EXHIBIT (C)(3)
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into this March 5, 1996 between GEOTEK COMMUNICATIONS, INC., a Delaware
corporation (the "Company"), and XXXXX XXXXXX INC. (the "Initial Purchaser").
This Agreement is made pursuant to the Purchase Agreement, dated March
4, 1996, between the Company and the Initial Purchaser (the "Purchase
Agreement"), which provides for the sale by the Company to the Initial Purchaser
of 12% Senior Subordinated Convertible Notes of the Company (the "Notes") having
an aggregate principal amount of up to $75,000,000 (after giving effect to the
over-allotment option granted to the Initial Purchaser pursuant to the Purchase
Agreement), each of which entitles the holder thereof to convert such Note into
shares of Common Stock at the conversion price set forth in the Indenture, dated
as of March 5, 1996, between the Company and The Bank of New York, as Trustee.
In order to induce the Initial Purchaser to enter into the Purchase Agreement,
the Company has agreed to provide to the Initial Purchaser and its direct and
indirect transferees the registration rights set forth in this Agreement. The
execution of this Agreement is a condition to the closing under the Purchase
Agreement.
In consideration of the foregoing, the parties hereto agree as follows:
1. Definitions. As used in this Agreement, capitalized terms shall have
the meanings set forth below, or to the extent not set forth below,
capitalized terms shall have the meanings set forth in the Purchase
Agreement.
"Common Stock" shall mean the Common Stock, par value $.01 per share,
of the Company.
"Company" shall have the meaning set forth in the preamble and also
includes the Company's successors.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.
"Holder" shall mean the Initial Purchaser, for so long as it owns any
Registrable Securities, and each of its successors, assigns and direct and
indirect transferees who become registered owners of Registrable
Securities.
"Indenture" shall mean the Indenture relating to the Notes, dated as of
March 5, 1996, between the Company and The Bank of New York, as trustee, as
the same may be amended from time to time in accordance with the terms
thereof.
"Initial Purchaser" shall have the meaning set forth in the
preamble to this Agreement.
"Liquidated Damages" shall have the meaning set forth in Section 5(l)
of this Agreement.
"Majority Holders" shall mean the Holders holding a majority of the
Registrable Securities, determined on an as-converted basis; provided that
whenever the consent or approval of a specified percentage of
Holders is required hereunder, Registrable Securities held by the Company
or any of its affiliates (as such term is defined in Rule 405 under the
Securities Act) (other than the Initial Purchaser or subsequent holders of
Registrable Securities, or securities that were previously Registrable
Securities, if such subsequent holders are deemed to be such affiliates
solely by reason of their holding Registrable Securities, securities that
were previously Registrable Securities, Senior Secured Notes, Warrants
and/or Warrant Shares and other than affiliates that control or are under
common control with the Company) shall not be counted in determining
whether such consent or approval was given by the Holders of such required
percentage or amount.
"Notes" shall mean the 12% Senior Subordinated Convertible Notes due
2001 of the Company.
"person" shall mean an individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political
subdivision thereof.
"Prospectus" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, and all other
amendments and supplements to such prospectus, including post-effective
amendments, and in each case including all material incorporated by
reference therein.
"Purchase Agreement" shall have the meaning set forth in the second
paragraph of this Agreement.
"Registrable Securities" shall mean the Notes and the Shares; provided,
however, that the Notes and the Shares shall cease to be Registrable
Securities when (i) in the case of Notes, a Shelf Registration Statement
with respect to the Notes shall have been declared effective under the
Securities Act and the Notes shall have been disposed of pursuant to such
Shelf Registration Statement, (ii) (A) in the case of the Shares, except as
otherwise provided in clause (ii)(B), a Resale Shelf Registration Statement
with respect to the Shares shall have been declared effective under the
Securities Act and such Shares shall have been disposed of pursuant to such
Shelf Registration Statement, or (B) in the case of any Shares actually
issued upon conversion of Notes, a Shelf Registration Statement with
respect to the issuance of such Shares shall have been declared effective
under the Securities Act and, following the issuance thereof, such Shares
are not subject to restrictions on transfer pursuant to the Securities Act,
(iii) the Notes or the Shares may be distributed to the public pursuant to
Rule 144(k) (or any similar provision then in force, but not Rule 144A
under the Securities Act) under the Securities Act or (iv) the Notes or the
Shares shall have ceased to be outstanding.
"Registration Expenses" shall mean any and all expenses incurred
incident to performance of or compliance by the Company with this
Agreement, including without limitation, (i) all SEC, stock exchange or
National Association of Securities Dealers, Inc. registration and filing
fees, (ii) all fees and expenses incurred in connection with compliance
with state securities or "blue sky" laws (including reasonable fees and
disbursements of one counsel for any Underwriters in connection with "blue
sky" qualification of any of the Registrable Securities), (iii) all
expenses of any persons retained by the Company in preparing or assisting
in preparing, word processing, printing and distributing any Registration
Statement or any Prospectus, or, in each case any amendments or supplements
thereto, (iv) the reasonable fees and expenses incurred by any Underwriter
in connection with the preparation of any underwriting agreements,
securities sales agreements and other documents relating to the performance
of and compliance with this Agreement, (v) all rating agency fees, (vi) all
fees and disbursements relating to the qualification of the Indenture under
applicable securities laws, (vii) the fees and disbursements of the Trustee
or any transfer agent retained by the Company, (viii) the fees and
disbursements of counsel for the Company and reasonable fees and
disbursements of one counsel for the Holders (which counsel shall be
selected by the Majority Holders (or, in the case of an Underwritten
Offering, a majority of the Holders participating in such Underwritten
Offering) and which counsel also may be counsel for the Initial Purchaser)
and (ix) the fees and disbursements of the independent public accountants
of the Company and any partnership or joint venture in which the Company or
any of its subsidiaries is a partner, including the expenses of any special
audits or "cold comfort" letters required by or incident to such
performance and compliance, but excluding fees of counsel to the
Underwriters (other than fees and expenses set forth in clause (ii) or (iv)
above) or the Holders (other than fees and expenses set forth in clause
(viii) above) and underwriting discounts and commissions and transfer
taxes, if any, relating to the sale or disposition of Registrable
Securities by a Holder.
