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EXHIBIT 4.2
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made
and entered into as of __________, 1999, by and between Golden Telecom, Inc., a
Delaware corporation (the "Company"), and Global TeleSystems Group, Inc., a
Delaware corporation ("GTS").
RECITALS
A. In connection with the initial public offering of shares of
common stock by the Company (the "Initial Public Offering"), the Company desires
to grant to GTS certain registration rights with respect to 10,600,000 shares of
common stock of the Company or other equity securities of the Company acquired
or held directly or indirectly by GTS as of the date hereof.
B. The parties hereto desire to set forth the terms and
conditions of the Company's covenants and agreements in respect of the
registration of the such shares with the Securities and Exchange Commission and
all applicable state securities agencies.
D. In consideration of the premises and the mutual agreements
contained herein, the parties hereby agree as follows:
AGREEMENT
1. Definitions
As used in this Agreement, the following capitalized terms
shall have the following meanings:
"Advice" has the meaning set forth in the last paragraph of
Section 6 hereof.
"Agents" means any Person authorized to act and who acts on
behalf of GTS with respect to the transactions contemplated by this
Agreement.
"Common Stock" means shares of the Company's common stock, par
value $.01 per share, as the same may be constituted from time to time.
"Demand Registration" has the meaning set forth in Section
3(a) hereof.
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"Exchange Act" means The Securities Exchange Act of 1934, as
amended, and the rules and regulations thereunder as in effect from
time to time.
"Person" means an individual, partnership, corporation trust
or unincorporated organization, or a government or agency or political
subdivision thereof.
"Prospectus" means the prospectus included in any Registration
Statement, as amended or supplemented by any prospectus supplement with
respect to the terms of the offering of any portion of the Registrable
Securities covered by the Registration Statement and all other
amendments and supplements to the Prospectus, including post-effective
amendments and all material incorporated by reference in such
Prospectus.
"Registrable Securities" means (i) the 10,600,000 shares of
Common Stock currently beneficially owned by GTS and (ii) any
securities issued or issuable with respect to such shares of Common
Stock by way of a stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization, until such shares of Common Stock or other securities
are not Restricted Securities as defined in Section 2.
"Registration Expenses" has the meaning set forth in Section 7
hereof.
"Registration Statement" means any registration statement of
the Company which covers Registrable Securities pursuant to the
provisions of this Agreement, including (i) the Prospectus, (ii)
amendments and supplements to such Registration Statement, (iii)
post-effective amendments, (iv) all exhibits and all material
incorporated by reference in such Registration Statement and (v) any
registration statement pursuant to a Demand Registration.
"Restricted Securities" means the Registrable Securities upon
original issuance thereof, subject to the provisions of Section 2
hereof.
"Securities Act" means The Securities Act of 1933, as amended
from time to time.
"SEC" means The Securities and Exchange Commission.
"Underwritten Offering" means the offering and sale of
securities of the Company covered by any Registration Statement
pursuant to a firm commitment underwriting to an underwriter at a fixed
price for reoffering or pursuant to agency or best efforts arrangements
with an underwriter.
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Unless the context otherwise requires: (i) "or" is not exclusive; and (ii) words
in the singular include the plural and in the plural include the singular.
2. Securities Subject to this Agreement
Registrable Securities. The securities entitled to the
benefits of this Agreement are the Registrable Securities but, with respect to
any particular Registrable Security, only so long as such security continues to
be a Restricted Security. A Registrable Security ceases to be a Restricted
Security when (i) it has been effectively registered under the Securities Act
and disposed of in accordance with the Registration Statement covering it, (ii)
it has been distributed pursuant to Rules 144 or 144A under the Securities Act
(or any similar provision then in force) or (iii) it has otherwise been
transferred and a new certificate or other evidence of ownership for it not
bearing a legend restricting transfer under the Securities Act and not subject
to any stop transfer order has been delivered by or on behalf of the Company and
no other restriction on transfer exists.
