This REGISTRATION RIGHTS AGREEMENT
(the "Agreement"), is made as of
December 3, 1999, by and among Teligent,
Inc. a Delaware corporation, (the
"Company") and the security holders
listed on Schedule I to this Agreement.
WHEREAS, the Company and the Initial Holders (as
herein defined) (or certain Affiliates of the Initial
Holders) entered into a Stock Purchase Agreement dated
November 4, 1999 (the "Stock Purchase Agreement");
WHEREAS, it is a condition precedent to the closing
of the transactions contemplated in the Stock Purchase
Agreement that the parties hereto execute and deliver this
Agreement;
NOW THEREFORE, in consideration of the premises,
mutual promises and covenants contained in this Agreement and
intending to be legally bound, the parties hereto hereby
agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Definitions. Terms defined in the
Stock Purchase Agreement are used herein as therein defined.
In addition, the following terms, as used herein, have the
following meanings:
"Chase Holders" means the Initial Chase Holders and
any direct or indirect transferee of any Registrable
Securities held by the Initial Chase Holders.
"Commission" means the Securities and Exchange
Commission.
"Demand Registration" means a registration under
the Securities Act requested in accordance with Section 2.01.
"DB Holders" means the Initial DB Holders and any
direct or indirect transferee of any Registrable Securities
held by the Initial DB Holders.
"HMTF Holders" means the Initial HMTF Holders and
any direct or indirect transferee of any Registrable
Securities held by the Initial HMTF Holders.
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"Holders" means the collective reference to the
HMTF Holders, the Microsoft Holders, the Chase Holders, the
DB Holders and the Olympus Holders.
"Initial Chase Holders" means Chase Capital
Partners, a New York General Partnership, or any of its
Affiliates that it controls (including without limitation
Chase Equity Associates, L.P.)
"Initial DB Holders" means DB Capital
Investors, L.P.
"Initial HMTF Holders" means HM4 Teligent Qualified
Fund, LLC; HM4 Teligent Private Fund, LLC; HM PG-IV Teligent,
LLC; HM 4-SBS Teligent Coinvestors, LLC, HM 4-EQ Teligent
Coinvestors, LLC and HMTF Bridge Teligent, LLC.
"Initial Holders" means the collective reference to
the Initial HMTF Holders, the Initial Microsoft Holders, the
Initial Chase Holders, the Initial DB Holders and the Initial
Olympus Holders.
"Initial Microsoft Holders" means Microsoft
Corporation.
"Initial Olympus Holders" means Olympus Growth Fund
III, L.P. and Olympus Executive Fund, L.P.
"Initial Shelf Registration" has the meaning set
forth in Section 2.03(a).
"Microsoft Holders" means the Initial Microsoft
Holders and any direct or indirect transferee of any
Registrable Securities held by the Initial Microsoft Holders.
"Olympus Holders" means the Initial Olympus Holders
and any direct or indirect transferee of any Registrable
Securities held by the Initial Olympus Holders.
"Piggyback Registration" has the meaning set forth
in Section 2.02.
"Registrable Common Stock" means the shares of
Common Stock issued upon conversion of the Registrable Series
A Preferred Stock, plus any additional shares of Common Stock
issued in respect thereof in connection with any stock split,
stock dividend or similar event with respect to the Common
Stock.
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"Registrable Series A Preferred Stock" means the
Series A Preferred Stock purchased pursuant to the Stock
Purchase Agreement, plus any additional shares of Series A
Preferred Stock issued in respect thereof in connection with
any stock split, stock dividend or similar event with respect
to the Series A Preferred Stock.
"Registrable Securities" means (a) the Registrable
Series A Preferred Stock, (b) the Registrable Common Stock
and (c) any securities of the Company or any successor entity
into which Registrable Common Stock or Registrable Series A
Preferred Stock may hereafter be converted or changed. As to
any particular Registrable Securities, such securities shall
cease to be Registrable Securities when (i) a registration
statement with respect to the sale of such securities shall
have become effective under the Securities Act and such
securities shall have been disposed of under such
registration statement, (ii) such securities shall have been
transferred pursuant to Rule 144, (iii) such securities shall
have been otherwise transferred or disposed of, and new
certificates therefor not bearing a legend restricting
further transfer shall have been delivered by the Company,
and subsequent transfer or disposition of them shall not
require their registration or qualification under the
Securities Act or any similar state law then in force, or
(iv) such securities shall have ceased to be outstanding.
"Requesting Holders" means the Holders requesting a
Demand Registration, and shall include parties deemed
"Requesting Holders" pursuant to Sections 2.01(a)(v)-(vii).
"Rule 144" means Rule 144 (or any successor rule of
similar effect) promulgated under the Securities Act.
"Second Shelf Registration" has the meaning set
forth in Section 2.03(b).
"Selling Holder" means any Holder who is selling
Registrable Securities pursuant to a public offering
registered hereunder.
"Underwriter" means a securities dealer who
purchases any Registrable Securities as principal and not as
part of such dealer's market-making activities.
SECTION 1.02. Internal References. Unless the
context indicates otherwise, references to Articles, Sections
and paragraphs shall refer to the corresponding articles,
sections and paragraphs in this Agreement, and references to
the parties shall mean the parties to the Stock Purchase
Agreement.
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ARTICLE II
Registration Rights
SECTION 2.01. Demand Registration. (a)(i) Holders
of a majority of the Registrable Securities held by the HMTF
Holders may make up to three written requests for a Demand
Registration of all or any part of the Registrable Securities
held by such HMTF Holders; provided, that (A) each such
Demand Registration by the HMTF Holders must be in respect of
Registrable Securities with a fair market value of at least
$50,000,000, and (B) the HMTF Holders shall not be entitled
to a Demand Registration if, during the 120 days preceding
such request, either the HMTF Holders had requested a Demand
Registration (unless such Demand Registration was preempted
pursuant to Section 2.01(e)), or the HMTF Holders were given
the opportunity to participate in a Piggyback Registration in
accordance with Section 2.02 and either (1) failed to notify
the Company of a desire to participate in such Piggyback
Registration or (2) notified the Company of a desire to
participate in such Piggyback Registration and were able to
sell in such Piggyback Registration at least 80% of the
Registrable Securities requested by the HMTF Holders to be
included in such Piggyback Registration.
