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REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is
entered into as of November 15, 1996, by and among METROCALL, INC., a Delaware
corporation (the "Company"), and each of the entities listed on the signature
pages hereof and on the Schedule of Purchasers attached as Exhibit A hereto
(each a "Purchaser" and, collectively, the "Purchasers").
RECITALS
WHEREAS, the Company and the Purchasers have entered into that
certain Unit Purchase Agreement, dated as of November 15, 1996 (the "Unit
Purchase Agreement"), pursuant to which the Purchasers are to purchase Units
consisting of (i) one share of the Company's Series A Convertible Preferred
Stock (the "Preferred Stock"), the terms and conditions of which are set forth
in the Certificate of Designation (as hereinafter defined), and (ii) one
warrant (each a "Warrant") representing the right to purchase 18.226 shares of
the Company's common stock, par value $.01 (the "Common Stock"), on the terms
and conditions set forth in the Warrant Agreement (as hereinafter defined); and
WHEREAS, in connection with the purchase and sale of the
Units, the Company has agreed, on the terms and conditions set forth herein, to
register shares of Preferred Stock and shares of Common Stock as set forth
below.
NOW THEREFORE, in consideration of the foregoing recitals and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.01 "Certificate of Designation" means the Certificate or
Designation, Number, Powers, Preferences and Relative, Participating, Optional
and Other Rights of Series A Convertible Preferred Stock of Metrocall, Inc.,
the form of which is attached as Exhibit A to the Unit Purchase Agreement.
1.02 "Closing" means the closing of the purchase and sale
of Units pursuant to the Unit Purchase Agreement.
1.03 "Commission" means the Securities and Exchange
Commission or any other federal agency at the time administering the Securities
Act.
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1.04 "Conversion Shares" means shares of Common Stock
issuable upon conversion of Preferred Shares, provided, however, that any
Conversion Share will cease to be a Conversion Share when (i) such Conversion
Share has been transferred pursuant to an effective registration statement
under the Securities Act covering such Conversion Share (but not including any
transfer exempt from registration under the Securities Act), (ii) the Holder of
such Conversion Share is then able to use Rule 144 promulgated under the
Securities Act (or any successor provision) to transfer such Conversion Share
without regard to any restrictions pursuant to Rule 144(k), or (iii) the
Preferred Stock which is convertible into such Conversion Share has been
transferred pursuant to an effective registration statement under the
Securities Act covering such Preferred Stock (but not including any transfer
exempt from registration under the Securities Act).
1.05 "Exchange Act" means the Securities Exchange Act of
1934, as amended, or any similar federal statute and the rules and regulations
of the Commission thereunder, all as the same shall be in effect from time to
time.
1.06 "Exercise Shares" means shares of Common Stock
issuable upon exercise of Warrants.
1.07 "Governmental Authority" means any nation or
government, any state or other political subdivision thereof and any court,
panel, judge, board, bureau, commission, agency or other entity, body or other
Person exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
1.08 "Holder" means each Purchaser and each transferee
permitted pursuant to Section 6.04 of this Agreement that has become a party to
this Agreement as provided in Section 6.04; provided, however, that a
transferee of Preferred Shares that is not an affiliate of a Purchaser shall be
deemed not to be a Holder for purposes of Sections 1.11 and 2.02 of this
Agreement.
1.09 "Person" means an individual or corporation,
partnership, trust, unincorporated organization, association or other entity
and includes any Governmental Authority.
1.10 "Preferred Shares" means the shares of Series A
Convertible Preferred Stock issued to the Purchasers pursuant to the Unit
Purchase Agreement and any additional or replacement shares of Preferred Stock
issued with respect to Preferred Shares upon any stock dividend, stock split,
recapitalization or similar event.
1.11 "Preferred Shares Group" means all Preferred Shares
held by Holders that were either (a) issued to a given Purchaser pursuant to
the Unit Purchase Agreement or (b) issued to a Holder after Closing as
dividends on the Preferred Shares issued at Closing to such
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Purchaser (including dividends on such dividends), regardless of the identities
of the Holders of the Preferred Shares that comprise the Preferred Shares
Group.
1.12 "Registrable Securities" means Preferred Shares and
any other securities issued with respect to Preferred Shares upon any stock
dividend, stock split, recapitalization or similar event; provided, however,
that Conversion Shares shall not be deemed to be Registrable Securities; and
provided further that any Registrable Security will cease to be a Registrable
Security when (i) such Registrable Security has been transferred pursuant to an
effective registration statement under the Securities Act covering such
Registrable Security (but not including any transfer exempt from registration
under the Securities Act), (ii) such Registrable Security is no longer held of
record by a Holder, or (iii) the Holder of such Registrable Security is then
able to use Rule 144 promulgated under the Securities Act (or any successor
provision) to transfer such Registrable Security without regard to any
restrictions pursuant to Rule 144(k).
1.13 "Securities Act" means the Securities Act of 1933, as
amended, or any similar federal statute and the rules and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.
1.14 "Shares" means the Exercise Shares, the Conversion
Shares, and the Registrable Securities.
1.15 "Warrant Agreement" means the Warrant Agreement of
even date herewith between the Company and The First National Bank of Boston,
as Warrant Agent, the form of which is attached as Exhibit C to the Unit
Purchase Agreement.
ARTICLE II
REGISTRATION RIGHTS
2.01 Required Registration.
(a) The Company shall prepare and file with the
Commission registration statements under the Securities Act with respect to the
Exercise Shares and the Conversion Shares and shall use its best efforts to
cause such registration statements to become effective promptly after filing.
The registration statement with respect to the Exercise Shares shall be filed
with the Commission within forty-five (45) days after the Closing. The
registration statement with respect to the Conversion Shares shall be filed
with the Commission on or before the earliest of (i) ninety (90) days before
the fifth anniversary of the Closing, (ii) on or before the date of closing of
any transaction identified in Section 5(b)(ii)(A) of the Certificate of
Designation to which the Company or any Subsidiary is a party, or of any
transaction identified in Section 5(b)(ii)(C) or (D) of the Certificate of
Designation, it being understood that the Company will cause such registration
statement to become effective on or before the date of, and
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as a condition to, the closing of any such transaction, or (iii) forty-five
(45) days after any other event described in Section 5(b)(ii) of the
Certificate of Designation.
(b) Except as provided in Section 2.01(c) of this
Agreement, the Company shall use its best efforts to maintain the effectiveness
of each registration statement filed pursuant to this Section 2.01 until such
time as all Shares registered pursuant to the registration statement either
have been transferred pursuant to the registration statement or are eligible to
be sold pursuant to Rule 144 under the Securities Act without regard to any
restrictions pursuant to Rule 144(k). Each Holder shall provide written notice
to the Company within fifteen (15) days after it has sold all of its Exercise
Shares or all of its Conversion Shares registered pursuant to this Section
2.01.
(c) The obligations of the Company under this
Section 2.01 are subject to the condition that the Company shall be entitled to
require the Holders to suspend for up to ninety (90) days once in any twelve
month period the sale of Shares pursuant to a registration statement filed
pursuant to this Section if (i) and for so long as the Board of Directors of
the Company determines, in its reasonable judgment, that the sale of Shares
pursuant thereto would materially interfere with any material financing,
acquisition, corporate reorganization or other material transaction by the
Company, (ii) the Company promptly gives the Holders of the Exercise Shares and
the Conversion Shares written notice of such determination, and (iii) all other
similarly situated shareholders shall also be subject to the same suspension.
The Company shall have no obligation to maintain the effectiveness of a
registration statement with respect to Conversion Shares or Exercise Shares
during periods when the Holders are required to suspend the sale of such Shares
as provided in this Section 2.01(c). As soon as practicable after the
expiration of such periods, the Company shall amend its registration statements
as necessary to permit the Holders to sell Shares pursuant to such registration
statements.
2.02 Registrations by Request.
(a) Within ninety (90) days after receiving a
written request therefor from the record Holder or Holders of Registrable
Securities representing at least 50% of a given Preferred Shares Group then
outstanding, the Company shall prepare and file a registration statement under
the Securities Act covering the Registrable Securities which are the subject of
such request and shall use its best efforts to cause such registration
statement to become effective promptly thereafter. The Company shall be
obligated to prepare, file and cause to become effective pursuant to this
Section 2.02(a) not more than one registration statement for each Preferred
Shares Group.
(b) In the event that the Holders of more than
50% of the Registrable Securities comprising the Preferred Shares Group for
which registration has been requested pursuant to Section 2.02(a) hereof
determine for any reason not to proceed with such registration at any time
before the registration statement has been declared effective by the
Commission, and such registration statement, if theretofore filed with the
Commission, is withdrawn with respect
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to the securities covered thereby, and such Holders agree to bear their own
expenses incurred in connection therewith and (subject to Section 2.02(d)) to
reimburse the Company for the reasonable out-of-pocket expenses incurred by it
attributable to the registration of such Registrable Securities, then the
Holders of such Registrable Securities shall not be deemed to have exercised
their right to require the Company to register Registrable Securities pursuant
to Section 2.02(a) hereof.
(c) Except as provided in Section 2.02(d) of this
Agreement, the Company shall use its best efforts to maintain the effectiveness
of each registration statement filed pursuant to this Section 2.02 until such
time as all Shares registered pursuant to the registration statement either
have been transferred pursuant to the registration statement or are eligible to
be sold pursuant to Rule 144 under the Securities Act without regard to any
restrictions pursuant to Rule 144(k). Each Holder shall provide written notice
to the Company within fifteen (15) days after it has sold all of its
Registrable Securities registered pursuant to this Section 2.02.
(d) The obligations of the Company under this
Section 2.02 are subject to the condition that the Company shall be entitled to
postpone for up to ninety (90) days once in any twelve month period the filing
of any registration statement otherwise required to be prepared and filed by it
pursuant to this Section 2.02 if, at the time it receives requests for
registration pursuant thereto, and for so long as the Board of Directors of the
Company determines, in its reasonable judgment, that the filing of such
registration statement and the offering of Registrable Securities pursuant
thereto would materially interfere with any material financing, acquisition,
corporate reorganization or other material transaction by the Company, and the
Company promptly gives the Holders requesting such registration written notice
of such determination and all other similarly situated shareholders shall also
be subject to the same suspension. If the Company shall so postpone the filing
of a registration statement, the Holders requesting such registration shall
have the right to withdraw the requests for registration by giving written
notice to the Company within thirty days after receipt of the Company's notice
of postponement and, in the event of such withdrawal, such requests shall not
be counted as being requests for one of the registration statements that the
Company is obligated to prepare, file and cause to become effective pursuant to
Section 2.02(a) hereof, nor shall the Holders be required to reimburse the
Company for out-of-pocket expenses incurred by it attributable to the
registration of such Registrable Securities.
2.03 "Piggy-Back" Registrations.
(a) If, at any time after the Closing, the
Company is requested pursuant to Section 2.02 to register any of the
Registrable Securities under the Securities Act on a registration statement on
Form S-1, Form S-2 or Form S-3 (or an equivalent general registration form then
in effect) for the account of any Holder (a "Registering Shareholder") of
Registrable Securities (an "offering"), then in each such case the Company
shall, not later than 15 days after receipt of notice from the Registering
Shareholder, give written notice thereof to each
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other Holder of Registrable Securities. Upon the written direction of any such
Holder of Registrable Securities, given within 10 days of the receipt by such
Holder of any such written notice (which direction shall specify the number of
Registrable Securities intended to be disposed of by such Holder and the
intended method of distribution thereof), the Company shall include in such
registration statement any or all of the Registrable Securities then owned by
such Holder requesting such registration (a "Requesting Shareholder"), to the
extent necessary to permit the sale or other disposition of the shares
constituting such number of Registrable Securities as such Requesting
Shareholder shall have so directed the Company to be so registered. Any
Requesting Shareholder shall have the right to withdraw such direction by
giving written notice to the Company to such effect within ten (10) days after
giving such direction.
(b) In the event that the Company proposes to
register Registrable Securities pursuant to Section 2.03(a), and any managing
underwriter shall advise the Requesting Shareholder or Shareholders and the
Registering Shareholders in writing that the inclusion in the registration
statement of some or all of the Registrable Securities sought to be registered
by the Requesting Shareholders creates a significant risk that the price per
share that such Requesting Shareholder or Shareholders and such Registering
Shareholders will derive from such registration will be adversely affected or
that the number of shares or securities sought to be registered (including any
securities sought to be registered at the instance of the Requesting
Shareholder or Shareholders and those sought to be registered by non-Requesting
Shareholders who are Registering Shareholders) is too large a number to be
reasonably sold, the Company will include in such registration statement such
number of shares or securities as the Company, the Registering Shareholders and
the Requesting Shareholders are so advised can be sold in such offering without
such an effect (the "Maximum Number"), as follows and in the following order of
priority: (i) first, the number of shares or securities sought to be registered
by non-Requesting Shareholders who are Registering Shareholders and (ii)
second, if the number of shares or securities to be registered under clause (i)
is less than the Maximum Number, such shares or securities sought to be
registered by such Requesting Shareholder or Shareholders pro rata in
proportion to the number of shares or securities sought to be registered by all
the Requesting Shareholders, which, when added to the number of Registrable
Securities to be registered by Registering Shareholders who are non-Requesting
Shareholders, equals the Maximum Number.
2.04. Registration for Underwritten Offerings.
(a) At any time after the first date on which
Preferred Shares may be converted into Conversion Shares, the Holders of a
majority of all outstanding Preferred Shares and Conversion Shares may request
the Company to register under the Securities Act for sale in an underwritten
secondary offering all or any portion of the Conversion Shares held by such
Holders or to be issued upon conversion of Preferred Shares held by such
Holders; provided, however, that (i) any such request must be to register no
less than 50% of all Conversion Shares then outstanding or into which Preferred
Shares then outstanding are convertible, and (ii) the Company shall not be
obligated under this Section 2.04 to register Conversion Shares for more
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than one underwritten secondary offering. For purposes of determining whether
Holders of a majority of all outstanding Preferred Shares and Conversion Shares
have requested registration under this Section 2.04(a), each issued and
outstanding Conversion Share shall be counted as one share and each issued and
outstanding Preferred Share shall be counted as the number of Conversion Shares
into which such Preferred Share is convertible on the date of such request.
(b) Promptly following receipt of any request
that complies with the requirements of Section 2.04(a), the Company shall
immediately give notice of such request to all other Holders of Preferred
Shares, Conversion Shares, and Exercise Shares, and shall use its best efforts
to register under the Securities Act, for public sale in a firm commitment
underwritten secondary offering, the number of Conversion Shares specified in
the initial request and in any requests received within 20 days after the date
of such notice from other Holders of Preferred Shares or Conversion Shares, and
the number of Exercise Shares specified in any requests received within such
20-day period from Holders of Exercise Shares; provided, however, that the
Company shall have no obligation under this Section 2.04(b) to register for
inclusion in an underwritten secondary offering any Exercise Shares of a Holder
that is then able to use Rule 144 promulgated under the Securities Act (or any
successor provision) to transfer such Exercise Shares without regard to any
restrictions pursuant to Rule 144(k). The Company shall have the right to
designate the managing underwriter of any such offering subject to the consent
of the Holders making such requests, which consent shall not be unreasonably
withheld.
(c) In the event that the Holders of a majority
of the outstanding Preferred Shares and Conversion Shares as to which
registration of Conversion Shares for sale in an underwritten secondary
offering has been requested pursuant to Section 2.04(a) hereof determine for
any reason not to proceed with such registration and offering at any time
before the registration statement has been declared effective by the
Commission, and such registration statement, if theretofore filed with the
Commission, is withdrawn with respect to the securities covered thereby, and
such Holders agree to bear their own expenses incurred in connection therewith
and (subject to Section 2.04(e)) to reimburse the Company for the reasonable
out-of-pocket expenses incurred by it attributable to the registration and
underwritten secondary offering of such Conversion Shares, then the Holders of
the Preferred Shares and Conversion Shares shall not be deemed to have
exercised their right to require the Company to register Conversion Shares for
sale in an underwritten secondary offering pursuant to Section 2.04(a) hereof.
(d) The Company shall be entitled to include in
any registration statement referred to in this Section 2.04, for sale in the
underwritten offering, shares of Common Stock to be sold by the Company for its
own account, except as and to the extent that, in the opinion of the managing
underwriter, such inclusion would adversely affect the marketing of the shares
to be sold. Except as provided in this Section 2.04(d) or in Section 2.04(e),
the Company will not file with the Commission any other registration statement
with respect to its Common Stock, whether for its own account or that of other
stockholders, from the date of
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receipt of a notice from the requesting Holders pursuant to Section 2.04(a)
until the completion of the period of distribution of the Shares contemplated
thereby.
(e) The obligations of the Company under this
Section 2.04 are subject to the condition that the Company shall be entitled to
postpone for up to 90 days the filing of any registration statement otherwise
required to be prepared and filed by it pursuant to this Section 2.04 if (i) at
the time it receives requests for registration pursuant thereto, and for so
long as the Board of Directors of the Company determines, in its reasonable
judgment, that the filing of such registration statement and the offering of
Conversion Shares or Exercise Shares pursuant thereto would materially
interfere with any material financing, acquisition, corporate reorganization or
other material transaction by the Company, (ii) the Company promptly gives the
Holders requesting such registration written notice of such determination, and
(iii) all other similarly situated shareholders shall also be subject to the
same suspension. If the Company shall so postpone the filing of a registration
statement, the Holders requesting such registration shall have the right to
withdraw the requests for registration by giving written notice to the Company
within thirty days after receipt of the Company's notice of postponement and,
in the event of such withdrawal, such requests shall not be counted as being
requests for the registration statement that the Company is obligated to
prepare, file and cause to become effective pursuant to this Section 2.04, nor
shall the Holders be required to reimburse the Company for out-of-pocket
expenses incurred by it attributable to the registration of such Conversion
Shares or Exercise Shares.
ARTICLE III
REGISTRATION PROCEDURES
3.01 Company Obligations. Following the Closing, the
Company will:
(a) furnish to the Purchasers, prior to the
filing of a registration statement pertaining to any Shares (each a
"Registration Statement") or any prospectus, amendment or supplement thereto,
copies of each such Registration Statement as proposed to be filed, which
documents will be subject to the reasonable review and comments of the Holders
(and their respective attorneys), and the Company will not file any such
Registration Statement, any prospectus or any amendment or supplement thereto
(or any such documents incorporated by reference) to which the Purchasers shall
reasonably object in writing; and thereafter furnish to the Holders such number
of copies of such Registration Statement, each amendment and supplement thereto
(including any exhibits thereto), the prospectus included in such Registration
Statement (including each preliminary prospectus) and such other documents as
any Holder may reasonably request in writing in order to facilitate the
disposition of the Shares registered pursuant to such Registration Statement;
provided, however, that the obligation of the Company to deliver copies of
prospectuses or preliminary prospectuses to any Holder shall be subject to the
receipt by the Company of reasonable assurances from such Holder that such
Holder will comply with the
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applicable provisions of the Securities Act and of such other securities or
blue sky laws as may be applicable in connection with any use of such
prospectuses or preliminary prospectuses;
(b) use its best efforts to register or qualify
the Shares registered pursuant to such Registration Statement under such other
securities or blue sky laws of such jurisdictions as a Holder may reasonably
request and do any and all other acts and things which may be reasonably
necessary to enable the Holder to consummate the disposition in such
jurisdictions of such Shares; provided, however, that the Company will not be
required to (i) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this subsection, (ii)
subject itself to taxation in any such jurisdiction, or (iii) consent to
general service of process in any such jurisdiction;
(c) apply, prior to or concurrently with the
filing of the Registration Statements, to the Nasdaq National Market System
(or, if the Company is not listed on the Nasdaq National Market System, any
other exchange on which the Company's Common Stock is then listed) for the
listing of the Conversion Shares or the Exercise Shares and use its best effort
to obtain the listing of such stock;
(d) notify the Holders in writing at any time
when a prospectus relating to the Shares registered pursuant to such
Registration Statement is required to be delivered under the Securities Act, of
the occurrence of an event requiring the preparation of a supplement or
amendment to such prospectus or filing of a report incorporated in the
prospectus by reference so that, as thereafter delivered to the purchasers of
such Shares, such prospectus (including documents incorporated therein by
reference) will not contain an untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading and promptly prepare, file with the
Commission and make available to the Holders any such supplement, amendment or
report incorporated in the prospectus by reference, including, without
limitation, after any period referred to in Section 2.01(c) or 2.02(d);
(e) make available for inspection by the Holders
of Shares to be registered pursuant to a Registration Statement and any
attorney, accountant or other professional retained thereby (collectively, the
"Inspectors"), all financial and other records, pertinent corporate documents
and properties of the Company (collectively, the "Records") as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors and employees to
supply all information reasonably requested by any such Inspectors in
connection with such Registration Statement. Records that the Company
determines, in good faith, to be confidential and which it notifies the
Inspectors in writing are confidential shall not be disclosed by the Inspectors
unless (i) in the judgment of counsel to the Company the disclosure of such
Records is necessary to avoid or correct a misstatement or omission in such
Registration Statement, (ii) the release of such Records is ordered pursuant to
a subpoena or other order from a court of competent jurisdiction, or (iii) the
information in such Records is generally available to the public. As a
condition of receiving access to such
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confidential information described in clause (i) or (ii) of the preceding
sentence, the Holders of such Shares shall agree that such confidential
information obtained by them as a result of such inspections shall be deemed
confidential and shall not be used by them as the basis for any market
transactions in the securities of the Company unless and until such information
is made generally available to the public, it being understood that nothing in
this sentence shall reduce the Company's obligations hereunder, including under
Section 3.01(d). Each Holder further shall agree that it will, upon learning
that disclosure of such Records from such Holder is sought in a court of
competent jurisdiction, give notice to the Company and allow the Company, at
its expense, to undertake appropriate action to prevent disclosure of the
Records deemed confidential;
(f) obtain consents from its independent public
accountants in customary form as required to obtain and maintain effectiveness
of the registration statement and, in connection with its obligations under
Section 2.04, obtain a "cold comfort" letter from such accountants in customary
form;
(g) obtain an opinion or opinions from its
counsel in customary form and reasonably satisfactory to the Holders and their
respective legal counsel and, in an underwritten offering, to the underwriters
and their legal counsel;
(h) make generally available to the Holders
earnings statements, which need not be audited, satisfying the provisions of
Section 11(a) of the Securities Act no later than forty-five days after the end
of the twelve-month period beginning with the first month of the first fiscal
quarter commencing after the effective date of a Registration Statement, which
earnings statements shall cover said twelve-month period;
(i) promptly notify each Holder of the issuance
or threatened issuance of any stop order or other order suspending the
effectiveness of a Registration Statement or preventing or suspending the use
of any preliminary prospectus, prospectus or prospectus supplement, use
reasonable efforts to prevent the issuance of any such threatened stop order or
other order, and, if any such order is issued, use its best efforts to obtain
the lifting or withdrawal of such order at the earliest possible moment and
promptly notify each Holder of any such lifting or withdrawal;
(j) if requested by any Holder, the Company will
promptly incorporate in a prospectus supplement or post-effective amendment to
a Registration Statement such information concerning such Holder and such
Holder's intended method of distribution as such Holder requests to be included
therein (and which is not violative of an applicable law, rule or regulation,
in the reasonable judgment of the Company, after consultation with its outside
legal counsel), including, without limitation, with respect to any change in
the intended method of distribution, the amount or kind of Shares being offered
by such Holder, the offering price for such Shares or any other terms of the
offering or distribution of the Shares, and the Company will make all required
filings of such prospectus supplement or post-effective amendment as
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soon as possible after being notified of the matters to be incorporated in such
prospectus supplement or post-effective amendment;
(k) as promptly as practicable after the filing
with the SEC of any document which is incorporated by reference into a
registration statement, notify each Holder of such filing and deliver a copy of
such document to each Holder;
(l) cooperate with the Holders to facilitate the
timely preparation and delivery of certificates, not bearing any restrictive
legends, unless otherwise required by the Holders, representing the Shares to
be sold under the Registration Statement, and enable such Shares to be in such
denominations and registered in such names as such Holders may request;
(m) cooperate with the Holders, their respective
legal counsel and any other interested party (including any interested
broker-dealer) in making any filings or submissions required to be made, and
the furnishing of all appropriate information in connection therewith, with the
NASD;
(n) cause its subsidiaries to take all action
necessary to effect the registration of the Shares contemplated hereby,
including preparing and filing any required financial or other information;
(o) make available to the transfer agent for each
class or series of Shares a supply of certificates or other instruments
evidencing or constituting such Shares which shall be in a form complying with
the requirements of such transfer agent, promptly after a registration thereof;
and
(p) use its best efforts to keep each such
registration or qualification effective, including through new filings,
amendments or renewals, during the period the Registration Statement is
required to be kept effective and do any and all other acts or things
reasonably necessary or advisable in connection with such registration or
qualifications in all jurisdictions in which qualification or registration is
necessary.
3.02 Information from Holders. The Company may require
the Holders to promptly furnish in writing to the Company such information
regarding the distribution of the Shares as it may from time to time reasonably
request and such other information as may be legally required in connection
with such registration.
3.03 Suspension of Sales. The Holders agree that, upon
receipt of any notice from the Company of the happening of any event of the
kind described in subsection 3.01(d) hereof, they will immediately discontinue
disposition of Shares pursuant to a Registration Statement until they receive
copies of the supplemented or amended prospectus contemplated by subsection
3.01(d) hereof, and, if so directed by the Company, the Holders will deliver to
the Company all copies, other than permanent file copies then in their
possession, of the most recent
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prospectus (including any prospectus supplement) covering such Shares at the
time of receipt of such notice or destroy all such copies.
ARTICLE IV
REGISTRATION EXPENSES
4.01 Except as provided in Section 4.02, all fees and
expenses incident to the Company's performance of or compliance with this
Agreement shall be borne by the Company, including, without limitation, the
following fees and expenses: (a) all SEC, National Association of Securities
Dealers, Inc., stock exchange or other registration and filing fees and listing
fees; (b) the fees and expenses of the Company's compliance with securities or
blue sky laws (including reasonable fees and disbursements of counsel in
connection with blue sky qualifications of the Shares); (c) printing expenses;
(d) the fees and disbursements of counsel for the Company and of one counsel
for the applicable Holders for each registration, and the fees and expenses for
independent certified public accountants (including, without limitation, the
expenses of any annual audit, special audit, if necessary, and "cold comfort"
letters required by or incident to the performance of any agreement with the
underwriter of an underwritten offering pursuant to Section 2.04), underwriters
and other persons retained by the Company in connection with such registration;
(e) fees of transfer agents and registrars; and (f) messenger and delivery
expenses. In addition, the Company shall pay its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expense of any annual audit or
quarterly review, the expense of any liability insurance obtained by the
Company, and the expenses and fees for listing or authorizing for quotation the
securities to be registered on each securities exchange on which any shares of
the Common Stock are then listed or quoted.
4.02 The Holders shall pay all underwriting discounts and
commissions and all of their internal expenses incurred in connection with the
offering (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties but excluding fees
and expenses of their counsel that are payable by the Company under Section
4.01).
ARTICLE V
INDEMNIFICATION; CONTRIBUTION
5.01 Indemnification by the Company. The Company agrees
to indemnify and hold harmless each Holder, each of such Holder's officers,
directors, partners and members, and each of such Holder's legal counsel and
independent accountants, if any, and each person controlling any such persons
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act, with respect to which registration, qualification or compliance
has been
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13
effected pursuant to this Agreement, and each underwriter, if any, and each
person who controls any underwriter within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and all
losses, claims, damages, liabilities and expenses (including reasonable costs
of investigation, any legal and any other expenses reasonably incurred in
connection with investigating, preparing or defending any such claim, loss,
damage, liability or action, and any of the foregoing incurred in settlement of
any litigation, commenced or threatened) arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus contained therein or in any amendment or
supplement thereto or in any preliminary prospectus, 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 any violation by the Company of any rule or regulation
promulgated under the Securities Act or any state securities laws applicable to
the Company and relating to action or inaction by the Company in connection
with any registration, qualification or compliance required hereunder or
arising out of or based upon the Company's breach of any representation,
warranty, covenant or agreement contained in this Agreement; provided, however,
that the Company shall not be liable in any such case to the extent any of such
losses, claims, damages, liabilities or expenses arise out of, or are based
upon, any such untrue statement or omission or allegation thereof based upon
information furnished in writing to the Company by such Holder expressly for
use therein.
5.02 Indemnification by Holders. Each Purchaser agrees,
and each other Holder that is not a signatory to this Agreement agrees by
exercising any of its rights hereunder, severally to indemnify and hold
harmless the Company, its directors and officers and each person, if any, who
controls the Company within the meaning of either Section 15 of the Securities
Act or Section 20 of the Exchange Act and each underwriter, if any, and each
person who controls any underwriter within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company set forth above in (a), but only with
respect to information furnished in writing by such Holder, or on its behalf
expressly for use in the Registration Statement or prospectus relating to the
Shares, any amendment or supplement thereto or any preliminary prospectus,
under the heading "Selling Shareholders" and "Distribution" and provided that
the obligation of each Holder to indemnify will be several and not joint. In
case any action or proceeding shall be brought against the Company or its
directors or officers, any such controlling person, or any such underwriter or
controlling person of an underwriter in respect of which indemnity may be
sought against the Holder, the Holder shall have the rights and duties given to
the Company, and the Company or its directors or officers or such controlling
person or any such underwriter or controlling person of an underwriter shall
have the rights and duties given to the Holder, by the preceding Section 5.01
hereof. Each Purchaser's indemnity obligations under this Section 5.02 shall
be limited to the net sales proceeds actually received in connection with the
applicable offering.
5.03 Conduct of Indemnification Proceedings. If any
action or proceeding (including any governmental investigation) shall be
brought or asserted against any person entitled to indemnification under
Section 5.01 or 5.02 above (an "Indemnified Party") in respect
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14
of which indemnity may be sought from any party who has agreed to provide such
indemnification (an "Indemnifying Party"), the Indemnifying Party shall assume
the defense thereof, including the employment of counsel reasonably
satisfactory to such Indemnified Party, and shall assume the payment of all
expenses. Such Indemnified Party shall have the right to employ separate
counsel in any such action and to participate in the defense thereof, but the
fees and expenses of such counsel shall be at the expense of such Indemnified
Party unless (a) the Indemnifying Party has agreed to pay such fees and
expenses, or (b) such Indemnified Party shall have been advised by counsel that
there is an actual or potential conflict of interest on the part of counsel
employed by the Indemnifying Party to represent such Indemnified Party (in
which case, if such Indemnified Party notifies the Indemnifying Party in
writing that Indemnified Party elects to employ separate counsel at the expense
of the Indemnifying Party, the Indemnifying Party shall not have the right to
assume the defense of such action or proceeding on behalf of such Indemnified
Party; it being understood, however, that the Indemnifying Party shall not, in
connection with any one cause of action or proceeding or separate but
substantially similar or related actions or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys
(together with appropriate local counsel) at any time for all such Indemnified
Parties, which firm shall be designated in writing by such Indemnified Parties
unless there shall be conflicts of interest among such Indemnified Parties, in
which case the Indemnifying Party shall be liable for the fees and expenses of
additional counsel). The Indemnifying Party shall not be liable for any
settlement of any such action or proceeding or any threatened action or
proceeding effected without its written consent, which consent shall not be
unreasonably withheld, but if settled with its written consent or if there be a
final judgment of the plaintiff in any such action or proceedings, the
Indemnifying Party shall indemnify and hold harmless such Indemnified Parties
from and against any loss or liability (to the extent stated above) by reason
of such settlement or judgment. The failure of any Indemnified Party to give
prompt notice of a claim for indemnification hereunder shall not limit the
Indemnifying Party's obligations to indemnify under this Agreement, except to
the extent such failure is prejudicial to the ability of the Indemnifying Party
to defend the action. No Indemnifying Party, in the defense of any such claim
or litigation, shall, except with the consent of each Indemnified Party,
consent to entry of any judgment or enter into any settlement unless (x) there
is no finding or admission of any violation of any rights of any Person and no
effect on any other claims that be made against any Indemnified Party, (y) the
sole relief provided is monetary damages that are paid in full by the
Indemnifying Party and (z) such judgment or settlement includes as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability in respect of such claim or
litigation.
5.04 Contribution. If the indemnification provided for in
this Article V is unavailable to the Indemnified Parties in respect of any
losses, claims, damages, liabilities or judgment referred to herein, then such
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 and judgments in the following
manner: as between the Company on the one hand and any Indemnified Party
entitled to indemnification
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15
under Section 5.01 on the other, in such proportion as is appropriate to
reflect the relative fault of the Company on the one hand and any Indemnified
Party entitled to indemnification under Section 5.02 on the other in connection
with the statements or omissions which resulted in such losses, claims,
damages, liabilities or judgments, as well as any other relevant equitable
considerations. The relative fault of the Company on the one hand and of any
Indemnified Party entitled to indemnification under Section 5.02 on the other
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 such party, and the
party's relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. No person guilty of fraudulent
misrepresentation (within the means of subsection 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
5.05 Survival. The indemnity and contribution agreements
contained in this Article V shall remain operative and in full force and effect
with respect to any sales of Shares made pursuant to a registration statement
filed pursuant to this Agreement regardless of (a) any termination of this
Agreement, (b) any investigation made by or on behalf of any Indemnified Party
or by or on behalf of the Company, and (c) the consummation of the sale or
successive resale of the Shares.
ARTICLE VI
MISCELLANEOUS
6.01 Rules 144 and 144A. The Company covenants that
following the registration of Shares it will file any reports required to be
filed by it under the Securities Act and the Exchange Act so as to enable
Holders holding registered Shares to sell such Shares without registration
under the Securities Act within the limitation of the exemptions provided by
(a) Rules 144 and 144A under the Securities Act, as each such Rule may be
amended from time to time, or (b) any similar rule or rules hereafter adopted
by the SEC. Upon the request of any such Holder, the Company will forthwith
deliver to such Holder a written statement as to whether it has complied with
such requirements.
6.02 Amendments and Waivers. The provision of this
Agreement may not be amended, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given other than as
mutually agreed upon in writing by the Company and the Holders of each of (i)
75% of the Registrable Securities, (ii) 75% of the Conversion Shares, and (iii)
more than 50% of the Exercise Shares.
6.03 Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing by hand delivery,
regular mail, registered first-class mail, confirmed facsimile or recognized
express courier service by next business day delivery;
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16
(i) if to the Company:
Metrocall, Inc.
0000 Xxxxxxxx Xxxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
Fax Number: (000) 000-0000
with a copy to:
Xxxxxx, Xxxxxx & Xxxxxxxxx
0000 X Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000-0000
Attn: Xxxxxx X. Xxxxx, Esq.
Fax Number: (000) 000-0000
Notices shall be deemed given on the day on which delivered by hand or
facsimile, if delivered by 5:00 p.m. Eastern time; on the fifth business day
after mailing if delivered by mail; or the business day after delivery to an
overnight air courier if next-day delivery is specified.
(ii) if to any of the Purchasers, to the
addresses set forth on the Schedule of Purchasers attached as Exhibit A hereto.
6.04 Successors and Assigns. No Holder may assign any
rights or benefits under this Agreement except as provided in this Section
6.04. A Holder may assign to any transferee without the Company's consent such
Holder's rights and benefits with respect to Preferred Shares, Warrants,
Exercise Shares or Conversion Shares. A transferee that executes and delivers
to the Company an agreement pursuant to which it becomes bound by the terms of
this Agreement shall retain the rights and benefits of the transferor under
this Agreement; provided, however, that a transferee of Preferred Shares that
is not an affiliate of the Purchaser of such Preferred Shares shall not be
entitled to exercise the rights of a Holder with respect to such Preferred
Shares under Section 2.02 of this Agreement. The Company shall not assign any
rights, benefits or obligations under this Agreement without prior written
consent of the Holders of a majority of each of (i) the Registrable Securities,
(ii) the Conversion Shares and (iii) the Exercise Shares; provided, however,
that the Company shall assign its rights, benefits and obligations to any
person the Company is merged with or consolidated into or to any person to whom
the Company sells substantially all of its assets. This Agreement shall inure
to the benefit of and be binding upon the permitted successors and assigns of
the Company, the Purchasers and the other Holders.
