Exhibit 10.4
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AMENDMENT TO REGISTRATION RIGHTS AGREEMENT
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THIS AMENDMENT TO REGISTRATION RIGHTS AGREEMENT is dated as of April 26,
1999 by and between NEXTLINK Communications, Inc., a Delaware corporation (the
"Company"), and the persons and entities that have executed and delivered the
Consent and Indemnity Agreement of Stockholders in the form attached to the
Merger Agreement (as defined below) (the "Holders") by and through the execution
of the Registration Rights Agreement (as defined below) by Xxxxxx X. Xxxxx (the
"Stockholders' Representative") as their attorney-in-fact.
Capitalized terms used herein without definition have the meanings assigned
to them in the Registration Rights Agreement referenced below.
RECITALS
WHEREAS, pursuant to the terms of an Agreement and Plan of Merger, dated as
of January 14, 1999 by and among the Company, WNP Communications, Inc. and PCO
Acquisition Corp. (the "Merger Agreement"), the Company and the Holders are
parties to a Registration Rights Agreement, dated as of January 14, 1999 (the
"Registration Rights Agreement"); and
WHEREAS, the parties desire to make certain amendments to the Registration
Rights Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowled ged, the parties agree as follows:
I. Amendments to the Registration Rights Agreement.
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A. Section 2(a) of the Registration Rights Agreement is hereby replaced in
its entirety with the following:
"a. Resale at Closing. The Company will use reasonable best efforts to have that
number of shares of Common Stock issued at the Closing, having an aggregate
market value of approximately $175 million (all references to the market value
of Common Stock in this Agreement to be determined based on the Closing Date
Average Price), subject to adjustment as set forth below (as so adjusted, the
"WNP Amount"), registered under the Securities Act for resale by the Holders in
an underwritten offering (the "Initial Offering") pursuant to a registration
statement (the "Initial Registration Statement") that has been declared
effective by the Commission within 30 days following the Closing, which
registration statement shall be kept effective by the Company until the earlier
of such time as the Initial Offering is completed or the expiration of 60 days
following the effectiveness of the Initial Registration Statement. Each Holder
and its permitted assignees shall be entitled to sell in the Initial Offering
that number of shares of Common Stock it receives in the Merger equal to its pro
rata share of the Common
Stock issued at the Closing multiplied by the WNP Amount. Any Holder or its
permitted assignees wishing to sell shares in the Initial Offering shall deliver
or cause the Stockholders' Representative to deliver on its behalf notice to the
Company, which notice shall become irrevocable at 12:00 noon (New York time) on
April 29, 1999 (and which notice, if oral, shall be confirmed in writing on the
same day) specifying the maximum number of shares such Holder or assignee wishes
to sell in such offering. If any Holder or assignee elects to sell less than its
pro rata share, the number of shares permitted to be sold by all other
participating Holders or their permitted assignees will be increased pro rata by
the number of shares that would otherwise have been allotted to
non-participating or partially participating Holders or their permitted
assignees; provided however, that with respect to any Holder which distributes
shares to its beneficial owners following the Closing, such reallotment shall be
applied first within such group of beneficial owners; and provided further, that
with respect to any two or more Holders who are "affiliates" of one another
within the meaning of Rule 144 under the Securities Act, such reallotment shall
be applied first among such affiliated Holders. Each Holder acknowledges and
agrees that the Company may elect to include additional shares of Common Stock
having an aggregate market value of approximately $165 million for its own
account in the Initial Registration Statement and the Initial Offering, and may
be required to include additional shares pursuant to registration rights
agreements heretofore furnished to WNP. In the event that the aggregate market
value of Common Stock offered for the account of the Company in the Initial
Offering exceeds $165 million, the WNP Amount shall be increased by an amount
equal to one third of such excess. All shares offered in the Initial Offering
shall be subject to the provisions of subdivision (g) below."