(ii) Holders of a majority of the Registrable
Securities held by the Microsoft Holders may make up to three
written requests for a Demand Registration of all or any part
of the Registrable Securities held by such Microsoft Holders;
provided, that (A) each such Demand Registration by the
Microsoft Holders must be in respect of Registrable
Securities with a fair market value of at least $50,000,000,
and (B) the Microsoft Holders shall not be entitled to a
Demand Registration if, during the 120 days preceding such
request, either the Microsoft Holders had requested a Demand
Registration (unless such Demand Registration was preempted
pursuant to Section 2.01(e)), or the Microsoft Holders were
given the opportunity to participate in a Piggyback
Registration in accordance with Section 2.02 and either (1)
failed to notify the Company of a desire to participate in
such Piggyback Registration or (2) notified the Company of a
desire to participate in such Piggyback Registration and were
able to sell in such Piggyback Registration at least 80% of
the Registrable Securities requested by the Microsoft Holders
to be included in such Piggyback Registration.
(iii) Holders of a majority of the Registrable
Securities held by the Chase Holders, the DB Holders and the
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Olympus Holders may make one written request for a Demand
Registration of all or any part of the Registrable Securities
held by such Chase Holders, DB Holders and Olympus Holders.
Any such Demand Registration pursuant to this Section
2.01(a)(iii) must be in respect of Registrable Securities
with a fair market value of at least $75,000,000; provided,
that such Requesting Holders shall not be entitled to
exercise a Demand Registration if, during the 120 days
preceding such request, such Requesting Holders were given
the opportunity to participate in a Piggyback Registration in
accordance with Section 2.02 and either (1) holders of a
majority of the Registrable Securities held by such
Requesting Holders failed to notify the Company of a desire
to participate in such Piggyback Registration or (2) such
Requesting Holders notified the Company of a desire to
participate in such Piggyback Registration and were able to
sell in such Piggyback Registration at least 80% of the
Registrable Securities requested by the Chase Holders, the DB
Holders and the Olympus Holders, respectively, to be included
in such Piggyback Registration.
(iv) Any request for a Demand Registration will
specify the aggregate number of shares of Registrable
Securities proposed to be sold by the Requesting Holders and
will also specify the intended method of disposition thereof.
A registration will not count as a Demand Registration until
it has become effective. Should a Demand Registration not
become effective due to the failure of a Holder to perform
its obligations under this Agreement or the inability of the
Requesting Holders to reach agreement with the Underwriters
for the proposed sale on price or other customary terms for
such transaction, or in the event the Requesting Holders
withdraw or do not pursue the request for the Demand
Registration (in each of the foregoing cases, provided that
at such time the Company is in compliance in all material
respects with its obligations under this Agreement), then,
subject to Section 2.01(b), such Demand Registration shall be
deemed to have been effected (provided that (i) if, the
Demand Registration does not become effective because a
material adverse change has occurred, or is reasonably likely
to occur, in the condition (financial or otherwise),
business, assets or results of operations of the Company and
its subsidiaries taken as a whole subsequent to the date of
the written request made by the Requesting Holders or (ii)
if, after the Demand Registration has become effective, an
offering of Registrable Securities pursuant to a registration
is interfered with by any stop order, injunction, or other
order or requirement of the Commission or other governmental
agency or court then the Demand Registration shall not be
deemed to have been effected and will not count as a Demand
Registration).
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(v) Upon receipt of any request for a Demand
Registration by holders of a majority of the Registrable
Securities held by the HMTF Holders, the Company shall
promptly (but in any event within ten (10) days) give written
notice of such proposed Demand Registration to all other HMTF
Holders, and all such HMTF Holders shall have the right,
exercisable by written notice to the Company within twenty
(20) days of their receipt of the Company's notice, to elect
to include in such Demand Registration such portion of their
Registrable Securities as they may request. All such HMTF
Holders requesting to have their Registrable Securities
included in a Demand Registration in accordance with the
preceding sentence shall be deemed to be "Requesting Holders"
for purposes of this Section 2.01.
(vi) Upon receipt of any request for a Demand
Registration by holders of a majority of the Registrable
Securities held by the Microsoft Holders, the Company shall
promptly (but in any event within ten (10) days) give written
notice of such proposed Demand Registration to all other
Microsoft Holders, and all such Microsoft Holders shall have
the right, exercisable by written notice to the Company
within twenty (20) days of their receipt of the Company's
notice, to elect to include in such Demand Registration such
portion of their Registrable Securities as they may request.
All such Microsoft Holders requesting to have their
Registrable Securities included in a Demand Registration in
accordance with the preceding sentence shall be deemed to be
"Requesting Holders" for purposes of this Section 2.01.
(vii) Upon receipt of any request for a Demand
Registration by holders of a majority of the Registrable
Securities held by the Chase Holders, DB Holders and Olympus
Holders, the Company shall promptly (but in any event within
ten (10) days) give written notice of such proposed Demand
Registration to all other Chase Holders, DB Holders and
Olympus Holders, and all such Holders shall have the right,
exercisable by written notice to the Company within twenty
(20) days of their receipt of the Company's notice, to elect
to include in such Demand Registration such portion of their
Registrable Securities as they may request. All such Holders
requesting to have their Registrable Securities included in a
Demand Registration in accordance with the preceding sentence
shall be deemed to be "Requesting Holders" for purposes of
this Section 2.01.