3. Demand Registration
(a) Requests for Registration. At any time after September 22,
2000 (the "Twelve Month Lock-Up"), GTS may make written requests for
registration with the SEC under and in accordance with the provisions of the
Securities Act of all or part of its Registrable Securities (a "Demand
Registration"). All requests made pursuant to this Section 3(a) shall specify
the number of Registrable Securities to be registered and the intended methods
of disposition thereof. All such requests shall be delivered to the Company in
accordance with the provisions of Section 10(d) of this Agreement.
(b) Number of, and Limitations on, Registrations. GTS will be
entitled to request up to a total of three Demand Registrations. The Company
will not be obligated to register any Registrable Securities pursuant to such a
Demand Registration (i) unless there is requested to be included in such
registration at least 1,000,000 shares of Common Stock (subject to such
adjustments as may be necessary by reason of the occurrence of an event
contemplated by clause (ii) of the definition of Registrable Securities)
(unless, at the time of such request, GTS holds less than 1,000,000 shares of
Common Stock, in which case such request must be for such lesser amount) or (ii)
if a prior Demand Registration was declared effective within a period commencing
12 months prior to the date of the written request for such Demand Registration
and such prior Demand Registration was maintained effective for a period of not
less than 180 days, or such shorter period during which all Registrable
Securities covered by such prior Demand Registration were sold or withdrawn.
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(c) Effective Registration - Expenses. In any registration
initiated as a Demand Registration, GTS will pay all Registration Expenses,
whether or not the Registration Statement has become effective.
(d) Selection of Underwriters. If any of the Registrable
Securities covered by a Demand Registration are to be sold in an underwritten
offering, or in a best efforts underwritten offering, the investment banker or
investment bankers and manager or managers that will administer the offering
will be selected by GTS. If GTS disapproves of the terms and conditions of the
underwriting, GTS may elect to withdraw all its Registrable Securities by
written notice to the Company and the managing underwriter.
4. Incidental Registration.
(a) Request for Registration. After the Twelve Month Lock-Up,
if the Company at any time proposes to register any of its authorized but
unissued shares of Common Stock on its own behalf or any of its unregistered and
issued shares of Common Stock on behalf of other stockholders, under the
Securities Act on a form and in a manner that would permit registration of
Registrable Securities under the Securities Act for sale to the public under the
Securities Act, it will each such time give prompt notice in accordance with the
provisions of Section 10(d) of this Agreement to GTS of its intention to do so,
specifying the form and manner and the other relevant facts involved in such
proposed registration (including, without limitation, the identity of the
managing underwriter, if any). Upon the written request of GTS delivered to the
Company within 30 days after such notice shall have been given to GTS (which
request shall specify the Registrable Securities intended to be disposed of by
such holder and the intended method of disposition thereof), the Company will
use its reasonable best efforts to effect the registration under the Securities
Act, as expeditiously as is reasonable, of all Registrable Securities that the
Company has been so requested to register by GTS, to the extent requisite to
permit the sale of the Registrable Securities to be so registered; provided,
however, that:
(i) if, at any time after giving such written notice of its
intention to register any Common Stock proposed to be registered by the
Company and prior to the effective date of the registration statement
filed in connection with such registration, the Company shall determine
for any reason not to register such Common Stock, the Company shall, at
its election, give written notice of such determination to GTS, and
thereupon the Company shall be relieved of its obligation to register
any Registrable Securities in connection with such registration (but
not from its obligation to pay the Registration Expenses in connection
therewith to the extent provided in Section 4(b));
(ii) if the managing underwriter of such offering shall advise
the Company that, in its judgment, the number of Common Stock proposed
to be included in
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such offering should be limited because the inclusion of Registrable
Securities is likely to adversely impact the purchase price obtained
for the Common Stock proposed to be included in such offering, then
the Company will promptly advise GTS thereof and may require, by
written notice to GTS accompanying such advice, that, to the extent
necessary to meet such limitation, all holders of Registrable
Securities and of other shares of Common Stock proposing to sell
Common Stock in such offering shall share pro rata in the number of
Common Stock to be excluded from such offering, such sharing to be
based on the respective numbers of Registrable Securities and other
shares of Common Stock as to which registration has been requested by
such holders, and that the distribution of such Registrable Securities
and other shares of Common Stock as are so excluded be deferred (in
case of a deferral as to a portion of such Registrable Securities and
other shares of Common Stock, such portion to be allocated among such
holders in proportion to the respective numbers of Common Stock so
requested to be registered by such holders) until the completion of
the distribution of such Common Stock and any other securities by such
underwriters; and
(b) Expenses. In any registration initiated pursuant to this
Section 4, the Company will pay all Registration Expenses, whether or not the
Registration Statement has become effective.