B. Section 2(g)(i) of the Registration Rights Agreement is hereby replaced
in its entirety with the following language:
"(i) In the case of the Initial Offering, the securities sought to be included
in such offering by the Holders shall be excluded as follows: (A) first,
securities offered for the account of the Company and the Holders or their
permitted assignees as described in the penultimate sentence of Section 2(a)
above shall be excluded on a pro rata basis with securities sought to be
included in the Initial Offering by all other Persons seeking inclusion of
securities in such offering (including pursuant to so-called piggyback
registration rights), until the aggregate market value of the securities sought
to be included in such offering by the Company has been reduced to approximately
$165 million (as pertains to the shares of the Company and the Holders or their
permitted assigns, such exclusions shall be based upon the Holders' and the
Company's relative number of securities sought to be so included pursuant to the
penultimate sentence of Section 2(a)); (B) thereafter, the number of shares of
Common Stock sought to be included by the Holders shall be excluded on a pro
rata basis with securities sought to be included in the Initial Offering by the
Company and all other Persons seeking inclusion of securities in such offering
(including pursuant to so-called piggyback registration rights), based upon the
Holders', the Company's and the other Persons' relative number of securities
sought to be so included until the aggregate market value of the securities
sought to be included in such offering by the Holders has been reduced to
approximately $125 million; (C) thereafter, any additional securities required
to be excluded from such offering in order to comply with the advice of the
managing underwriter shall be securities that were to have been offered for the
Company's account until the offering includes no such securities; and (D)
thereafter, the securities sought to be included in such
offering by the Holders shall be excluded on a pro rata basis with the
securities sought to be included in the Initial Offering by all other Persons
seeking inclusion of securities in such offering (including pursuant to
so-called piggyback registration rights), based upon the Holders' and the other
Persons' relative number of securities sought to be so included.
C. Section 4(c) of the Registration Rights Agreement is hereby replaced in
its entirety with the following language:
"c. Holdback Agreements. Each Holder agrees, if required by the managing
underwriter in any underwritten public offering of securities pursuant to the
Initial Registration Statement, a Subsequent Registration Statement or an
Incidental Registration Statement, not to effect any public sale or public
distribution of Registrable Securities, any sale or distribution thereof
pursuant to Rule 144 or 145 under the Securities Act, or any short sale thereof
or any transaction or series of transactions having a substantially similar
economic effect (other than (i) sales pursuant to the Initial Registration
Statement, or (ii) distributions to any stockholder, partner or other beneficial
owner of such Holder) during the period beginning, in the case of the Initial
Registration Statement, on the date hereof and, in the case of each Subsequent
and Incidental Registration, beginning seven days prior to the effective date of
such registration statement, and ending on the date 90 days after the Initial
Registration Statement, any Subsequent Registration Statement or any Incidental
Registration Statement shall have been declared effective, provided that in the
event the Initial Registration Statement shall not have been declared effective
within 30 days following the Closing Date and a majority-in-interest of the
Holders seeking to participate in the Initial Offering shall have voted to be
released, in whole or in part, from such restrictions, all of the Holders shall
be released, in whole or in part, as so determined, from such restrictions with
respect to the Initial Offering. In addition, if (i) the market value of the
Common Stock of the Holders included in the Initial Offering is limited to $150
million or less and a majority-in-interest of the Holders seeking to participate
in such offering vote to be released, in whole or in part, from the restrictions
contained in the preceding sentence or (ii) the market value of Common Stock of
the Holders included in any Subsequent Offering is limited to $30 million or
less and a majority-in-interest of all Holders of Registrable Securities vote to
be released, in whole or in part, from the restrictions contained in the
preceding sentence then all Holders shall be released from the restrictions
contained in the preceding sentence with respect to such offering, in whole or
in part, as so determined."
II. No Further Amendments. Except as specifically amended hereby, the
Registration Rights Agreement shall remain unmodified and in full force and
effect and is hereby reaffirmed.
III. Miscellaneous.
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A. This Amendment to Registration Rights Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
B. This Amendment to Registration Rights Agreement may be executed by the
parties hereto in several counterparts hereof and by the different parties
hereto on separate counterparts hereof, all of which counterparts shall together
constitute one and the same agreement.
IN WITNESS WHEREOF, the Company and the Holders have caused this Amendment
to Registration Rights Agreement to be signed and delivered by their respective
duly authorized officers or representatives, as applicable, as of the date first
above written.
NEXTLINK COMMUNICATIONS, INC.
By: /s/ R. Xxxxx Xxxxxx, Xx.
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Name: R. Xxxxx Xxxxxx, Xx.
Title: Vice President
HOLDERS
/s/ Xxxxxx X. Xxxxx
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By: Xxxxxx X. Xxxxx, as Stockholders'
Representative