(b) In the event that the Requesting Holders
withdraw or do not pursue a request for a Demand Registration
and, pursuant to Section 2.01(a) hereof, such Demand
Registration is deemed to have been effected, the
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HMTF Holders, the Microsoft Holders or the Chase Holders, the
DB Holders and the Olympus Holders, as the case may be, may
reacquire such Demand Registration (such that the with drawal
or failure to pursue a request will not count as a Demand
Registration hereunder) if the Selling Holders reimburse the
Company for any and all Registration Expenses incurred by the
Company in connection with such request for a Demand
Registration.
(c) If the Requesting Holders so elect, the
offering of such Registrable Securities pursuant to such
Demand Registration shall be in the form of a "firm commit
ment" underwritten offering. A majority in interest of the
Requesting Holders shall have the right to select the
managing Underwriters and any additional investment bankers
and managers to be used in connection with any offering under
this Section 2.01, subject to the Company's approval, which
approval shall not be unreasonably withheld.
(d) The Requesting Holders will inform the Company
of the time and manner of any disposition of Registrable
Common Stock, and agree to reasonably cooperate with the
Company in effecting the disposition of the Registrable
Common Stock in a manner that does not unreason ably disrupt
the public trading market for the Common Stock; provided,
however, that the Holders' only right to a shelf registration
statement shall be pursuant to Section 2.03.
(e) The Company will have the right to preempt any
Demand Registration with a primary registration by delivering
written notice (within five business days after the Company
has received a request for such Demand Registration) of such
intention to the Selling Holder indicating that the Company
has identified a specific business need and use for the
proceeds of the sale of such securities and the Company shall
use commercially reasonable efforts to effect a primary
registration within 60 days of such notice. In the ensuing
primary registration, the Holders will have such piggyback
registration rights as are set forth in Section 2.02 hereof.
Upon the Company's preemption of a requested Demand
Registration, such requested registration will not count as
the Holders' Demand Registration; provided that a Demand
Registration will not be deemed preempted if the Holders are
permitted to sell all requested securities in connection with
the ensuing primary offering by exercising their piggyback
registration rights as set forth in Section 2.02. The Company
may exercise the right to preempt only twice in any 360-day
period; provided that during any 360-day period the Company
shall use its reasonable best efforts to permit a period of
at least
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120 consecutive days during which the Selling Holders may
effect a Demand Registration.
(f) Priority on Demand Registrations. No securi
ties to be sold for the account of any Person (including the
Company) other than a Requesting Holder shall be included in
a Demand Registration unless the managing Underwriter or
Underwriters shall advise the Company and the Requesting
Holders in writing that the inclusion of such securities will
not materially and adversely affect the price of the offering
(a "Material Adverse Effect"). Furthermore, in the event the
managing Underwriter or Underwriters shall advise the Company
or the Requesting Holders that even after exclusion of all
securities of other Persons (including the Company) pursuant
to the immediately preceding sentence, the amount of
Registrable Securities proposed to be included in such Demand
Registration by Requesting Holders is suffi ciently large to
cause a Material Adverse Effect, the Registrable Securities
of the Requesting Holders to be included in such Demand
Registration shall equal the number of shares which the
Company and the Requesting Holders are so advised can be sold
in such offering without a Material Adverse Effect and such
shares shall be allocated pro rata among the Requesting
Holders on the basis of the number of Registrable Securities
requested to be included in such registration by each such
Requesting Holder; provided, however, that if any Registrable
Securities requested to be registered pursuant to a Demand
Registration under Section 2.01 are excluded from
registration hereunder, then the Holder(s) having shares
excluded ("Excluded Holders") shall have the right to
withdraw all, or any part, of their shares from such
registration.
SECTION 2.02. Piggyback Registration. (a) If the
Company proposes to file a registration statement under the
Securities Act with respect to an offering of Common Stock
for its own account or for the account of another Person
(other than a registration statement on Form S-4 or S-8, or,
except as provided for in Section 2.03, pursuant to Rule 415
(or any substitute form or rule, respectively, that may be
adopted by the Commission)), the Company shall give written
notice of such proposed filing to the Holders at the address
set forth in the share register of the Company as soon as
reasonably practicable (but in no event less than 15 days
before the anticipated filing date), undertaking to provide
each Holder the opportunity to register on the same terms and
conditions such number of shares of Registrable Common Stock
as such Holder may request (a "Piggyback Registra tion").
Each Holder will have seven business days after receipt of
any such notice to notify the Company as to whether it wishes
to participate in a Piggyback Registration
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(which notice shall not be deemed to be a request for a
Demand Registration); provided that should a Holder fail to
provide timely notice to the Company, such Holder will
forfeit any rights to participate in the Piggyback Registra
tion with respect to such proposed offering other than as
described in Sections 2.01(a)(v)-(vii), as applicable. In the
event that the registration statement is filed on behalf of a
Person other than the Company, the Company will use its best
efforts to have the shares of Registrable Common Stock that
the Holders wish to sell included in the registration
statement. If the Company or the Person for whose account
such offering is being made shall determine in its sole
discretion not to register or to delay the proposed offering,
the Company may, at its election, provide written notice of
such determination to the Holders and (i) in the case of a
determination not to effect the proposed offering, shall
thereupon be relieved of the obligation to register such
Registrable Common Stock in connection therewith, and (ii) in
the case of a determination to delay a proposed offering,
shall thereupon be permitted to delay registering such
Registrable Common Stock for the same period as the delay in
respect of the proposed offering. As between the Company and
the Selling Holders, the Company shall be entitled to select
the Underwriters in connection with any Piggyback
Registration.
