Offer such that holders of its 11% Notes and 15% Notes will receive
solely New Senior Notes or a combination of New Senior Notes and New Senior
Discount Notes in the Subordinated Notes Exchange Offer.
WHEREAS, the Company desires to provide to the Stockholder the same
allocation of New Senior Notes and New Senior Discount Notes as will be
available to holders of 11% Notes and 15% Notes participating in the
Subordinated Notes Exchange Offer.
Capitalized terms used and not otherwise defined in this Amendment shall
have the respective meanings assigned to them in the Stockholder's Agreement, as
amended hereby.
NOW, THEREFORE, in consideration of the premises and the representations,
warranties and agreements contained herein, the parties agree as follows:
1. Amendment to the Stockholder's Agreement.
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Upon the effectiveness of this Amendment, the Stockholder's Agreement shall
be and is hereby amended as set forth in paragraph (a) below.
(a) Section (1) of the Stockholder's Agreement is deleted and replaced in
its entirety with the following:
The Stockholder hereby agrees that it shall
exchange its Exchange Debentures for New Senior
Notes and/or New Senior Discount Notes at the
Exchange Price (as defined) in the Debenture
Exchange Transaction (it being understood that the
obligation contained in this sentence is
unconditional, subject to Section 7), and that it
shall execute such other documentation as may be
required to effect its participation in the
Debenture Exchange Transaction. The exchange
price (the "Exchange Price") will be (1) New
Senior Notes with a value (determined as of
June 16, 2000, and inclusive of principal amount
and accrued interest assuming issuance of such New
Senior Notes on the issue date of the New Senior
Notes issued in the Private Placement and the
Subordinated Notes Exchange Offer) of $1,545.91,
(2) New Senior Discount Notes with an Accreted
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Value (as defined therein) of $1,545.91
(determined as of June 16, 2000) or (3) a
combination of New Senior Notes and New Senior
Discount Notes with a value and Accreted Value,
respectively, of $1,545.91 (determined as of June
16, 2000) for each $1,000 principal amount of the
Exchange Debentures. The Company's obligation to
effect the Exchange Debenture Election and
consummate the Debenture Exchange Transaction is
subject to the following conditions (which may be
waived in the sole discretion of the
Company): (a) the Company having accepted
Existing Senior Notes for payment in the Tender
Offer, (b) the Company having accepted Existing
Subordinated Notes for exchange in the
Subordinated Notes Exchange Offer, and (c) the
Company having consummated the Notes Offering.
Upon satisfaction (or waiver) of these conditions,
the Company will become unconditionally obligated
to effect the Exchange Debenture Election and
consummate the Debenture Exchange Transaction,
subject only to the next paragraph.
In lieu of the commitment by the Company to
effect the Exchange Debenture Election and the
Debenture Exchange Transaction, the Company
reserves the right, at any time after consummation
of the Refinancing, to commence a Direct Exchange
Offer wherein the Company would offer to exchange
any and all of the shares of Preferred Stock for
its New Senior Notes, New Senior Discount Notes or
a combination thereof. In such event, the
Stockholder hereby agrees that it shall tender its
Shares into any Direct Exchange Offer and that it
shall not withdraw any Shares so tendered (it
being understood that the obligation contained in
this sentence is unconditional, subject to
Section 7). The Offer Price in any Direct
Exchange Offer will be (1) New Senior Notes with a
value (determined as of June 16, 2000, and
inclusive of principal amount and accrued interest
assuming issuance of such New Senior Notes on the
issue date of the New Senior Notes issued in the
Private Placement and the Subordinated Notes
Exchange Offer) of $1,545.91, (2) New Senior
Discount Notes with an Accreted Value (as defined
therein) of $1,545.91 (determined as of June 16,
2000) or (3) a combination of New Senior Notes and
New Senior Discount Notes with a value and
Accreted Value, respectively, of $1,545.91
(determined as of June 16, 2000) for each $1,000
Initial Liquidation Preference (as defined in the
Certificate of Designation) of the Preferred
Stock.