5. Additional Registration.
(a) Request for Registration. When GTS owns less than 25% of
the outstanding shares of Common Stock of the Company, GTS may make a written
request that the Company register all of its remaining Registrable Securities in
a shelf registration statement with the SEC under and in accordance with the
provisions of the Securities Act.
(b) Expenses. In a registration initiated under this Section
5, GTS will pay all Registration Expenses.
6. Registration Procedures
Whenever GTS has requested that any Registrable Securities be
registered pursuant to this Agreement, the Company will promptly take all such
actions as may be necessary or desirable to permit the sale of such Registrable
Securities in accordance with the intended method or methods of disposition
thereof, and pursuant thereto the Company will as expeditiously as possible:
(a) with respect to a request to file a Registration Statement
covering Registrable Securities made pursuant to Section 3, use its
reasonable best efforts to prepare and file with the SEC not later than
60 days after receipt of such request (which
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60-day period may be extended by the Company for up to an additional
60 days if at the time of such request the Company is engaged in
negotiations in anticipation of its participation in a material
merger, acquisition or other form of business combination or, if by
reason of such transaction, the Company is not in a position to timely
prepare and file the Registration Statement and the Company furnishes
to GTS a certificate signed by the president or a vice president of
the Company stating that in the good faith opinion of the board of
directors of the Company such registration would interfere with such
transaction then being pursued by the Company) a Registration
Statement on a form for which the Company then qualifies which is
satisfactory to the Company and GTS (unless the offering is made on an
underwritten basis, including on a best efforts underwriting basis, in
which event the managing underwriter or underwriters may determine the
form to be used) and which form shall be available for the sale of the
Registrable Securities in accordance with the intended method or
methods of distribution thereof, and use its reasonable best efforts
to cause such Registration Statement to become effective; the Company
shall not file any Registration Statement pursuant to Section 3 or any
amendment thereto or any Prospectus or any supplement thereto
(including such documents incorporated by reference) to which GTS or
the underwriters, if any, shall reasonably object in light of the
requirements of the Securities Act or any other applicable laws or
regulations;
(b) before filing a Registration Statement or Prospectus or
any amendments or supplements thereto (excluding documents to be
incorporated by reference therein, except in the case of the
preparation of the initial Registration Statement), the Company shall,
within five days of filing, furnish to GTS and the underwriters, if
any, copies of all such documents in substantially the form proposed to
be filed (including documents incorporated therein by reference), to
enable GTS and the underwriters, if any, to review such documents prior
to the filing thereof, and the Company shall make such reasonable
changes thereto (including changes to, or the filing of amendments
reflecting such changes to, documents incorporated by reference) as may
be reasonably requested by GTS and the managing underwriter or
underwriters, if any;
(c) subject to paragraph (b) above, prepare and file with the
SEC such amendments and post-effective amendments to the Registration
Statement as may be necessary to keep the Registration Statement
continuously effective for a period of not less than 180 days or such
longer period as is required for the intended method of distribution,
or such shorter period which will terminate when all Registrable
Securities covered by such Registration Statement have been sold or
withdrawn; cause the Prospectus to be supplemented by any required
Prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 under the Securities Act; and comply with the provisions of
the Securities Act with respect to the disposition of all securities
covered by such Registration Statement during the applicable period in
accordance with
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the intended methods of disposition by GTS thereof set forth in such
Registration Statement or supplement to the Prospectus;
(d) notify GTS and the managing underwriters, if any,
promptly, and (if requested by any such Person) confirm such advice in
writing, (1) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to the