(b) Priority on Piggyback Registrations. If the
Registrable Securities requested to be included in the
Piggyback Registration by any Holder differ from the type of
securities proposed to be registered by the Company and the
managing Underwriter advises the Company that due to such
differences the inclusion of such Registrable Securities
would cause a Material Adverse Effect, then (i) the number of
such Holders' Registrable Securities to be included in the
Piggyback Registration shall be reduced to an amount which,
in the opinion of the managing Underwriter, would eliminate
such Material Adverse Effect or (ii) if no such reduction
would, in the opinion of the managing Underwriter, eliminate
such Material Adverse Effect, then the Company shall have the
right to exclude all such Registrable Securities from such
Piggyback Registration, provided, that no other securities of
such type are included and offered for the account of any
other Person in such Piggyback Registration. Any partial
reduction in number of Registrable Securities of any Holder
to be included in the Piggyback Registration pursuant to
clause (i) of the immediately preceding sentence shall be
effected pro rata based on the ratio which such Holder's
requested shares bears to the total number of shares
requested to be included in such Piggyback Registration by
all Persons other than the Company who have the contractual
right to request that their
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shares be included in such registration statement and who
have requested that their shares be included. If the
Registrable Securities requested to be included in the
registration statement are of the same type as the securities
being registered by the Company and the managing Underwriter
advises the Company that the inclusion of such Registrable
Securities would cause a Material Adverse Effect, the Company
will be obligated to include in such registration statement,
as to each Holder only a portion of the shares such Holder
has requested be registered equal to the ratio which such
Holder's requested shares bears to the total number of shares
requested to be included in such registration statement by
all Persons (other than the Person or Persons initiating such
registration request) who have the contractual right to
request that their shares be included in such registration
statement and who have requested their shares be included. If
the Company initiated the registration, then the Company may
include all of its securities in such registration statement
before any such Holder's requested shares are included. If
another security holder initiated the registration, then the
Company may not include any of its securities in such
registration statement unless all Registrable Securities
requested to be included in the registration statement by all
Holders are included in such registration statement. If as a
result of the provisions of this Section 2.02(b) any Holder
shall not be entitled to include all Registrable Securities
in a registration that such Holder has requested to be so
included, such Holder may withdraw such Holder's request to
include Registrable Securities in such registration statement
prior to its effectiveness.
Section 2.03 Shelf Registration. (a) Holders of a
majority of the Registrable Securities may, at any time after
the first anniversary of the Closing Date (the "First
Anniversary"), make a written request that the Company effect
a shelf registration of a portion of the Registrable
Securities held by such Holders (the "Initial Shelf Regis
tration") pursuant to Rule 415; provided, that a Holder will
be entitled to include in the Initial Shelf Registration no
more than 25% of the Registrable Securities held by such
Holder. Upon receipt of a request for the Initial Shelf
Registration, the Company shall promptly (but in any event
within 10 days) give written notice of the proposed Initial
Shelf Registration to all other Holders, and each such other
Holders shall have the right to include in the Initial Shelf
Registration up to 25% of the Registrable Securities held by
such Holder.
(b) From and after the fifth anniversary of the
Closing Date (the "Fifth Anniversary"), Holders of a
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majority of the Registrable Securities may make a written
request that the Company effect a shelf registration pursuant
to Rule 415 of all or a portion of the Registrable Securities
held by such Holders (the "Second Shelf Registration"). Upon
receipt of a written request for the Second Shelf
Registration, the Company shall promptly (but in any event
within ten (10) days) give written notice of the proposed
Second Shelf Registration to all other Holders, and all such
other Holders shall have the right to include in the Second
Shelf Registration all or a portion of the Registrable
Securities held by such Holder.
ARTICLE III
Registration Procedures
SECTION 3.01. Filings; Information. In connec tion
with the registration of Registrable Securities pursuant to
Section 2.01, Section 2.02 and Section 2.03 hereof, the
Company will use its reasonable best efforts to effect the
registration of such Registrable Securities as promptly as is
reasonably practicable, and in connection with any such
request:
(a) The Company will expeditiously prepare and file
with the Commission a registration statement on any form for
which the Company then qualifies and which counsel for the
Company shall deem appropriate and available for the sale of
the Registrable Securities to be registered there under in
accordance with the intended method of distribution thereof,
and use its reasonable best efforts to cause such filed
registration statement to become and remain effective (i)
with respect to any Demand Registration or Piggyback
Registration, for such period, not to exceed 60 days, as may
be reasonably necessary to effect the sale of such securi
ties, (ii) with respect to the Initial Shelf Registration,
until the earlier of the sale of all Registrable Securities
thereunder and the Fifth Anniversary and (iii) with respect
to the Second Shelf Registration, until the earlier of the
sale of all Registrable Securities thereunder and the end of
the 36th calendar month from the time the Second Shelf
Registration becomes effective; provided that if the Company
shall furnish to the Selling Holder a certificate signed by
the Company's Chairman, President or any Vice-President
stating that the Company's Board of Directors has determined
in good faith that it would be detrimental or otherwise dis
advantageous to the Company or its shareholders for such a
registration statement to be filed as expeditiously as
possible because the sale of Registrable Securities covered
by such Registration Statement or the disclosure of informa
tion in any related prospectus or prospectus supplement would
materially interfere with any acquisition, financing or other
material event or transaction which is then intended or the
public disclosure of which at the time would be materially
prejudicial to the Company, the Company may postpone the
filing or effectiveness of a registration statement for a
period of not more than 120 days; provided that during any
360-day period the Company shall use its reasonable best
efforts to permit a period of at least 120 consecutive days
during which the Company will make a registration statement
available under this Agreement; and provided further that if
(i) the effective date of any registration statement filed
pursuant to a Demand Registration would otherwise be at least
45 calendar days, but fewer than 90 calendar days, after the
end of the Company's fiscal year, and (ii) the Securities Act
requires the Company to include audited financials as of the
end of such fiscal year, the Company may delay the
effectiveness of such registration statement for such period
as is reasonably necessary to include therein its audited
financial statements for such fiscal year.