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In either instance, the Stockholder will
receive New Senior Notes and New Senior Discount
Notes in the proportions set forth below:
(1) New Senior Discount Notes with an Accreted
Value (determined as of June 16, 2000) equal
to the aggregate principal amount of Exchange
Debentures (or aggregate Liquidation
Preference of Preferred Stock in the case of
a Direct Exchange Offer) held by the
Stockholder multiplied by a fraction equal to
(A) the amount of New Senior Discount Notes
available for issuance to holders of 11%
Notes and 15% Notes in the Subordinated Notes
Exchange Offer and to holders of Exchange
Debentures (or Preferred Stock) divided by
(B) the sum of (x) the aggregate Total
Exchange Value (which represents the offer
price plus the consent consideration to be
paid in the Subordinated Notes Exchange
Offer) of the 11% Notes and 15% Notes
tendered in the Subordinated Notes Exchange
Offer and (y) the result of (i) the Exchange
Price multiplied by (ii) the aggregate
Initial Liquidation Preference of the
Series C Preferred Stock; and
(2) New Senior Notes with a value (determined as
of June 16, 2000, and inclusive of principal
amount and accrued interest assuming issuance
of such New Senior Notes on the issue date of
the New Senior Notes issued in the Private
Placement and the Subordinated Notes Exchange
Offer) equal to the aggregate principal
amount of Exchange Debentures (or aggregate
Liquidation Preference of Preferred Stock in
the case of a Direct Exchange Offer) held by
the Stockholder multiplied by the fraction
obtained by subtracting the fraction
calculated in the preceding paragraph from
1.0.
The Company will designate no more than
$450.0 million of New Senior Discount Notes
(calculated based on the issue date Accreted Value
of such notes) for issuance in the Subordinated
Notes Exchange Offer and in exchange for the
Exchange Debentures to be issued in respect of the
Preferred Stock (or in exchange for the Preferred
Stock in the case of a Direct Exchange Offer).
This amount will be reduced to less than $450.0
million (and may be reduced to zero) to the extent
the Company (1) sells New Senior Discount Notes in
the Private Placement and/or (2) holders of 10%
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Notes elect to receive New Senior Discount Notes
in the Subordinated Notes Exchange Offer and (3)
the Company does not increase the amount of New
Senior Discount Notes to be issued.
2. Stockholder's Agreement.
Except as expressly amended or modified herein,
the Stockholder's Agreement (as amended hereby) shall
continue in full force and effect in accordance with the
provisions hereof and thereof as in existence on the date
hereof. After the date hereof, any reference to the
Stockholder's Agreement, shall mean the Stockholder's
Agreement as amended by this Amendment.
3. General Provisions.
(a) Amendments. This Amendment may be amended at
any time only by a written instrument executed by each
of the parties hereto.
(b) Counterparts. This Amendment may be executed
in two or more counterparts, all of which shall be
considered one and the same agreement and shall become
effective when two or more counterparts have been
signed by each of the parties and delivered to the
other parties, it being understood that all parties
need not sign the same counterpart.
(c) Entire Agreement; No Third-Party
Beneficiaries. The Stockholder's Agreement (including
the documents and instruments referred to herein), as
amended by this Amendment, (i) constitutes the entire
agreement and supersedes all prior agreements and
understandings, both written and oral, among the
parties with respect to the subject matter hereof and
(ii) is not intended to confer upon any person other
than the parties hereto any rights or remedies
hereunder.
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(d) Governing Law. THIS AMENDMENT SHALL BE
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT
GIVING EFFECT TO ITS CONFLICT OF LAWS RULES) AS TO ALL
MATTERS, INCLUDING BUT NOT LIMITED TO, MATTERS OF
VALIDITY, CONSTRUCTION, EFFECT AND PERFORMANCE.
WINSTAR COMMUNICATIONS, INC.
by __________________________
Name:
Title:
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[Counterpart Signature Page]
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(Stockholder)
Dated: By:
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(signature)
Aggregate Initial Liquidation
Preference of Preferred
by Stock held by ----------------------------------
Stockholder: (name and title)
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$ (city/state/zip code)
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(phone)
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(facsimile)