Registration Statement or any post-effective amendment, when the same
has become effective, (2) of any request by the SEC for amendments or
supplements to the Registration Statement or the Prospectus or for
additional information, (3) of the issuance by the SEC of any stop
order suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose, (4) if at any time the
representations and warranties of the Company contemplated by paragraph
(o) below cease to be true and correct, (5) of the receipt by the
Company of any notification with respect to the suspension of the
qualification of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for
such purpose, and (6) of the happening of any event which makes any
statement made in the Registration Statement, the Prospectus or any
document incorporated therein by reference untrue or which requires the
making of any changes in the Registration Statement, the Prospectus or
any document incorporated therein by reference in order to make the
statements therein not misleading;
(e) make every reasonable effort to obtain the withdrawal of
any order suspending the effectiveness of the Registration Statement at
the earliest possible moment;
(f) as promptly as practicable after filing with the SEC of
any document which is incorporated by reference into the Registration
Statement or the Prospectus (after initial filing of the Registration
Statement) provide copies of such document to counsel to GTS and to the
managing underwriters;
(g) provide to GTS and each managing underwriter, without
charge, at least one signed copy of the Registration Statement and any
post-effective amendment thereto, including financial statements and
schedules, all documents incorporated therein by reference and all
exhibits (including those incorporated by reference) and a reasonable
number of conformed copies of all such documents;
(h) deliver to GTS and the underwriters, if any, as many
copies of the Prospectus (including each preliminary prospectus) and
any amendment or supplement thereto as such Persons may reasonably
request; the Company consents to the use of the Prospectus or any
amendment or supplement thereto by GTS and the underwriters, if
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any, in connection with the offering and sale of the Registrable
Securities covered by the Prospectus or any amendment or supplement
thereto;
(i) prior to the date on which the Registration Statement is
declared effective, use its reasonable best efforts to register or
qualify, or cooperate with GTS and the underwriters, if any, and their
respective counsel in connection with the registration or qualification
of, such Registrable Securities for offer and sale under the securities
or blue sky laws of such jurisdictions as any seller or underwriter
reasonably requests in writing and do any and all other acts or things
necessary or advisable to enable the disposition in such jurisdictions
of the Registrable Securities covered by the Registration Statement;
provided that the Company will not be required to qualify generally to
do business in any jurisdiction where it is not then so qualified or to
take any action which would subject it to general service of process in
any such jurisdiction where it is not then so subject; provided,
further, that the Company will not be required to qualify such
Registrable Securities in any jurisdiction in which the securities
regulatory authority requires that GTS submit any shares of its
Registrable Securities to the terms, provisions and restrictions of any
escrow, lock-up or similar agreement(s) for consent to sell Registrable
Securities in such jurisdiction unless GTS agrees to do so;
(j) cooperate with GTS and the managing underwriters, if any,
to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold and not bearing any
restrictive legends; and enable such Registrable Securities to be in
such denominations and registered in such names as the managing
underwriters may request at least two business days prior to any sale
of Registrable Securities to the underwriters;
(k) use its reasonable best efforts to cause the Registrable
Securities covered by the Registration Statement to be registered with
or approved by such other governmental agencies or authorities within
the United States as may be necessary to enable the seller or sellers
thereof or the underwriters, if any, to consummate the disposition of
such Registrable Securities;
(1) upon the occurrence of any event contemplated by paragraph
(d)(6) above, prepare a supplement or post-effective Amendment to the
Registration Statement or the Prospectus or any document incorporated
therein by reference or file any other required document so that, as