(b) Anything in this Agreement to the contrary
notwithstanding, it is understood and agreed that the Company
shall not be required to keep any shelf registration
effective or useable for offers and sales of the Registrable
Securities, file a post effective amendment to a shelf
registration statement or prospectus supplement or to
supplement or amend any registration statement, if the
Company is then involved in discussions concerning, or
otherwise engaged in, any material financing or investment,
acquisition or divestiture transaction or other material
business purpose if the Company determines in good faith that
the making of such a filing, supplement or amendment at such
time would interfere with such transaction or purpose. The
Company shall promptly give the Holders of Registrable
Securities written notice of such postponement containing a
general statement of the reasons for such postponement and an
approximation of the anticipated delay. Upon receipt by a
Holder of Registrable Securities of notice of an event of the
kind described in this Section 3.01(b), such Holder shall
forthwith discontinue such Holder's disposition of
Registrable Securities until such Holder's receipt of notice
from the Company that such disposition may continue and of
any supplemented or amended prospectus indicated in such
notice. The Company shall use its reasonable best efforts to
permit sales of Registrable Securities on such shelf
registration statement for at least 120 days during any 360-
day period.
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(c) The Company will, if requested, prior to filing
such registration statement or any amendment or supplement
thereto, furnish to the Selling Holders, and each applicable
managing Underwriter, if any, copies thereof, and thereafter
furnish to the Selling Holders and each such Underwriter, if
any, such number of copies of such registration statement,
amendment and supplement thereto (in each case including all
exhibits thereto and documents incorporated by reference
therein) and the prospectus included in such registration
statement (including each preliminary prospectus) as the
Selling Holders or each such Underwriter may reasonably
request in order to facilitate the sale of the Registrable
Securities by the Selling Holders.
(d) After the filing of the registration statement,
the Company will promptly notify the Selling Holders of any
stop order issued or, to the Company's knowledge, threatened
to be issued by the Commission and take all reasonable
actions required to prevent the entry of such stop order or
to remove it if entered.
(e) The Company will use its commercially reason
able efforts to qualify the Registrable Securities for offer
and sale under such other securities or blue sky laws of such
jurisdictions in the United States as the Selling Holders
reasonably request; keep each such registration or
qualification (or exemption therefrom) effective during the
period in which such registration statement is required to be
kept effective; and do any and all other acts and things
which may be reasonably necessary or advisable to enable each
Selling Holder to consummate the disposition of the
Registrable Securities owned by such Selling Holder in such
jurisdictions; provided that the Company will not be required
to (i) qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for
this paragraph 3.01(e), (ii) subject itself to taxation in
any such jurisdiction or (iii) consent to general service of
process in any such jurisdiction.
(f) The Company will as promptly as is practicable
notify the Selling Holders, at any time when a prospectus
relating to the sale of the Registrable Securities is
required by law to be delivered in connection with sales by
an Underwriter or dealer, of the occurrence of any event
requiring the preparation of a supplement or amendment to
such prospectus so that, as thereafter delivered to the
purchasers of such Registrable Securities, such prospectus
will not contain an untrue statement of a material fact or
omit to state any material fact required to be stated therein
or necessary to make the statements
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therein, in the light of the circumstances under which they
were made, not misleading and promptly make available to the
Selling Holders and to the Underwriters any such supplement
or amendment. Upon receipt of any notice of the occurrence of
any event of the kind described in the preceding sentence,
Selling Holders will forthwith discontinue the offer and sale
of Registrable Securities pursuant to the registration
statement covering such Registrable Securities until receipt
by the Selling Holders and the Underwriters of the copies of
such supplemented or amended prospectus and, if so directed
by the Company, the Selling Holders will deliver to the
Company all copies, other than permanent file copies then in
the possession of Selling Holders, of the most recent
prospectus covering such Registrable Securities at the time
of receipt of such notice. In the event the Company shall
give such notice, the Company shall extend the period during
which such registration statement shall be maintained
effective as provided in Section 3.01(a) hereof by the number
of days during the period from and including the date of the
giving of such notice to the date when the Company shall make
available to the Selling Holders such supplemented or amended
prospectus.
(g) The Company will enter into customary
agreements (including an underwriting agreement in customary
form) and take such other actions as are required in order to
expedite or facilitate the sale of such Registrable
Securities.
(h) At the request of any Underwriter in connection
with an underwritten offering the Company will furnish (i) an
opinion of counsel, addressed to the Underwriters, covering
such customary matters as the managing Underwriter may
reasonably request and (ii) a comfort letter or comfort
letters from the Company's independent public accountants
covering such customary matters as the managing Underwriter
may reasonably request.
(i) If requested by the managing Underwriter or any
Selling Holder, the Company shall promptly incorporate in a
prospectus supplement or post effective amendment such
information as the managing Underwriter or any Selling Holder
reasonably requests to be included therein, including without
limitation, with respect to the Registrable Securities being
sold by such Selling Holder, the purchase price being paid
therefor by the Underwriters and with respect to any other
terms of the underwritten offering of the Registrable
Securities to be sold in such offering, and promptly make all
required filings of such prospectus supplement or post
effective amendment.