"Registration Statement" shall mean a Shelf Registration Statement or a
Resale Shelf Registration Statement, as applicable; provided, that, if more
than one Registration Statement is required in order to satisfy the
registration requirements set forth in this Agreement, the term
"Registration Statement" shall refer to all such Registration Statements
prepared pursuant to this Agreement, unless the context otherwise requires.
"Resale Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company pursuant to the provisions of Section 2(a) of this
Agreement covering the resale of all of the Notes and the Shares (in the
case of the Shares, to the extent that the Shares are not covered by a
Shelf Registration Statement) by the holders thereof (but no other
securities, except to the extent otherwise provided in Section 2(f) hereof,
unless approved by the Majority Holders), on an appropriate form under Rule
415 under the Securities Act, or any similar rule that may be adopted by
the SEC, and all amendments and supplements to such registration statement,
including post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated by
reference therein; provided, that, if the Notes and the Shares are not
permitted to be registered on the same registration statement, the term
"Resale Registration Statement" shall refer to all such registration
statements prepared pursuant to this Agreement, unless the context
otherwise requires.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as
amended.
"Senior Secured Notes" shall mean the 15% Senior Secured Discount Notes
due 2005 of the Company.
"Shares" means the shares of Common Stock issuable upon the
conversion of the Notes.
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company pursuant to the provisions of Section 2(a) of this
Agreement covering the issuance of all of the Shares (but no other
securities, except to the extent otherwise provided in Section 2(f) hereof,
unless approved by the Majority Holders) on an appropriate form under Rule
415 under the Securities Act, or any similar rule that may be adopted by
the SEC, and all amendments and supplements to such registration statement,
including post-effective amendments, and in each case including the
Prospectus contained therein, all exhibits thereto and all material
incorporated by reference therein.
"Underwriter" shall have the meaning set forth in
Section 2(b) of this Agreement.
"Underwritten Offering" shall mean a registration in which Registrable
Securities are sold to an Underwriter for reoffering to the public.
"Warrant Shares" shall mean the shares of Common Stock issued upon
exercise of the Warrants.
"Warrants" shall mean the warrants to purchase Common Stock issued
pursuant to the Warrant Agreement dated as of June 30, 1995 between the
Company and IBJ Xxxxxxxx Bank & Trust Company, as Warrant Agent.
2. Registration Under the Securities Act.
(a) The Company shall file and shall use its best efforts to cause a
Resale Shelf Registration Statement pertaining to the Notes, to be declared
effective by the SEC no later than July 3, 1996. The Company shall file and
shall use its best efforts to cause a Shelf Registration Statement pertaining
to the Shares to be declared effective by the SEC prior to the first date upon
which the Notes become convertible; provided, that, if due to applicable law, or
any applicable interpretation of the staff of the SEC, a Shelf Registration
Statement does not permit the public resale by all of the Holders of the Shares
(other than by any Holders that are affiliates (as such term is defined in Rule
405 under the Securities Act) of the Company (unless such Holders are affiliates
solely by reason of their holding Registrable Securities, securities that were
previously Registrable Securities, Senior Secured Notes, Warrants and/or Warrant
Shares)), or is otherwise prohibited, the Company shall file and use its best
efforts to cause to be declared effective within such time period a Resale Shelf
Registration Statement covering the Shares. The Company agrees to use all
reasonable best efforts to keep the Registration Statement continuously
effective for so long as any of the Notes or Shares covered thereby (in the case
of the Shares, without regard to whether such Shares actually have been issued)
shall constitute Registrable Securities. The Company further agrees to
supplement or amend the Registration Statement, if required by the rules,
regulations or instructions applicable to the registration form used by the
Company for the Registration Statement or by the Securities Act or by any other
rules and regulations thereunder for shelf registration or if reasonably
requested by a Holder with respect to information relating to such Holder in
order to accurately reflect information regarding such Holder or such Holder's
plan of distribution as required by the Registration Statement, and to use its
best efforts to cause any such amendment to become effective and such
Registration Statement to become usable as soon as thereafter practicable. The
Company agrees to furnish to the Holders copies of any such supplement or
amendment promptly after its being made available for use or filed with the SEC.
In addition to the registration requirements of the Company provided for above,
the Company shall effect any other registration within the United States, within
the time period provided for in the first sentence of this paragraph, that may
be required in order to enable the holders of the Notes to exercise their right
to convert the Notes into Shares thereunder.