thereafter delivered to the purchasers of the Registrable Securities,
the Prospectus will not contain an untrue statement of a material fact
or omit to state any material fact necessary to make the statements
therein not misleading;
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(m) use its reasonable best efforts to cause all Registrable
Securities covered by the Registration Statement to be listed on each
securities exchange or the Nasdaq National Market on which similar
securities issued by the Company are then listed if requested by GTS or
the managing underwriters, if any;
(n) provide a transfer agent and registrar for all Registrable
Securities;
(o) enter into such agreements (including an underwriting
agreement) and take all such other actions in connection therewith as
GTS or the managing underwriters, if any, reasonably request in order
to expedite or facilitate the disposition of such Registrable
Securities and in such connection, whether or not an underwriting
agreement is entered into and whether or not the registration is an
underwritten registration (1) make such representations and warranties
to GTS and the underwriters, if any, in form, substance and scope as
are customarily made by issuers to underwriters in primary underwritten
offerings (including, without limitation, an agreement to not sell
equity securities during a customary lock-up period) and confirm the
accuracy of the same if and when requested, and matters relating to the
compliance of the Registration Statement and the Prospectus with the
Securities Act; (2) obtain opinions of counsel to the Company, and
updates thereof (which counsel and opinions (in form, scope and
substance) shall be reasonably satisfactory to the managing
underwriters) addressed to GTS and the underwriters, if any, covering
the matters customary in underwritten primary offerings and such other
matters as may be reasonably requested by GTS and underwriters, if any;
(3) obtain "comfort" letters and updates thereof from the Company's
independent certified public accountants addressed to GTS and the
underwriters, if any, such letters to be in customary form and covering
matters of the type customarily covered in "comfort" letters by
underwriters in connection with primary underwritten offerings; (4) if
an underwriting agreement is entered into, the same shall set forth in
full the indemnification provisions and procedures of Section 8 hereof
with respect to all parties to be indemnified pursuant to said Section;
and (5) the Company shall deliver such documents and certificates as
may be requested by GTS and the managing underwriters, if any, to
evidence compliance with clause (1) above and with any customary
conditions contained in the underwriting agreement or other agreement
entered into by the Company. The above shall be done at each closing
under such underwriting or similar agreement or as and to the extent
required thereunder;
(p) make available for inspection during normal business hours
by GTS, any underwriter participating in any disposition pursuant to
such registration statement, and any attorney, accountant or other
agent retained by GTS or any such underwriter, all financial and other
records, pertinent corporate documents and properties of the Company,
and cause the Company's officers, directors and employees to supply all
information reasonably requested by GTS or any such underwriter,
attorney, accountant
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or agent in connection with such registration statement; provided that
any records, information or documents that are designated by the
Company in writing as confidential shall be kept confidential by such
Persons;
(q) otherwise use its reasonable best efforts to comply with
all applicable rules and regulations of the SEC, and make generally
available to its security holders, earnings statements satisfying the
provisions of Section 11(a) of the Securities Act, no later than 45
days after the end of any 12-month period (1) commencing at the end of
any fiscal quarter in which Registrable Securities are sold to
underwriters in a firm or best efforts underwriting offering, and (2)
beginning with the first month of the Company's first fiscal quarter
commencing after the effective date of the Registration Statement,
which statements shall cover said 12-month periods; and
(r) take such other reasonable steps that are necessary or
advisable to permit the sale of such Registrable Securities.
The Company may require GTS to furnish to the Company such
information and documents regarding GTS and the distribution of the Registrable
Securities as the Company may from time to time reasonably request in writing.