14
(j) The Company shall promptly make available for
inspection by any Selling Holder or Underwriter participating
in any disposition pursuant to any registration statement,
and any attorney, accountant or other agent or representative
retained by any such Selling Holder or Underwriter
(collectively, the "Inspectors"), all financial and other
records, pertinent corporate documents and properties of the
Company (collectively, the "Records"), as shall be reasonably
necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors
and employees to supply all information requested by any such
Inspector in connection with such registration statement;
provided, however, that unless the disclosure of such Records
is necessary to avoid or correct a misstatement or omission
in the registration statement or the release of such Records
is ordered pursuant to a subpoena or other order from a court
of competent jurisdiction, the Company shall not be required
to provide any information under this subparagraph (j) if (A)
the Company believes, after consultation with counsel for the
Company, that to do so would cause the Company to forfeit an
attorney-client privilege that was applicable to such
information or (B) if either (1) the Company has requested
and been granted from the Commission confidential treatment
of such information contained in any filing with the
Commission or documents provided supplementally or otherwise
or (2) the Company reasonably determines in good faith that
such Records are confidential and so notifies the Inspectors
in writing unless prior to furnishing any such information
with respect to (A) or (B) such Holder of Registrable
Securities requesting such information agrees to enter into a
confidentiality agreement in customary form and subject to
customary exceptions; provided further, however, that each
Holder of Registrable Securities agrees that it will, upon
learning that disclosure of such Records is sought in a court
of competent jurisdiction, give notice to the Company and
allow the Company, at its expense, to undertake appropriate
action and to prevent disclosure of the Records deemed
confidential.
(k) The Company shall cause the Registrable
Securities included in any registration statement to be (A)
listed on each securities exchange, if any, on which similar
securities issued by the Company are then listed, or (B)
authorized to be quoted and/or listed (to the extent
applicable) on the Nasdaq National Market if the Registrable
Securities so qualify.
(l) The Company shall provide a CUSIP number for
the Registrable Securities included in any registration
15
statement not later than the effective date of such
registration statement.
(m) The Company shall cooperate with each Selling
Holder and each Underwriter participating in the disposition
of such Registrable Securities and their respective counsel
in connection with any filings required to be made with the
National Association of Securities Dealers, Inc.
(n) The Company shall during the period when the
prospectus is required to be delivered under the Securities
Act, promptly file all documents required to be filed with
the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d)
of the Exchange Act.
(o) The Company will make generally available to
its security holders, as soon as reasonably practicable, an
earnings statement covering a period of 12 months, beginning
within three months after the effective date of the
registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act
and the rules and regulations of the Commission thereunder.
(p) The Company will use its commercially
reasonable efforts to cause all such Registrable Common Stock
and, in the event of a public offering of Series A Preferred
Stock, the Series A Preferred Stock (subject to applicable
listing requirements) to be listed on each securities
exchange or quoted on each inter-dealer quotation system on
which the Common Stock is then listed or quoted.
The Company may require Selling Holders promptly to
furnish in writing to the Company such information regarding
such Selling Holders, the plan of distribution of the
Registrable Securities and other information as the Company
may from time to time reasonably request or as may be legally
required in connection with such registration.
SECTION 3.02. Registration Expenses. In connection
with any Registration effected hereunder, the Company shall
pay the following expenses incurred in connection with such
registration (the "Registration Expenses"): (i) registration
and filing fees with the Commission and the National
Association of Securities Dealers, Inc., (ii) fees and
expenses of compliance with securities or blue sky laws
(including reasonable fees and disbursements of counsel in
connection with blue sky qualifications of the Registrable
Securities), (iii) printing expenses, (iv) fees and expenses
incurred in
16
connection with the listing or quotation of the Registrable
Securities, (v) fees and expenses of counsel to the Company
and the reasonable fees and expenses of independent certified
public accountants for the Company (including fees and
expenses associated with the special audits or the delivery
of comfort letters), (vi) the reasonable fees and expenses of
any additional experts retained by the Company in connection
with such registration and (vii) all roadshow costs and
expenses not paid by the Underwriters.
ARTICLE IV
Indemnification and Contribution
SECTION 4.01. Indemnification by the Company. The
Company agrees to indemnify and hold harmless each Selling
Holder and its Affiliates and their respective officers,
directors, partners, stockholders, members, employees, agents
and representatives and each Person (if any) which controls a
Selling Holder within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages, liabilities,
costs and expenses (including reason able attorneys' fees)
caused by, arising out of, resulting from or related to any
untrue statement or alleged untrue statement of a material
fact contained in any registration statement or prospectus
relating to the Registrable Securities (as amended or
supplemented if the Company shall have furnished any
amendments or supplements thereto) or any preliminary
prospectus, or caused by any omission or alleged omission to
state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages or liabilities
are caused by or based upon any information furnished in
writing to the Company by or on behalf of such Selling Holder
expressly for use therein or by the Selling Holder's failure
to deliver a copy of the registration statement or prospectus
or any amendments or supplements thereto after the Company
has furnished the Selling Holder with copies of the same;
provided, however, that the Company shall have no obligation
to indemnify under this sentence to the extent any such
losses, claims, damages or liabilities have been finally and
non-appealably determined by a court to have resulted from
such Selling Holder's willful misconduct or gross negligence.
The Company also agrees to indemnify any Underwriters of the
Registrable Securities, their officers and directors and each
person who controls such Underwriters on substantially the
same basis as that of the indemnification of the Selling
Holders provided in this Section 4.01, except insofar as
17
such losses, claims, damages or liabilities are caused by or
based upon any information furnished in writing to the
Company by or on behalf of such Underwriter expressly for use
therein or by the Underwriter's failure to deliver a copy of
the registration statement or prospectus or any amendments or
supplements thereto after the Company has furnished the
Underwriter with copies of the same; provided, however, that
the Company shall have no obligation to indemnify under this
sentence to the extent any such losses, claims, damages or
liabilities have been finally and non-appealably determined
by a court to have resulted from any such Underwriter's
willful misconduct or gross negligence.
SECTION 4.02. Indemnification by Selling Holders.
Each Selling Holder agrees to indemnify and hold harmless the
Company, its officers and directors, and each Person, if any,
which controls the Company within the meaning of either
Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity
from the Company to each Selling Holder, but only with
reference to information furnished in writing by or on behalf
of such Selling Holder expressly for use in any registration
statement or prospectus relating to the Registrable
Securities, or any amendment or supplement thereto, or any
preliminary prospectus. Each Selling Holder also agrees to
indemnify and hold harmless any Underwriters of the
Registrable Securities, their officers and directors and each
person who controls such Underwriters on substan tially the
same basis as that of the indemnification of the Company
provided in this Section 4.02, but only with reference to
information furnished in writing by or on behalf of such
Selling Holder expressly for use in any registration
statement or prospectus relating to the Registrable
Securities, or any amendment or supplement thereto, or any
preliminary prospectus. Each such Selling Holder's liability
under this Section 4.02 shall be limited to an amount equal
to the net proceeds (after deducting the underwriting
discount and expenses) received by such Selling Holder from
the sale of such Registrable Securities by such Selling
Holder.
SECTION 4.03. Conduct of Indemnification
Proceedings. In case any proceeding (including any govern
mental investigation) shall be instituted involving any
Person in respect of which indemnity may be sought pursuant
to Section 4.01 or Section 4.02, such Person (the
"Indemnified Party") shall promptly notify the Person against
whom such indemnity may be sought (the "Indemnifying Party")
in writing and the Indemnifying Party, upon the request of
the Indemnified Party, shall retain counsel reasonably
satisfactory to such Indemnified Party to
18
represent such Indemnified Party and any others the
Indemnifying Party may designate in such proceeding and shall
pay the fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any Indemnified
Party shall have the right to retain its own counsel, but the
fees and expenses of such counsel shall be at the expense of
such Indemnified Party unless (i) the Indemnifying Party and
the Indemnified Party shall have mutually agreed to the
retention of such counsel or (ii) the named parties to any
such proceeding (including any impleaded parties) include
both the Indemnified Party and the Indemnifying Party and, in
the written opinion of counsel for the Indemnified Party,
representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests
between them. It is understood that the Indemnifying Party
shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees
and expenses of more than one separate firm of attorneys (in
addition to any local counsel) at any time for all such
Indemnified Parties, and that all such fees and expenses
shall be reimbursed as they are incurred. In the case of any
such separate firm for the Indemnified Parties, such firm
shall be designated in writing by the Indemnified Parties.
The Indemnifying Party shall not be liable for any settlement
of any proceeding effected without its written consent, but
if settled with such consent (not to be unreasonably
withheld), or if there be a final judgment for the plaintiff,
the Indemnifying Party shall indemnify and hold harmless such
Indemnified Parties from and against any loss or liability
(to the extent stated above) by reason of such settlement or
judgment.
SECTION 4.04. Contribution. If the indemnifica tion
provided for in this Article IV is unavailable to an
Indemnified Party in respect of any losses, claims, damages
or liabilities in respect of which indemnity is to be
provided hereunder, then each such Indemnifying Party, in
lieu of indemnifying such Indemnified Party, shall to the
fullest extent permitted by law contribute to the amount paid
or payable by such Indemnified Party as a result of such
losses, claims, damages or liabilities in such pro portion as
is appropriate to reflect the relative fault of such party in
connection with the statements or omissions that resulted in
such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations. The relative fault
of the Company, a Selling Holder and the Underwriters shall
be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact
relates to
19
information supplied by such party and the parties' relative
intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Company and each Selling Holder agrees that it
would not be just and equitable if contribution pursuant to
this Section 4.04 were determined by pro rata allocation
(even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not
take account of the equitable considerations referred to in
the immediately preceding paragraph. The amount paid or
payable by an Indemnified Party as a result of the losses,
claims, damages or liabilities referred to in the immediately
preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses
reasonably incurred by such Indemnified Party in connection
with investigating or defending any such action or claim.
Notwithstanding the provisions of this Article IV, no
Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the
securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages
which such Underwriter has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission
or alleged omission, and each Selling Holder shall not be
required to contribute any amount in excess of the amount by
which the net proceeds of the offering (before deducting
expenses) received by such Selling Holder exceeds the amount
of any damages which such Selling Holder has otherwise been
required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such
fraudulent misrepresentation.
ARTICLE V
Miscellaneous
SECTION 5.01. Participation in Underwritten
Registrations. No Person may participate in any under written
registered offering contemplated hereunder unless such Person
(a) agrees to sell its securities on the basis provided in
any underwriting arrangements approved by the Persons
entitled hereunder to approve such arrangements, (b)
completes and executes all questionnaires, powers of
attorney, custody arrangements, indemnities, underwriting
agreements and other documents reasonably required under the
20
terms of such underwriting arrangements and this Agreement
and (c) furnishes in writing to the Company such information
regarding such Person, the plan of distribution of the
Registrable Securities and other information as the Company
may from time to time request or as may be legally required
in connection with such registration; provided, however, that
no such Person shall be required to make any representations
or warranties in connection with any such registration other
than representations and warranties as to (i) such Person's
ownership of his or its Registrable Securities to be sold or
transferred free and clear of all liens, claims and
encumbrances, (ii) such Person's power and authority to
effect such transfer and (iii) such matters pertaining to
compliance with securities laws as may be reasonably
requested; provided further, however, that the obligation of
such Person to indemnify pursuant to any such underwriting
agreements shall be several, not joint and several, among
such Persons selling Registrable Securities, and the
liability of each such Person will be in proportion to, and
provided further that such liability will be limited to, the
net amount received by such Person from the sale of such
Person's Registrable Securities pursuant to such
registration.
SECTION 5.02. Rule 144. The Company covenants that
it will file any reports required to be filed by it under the
Securities Act and the Exchange Act and that it will take
such further action as the Holders may reasonably request to
the extent required from time to time to enable the Holders
to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions
provided by Rule 144 under the Securities Act, as such Rule
may be amended from time to time, or any similar rule or
regulation hereafter adopted by the Commission. Upon the
request of any Holder, the Company will deliver to such
Holder a written statement as to whether it has complied with
such reporting requirements.