(b)(i) The Holders whose Registrable Securities are covered by a Resale
Shelf Registration Statement who desire to do so may sell Registrable Securities
in an Underwritten Offering subject to the limitations set forth in the proviso
to the first sentence of Section 3(p) hereunder (including the Company's
obligation to use its best efforts in connection therewith); provided, that,
such Underwritten Offering shall be required to be consummated as promptly as
reasonably practicable and in no event later than 30 days following the
commencement of the marketing of such Underwritten Offering. In any such
Underwritten Offering, the investment banker or investment bankers and manager
or managers (the "Underwriters") that will administer the offering will be
selected by the Holders of a majority of the Registrable Securities (determined
on an as-converted basis) included in such offering, with the consent of the
Company, which shall not be unreasonably withheld. Notwithstanding anything to
the contrary set forth in this paragraph, the Holders shall not have the right
to sell Registrable Securities in an Underwritten Offering (i) at any time
during which the Company is engaged in a registration of securities for its own
account which are to be sold pursuant to an underwritten offering with respect
to which an underwriter has been selected, to the extent so requested by such
underwriter, or, to the extent that, prior to or as of the date of any request
for an Underwritten Offering pursuant to this Section 2(b)(i), the Company has
engaged (and continues to be engaged as of the date of such request) in
discussions with an underwriter, so long as, no later than 30 days after such
request, the Company is in registration, and (ii) during any customary "lock-up"
period thereafter (not to last beyond the 90-day period beginning on the closing
date of such underwritten offering) required by such underwriter in connection
with such underwritten offering. Notwithstanding anything to the contrary set
forth herein, nothing contained in this Agreement shall require the Company to
effect an Underwritten Offering pursuant to this Section 2(b)(i) to the extent
that the offer and sale of Registrable Securities in connection with such
Underwritten Offering would jeopardize (in the reasonable good faith advice of
outside counsel to the Company) any exemption from the registration requirements
of the Securities Act being relied on by the Company in connection with any
prior offer and sale of securities or that is to be relied on by the Company in
connection with any proposed sale to a specific identified investor or through a
placement agent that, prior to or as of the date of any request for an
Underwritten Offering pursuant to this Section 2(b)(i), has engaged (and
continues to be engaged as of the date of such request) in discussions with the
Company concerning the placeent of securities of the Company by such agent, so
long as, no later than 30 days after such request, the Company has entered into
an engagement letter with such agent.
(ii) Each Holder whose Registrable Securities are covered by a Resale
Shelf Registration Statement and are of the same class or type as any
Registrable Securities being sold in an Underwritten Offering agrees, upon the
request of the Underwriter(s) in any Underwritten Offering permitted pursuant to
this Agreement, not to effect any public sale or distribution of securities of
the Company of the same class or type as the Registrable Securities included in
such Resale Shelf Registration Statement (except as part of such registration),
including a sale pursuant to Rule 144 under the Securities Act, during the
10-day period prior to, and during the 90-day period beginning on, the closing
date of any such Underwritten Offering made pursuant to such Resale Shelf
Registration Statement, to the extent timely notified in writing by the Company
or such Underwriter(s).
The foregoing provision shall not apply to any Holder if such Holder is
prevented by applicable statute or regulation from entering into any such
agreement; provided, however, that any such Holder shall undertake, in its
request to participate in any such Underwritten Offering, not to effect any
public sale or distribution of any of its Registrable Securities not sold in
such Underwritten Offering, commencing on the date of sale of Registrable
Securities pursuant to such Underwritten Offering and ending on the date that is
90 days after the closing date of such Underwritten Offering, unless it has
provided 45 days' prior written notice of such sale or distribution to the
Underwriter(s).
(iii) Unless otherwise agreed to by the Underwriter(s), the Company
agrees not to effect any public or private offer, sale or distribution of
securities of the same quality and nature as the Registrable Securities being
sold in the Underwritten Offering, including a sale pursuant to Regulation D
under the Act, during the 10-day period prior to, and during the 60-day period
beginning on, the closing date of each Underwritten Offering permitted pursuant
to Section 3(p) hereof made pursuant to the Registration Statement, to the
extent timely notified in writing by the Underwriter(s). Notwithstanding the
foregoing, the Company may effect a private offer, sale or distribution of
securities of the same quality and nature as the Registrable Securities being
sold in the Underwritten Offering to the extent that, at the time that the price
of such securities is determined, the price of such securities (on an as
converted basis, if applicable) is in excess of the market price of the
applicable Registrable Securities; provided, that, the limitation on private
offers, sales and distributions set forth in this sentence shall apply only to
the extent so requested by the Underwriter(s) in the Underwritten Offering
within 3 Business Days following notice of such proposed offer, sale or
distribution (which notice shall be provided by the Company at least 7 Business
Days prior to any such proposed offer, sale or distribution).
(c) The Company shall pay all Registration Expenses in
connection with any registration pursuant to Section 2(a). Each Holder shall pay
all underwriting discounts and commissions and transfer taxes, if any, relating
to the sale or disposition of such Holder's Registrable Securities pursuant to
the Registration Statement.
(d) Upon the occurrence or failure to occur of certain events
described in the Notes or in this Agreement, additional interest, or Liquidated
Damages, as the case may be, will accrue on the Notes or the Shares, as provided
in the Notes and in this Agreement.
(e) Without limiting the remedies available to the Initial
Purchaser and subsequent Holders, the Company acknowledges that any failure
by the Company to comply with its obligations under Section 2(a) hereof may
result in material irreparable injury to the Initial Purchaser and/or subsequent
Holders for which there is no adequate remedy at law, that it will not be
possible to measure damages for such injuries precisely and that, in the event
of any such failure, the Initial Purchaser or any subsequent Holder may obtain
such relief as may be required to specifically enforce the Company's obligations
under Section 2(a) hereof.
(f) Notwithstanding anything to the contrary contained in this
Agreement, any securityholders of the Company that have "piggyback" registration
rights pursuant to any agreement in effect on the date hereof, shall be entitled
to include any securities to which such "piggyback" right applies in any
Registration Statement filed pursuant to this Agreement, and shall be entitled
to participate in any Underwritten Offering, in each case to the extent provided
in the agreement containing such "piggyback" rights.