GTS agrees by acquisition of such Registrable Securities that,
upon receipt of any notice from the Company of the happening of any event of the
kind described in Section 6(d)(6) hereof, GTS will forthwith discontinue
disposition of Registrable Securities until GTS's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 6(l) hereof, or until
it is advised in writing (the "Advice") by the Company that the use of the
Prospectus may be resumed, and has received copies of any additional or
supplemental filings which are incorporated by reference in the Prospectus, and,
if so directed by the Company, GTS will, or will request the underwriters to,
deliver to the Company (at the Company's expense) all copies, other than
permanent file copies then in GTS's possession, of the Prospectus covering such
Registrable Securities current at the time of receipt of such notice. If the
Company shall give such notice, the time periods mentioned in Section 6(c)
hereof shall be extended by the number of days during the period from and
including the date of the giving of such notice pursuant to Section 6(d)(6) to
and including the date when GTS shall have received the copies of the
supplemented or amended prospectus contemplated by Section 6(l) hereof or the
Advice.
7. Expenses
Except as otherwise provided herein, all expenses incident to
the Company's performance of or compliance with this Agreement including without
limitation all registration and filing fees, including with respect to filings
required to be made with the National
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Association of Securities Dealers, fees and expenses of compliance with
securities or blue sky laws (including reasonable fees and disbursements of
counsel for the underwriters in connection with blue sky qualifications of the
Registrable Securities and determination of their eligibility for investment
under the laws of such jurisdictions as the managing underwriters or holders of
a majority of the Registrable Securities being sold may designate), printing
expenses, messenger, telephone and delivery expenses, and fees and disbursements
of counsel for the Company, GTS and of all independent certified public
accountants (including the expenses of any special audit and "comfort" letters
required by or incident to such performance), the fees and expenses incurred in
connection with the listing of the securities to be registered on each
securities exchange on which similar securities issued by the Company are then
listed, rating agency fees, securities acts liability insurance if GTS so
requires, the reasonable fees and expenses of any special experts retained by
GTS or by the Company at the request of the managing underwriters in connection
with such registration and fees and expenses of other Persons retained by GTS
(all such expenses being herein called "Registration Expenses") will be borne by
the Company. The Company shall, in any event, pay its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties) and the expense of any annual
audit which are not "Registration Expenses" for purposes of this Agreement. In
no event shall the Company be liable for the payment of any discounts,
commissions or fees of underwriters, selling brokers, dealer managers or similar
industry professionals relating to the distribution of the Registrable
Securities. GTS shall be liable for the cost and expense of the time spent by
its officers, employees and Agents incurred in connection with the registration
of Registrable Securities owned by it.
8. Indemnification
(a) Indemnification by Company. The Company will indemnify and
hold harmless, to the full extent permitted by law, GTS, its officers and
directors, their Agents and each Person who controls GTS (within the meaning of
the Securities Act) against all losses, claims, damages, liabilities (or actions
in respect thereto) and expenses to which any such Person may be subject, under
the Securities Act or otherwise, and reimburse all such Persons for any legal or
other expenses incurred with investigating or defending against any such losses,
claims, damages or liabilities, insofar as such losses, claims, damages or
liabilities arise out of or are based upon any untrue or alleged untrue
statement of a material fact contained in a Registration Statement, Prospectus
or preliminary prospectus or 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 the same arise out of or are based
upon an untrue statement of a material fact or omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, which statement or omission is made therein in reliance upon and in
conformity with information furnished in writing to the Company by GTS,
expressly for use therein. Such indemnity shall remain in full force and
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effect regardless of any investigation made by or on behalf of GTS, GTS's
directors and officers, their Agents or a controlling Person, and shall survive
the transfer of such securities by GTS. The Company will also indemnify
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in the distribution, their officers and directors
and each Person who controls such Persons (with the meaning of the Securities
Act) to the same extent as provided above with respect to the indemnification of
GTS of Registrable Securities.