SECTION 5.03. Holdback Agreements. Each Holder
agrees, in the event of an underwritten offering for the
Company (whether for the account of the Company or otherwise)
not to offer, sell, contract to sell or otherwise dispose of
any Registrable Securities, or any securities convertible
into or exchangeable or exercisable for such securities,
including any sale pursuant to Rule 144 under the Securities
Act (except as part of such underwritten offering), during
the 14 days prior to, and during the 120-day period (or such
lesser period as the lead or managing underwriters may
require) beginning on, the effective date of the registration
statement for such underwritten offering (or, in the case of
an offering
21
pursuant to an effective shelf registration statement
pursuant to Rule 415, the pricing date for such underwritten
offering).
SECTION 5.04. Termination. The registration rights
granted under this Agreement will terminate on November 30,
2014, or such earlier time as there shall no longer be any
Registrable Securities; provided, however, that if all shares
of Series A Preferred Stock outstanding on such date shall
not have been redeemed in full in accordance with Section 10
of the Certificate of Designations, this Agreement shall
remain in full force and effect with respect to such shares
(and the shares of Common Stock issuable upon the conversion
of such shares) until such time as such shares have been so
redeemed in full.
SECTION 5.05. Amendments, Waivers, Etc. This
Agreement may not be amended, waived or otherwise modified or
terminated except by an instrument in writing signed by the
Company and (i) Holders of at least 50% of the Registrable
Securities then held by all HMTF Holders, if the amendment is
to be effective against the HMTF Holders, (ii) Holders of at
least 50% of the Registrable Securities then held by all
Microsoft Holders, if the amendment is to be effective
against the Microsoft Holders, (iii) Holders of at least 50%
of the Registrable Securities then held by all Chase Holders,
if the amendment is to be effective against the Chase
Holders, (iv) Holders of at least 50% of the Registrable
Securities then held by all DB Holders, if the amendment is
to be effective against the DB Holders, and (v) Holders of at
least 50% of the Registrable Securities then held by all
Olympus Holders, if the amendment is to be effective against
the Olympus Holders.
SECTION 5.06. Counterparts. This Agreement may be
executed in one or more counterparts, all of which shall be
considered one and the same agreement. Each party need not
sign the same counterpart.
SECTION 5.07. Entire Agreement. This Agreement (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.
SECTION 5.08. Governing Law. This Agreement shall
be governed by, and construed in accordance with, the laws of
the State of New York regardless of the laws that might
otherwise govern under applicable principles of conflicts of
law thereof.
22
SECTION 5.09. Assignment of Registration Rights.
Each Holder of the Registrable Securities may assign all or
any part of its rights under this Agreement to any person to
whom such Holder sells, transfers or assigns such Regis
trable Securities. In the event that the Holder shall assign
its rights pursuant to this Agreement in connection with the
transfer of less than all its Registrable Securities, the
Holder shall also retain his rights with respect to its
remaining Registrable Securities.
IN WITNESS WHEREOF, the Company and each Initial
Holder has caused this Agreement to be signed on its behalf
by its officer thereunto duly authorized as of the date first
written above.
TELIGENT, INC.,
by /s/ Xxxx Xxxxx
----------------------------
Name: Xxxx Xxxxx
Title: Chairman and Chief
Executive Officer
HM4 TELIGENT QUALIFIED FUND, LLC,
by /s/ Xxxxx X. Xxxxxxx
------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
HM4 TELIGENT PRIVATE FUND, LLC,
by /s/ Xxxxx X. Xxxxxxx
------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
HM PG-IV TELIGENT, LLC,
by /s/ Xxxxx X. Xxxxxxx
------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
23
HM 4-SBS TELIGENT COINVESTORS, LLC,
by /s/ Xxxxx X. Xxxxxxx
------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
HM 4-EQ TELIGENT COINVESTORS, LLC,
by /s/ Xxxxx X. Xxxxxxx
------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
HMTF BRIDGE TELIGENT, LLC,
by/s/ Xxxxx X. Xxxxxxx
------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
MICROSOFT CORPORATION,
by /s/ Xxxxxx X. Xxxxxxxx
------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Assistant Secretary
CHASE EQUITY ASSOCIATES, L.P.,
by CHASE CAPITAL PARTNERS,
its General Partner
by /s/ Xxxxxxx X. Xxxxxx
------------------------
Name: Xxxxxxx X. Xxxxxx
Title: General Partner
24
DB CAPITAL INVESTORS, L.P.,
by DB CAPITAL PARTNERS, L.P.,
its General Partner
by DB CAPITAL PARTNERS, INC.,
by /s/ Xxxxx Xxxxxx
------------------------
Name: Xxxxx Xxxxxx
Title: Managing Director
OLYMPUS GROWTH FUND III, L.P.,
by OGP III, LLC
by /s/ Xxxxx X. Xxxxxxxxxx
--------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: Member
OLYMPUS EXECUTIVE FUND, L.P.,
by OEF, L.P., its general partner
by LJM L.L.C., its general partner
by /s/ Xxxxx X. Xxxxxxxxxx
--------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: Managing Member
SCHEDULE I
Purchase Price
Purchasers Number of Shares of the Shares
---------- ---------------- -------------
HM4 Teligent Qualified Fund, LLC 136,207 $ 136,207,000
HM4 Teligent Private Fund, LLC 965 $ 965,000
HM 4-SBS Teligent Coinvestors, LLC 3,350 $ 3,350,000
HM PG-IV Teligent, LLC 7,252 $ 7,252,000
HM 4-EQ Teligent Coinvestors, LLC 2,226 $ 2,226,000
HMTF Bridge Teligent, LLC 50,000 $ 50,000,000
Microsoft Corporation 200,000 $ 200,000,000
Chase Equity Associates, L.P. 50,000 $ 50,000,000
DB Capital Investors, L.P. 25,000 $ 25,000,000
Olympus Growth Fund III, L.P. 24,750 $ 24,750,000
Olympus Executive Fund, L.P. 250 $ 250,000