3. Registration Procedures. In connection with the obligations
of the Company with respect to Section 2(a) hereof, the Company shall, to the
extent required by Section 2(a), as expeditiously as practicable:
(a) prepare and file with the SEC a Registration Statement on
the appropriate form under the Securities Act, which form shall, (x) be
selected by the Company and (y) comply as to form in all material
respects with the requirements of the applicable form and include all
financial statements required by the SEC to be filed therewith, and use
all reasonable best efforts to cause such Registration Statement to
become effective and remain effective in accordance with Section 2
hereof;
(b) prepare and file with the SEC such amendments and
post-effective amendments to the Registration Statement as may be
necessary to (x) keep such Registration Statement effective for the
applicable period under this Agreement and (y) cause each 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 (z) keep each Prospectus current during the period described under
Section 4(3) and Rule 174 under the Securities Act that is applicable
to transactions by brokers or dealers with respect to the securities
covered by such Prospectus;
(c) in the case of a registration pursuant to a Resale Shelf
Registration Statement, furnish to each Holder of securities registered
thereunder, to counsel for the Initial Purchaser, to counsel for such
Holders and to each Underwriter of an Underwritten Offering of
Registrable Securities, if any, and each such Underwriter's Counsel,
without charge, as many copies of each Prospectus, including
each preliminary Prospectus, and any amendment or supplement thereto
and such other documents as such Holder or Underwriter may reasonably
request, in order to facilitate the public sale or other disposition of
the Registrable Securities; the Company consents to the use of such
Prospectus and any amendment or supplement thereto in accordance with
applicable law by each of the Holders selling Registrable Securities
and any such Underwriters in connection with the offering and sale of
the Registrable Securities covered by and in the manner described in
such Prospectus or any amendment or supplement thereto in accordance
with applicable law;
(d) use its reasonable best efforts to register or qualify the
Registrable Securities under all applicable state securities or "blue
sky" laws of such jurisdictions as any Holder with Registrable
Securities covered by a Registration Statement shall reasonably request
in writing by the time the Registration Statement is declared effective
by the SEC, to cooperate with such Holders in connection with any
filings required to be made with the National Association of Securities
Dealers, Inc. and do any and all other acts and things which may be
reasonably necessary or advisable to enable such Holder to consummate
the disposition in each such jurisdiction of such Registrable
Securities; provided, however, that the Company shall not be required
to (i) qualify as a foreign entity or as a dealer in securities in any
jurisdiction where it would not otherwise be required to qualify but
for this Section 3(d), (ii) file any general consent to service of
process or (iii) subject itself to taxation in any such jurisdiction if
it is not so subject;
(e) notify each Holder, counsel for the Holders and counsel
for the Initial Purchaser promptly and, if requested by any such
Holder, confirm such advice in writing, (i) when the Registration
Statement has become effective and when any post-effective amendments
and supplements thereto have been filed and become effective, (ii) of
any request by the SEC or any state securities authority for amendments
and supplements to the Registration Statement and related Prospectus or
for additional information after the Registration Statement has become
effective, (iii) of the issuance by the SEC or any state securities
authority of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that
purpose, (iv) if, between the effective date of the Resale Shelf
Registration Statement and the closing of any sale of Registrable
Securities covered thereby, the representations and warranties of the
Company contained in any underwriting agreement, securities sales
agreement or other similar agreement, if any, relating to such offering
cease to be true and correct in all material respects or if the
Company receives any notification with respect to the suspension of the
qualification of the Registrable Securities for sale in any
jurisdiction or the initiation of any proceeding for such purpose, (v)
of the happening of any event which makes any statement made in the
Registration Statement or the related Prospectus untrue in any material
respect or which requires the making of any changes in the Registration
Statement or Prospectus in order to make the statements therein not
misleading and (vi) of any determination by the Company that a
post-effective amendment to the Registration Statement would be
appropriate;
(f) make every reasonable effort to obtain the withdrawal of
any order suspending the effectiveness of a Registration Statement at
the earliest practicable moment and provide prompt notice to each
Holder of the withdrawal of any such order;
(g) in the case of any registration pursuant to a Resale Shelf
Registration Statement, furnish to each Holder, without charge, at
least one conformed copy of the Resale Shelf Registration Statement and
any post-effective amendment thereto, together with any documents
incorporated therein by reference (in each case, without exhibits
thereto, unless requested);
(h) in the case of a registration pursuant to a Resale Shelf
Registration Statement, cooperate with the selling Holders of
Registrable Securities 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 amounts (in the case of the Notes, consistent
with the provisions of the Indenture) and registered in such names as
such Holders may reasonably request at least two business days prior to
the closing of any sale of Registrable Securities;
(i) upon the occurrence of any event contemplated by Section
3(e)(v) hereof, use its reasonable best efforts to prepare a supplement
or post-effective amendment to the Shelf Registration Statement or the
related Prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered to
the purchasers of Registrable Securities, such Prospectus will not
contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; the Company
agrees to notify each Holder to suspend use of the Prospectus included
in a Resale Shelf Registration Statement as promptly as practicable
after the occurrence of such an event and each Holder hereby agrees to
suspend use of the Prospectus until the Company has amended or
supplemented the Prospectus to correct such misstatement or omission;
(j) in the case of a registration pursuant to a Resale Shelf
Registration Statement, within a reasonable time prior to the filing of
the Resale Shelf Registration Statement, Prospectus to be included
therein, or amendment or supplement to either of the foregoing, provide
copies of such document to the Initial Purchaser and its counsel, and
the Holders and their counsel, and make such of the representatives of
the Company as shall be reasonably requested by the Initial Purchaser
or its counsel and the Holders or their counsel available for
discussion of such document, and shall not at any time file or make any
amendment or supplement to any such document of which the Initial
Purchaser and its counsel and the Holders and their counsel, shall not
have previously been advised and furnished a copy or in a form to which
the Initial Purchaser or its counsel and the Majority Holders or their
counsel shall reasonably object; provided, however, that any document