(b) Indemnification by GTS. GTS will indemnify and hold
harmless, to the full extent permitted by law, the Company, its directors and
officers and each Person who controls the Company (within the meaning of the
Securities Act) against any losses, claims, damages, liabilities (or actions in
respect thereto) and expenses to which any such Person may be subject, under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities arise out of or are based upon any untrue or alleged untrue
statement of a material fact contained in a Registration Statement or Prospectus
or preliminary prospectus or any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, to the extent, but only if and to the extent, that such untrue or
alleged untrue statement or omission or alleged omission is made therein in
reliance upon and in conformity with the information furnished in writing by GTS
specifically for inclusion therein. In no event shall the liability of GTS
hereunder be greater in amount than the dollar amount of the proceeds received
by GTS upon the sale of the Registrable Securities giving rise to such
indemnification obligation. The Company shall be entitled to receive indemnities
from underwriters, selling brokers, dealer managers and similar securities
industry professionals participating in the distribution, to the same extent as
provided above with respect to information so furnished in writing by such
Persons.
(c) Conduct of Indemnification Proceedings. Any Person
entitled to indemnification hereunder will (i) give prompt notice to the
indemnifying party of any claim with respect to which it seeks indemnification
and (ii) unless in such indemnified party's reasonable judgment a conflict of
interest may exist between such indemnified and indemnifying parties with
respect to such claim, permit such indemnifying party to assume the defense of
such claim with counsel reasonably satisfactory to the indemnified party and in
that case the indemnified party shall have the right to participate in the
conduct of such defense provided that it will pay for the fees of its own
counsel. Whether or not such defense is assumed by the indemnifying party, the
indemnifying party will not be subject to any liability for any settlement made
without its consent (but such consent will not be unreasonably withheld). No
indemnifying party will consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving of
the claimant or plaintiff to such indemnified party of a release from all
liability in respect to such claim or litigation. An indemnifying party who is
not entitled to, or elects not to, assume the defense of a claim will not be
obligated to pay the fees and expenses of more than one counsel for all
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parties indemnified by such indemnifying party with respect to such claim,
unless in the reasonable judgment of any indemnified party a conflict of
interest may exist between such indemnified party and any other of such
indemnified parties with respect to such claim, in which event the indemnifying
party shall be obligated to pay the fees and expenses of such additional counsel
or counsels. The failure to notify an indemnifying party promptly of the
commencement of any such action, if and to the extent prejudicial to its ability
to defend such action, shall relieve such indemnifying party of any liability to
the indemnified party under this Section, but the omission so to notify the
indemnifying party will not relieve it of any liability that it may have to any
indemnified party otherwise than under this Section.
(d) Contribution. To the extent any indemnification by an
indemnifying party is prohibited or limited by law, the indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims, damages
or liabilities in such proportion as is appropriate to reflect the relative
fault of the indemnifying party and indemnified party in connection with the
actions which resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative fault of such
indemnifying party and indemnified party shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of material fact or omission or alleged omission to
state a material fact, has been made, or relates to information supplied by,
such indemnifying party or indemnified party, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
action. The amount paid or payable by a party as a result of the losses, claims,
damages or liabilities referred to above shall be deemed to include any legal or
other fees or expenses reasonably incurred by such party in connection with any
investigation or proceeding.
The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 8(d) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. 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.
9. Transfer of Registration Rights
The registration rights of GTS under this Agreement with
respect to any Registrable Securities may be transferred to any transferee of
such Registrable Securities, including any affiliate of GTS; provided, however,
that (i) GTS shall give the Company written notice at or prior to the time of
such transfer stating the name and address of the transferee and identifying the
securities with respect to which the rights under this Agreement
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are being transferred and (ii) such transferee shall agree in writing, in form
and substance reasonably satisfactory to the Company, to be bound by the
provisions of this Agreement.