6.05 Counterparts. This Agreement may be executed in a
number of identical counterparts and it shall not be necessary for the Company
and the Purchasers to execute each of
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17
such counterparts, but when each has executed and delivered one or more of such
counterparts, the several parts, when taken together, shall be deemed to
constitute one and the same instrument, enforceable against each in accordance
with its terms. In making proof of this Agreement, it shall not be necessary
to produce or account for more than one such counterpart executed by the party
against whom enforcement of this Agreement is sought.
6.06 Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
6.07 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OR CHOICE OF LAW.
6.08 Severability. If any provision of this Agreement is
held to be illegal, invalid or unenforceable under present or further laws
effective during the term of this Agreement, such provision shall be fully
severable; this Agreement shall be construed and enforced as if such illegal,
invalid or unenforceable provision had never comprised a part of this
Agreement; and the remaining provisions of this Agreement shall remain in full
force and effect and shall not be affected by the illegal, invalid or
unenforceable provision or by its severance from this Agreement.
6.09 Entire Agreement. This Agreement and the Unit
Purchase Agreement (including exhibits thereto) are intended by the Company and
the Purchasers as final expression of their agreement and are intended to be a
complete and exclusive statement of their agreement and understanding in
respect of the subject matter contained herein. This Agreement supersedes all
prior agreements and understandings between the Company and the Purchasers with
respect to such subject matter.
6.10 Third Party Beneficiaries. Other than Indemnified
Parties not a party hereto, this Agreement is intended for the benefit of the
Company, the Purchasers and their respective successors and permitted assigns
and is not for the benefit of, nor may any provision hereof be enforced by, any
other person or entity.
6.11 Obligations Several; Independent Nature of Each
Holder's Rights. Each obligation of any Holder is several and no such Holder
shall be responsible for the obligations of any other Holder. Nothing
contained herein, and no action taken by any such Holder pursuant hereto, shall
be deemed to constitute such Holders as a partnership, an association, a joint
venture or any other kind of entity. Each Holder shall be entitled to protect
and enforce its rights arising out of this Agreement without notice to or the
consent of any other person and it shall not be necessary for any other such
Holder to be joined as an additional party in any proceeding for such purpose.
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6.12 Nonwaiver. No course of dealing or any delay or
failure to exercise any right, power or remedy hereunder on the part of the
Holder shall operate as a waiver of or otherwise prejudice such Holder's
rights, powers or remedies.
6.13 Remedies. The Company acknowledges that the remedies
at law of the Holder in the event of any default or threatened default by the
Company in the performance of or compliance with any of the terms of this
Agreement are not and will not be adequate and that, to the fullest extent
permitted by law, such terms may be specifically enforced by a decree for the
specific performance of any agreement contained herein or by an injunction
against a violation of any of the terms hereof or otherwise without requiring
such Holder to post any bond or other security, unless otherwise required by
applicable law (which cannot be waived by the Company).
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19
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
METROCALL, INC.
By:/s/ XXXXXXX X. XXXXX
---------------------------------
Xxxxxxx X. Xxxxx
Chief Financial Officer
PURCHASERS
XXXX XXXXXXX MUTUAL LIFE INSURANCE
COMPANY
By:/s/ XXXXXX X. XXXXX
---------------------------------
Name: Xxxxxx X. Xxxxx
Title: Investment Officer
SUNAMERICA, INC.
By:/s/ XXXXX XxXXXXXX
---------------------------------
Name: Xxxxx XxXxxxxx
Title: Authorized Agent
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20
UBS CAPITAL LLC
By:/s/ XXXXXXX XXXXX
---------------------------------
Name: Xxxxxxx Xxxxx
Title: Managing Director
By:/s/ XXXXXX X. XXXXXXXXX
---------------------------------
Name: Xxxxxx X. Xxxxxxxxx
Title: Managing Director
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21
EXHIBIT A
PURCHASERS
SUNAMERICA INVESTMENTS, INC.:
SunAmerica Investments, Inc.
Xxx XxxXxxxxxx Xxxxxx
Xxxxxxx Xxxx
Xxx Xxxxxxx, XX 00000-0000
Attention: Xxxxx XxXxxxxx
Executive Vice President
and Chief Investment Officer
Facsimile: 000-000-0000
with a copy to:
Xxxxxx X. Xxxxxx, Esq.
O'Melveny & Xxxxx
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, XX 00000-0000
Facsimile: 000-000-0000
XXXX XXXXXXX MUTUAL LIFE INSURANCE COMPANY:
Xxxx Xxxxxxx Mutual Life Insurance Company
Bond and Corporate Finance Group (T-57)
000 Xxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
Investment Officer
Facsimile: 000-000-0000
with a copy to:
Xxxx Xxxxxxx Mutual Life Insurance Company
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxx Xxxxxxx, Esq.
Counsel
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Facsimile: 000-000-0000
and a copy to:
Xxxxxx X. Xxxxxx, Esq.
O'Melveny & Xxxxx
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, XX 00000-0000
Facsimile: 000-000-0000
UBS CAPITAL LLC:
UBS Capital LLC
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxx and Xxxxx X. Xxxxxxxxxxxx
Facsimile:
with a copy to:
Xxxxx Xxxxx, Esq.
Xxxx, Scholer, Fierman, Xxxx & Handler, LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: 000-000-0000 or -7150
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