incorporated by reference in any such Prospectus by any amendment or
supplement shall be provided to the Initial Purchaser and its counsel
and to the Holders and their counsel at the time that such amendment or
supplement is filed with the SEC;
(k) obtain a CUSIP number for the Registrable Securities
covered by the Registration Statement not later than the effective
date thereof;
(l) cause the Indenture to be qualified under the Trust
Indenture Act of 1939, as amended (the "TIA") in connection with the
registration of the Notes that are Registrable Securities, cooperate
with the Trustee and the Holders to effect such changes to the
Indenture as may be required for the Indenture to be so qualified in
accordance with the terms of the TIA and execute, and use its
reasonable best efforts to cause the Trustee to execute, all documents
as may be required to effect such changes, and all other forms and
documents required to be filed with the SEC to enable the Indenture to
be so qualified in a timely manner;
(m) in the case of a registration pursuant to a Resale Shelf
Registration Statement, make available for inspection by a
representative of all of the Holders, any Underwriter participating in
any disposition pursuant to the Resale Shelf Registration Statement and
attorneys and accountants designated by the Holders or any Underwriter,
at reasonable times and in a reasonable manner, all financial and other
records, pertinent documents and properties of the Company, and
cause the respective officers, directors and employees of the Company
to supply all information reasonably requested by any such
representative, Underwriter, attorney or accountant in connection with
the Resale Shelf Registration Statement; provided, however, that such
Underwriters, representatives, attorneys or accountants agree to keep
confidential any records, information or documents that are designated
by the Company in writing as confidential and to use such information
obtained pursuant to this provision only in connection with the
transaction for which such information was obtained, and not for any
other purpose, unless (i) such records, information or documents (x)
are available to the public, (y) were already in such Underwriters',
representatives', attorneys' or accountants' possession prior to its
receipt from the Company and they do not otherwise have any obligation
to keep such records, information or documents confidential or (z) are
obtained by such Underwriters, representatives, attorneys or
accountants from a third person who, insofar as is known to such
Underwriters, representatives, attorneys or accountants, is not
prohibited from transmitting the information to such Underwriters,
representatives, attorneys or accountants by a contractual, legal or
fiduciary obligation to the Company or a third party, or (ii)
disclosure of such records, information or documents is required by (A)
any regulatory agency or (B) any court or administrative order after
the exhaustion of appeals therefrom;
(n) use its reasonable best efforts to cause all Registrable
Securities to be listed at the time of resale or issuance, as
applicable, on any securities exchange or any automated quotation
system on which similar securities issued by the Company are then
listed if requested by the Majority Holders, to the extent such
Registrable Securities satisfy applicable listing requirements;
(o) if reasonably requested by any Holder of Registrable
Securities covered by the Registration Statement in order to accurately
reflect information regarding such Holder or such Holder's plan of
distribution as required by such Registration Statement, (i) promptly
incorporate in a Prospectus supplement or post-effective amendment such
information with respect to such Holder as such Holder reasonably
requests to be included therein and (ii) make all required filings of
such Prospectus supplement or such post-effective amendment as soon as
the Company has received satisfactory notification of the matters to be
incorporated in such filing; and
(p) in the case of a registration pursuant to a Resale Shelf
Registration Statement, use its best efforts to enter into such
customary agreements and take all such other reasonable actions in
connection therewith (including those requested by the Holders of a
majority of the Registrable Securities being sold (determined on an
as-converted basis)) in order to expedite or facilitate the disposition
of such Registrable Securities including, but not limited to, an
Underwritten Offering and in connection with any such Underwritten
Offering, (i) to the extent possible, make such representations and
warranties to the Holders and any Underwriters of such Registrable
Securities with respect to the business of the Company and its
subsidiaries and its or its subsidiaries' joint ventures, the Resale
Shelf Registration Statement, Prospectus and documents incorporated by
reference or deemed incorporated by reference, if any, in each case, in
form, substance and scope as are customarily made by issuers to
underwriters in Underwritten Offerings and confirm the same if and when
requested, (ii) obtain opinions of counsel to the Company (which
counsel and opinions, in form, scope and substance, shall be reasonably
satisfactory to the Holders of a majority of the Registrable Securities
to be sold in such Underwritten Offering (determined on an as-converted
basis) and their counsel and any Underwriters and their respective
counsel) addressed to each selling Holder and any Underwriter of
Registrable Securities, covering the matters customarily covered in
opinions requested in Underwritten Offerings, (iii) obtain "cold
comfort" letters from the independent certified public accountants of
the Company (and, if necessary, any other certified public accountant
of any subsidiary of the Company or any joint venture in which the
Company or any of its subsidiaries is a partner, or of any business
acquired by the Company for which financial statements and financial
data are or are required to be included in the Shelf Registration
Statement) addressed to each selling Holder and any Underwriter of
Registrable Securities, such letters to be in customary form and
covering matters of the type customarily covered in "cold comfort"
letters in connection with Underwritten Offerings, and (iv) deliver
such documents and certificates as may be reasonably requested by the
Holders of a majority of the Registrable Securities being sold
(determined on an as-converted basis) or any Underwriter, and which are
customarily delivered in Underwritten Offerings, to evidence the
continued validity of the representations and warranties of the Company
made pursuant to clause (i) above and to evidence compliance with any
customary conditions contained in an underwriting agreement; provided
that the Company shall be required to use its best efforts to make an
Underwritten Offering only upon the request of Holders of the
greater of (x) at least 25% of the Registrable Securities outstanding
(determined on an as-converted basis) at the time such request is
delivered to the Company and (y) 710,526 shares of Common Stock
(determined on an as-converted basis after giving effect to any stock
splits, combinations or reclassifications). In the case of any
Underwritten Offering, the Company shall provide written notice to the
Holders of such Underwritten Offering at least 30 days prior to the
filing of a prospectus supplement for such Underwritten Offering, (y)
specify a date, which shall be no earlier than 10 days following the
date of such notice, by which each such Holder must inform the Company
of its intent to participate in such Underwritten Offering and (z)
include the instructions such Holder must follow in order to
participate in such Underwritten Offering.
In the case of a Resale Shelf Registration Statement, the
Company may require each Holder to furnish to the Company such information
regarding the Holder and the proposed distribution by such Holder of Registrable
Securities as the Company may from time to time reasonably request in writing.
Each such Holder shall provide the Company with any such information within five
business days after such information is requested and shall provide to the
Company, within five business days after such Holder receives a draft of the
Registration Statement or amendment thereto in which such information is
included, comments on such Registration Statement or amendment thereto;
provided, that no Holder shall be required to comment on any information not
provided to the Company by such Holder. A Holder of Registrable Securities shall
not be entitled to receive additional interest pursuant to Section 2 of the
Notes or Liquidated Damages pursuant to Section 5(l) of this Agreement to the
extent that such Holder fails to comply with any obligation under this
paragraph, and such failure by such Holder would otherwise be the sole reason
for the accrual of additional interest pursuant to Section 2 of the Notes or
Liquidated Damages pursuant to Section 5(l) of this Agreement or to the extent
that any action or inaction on the part of any Underwriter or regulatory agency
in connection with any Underwritten Offering would otherwise be the primary
reason or reasons for the accrual of additional interest pursuant to Section 2
of the Notes or Liquidated Damages pursuant to Section 5(l) of this Agreement.
Each Holder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section
3(e)(iii), (v) or (vi) hereof, such Holder will forthwith discontinue
disposition of Registrable Securities pursuant to the Resale Shelf Registration
Statement until such Holder's receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 3(i) hereof and, if so directed by
the Company, such Holder will deliver to the Company (at its expense) all copies
in its possession, other than permanent file copies then in such Holder's
possession, of the Prospectus covering such Registrable Securities current at
the time of receipt of such notice.
4. Indemnification and Contribution. (a) The Company agrees to
indemnify and hold harmless the Initial Purchaser, each Holder, each person, if
any, who controls the Initial Purchaser or any Holder within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act or is
under common control with or is controlled by the Initial Purchaser or any
Holder and any investment advisor otherwise affiliated with any Holder and each
of their respective directors and officers (each a "Non-Company Indemnitee")
from and against any and all losses, claims, damages, liabilities and expenses
(including, without limitation, any legal or other expenses reasonably incurred
by the Non-Company Indemnitee in connection with defending or investigating any
such action or claim) arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement (or any amendment or supplement thereto) pursuant to which Registrable
Securities were registered under the Securities Act, including all documents
incorporated therein by reference, or arising out of or based upon 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, or arising
out of or based upon any untrue statement or alleged untrue statement of a
material fact contained in any Prospectus (as amended or supplemented, if the
Company shall have furnished any amendments or supplements thereto), or caused
by any omission or alleged omission to state therein a material fact necessary
to make the statements therein in light of the circumstances under which they
were made not misleading, except insofar as such losses, claims, damages,
liabilities or expenses arise out of or are based upon any untrue statement or
omission or alleged untrue statement or omission which has been made therein or
omitted therefrom in reliance upon and in conformity with information relating
to the Initial Purchaser or any Holder furnished to the Company in writing by
the Initial Purchaser or any selling Holder expressly for use therein; provided,
however, that the indemnification provided for in this paragraph (a) shall not
inure to the benefit of any Non-Company Indemnitee with respect to any sale or
disposition of Registrable Securities by such Holder in violation of the
provisions of the last paragraph of Section 3 hereof. In connection with any
Underwritten Offering contemplated by Section 3(p), the Company also shall
indemnify the Underwriters, if any, selling brokers, dealers and similar
securities industry professionals participating in the distribution, their
officers and directors and each person who controls such persons (within the
meaning of the Securities Act and the Exchange Act) to the same extent as
provided above with respect to the indemnification of the Holders, if requested
in connection with the Resale Shelf Registration Statement. The indemnification
obligation of the Company set forth in this paragraph (a) shall be in addition
to any liability which the Company may otherwise have, including, without
limitation, for any breach of any covenant contained in this Agreement.
(b) Each Holder agrees, severally and not jointly, to
indemnify and hold harmless the Company, the Initial Purchaser, the other
selling Holders, each of their respective directors and officers, each person,
if any, who controls the Company, the Initial Purchaser, or any other selling
Holder within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act or is under common control with or is controlled by the
Company, the Initial Purchaser or any other selling Holder and any investment
advisor affiliated with any of the foregoing to the same extent as the foregoing
indemnity from the Company to the Initial Purchaser and the Holders, but only
with reference to information relating to such Holder furnished to the Company
in writing by such Holder expressly for use in the Registration Statement (or
any amendment thereto) or any Prospectus (or any amendment or supplement
thereto).
(c) If any action, suit or proceeding shall be instituted
involving any person in respect of which such person is entitled to indemnity
pursuant to either paragraph (a) or (b) above, such person (the "indemnified
party") shall promptly notify the parties against whom indemnification is being
sought (each an "indemnifying party") and such indemnifying parties shall assume
the defense thereof, including the employment of counsel and payment of all fees
and expenses. Such indemnified party, shall have the right to counsel, but the
fees and expenses of such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying parties have agreed in writing to pay such
fees and expenses, (ii) the indemnifying parties shall have failed to assume the
defense and employ counsel or (iii) the named parties to any such action, suit,
or proceeding (including any impleaded parties) include both such indemnifying
parties and such indemnified party and such indemnified party shall have been
advised by its counsel that representation of such indemnified party and any
indemnifying party by the same counsel would be inappropriate under applicable
standards of professional conduct (whether or not such representation by the
same counsel has been proposed due to actual or potential differing interests
between them (in which case the indemnifying parties shall not have the right to
assume the defense of such action, suit or proceeding on behalf of the
indemnified party)). It is understood, however, that the indemnifying parties
shall, in connection with any one such action, suit or proceeding, or
substantially similar action, suit or proceeding or related actions, suits or
proceedings in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
the Initial Purchaser and all persons, if any, who control the Initial Purchaser
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act or is under common control with or is controlled by the Initial
Purchaser, any investment advisor affiliated with any of the foregoing and each
of their respective directors and officers, and the reasonable fees and expenses
of only one separate firm of attorneys (in addition to any local counsel) at any
time for all other Holders and all persons, if any, who control any such Holders
within the meaning of either such Section, or are under common control with or
are controlled by such Holders, any investment advisor affiliated with any of
the foregoing and each of their respective directors and officers. In such case
involving the Initial Purchaser, persons who control, are controlled by or under
common control with the Initial Purchaser, or their respective directors or
officers, such firm shall be designated in writing by the Initial Purchaser. In
such case involving other Holders and such persons who control, are controlled
by or under common control with such Holders, any investment advisor affiliated
with any of the foregoing or their respective directors or officers, such firm
shall be designated in writing by such Holders holding a majority of the
Registrable Securities sold under the Resale Shelf Registration Statement by all
such Holders. The indemnifying parties shall not be liable for any settlement of
any action, suit or proceeding effected without their written consent, but if
settled with such written consent or if there be a final judgment for the
plaintiff, the indemnifying parties agree to indemnify and hold harmless the
indemnified party from and against any loss, action, damage, liability or
expense by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 4 is
unavailable to an indemnified party under paragraphs (a) or (b) hereof in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then an 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, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party or parties, on the one hand, and of the indemnified party or parties, on
the other hand, in connection with such statements or omissions that resulted in
such losses, claims, damages, liabilities or expenses as well as any other
relevant equitable consideration. The relative fault of the Company, on the one
hand, and any Holder, on the other hand, 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
information supplied by the Company, on the one hand, or by such Holder, on the
other hand, and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Holders'
respective obligations to contribute pursuant to this Section 4(d) are several
in proportion to the respective number of Registrable Securities of such Holders
that were registered pursuant to the Registration Statement.
(e) The Company, the Initial Purchaser and each Holder agree
that it would not be just or equitable if contribution pursuant to this Section
4 were determined by a pro rata allocation or by any other method of allocation
that does not take account of the equitable considerations referred to in
paragraph (d) above. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages and liabilities referred to in paragraph
(d) above 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 any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 4, no Holder shall be
required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities sold by such Holder exceeds the amount
of any damages that such 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. The remedies provided
for in this Section 4 are not exclusive and shall not limit any rights or
remedies that may otherwise be available to any indemnified party at law or in
equity.
(f) Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or contribution under
this Section 4 shall be paid by the indemnifying party to the indemnified party
as such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 4 shall remain
operative and in full force and effect, regardless of (i) any investigation made
by or on behalf any indemnified party, (ii) any sale of Registrable Securities
by an indemnified party and (iv) any termination of this Agreement. A successor
to any indemnified party shall be entitled to the benefits of the indemnity,
contribution and reimbursement agreements contained in this Section 4.
(g) No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action, suit or proceeding in respect of which any indemnified party
is or could have been a party and indemnity could have been sought hereunder by
such indemnified party, unless such settlement includes an unconditional release
of such indemnified party from all liability on claims that are the subject
matter of such action, suit or proceeding.
5. Miscellaneous. (a) No Inconsistent Agreements. The Company
has not entered into, and on or after the date of this Agreement will not enter
into, any agreement that is inconsistent with the rights granted to the Holders
in this Agreement or otherwise conflicts with the provisions hereof. The rights
granted to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Company's other
issued and outstanding securities under any such agreements. Notwithstanding
anything to the contrary set forth in this paragraph, no agreement contemplated
in Section 2(f) hereof shall be deemed to be inconsistent with the rights
granted to the Holders in this Agreement or otherwise to conflict with the
provisions hereof to the extent provided for in such Section 2(f).
(b) 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 the
Holders of at least a majority of the outstanding Registrable Securities
(determined on an as-converted basis) affected by such amendment, modification,
supplement, waiver or departure; provided, however, that no amendment,
modification, supplement, waiver or consent to the departure with respect to the
provisions of Section 4 hereof shall be effective as against any person unless
consented to in writing by such person.
(c) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telex, telecopier or any courier guaranteeing overnight
delivery (i) if to a Holder, at the most current address given by such Holder to
the Company by means of a notice given in accordance with the provisions of this
Section 5(c), which address initially is, with respect to the Initial Purchaser,
the address set forth in the Purchase Agreement; and (ii) if to the Company,
initially at the Company's address set forth in the Purchase Agreement, and,
thereafter, at such other address, notice of which is given in accordance with
the provisions of this Section 5(c).
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt is acknowledged, if telecopied; and
on the next business day, if timely delivered to an air courier guaranteeing
overnight delivery.
Copies of all such notices, demands, or other
communications shall be concurrently delivered by the person giving the same to
the Trustee, at the address specified in the Indenture.
(d) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors, assigns and transferees of each
of the parties, including, without limitation and without the need for an
express assignment, subsequent Holders; provided that nothing herein shall be
deemed to permit any assignment, transfer or other disposition of Registrable
Securities in violation of the terms of the Purchase Agreement. If any
transferee of any Holder 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 person 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 person shall be entitled to receive the benefits hereof. The
Initial Purchaser (in its capacity as Initial Purchaser) shall have no liability
or obligation to the Company with respect to any failure by any other Holder to
comply with, or any breach by any other Holder of, any of the obligations of
such other Holder under this Agreement.
(e) Purchases and Sale of Notes. The Company shall not, and
shall use its best efforts to cause its affiliates (as defined in Rule 405 under
the Securities Act) that it controls not to, purchase and then resell or
otherwise transfer any Notes.
(f) Third Party Beneficiary. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company, on the one
hand, and the Initial Purchaser, on the other hand, and the Initial Purchaser
and the Holders shall have the right to enforce such agreements directly to the
extent they deem such enforcement necessary or advisable to protect the rights
of the Initial Purchaser or the Holders hereunder.
(g) Counterparts. This Agreement may be signed in various
counterparts which constitute one and the same instrument. If signed in
counterparts, this Agreement shall not become effective unless at least one
counterpart hereof shall have been executed and delivered on behalf of each
party hereto.
(h) Headings. The headings of the Sections of this Agreement
have been inserted for convenience of reference only and shall not be deemed a
part of this Agreement.
(i) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed in the State of New York.
(j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
(k) Submission to Jurisdiction. The Company irrevocably
submits to the jurisdiction of any United States or State court located in the
State of New York in any suit or proceeding based on or arising under this
Agreement and irrevocably agrees that all claims in respect of such suit or
proceeding may be determined in any such court. The Company irrevocably waives
the defense of an inconvenient forum to the maintenance of such suit or
proceeding. The Company hereby agrees to designate and appoint CT Corporation
System as an agent upon whom process may be served in any suit or proceeding
based on or arising under this Agreement. The Company further agrees that
service of process upon the Company, or upon an agent appointed pursuant to the
preceding sentence accompanied with written notice of said service to the
Company, as the case may be, mailed by first class mail shall be deemed in every
respect effective service of process upon the Company in any such suit or
proceeding. Nothing herein shall affect the Initial Purchaser's or any Holder's
right to serve process in any other manner permitted by law. The Company agrees
that a final non-appealable judgment in any such suit or proceeding shall be
conclusive and may be enforced in other jurisdictions by suit on such judgment
or in any other lawful manner.
(l) Liquidated Damages.
If, at any time during which any of the Notes are
outstanding, the Company shall fail to comply with the registration requirements
provided for in Section 2 of the Notes, additional interest on the Notes shall
accrue and be payable to the extent provided in such Section. Following the
conversion of any Notes into Shares, to the extent that any such Shares
constitute Registrable Securities, liquidated damages ("Liquidated Damages")
shall be payable on such Shares to the extent provided below:
(i) if the Registration Statement pertaining to the issuance or
resale of such Shares, as applicable, is not declared effective prior to the
first date upon which the Notes become convertible, then, commencing on such
date, Liquidated Damages shall accrue on such Shares at a rate of $.001 per week
per Share for the first 90 days immediately following such date, such Liquidated
Damages increasing by an additional $.001 per week per Share at the beginning of
each subsequent 90-day period; and
(ii) if the Registration Statement pertaining to the issuance or
resale of such Shares, as applicable, ceases to be effective or the Prospectus
which is a part thereof cannot be used as a result of a Suspension Event for a
period of more than 90 days, in each case under this clause (ii) prior to the
last date as of which such Registration Statement is required to remain
effective pursuant to this Agreement, then Liquidated Damages shall accrue on
such Shares at a rate of $.001 per week per Share for the first 60 days
immediately following the day such Registration Statement ceases to be effective
or a Suspension Event has lasted for more than 90 days, such Liquidated Damages
increasing by an additional $.001 per week per Share at the beginning of each
subsequent 60-day period.
In the case of each of clauses (i) and (ii) of the preceding
paragraph, such Liquidated Damages will be payable in cash semi-annually in
arrears on each August 15 and February 15, commencing August 15, 1997, and shall
be calculated at the rates noted above; provided, however, that such Liquidated
Damages may not exceed $.005 per week per Share; and, provided, further, that
(1) upon the effectiveness of the Registration Statement (in the case of clause
(i) above) or (2) upon the effectiveness of the Registration Statement that had
ceased to remain effective prior to the last date as of which such Registration
Statement is required to remain effective or the end of the Suspension Event (in
the case of clause (ii) above), Liquidated Damages on the Shares as a result of
such clause (i) or (ii) shall cease to accrue. Liquidated Damages shall only
accrue under one of clause (i) or (ii) at any given time.
If the Company shall fail to satisfy the requirements of
either of clause (i) or (ii) above, each Holder of Notes shall be entitled to
receive Additional Interest under the Notes at the rates set forth in either
Section 2(b) of the Notes (in case of a failure under clause (i) above) or
Section 2(c) of the Notes (in the case of a failure under clause (ii) above);
provided, that Additional Interest shall not accrue on the Notes under this
Section 5(l) at any time that Additional Interest is accruing on the Notes
pursuant to Section 2 of the Notes. Following the conversion of any Notes into
Shares, to the extent that such failure is continuing, Liquidated Damages shall
be paid in respect of such Shares to the extent and at the rates provided
herein.
All of the Company's obligations set forth in the preceding
paragraph which are outstanding with respect to any Shares that constitute
Registrable Securities at the time such Shares cease to be Registrable
Securities shall survive until such time as all such obligations with respect to
such Shares shall have been satisfied in full.
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
GEOTEK COMMUNICATIONS, INC.
By:/s/ Xxxxxx Xxxxxx
Name: Xxxxxx Xxxxxx
Title: Secretary
Confirmed and accepted as of
the date first above written:
XXXXX XXXXXX INC.
By: /s/ Xxxx X. Xxxxxxx
Name: Xxxx X. Xxxxxxx
Title: Managing Director