10. Miscellaneous
(a) Remedies. GTS shall be entitled to exercise all rights
provided herein or granted by law, including recovery of damages, and each will
be entitled to specific performance of their rights under this Agreement. The
Company agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of the provisions of this Agreement
and hereby agrees to waive the defense in any action for specific performance
that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company will not on or
after the date of this Agreement enter into any agreement with respect to its
securities which is inconsistent with the rights granted to GTS in this
Agreement or otherwise conflicts with the provisions hereof. The Company has not
previously entered into any agreement with respect to its securities granting
any registration rights to any Person.
(c) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of GTS.
(d) Notices. All notices, requests, demands and other
communications provided for by this Agreement shall be in writing (including
telecopier or similar writing) and shall be deemed to have been given at the
time when mailed in any general or branch office of the United States Postal
Service, enclosed in a registered or certified postpaid envelope, or sent by
Federal Express or other similar overnight courier service, addressed to the
address of the parties stated below or to such changed address as such party may
have fixed by notice or, if given by telecopier, when such telecopy is
transmitted and the appropriate answerback is received.
(i) If to Global TeleSystems Group, Inc.:
Global TeleSystems Group, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxx Xxxxx, 00xx Xxxxx
XxXxxx, XX 00000
Attn: Chief Financial Officer
Copy to: General Counsel
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(ii) If to the Company:
Golden Telecom, Inc.
00 Xxxxxxxxxxxxxxxxxx Xxx., 0xx Xxxxx
000000 Xxxxxx, Xxxxxx
Attn: Chief Financial Officer
Copy to: General Counsel
(e) Assignment. Neither party shall assign or transfer any of
its rights under this Agreement without the prior written consent of the other
party. If any transferee of a holder of Registrable Securities shall acquire
Registrable Securities, in any manner, whether by operation of law or otherwise,
such Registrable Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Registrable Securities such transferee
shall be conclusively deemed to have agreed to be bound by and to perform all of
the terms and provisions of this Agreement and such transferee shall be entitled
to receive the benefits hereof.
(f) Governing Law. This Agreement shall be governed by the
laws of the State of New York.
(g) Entire Agreement. This Agreement, together with any other
agreements between the parties, constitutes the entire understanding between the
parties and supersedes all proposals, commitments, writings, negotiations and
understandings, oral and written, and all other communications between the
parties relating to the subject matter of this Agreement.
(h) Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same document.
(i) Severability. Should any part, term or condition hereof be
declared illegal or unenforceable or in conflict with any other law, the
validity of the remaining portions or provisions of this Agreement shall not be
affected thereby, and the illegal or unenforceable portions of this Agreement
shall be and hereby are redrafted to conform with applicable law, while leaving
the remaining portions of this Agreement intact.
(j) Force Majeure. No party shall be deemed to have breached
this Agreement or be held liable for any failure or delay in the performance of
all or any portion of its obligations under this Agreement if prevented from
doing so by a cause or causes beyond its control. Without limiting the
generality of the foregoing, such causes include acts of God or the public
enemy, fires, floods, storms, earthquakes, riots, strikes, lock-outs, wars and
war-operations, restraints of government power or communication line failure or
other
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circumstances beyond such party's control, or by reason of the judgment, ruling
or order of any court or agency of competent jurisdiction or change of law or
regulation subsequent to the execution of this Agreement.
(k) Successors and Assigns. Subject to the provisions of
Section 10(e), this Agreement is solely for the benefit of the parties and their
respective successors and assigns. Nothing herein shall be construed to provide
any rights to any other entity or individual.
(l) Headings. Section headings are for convenience only and do
not control or affect the meaning or interpretation of any terms or provisions
of this Agreement.
(m) Attorneys' Fees. In any action or proceeding brought to
enforce any provision of this Agreement, or where any provision hereof or
thereof is validly asserted as a defense, the successful party shall be entitled
to recover reasonable attorneys, fees in addition to any other available remedy.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
GOLDEN TELECOM, INC.
By:
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Name:
Title:
GLOBAL TELESYSTEMS GROUP, INC.
By:
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Name:
Title:
