Exhibit 10.59
MOTIENT CORPORATION
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made as of
February 9, 2005 by and among MOTIENT CORPORATION, a Delaware corporation, (the
"Company"), the Telcom Stockholders (defined below), Spectrum (defined below)
and Columbia (defined below) (each such stockholder, individually, an "Investor"
and, collectively, the "Investors").
WHEREAS, the Company has agreed to issue 8,187,804 shares (the "Telcom
Shares") of its common stock, $0.01 par value per share (including any
securities into which or for which such shares may be exchanged for, or
converted into, pursuant to any stock dividend, stock split, stock combination,
recapitalization, reclassification, reorganization or other similar event, the
"Common Stock"), to the Telcom Stockholders in connection with the merger of
Telcom Satellite Ventures Inc. ("Telcom I") and Telcom Satellite Ventures II
Inc. ("Telcom II") with and into MVH Holdings Inc. ("MVH"), a Delaware
corporation and wholly-owned subsidiary of the Company pursuant to the Agreement
and Plan of Merger dated February 9, 2005 by and between the Company, Telcom I,
Telcom II and MVH (the "Merger Agreement"); and
WHEREAS, the Company has also agreed to acquire, through MVH, shares of
common stock of several different corporations pursuant to certain Stock
Purchase Agreements (defined below), pursuant to which the Company will issue an
aggregate of 2,706,992 shares of Common Stock to Columbia (the "Columbia
Shares") and 1,809,995 shares of Common Stock to Spectrum (the "Spectrum Shares"
and, together with the Telcom Shares and Columbia Shares, the "Shares"); and
WHEREAS, the terms of the Merger Agreement and the Stock Purchase
Agreements provide that it shall be a condition precedent to the closing of the
transactions contemplated thereunder, for the Company and the Investors to
execute and deliver this Agreement.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties hereto hereby agree as follows:
1. DEFINITIONS. The following terms shall have the meanings provided
therefor below or elsewhere in this Agreement as described below:
"Additional Consideration Shares" means shares of Common Stock issuable
as Additional Merger Consideration (as such term is defined in Section 2.1(c) of
the Merger Agreement) or shares of Common Stock issuable as Additional
Consideration (as such term is defined in Section 4.4 of each Stock Purchase
Agreement).
"Affiliates" means any Person that, directly or indirectly, through one
or more intermediaries, controls, is controlled by, or is under common control
with, a Person, as such terms are used and construed under Rule 144.
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"Board" means the board of directors of the Company.
"Business Day" means any day except Saturday, Sunday and any day which
shall be a federal legal holiday or a day on which banking institutions in the
State of Delaware are authorized or required by law or other governmental action
to close.
"Closing Date" shall mean the date hereof.
"Columbia" shall mean Columbia Capital Equity Partners III (QP), L.P.,
Columbia Capital Equity Partners III (AI), L.P., Columbia Capital Equity
Partners III (CAYMAN), L.P., Columbia Capital Investors III, LLC and Columbia
Capital Employee Investors III, L.L.C.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and all of the rules and regulations promulgated thereunder.
"Person" (whether or not capitalized) means an individual, partnership,
limited liability company, corporation, association, trust, joint venture,
unincorporated organization, and any government, governmental department or
agency or political subdivision thereof.
"Prospectus" means the prospectus included in any Registration
Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an effective
Registration Statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable Shares
covered by such Registration Statement, and all other amendments and supplements
to the Prospectus, including post-effective amendments, and all material
incorporated by reference in such Prospectus.
"Registrable Shares" means, at the relevant time of reference thereto,
(i) the Shares, (ii) the Warrant Shares (including any shares of capital stock
that may be issued in respect thereof pursuant to a stock split, stock dividend,
recombination, reclassification or the like) and (iii) the Additional
Consideration Shares (except for purposes of Section 2), provided, however, that
the term "Registrable Shares" shall not include any of the Shares or Warrant
Shares that are actually sold pursuant to a registration statement that has been
declared effective under the Securities Act by the SEC.
"Registration Statement" means the Mandatory S-1 Registration Statement
and any additional registration statements contemplated by this Agreement,
including (in each case) the Prospectus, amendments and supplements to such
registration statement or Prospectus, including pre- and post-effective
amendments, all exhibits thereto, and all material incorporated by reference in
such registration statement or Prospectus.
"Rule 144" means Rule 144 promulgated under the Securities Act and any
successor or substitute rule, law or provision.
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"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and all
of the rules and regulations promulgated thereunder.
"Spectrum" means Spectrum Equity Investors IV, L.P., Spectrum IV
Investment Managers' Fund, L.P. and Spectrum Equity Investors Parallel IV, L.P.
"Stock Purchase Agreements" means the Stock Purchase Agreements dated
as of the date hereof by and among the Company, MVH Holdings Inc. and each of
the Spectrum entities and the Columbia entities.
"Telcom Stockholders" means Xx. Xxxxxxxx Xxxxx, Xxxxx Xxxxx, The Xxxxx
Xxx Xxxxx Education Trust and The Samir Xxx Xxxxx Education Trust.
"Warrants" means the warrants to purchase Common Stock, dated as of the
date hereof, issued by the Company to the Investors pursuant to the Merger
Agreement and pursuant to the Stock Purchase Agreements, a form of which is
attached as Exhibit A to the Merger Agreement and each Stock Purchase Agreement.
"Warrant Shares" means the shares of Common Stock issued or issuable
upon the exercise of the Warrants.
2. MANDATORY FORM S-1 REGISTRATION.
(a) The Company will use its reasonable best efforts to prepare
and file with the SEC, on or before the date that is three (3) Business Days
following the Closing Date, a pre-effective amendment to the Company's
Registration Statement on Form S-1 (Reg. No. 333- 121862), in substantially the
form provided to the Investors, for the purpose of registering under the
Securities Act all of the Registrable Shares for resale by, and for the account
of, each Investor as an initial selling stockholder thereunder (the "Mandatory
S-1 Registration Statement"). The Mandatory S-1 Registration Statement shall
permit the Investors to offer and sell, on a delayed or continuous basis
pursuant to Rule 415 under the Securities Act, any or all of the Registrable
Shares. The Company agrees to use its reasonable best efforts to cause the
Mandatory S-1 Registration Statement to be declared effective as soon as
practicable after the date of such filing (including filing with the SEC, within
three (3) Business Days of the date that the Company is notified (orally or in
writing, whichever is earlier) by the SEC that the Mandatory S-1 Registration
Statement will not be "reviewed" or will not be subject to further review, a
request for acceleration of effectiveness in accordance with Rule 461
promulgated under the Securities Act (an "Acceleration Request"), which request
shall request an effective date that is within three (3) Business Days of the
date of such request). The Company shall notify each Investor in writing
promptly (and in any event within one (1) Business Day) after the Company's
submission of an Acceleration Request to the SEC. The Company shall use its
reasonable best efforts to keep the Mandatory S-1 Registration Statement
continuously effective (including through the filing of any required
post-effective amendments) until the earliest to occur of: (i) the date on which
the Investors may sell all Registrable Shares pursuant to Rule 144 without being
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subject to the volume restrictions of such rule, (ii) the date after which all
of the Registrable Shares registered thereunder shall have been sold, or (iii)
the second (2nd) anniversary of the Closing Date; provided, that in any case
such date shall be extended by the amount of time of any Suspension Period (as
defined below). Thereafter, the Company shall be entitled to withdraw the
Mandatory S-1 Registration Statement and, upon such withdrawal, the Investors
shall have no further right to offer or sell any of the Registrable Shares
pursuant to the Mandatory S-1 Registration Statement (or any prospectus relating
thereto). For purposes of the Company's reasonable best efforts obligations in
this Section 2(a), the Company shall use its reasonable best efforts to avoid
taking any action or failing to take any action, that could reasonably lead to a
material delay in the effectiveness of the Mandatory S-1 Registration Statement,
such as filing other registration statements, engaging in business transactions
that could have such an effect, and failing to complete and file with the SEC as
required its audited year end 2004 financial statements.
(b) Notwithstanding anything in this Section 2 to the contrary, if
the Company shall furnish to the Investors a certificate signed by the President
or Chief Executive Officer of the Company, or the person performing such
functions, stating that the Board has made the good faith determination (i) that
the continued use by the Investors of the Mandatory S-1 Registration Statement
for purposes of effecting offers or sales of Registrable Shares pursuant hereto
would require, under the Securities Act and the rules and regulations
promulgated thereunder, premature disclosure in the Mandatory S-1 Registration
Statement (or the Prospectus relating thereto) of material, nonpublic
information concerning the Company, its business or prospects or any proposed
material transaction involving the Company, (ii) that such premature disclosure
would be materially adverse to the Company, its business or prospects or any
such proposed material transaction or would not be in the best interests of the
Company and (iii) that it is therefore essential to suspend the use by the
Investors, of the Mandatory S-1 Registration Statement (and the Prospectus
relating thereto), then the right of the Investors to use the Mandatory S-1
Registration Statement (and the Prospectus relating thereto) for purposes of
effecting offers or sales of Registrable Shares pursuant thereto shall be
suspended for a period (the "Suspension Period") not greater than fifteen (15)
consecutive Business Days during any consecutive twelve (12) month period.
During the Suspension Period, the Investors shall not offer or sell any
Registrable Shares pursuant to or in reliance upon the Mandatory S-1
Registration Statement (or the Prospectus relating thereto). The Company agrees
that, as promptly as possible, but in no event later than one (1) Business Day,
after the consummation, abandonment or public disclosure of the event or
transaction that caused the Company to suspend the use of the Mandatory S-1
Registration Statement (and the Prospectus relating thereto) pursuant to this
Section 2(b), the Company will as promptly as possible lift any suspension,
provide the Investors with revised Prospectuses, if required, and will notify
the Investors of their ability to effect offers or sales of Registrable Shares
pursuant to or in reliance upon the Mandatory S-1 Registration Statement.
(c) It shall be a condition precedent to the obligations of the
Company to register Registrable Shares for the account of an Investor pursuant
to this Section 2 or Section 3 that such Investor furnish to the Company such
information regarding itself, the Registrable Securities held by it, and the
method of disposition of such securities as shall be required to effect the
registration of such Investor's Registrable Securities.
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(d) Notwithstanding anything in this Agreement to the contrary,
the Investors' sole remedy at law (but without in any way or form limiting the
availability of equitable remedies) for the failure of the Company to file the
Mandatory S-1 Registration Statement within three (3) Business Days after the
date hereof or for the failure of the Company to make effective the Mandatory
S-1 Registration Statement as soon as practicable after the date the Mandatory
S-1 Registration Statement is filed, shall be the vesting of the Warrants as
provided for therein.
3. PIGGYBACK REGISTRATION.
(a) If at any time any Registrable Shares are not able to be
resold pursuant to an effective Registration Statement, including prior to the
date the Mandatory S-1 Registration Statement is declared effective, and the
Company proposes to register any of its Common Stock under the Securities Act,
whether as a result of an offering for its own account or the account of others
(but excluding any registrations to be effected on Forms S-4 or S-8 or other
applicable successor Forms), the Company shall, each such time, give to the
Investors twenty (20) days' prior written notice of its intent to do so, and
such notice shall describe the proposed registration and shall offer such
Investors the opportunity to register such number of Registrable Shares as each
such Investor may request. Upon the written request of any Investor given to the
Company within fifteen (15) days after the receipt of any such notice by the
Company, the Company shall include in such Registration Statement all or part of
the Registrable Shares of such Investor, to the extent requested to be
registered and subject to subsection (b) below.
(b) If a registration pursuant to Section 3 hereof involves an
underwritten offering and the managing underwriter shall advise the Company in
writing that, in its opinion, the number of shares of Common Stock requested by
the Investors to be included in such registration is likely to affect materially
and adversely the success of the offering or the price that would be received
for any shares of Common Stock offered in such offering, then, notwithstanding
anything in this Section 3 to the contrary, the Company shall only be required
to include in such registration, to the extent of the number of shares of Common
Stock which the Company is so advised can be sold in such offering, (i) first,
the number of shares of Common Stock requested to be included in such
registration for the account of any stockholders of the Company (including the
Investors), pro rata among such stockholders on the basis of the number of
shares of Common Stock that each of them has requested to be included in such
registration, and (ii) second, any shares of Common Stock proposed to be
included in such registration for the account of the Company.
(c) In connection with any offering involving an underwriting of
shares, the Company shall not be required under this Section 3 or otherwise to
include the Registrable Shares of any Investor therein unless such Investor
accepts and agrees to the terms of the underwriting, which shall be reasonable
and customary, as agreed upon between the Company and the underwriters selected
by the Company.
4. OBLIGATIONS OF THE COMPANY. In connection with the Company's
registration obligations hereunder, the Company shall, as expeditiously as
practicable:
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(a) (i) furnish to each Investor copies of all documents filed
with the SEC not less than two (2) Business Days prior to their being filed with
the SEC, (ii) use commercially reasonable efforts to cause its officers and
directors, counsel and certified public accountants to respond to such inquiries
as shall be necessary, in the reasonable opinion of such Investor, to conduct a
reasonable investigation within the meaning of the Securities Act, and (iii)
notify the Investors of any stop order issued or threatened by the SEC and use
best efforts to prevent the entry of such stop order or to remove it if entered.
(b) (i) prepare and file with the SEC such amendments and
supplements, including post-effective amendments, to each Registration Statement
and the Prospectus used in connection therewith as may be necessary to comply
with the Securities Act and to keep the Registration Statement continuously
effective as required herein, and prepare and file with the SEC such additional
Registration Statements or amendments and supplements, including post-effective
amendments, as necessary to register for resale under the Securities Act all of
the Registrable Shares (including naming any permitted transferees of
Registrable Shares as selling stockholders in any such Registration Statement)
as required herein; (ii) cause any related Prospectus to be amended or
supplemented by any required Prospectus supplement, and as so supplemented or
amended to be filed pursuant to Rule 424; (iii) respond as promptly as possible
through its reasonable best efforts to any comments received from the SEC with
respect to each Registration Statement or any amendment thereto and as promptly
as possible through its reasonable best efforts provide the Investors true and
complete copies of all correspondence from and to the SEC relating to the
Registration Statement (other than correspondence containing material nonpublic
information); and (iv) comply with the provisions of the Securities Act and the
Exchange Act with respect to the disposition of all Registrable Shares covered
by such Registration Statement as so amended or in such Prospectus as so
supplemented.
(c) Notify the Investors and legal counsel to the Investors
("Investors' Counsel") as promptly as possible:
(i) when the SEC notifies the Company whether there will be a
"review" of a Registration Statement and whenever the SEC comments in writing on
such Registration Statement; and (ii) when a Registration Statement, or any
post-effective amendment or supplement thereto, has become effective, and after
the effectiveness thereof: (A) of any request by the SEC or any other federal or
state governmental authority for amendments or supplements to the Registration
Statement or Prospectus or for additional information; (B) of the issuance by
the SEC or any state securities commission of any stop order suspending the
effectiveness of the Registration Statement covering any or all of the
Registrable Shares or the initiation of any proceedings for that purpose; and
(C) of the receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of any of the
Registrable Shares for sale in any jurisdiction, or the initiation or
threatening of any proceeding for such purpose. Without limitation of any
remedies to which the Investors may be entitled under this Agreement, if any of
the events described in Section 4(c)(ii)(A), 4(c)(ii)(B), and 4(c)(ii)(C) occur,
the Company shall use best efforts to respond to and correct the event.
(d) Notify the Investors and their counsel as promptly as possible
of the happening of any event as a result of which the Prospectus included in or
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relating to a Registration Statement contains an untrue statement of a material
fact or omits any fact necessary to make the statements therein not misleading;
and, thereafter, the Company will as promptly as possible prepare (and, when
completed, give notice to each Investor) a supplement or amendment to such
Prospectus so that, as thereafter delivered to the purchasers of such
Registrable Shares, such Prospectus will not contain an untrue statement of a
material fact or omit to state any fact necessary to make the statements therein
not misleading; provided that upon such notification by the Company, the
Investors will not offer or sell Registrable Shares pursuant to such Prospectus
until the Company has notified the Investors that it has prepared a supplement
or amendment to such Prospectus and delivered copies of such supplement or
amendment to the Investors (it being understood and agreed by the Company that
the foregoing proviso shall in no way diminish or otherwise impair the Company's
obligation to as promptly as possible prepare a Prospectus amendment or
supplement as above provided in this Section 4(d) and deliver copies of same as
above provided in Section 4(h) hereof), and it being further understood that, in
the case of the Mandatory S-1 Registration Statement, any such period during
which the Investors are restricted from offering or selling Registrable Shares
shall constitute a Suspension Period.
(e) Upon the occurrence of any event described in Section 4(d)
hereof, as promptly as possible, prepare a supplement or amendment, including a
post-effective amendment, to the Registration Statement or a supplement to the
related Prospectus or any document incorporated or deemed to be incorporated
therein by reference, and file any other required document so that, as
thereafter delivered, neither the Registration Statement nor such Prospectus
will contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they are made, not misleading.
(f) Use best efforts to avoid the issuance of or, if issued,
obtain the withdrawal of, (i) any order suspending the effectiveness of any
Registration Statement or (ii) any suspension of the qualification (or exemption
from qualification) of any of the Registrable Shares for sale in any
jurisdiction, as promptly as possible (it being understood that, in the case of
the Mandatory S-1 Registration Statement, any period during which the
effectiveness of the Mandatory S-1 Registration Statement or the qualification
of any Registrable Shares is suspended shall constitute a Suspension Period).
(g) Furnish to the Investors and their counsel, without charge, at
least one conformed copy of each Registration Statement and each amendment
thereto, and all exhibits to the extent requested by such Investor or their
counsel (including those previously furnished or incorporated by reference) as
promptly as possible after the filing of such documents with the SEC.
(h) As promptly as possible furnish to each selling Investor,
without charge, such number of copies of a Prospectus, including a preliminary
Prospectus, in conformity with the requirements of the Securities Act, and such
other documents (including, without limitation, Prospectus amendments and
supplements) as each such selling Investor may reasonably request in order to
facilitate the disposition of the Registrable Shares covered by such Prospectus
and any amendment or supplement thereto. The Company hereby consents to the use
of such Prospectus and each amendment or supplement thereto by each of the
selling Investors in connection with the offering and sale of the Registrable
Shares covered by such Prospectus and any amendment or supplement thereto to the
extent permitted by federal and state securities laws and regulations.
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(i) Use best efforts to register and qualify (or obtain an
exemption from such registration and qualification) the Registrable Shares under
such other securities or blue sky laws of the states of residence of each
Investor and such other jurisdictions as each Investor shall reasonably request,
to keep such registration or qualification (or exemption therefrom) effective
during the periods each Registration Statement is effective, and do any and all
other acts or things which may be reasonably necessary or advisable to enable
each Investor to consummate the public sale or other disposition of Registrable
Shares in such jurisdiction, provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do business or to
file a general consent to service of process in any such states or jurisdictions
where it is not then qualified or subject to process.
(j) Cooperate with the Investors to facilitate the timely
preparation and delivery of certificates representing the Registrable Shares to
be delivered to a transferee pursuant to a Registration Statement, which
certificates shall be free, to the extent permitted by the Merger Agreement or
the Purchase Agreement, as applicable, and applicable law, of all restrictive
legends, and to enable such Registrable Shares to be in such denominations and
registered in such names as such Investors may request.
(k) Cooperate with any reasonable due diligence investigation
undertaken by the Investors, any managing underwriter participating in any
disposition pursuant to a Registration Statement, Investors' Counsel and any
attorney, accountant or other agent retained by Investors or any managing
underwriter, in connection with the sale of the Registrable Shares, including,
without limitation, making available any documents and information; provided,
however, that the Company will not deliver or make available to any Investor
material, nonpublic information unless such Investor specifically requests and
consents in advance in writing to receive such material, nonpublic information
and, if requested by the Company, such Investor agrees in writing to treat such
information as confidential.
(l) At the request of a permitted transferee, the Company shall
amend any Registration Statement to include such transferee as a selling
stockholder in such Registration Statement.
(m) Comply with all applicable rules and regulations of the SEC in
all material respects.
5. EXPENSES OF REGISTRATION. The Company shall pay for all expenses
incurred in connection with a registration pursuant to this Agreement and
compliance with Section 4 of this Agreement, including without limitation (i)
all registration, filing and qualification fees and expenses (including without
limitation those related to filings with the SEC, The NASDAQ Stock Market, or
any national securities exchange upon which the Company's securities are listed
and in connection with applicable state securities or blue sky laws), (ii) all
printing expenses, (iii) all messenger, telephone and delivery expenses incurred
by the Company, (iv) all fees and disbursements of counsel for the Company and
Investors' Counsel, and (v) all fees and expenses of all other Persons retained
by the Company in connection with the consummation of the transactions
contemplated by this Agreement.
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6. DELAY OF REGISTRATION. Subject to Section 11(d) hereof, the
Investors and the Company (other than with respect to Section 4(d) hereof) shall
not take any action to restrain, enjoin or otherwise delay any registration as
the result of any controversy which might arise with respect to the
interpretation or implementation of this Agreement.
7. INDEMNIFICATION. In the event that any Registrable Shares of the
Investors are included in a Registration Statement pursuant to this Agreement:
(a) To the fullest extent permitted by law, the Company will
indemnify and hold harmless each Investor and each officer, director, fiduciary,
agent, investment advisor, employee, member (or other equity holder), general
partner and limited partner (and Affiliates thereof) of such Investor, each
broker, underwriter or other person acting on behalf of such Investor and each
person, if any, who controls such Investor within the meaning of the Securities
Act, against any losses, claims, damages or liabilities, joint or several, (the
"Losses") to which they may become subject under the Securities Act or
otherwise, insofar as such Losses (or actions in respect thereof) arise out of
or relate to any untrue or alleged untrue statement of any material fact
contained in the Registration Statement, or arise out of or relate to the
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 the Securities Act or state securities or blue
sky laws applicable to the Company and leading to action or inaction required of
the Company in connection with such registration or qualification under such
Securities Act or state securities or blue sky laws; and, subject to the
provisions of Section 7(c) hereof, the Company will reimburse on demand such
Investor, such broker or other person acting on behalf of such Investor or such
officer, director, fiduciary, employee, member (or other equity holder), general
partner, limited partner, Affiliate or controlling person for any legal or other
expenses reasonably incurred by any of them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the indemnity agreement contained in this Section 7(a) shall not apply to
amounts paid in settlement of any such Losses if such settlement is effected
without the consent of the Company (which consent shall not be unreasonably
withheld), nor shall the Company be liable in any such case for any such loss,
damage, liability or action to the extent that it solely arises out of or is
based upon an untrue statement of any material fact contained in the
Registration Statement or omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading, in
each case to the extent that such untrue statement or alleged untrue statement
or omission or alleged omission was made in the Registration Statement, in
reliance upon and in conformity with written information furnished by such
Investor expressly for use in connection with such Registration Statement.
(b) To the fullest extent permitted by law, each Investor,
severally (as to itself) and not jointly, will indemnify and hold harmless the
Company, each of its directors, each of its officers who have signed the
Registration Statement, each person, if any, who controls the Company within the
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meaning of the Securities Act, and all other Investors against any Losses to
which the Company or any such director, officer or controlling person or other
Investor may become subject to, under the Securities Act or otherwise, insofar
as such Losses (or actions in respect thereto) solely arise out of or are based
upon any untrue statement of any material fact contained in the Registration
Statement, or solely arise out of or relate to the omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent that such untrue statement or
alleged untrue statement or omission or alleged omission was made in the
Registration Statement in reliance upon and in conformity with written
information furnished by such Investor expressly for use in connection with such
Registration Statement; and, subject to the provisions of Section 7(d) hereof,
such Investor will reimburse on demand any legal or other expenses reasonably
incurred by the Company or any such director, officer, controlling person, or
other Investor in connection with investigating or defending any such Losses,
provided, however, that the maximum aggregate amount of liability of such
Investor under this Section 7 shall be limited to the proceeds (net of
underwriting discounts and commissions, if any) actually received by such
Investor from the sale of Registrable Shares covered by such Registration
Statement; and provided, further, however, that the indemnity agreement
contained in this Section 7(b) or 7(e)shall not apply to amounts paid in
settlement of any such Losses if such settlement is effected without the consent
of such Investor against which the request for indemnity is being made (which
consent shall not be unreasonably withheld).
(c) As promptly as possible after receipt by an indemnified party
under this Section 7 of notice of the threat, assertion or commencement of any
action, such indemnified party will, if a claim in respect thereof is to be made
against any indemnifying party under this Section 7, notify the indemnifying
party in writing of the commencement thereof and the indemnifying party shall
have the right to participate in and, to the extent the indemnifying party
desires, jointly with any other indemnifying party similarly noticed, to assume
at its expense the defense thereof with counsel mutually satisfactory to the
parties; provided, however, that, the failure to notify an indemnifying party
promptly of the threat, assertion or commencement of any such action shall not
relieve such indemnifying party of any liability to the indemnified party under
this Section 7 except (and only) to the extent that it shall be finally
determined by a court of competent jurisdiction (which determination is not
subject to appeal or further review) that such failure shall have proximately
and materially adversely prejudiced the indemnifying party.
(d) If any indemnified party shall have reasonably concluded that
there may be one or more legal defenses available to such indemnified party
which are different from or additional to those available to the indemnifying
party, or that such claim or litigation involves or could have an effect upon
matters beyond the scope of the indemnity agreement provided in this Section 7,
the indemnifying party shall not have the right to assume the defense of such
action on behalf of such indemnified party, and such indemnifying party shall
reimburse such indemnified party and any person controlling such indemnified
party for the fees and expenses of counsel retained by the indemnified party
which are reasonably related to the matters covered by the indemnity agreement
provided in this Section 7. Subject to the foregoing, an 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 not be at
the expense of the Company.
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(e) If the indemnification provided for in this Section 7 from the
indemnifying party is applicable by its terms but unavailable to an indemnified
party hereunder in respect of any Losses, then the indemnifying party, in lieu
of indemnifying such indemnified party, shall, subject to the maximum aggregate
liability of any Investor as set forth in Section 7(b), 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 and indemnified party in connection
with the actions which resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The relative
faults of such indemnifying party and indemnified party shall be determined by
reference to, among other things, whether any action in question, including any
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact, has been made by, or relates to information
supplied by, such indemnifying party or indemnified party, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such action. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities and expenses referred to above shall be
deemed to include, subject to the limitations set forth in Sections 7(a), 7(b)
7(c) and 7(d), any legal or other fees, charges or expenses reasonably incurred
by such party in connection with any investigation or proceeding. 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. The
parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 7(e) were determined by pro rata allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding paragraph.
(f) The indemnity and contribution agreements contained in this
Section are in addition to any liability that any indemnifying party may have to
any indemnified party.
8. REPORTS UNDER THE EXCHANGE ACT. With a view to making available to
the Investors the benefits of Rule 144 and any other rule or regulation of the
SEC that may at any time permit the Investors to sell the Registrable Shares to
the public without registration, the Company agrees to use best efforts to: (i)
make and keep public information available, as those terms are understood and
defined in Rule 144, (ii) file with the SEC in a timely manner all reports and
other documents required to be filed by an issuer of securities registered under
the Securities Act or the Exchange Act; (iii) as long as any Investor owns any
Shares or Warrant Shares, to furnish in writing upon such Investor's request a
written statement by the Company that it has complied with the reporting
requirements of Rule 144 and of the Securities Act and the Exchange Act, and to
furnish to such Investor a copy of the most recent annual and quarterly reports
of the Company, and such other reports and documents so filed by the Company as
may be reasonably requested in availing such Investor of any rule or regulation
of the SEC permitting the selling of any such Shares without registration, and
(iv) undertake any additional actions reasonably necessary to maintain the
availability of a Registration Statement, including any successor or substitute
forms, or the use of Rule 144.
9. TRANSFER OF REGISTRATION RIGHTS. Each Investor may assign or
transfer any or all of its rights under this Agreement to any Person, provided
such assignee or transferee agrees in writing to be bound by the provisions
hereof that apply to such assigning or transferring Investor. Upon any such, and
each successive, assignment or transfer to any permitted assignee or transferee
in accordance with the terms of this Section 9, such permitted assignee or
transferee shall be deemed to be an "Investor" for all purposes of this
Agreement.
11
10. ENTIRE AGREEMENT. This Agreement constitutes and contains the
entire agreement and understanding of the parties with respect to the subject
matter hereof, and it also supersedes any and all prior negotiations,
correspondence, agreements or understandings with respect to the subject matter
hereof.
11. MISCELLANEOUS.
(a) This Agreement, and any right, term or provision contained
herein, may not be amended, modified or terminated, and no right, term or
provision may be waived, except with the written consent of each Investor and
the Company; provided that any particular Investor (as compared to all Investors
as a group) may pursue remedies, settle disputes and otherwise enforce or waive
rights as to such Investor whether or not any of the other Investors participate
in such action, as long as such action relates only to the rights of such
Investor and does not modify or waive the rights of any of the other Investors.
(b) This Agreement shall be governed by and construed and enforced
in accordance with the laws of the State of Delaware. This Agreement shall be
binding upon the parties hereto and their respective heirs, personal
representatives, successors and permitted assigns and transferees, provided that
the terms and conditions of Section 9 hereof are satisfied. Notwithstanding
anything in this Agreement to the contrary, if at any time any Investor
(including any successors or assigned) shall cease to own any Registrable
Shares, all of such Investor's rights under this Agreement shall immediately
terminate.
(c) Any notices to be given pursuant to this Agreement shall be in
writing and shall be given by certified or registered mail, return receipt
request. Notices shall be deemed given when personally delivered or when mailed
to the addresses of the respective parties as set forth on Exhibit A or Schedule
1 hereto, as applicable, or to such changed address of which any party may
notify the others pursuant hereto, except that a notice of change of address
shall be deemed given when received.
(d) The parties acknowledge and agree that in the event of any
breach of this Agreement, remedies at law will be inadequate, and each of the
parties hereto shall be entitled to specific performance of the obligations of
the other parties hereto and to such appropriate injunctive relief as may be
granted by a court of competent jurisdiction. All remedies, either under this
Agreement or by law or otherwise afforded to any of the parties, shall be
cumulative and not alternative.
(e) This Agreement may be executed in a number of counterparts.
All such counterparts together shall constitute one Agreement, and shall be
binding on all the parties hereto notwithstanding that all such parties have not
signed the same counterpart. The parties hereto confirm that any facsimile copy
of another party's executed counterpart of this Agreement (or its signature page
thereof) will be deemed to be an executed original thereof.
12
(f) Except as contemplated in Section 9 hereof, this Agreement is
intended solely for the benefit of the parties hereto and is not intended to
confer any benefits upon, or create any rights in favor of, any Person
(including, without limitation, any stockholder or debt holder of the Company)
other than the parties hereto.
(g) If any provision of this Agreement is invalid, illegal or
unenforceable, such provision shall be ineffective to the extent, but only to
the extent of, such invalidity, illegality or unenforceability, without
invalidating the remainder of such provision or the remaining provisions of this
Agreement, unless such a construction would be unreasonable.
(h) This Agreement shall be binding upon, and inure to the benefit
of, the parties hereto and their permitted successors and assigns.
[Signature Pages Follow]
IN WITNESS WHEREOF, the parties hereto have executed this Registration
Rights Agreement as of the date and year first above written.
MOTIENT CORPORATION
By: /s/ Xxxxxxxxxxx Xxxxxx
-------------------------------------
Xxxxxxxxxxx Xxxxxx,
Executive Vice President and Chief
Operating Officer
INVESTORS:
/s/ Xx. Xxxxxxxx Xxxxx
-----------------------------------
Xx. Xxxxxxxx Xxxxx
/s/ Xxxxx Xxxxx
-----------------------------------
Xxxxx Xxxxx
THE XXXXX XXX XXXXX EDUCATION TRUST
By: /s/ Xxxxx Xxxxx
----------------------------
Name: ____________________________
Title: ____________________________
THE SAMIR XXX XXXXX EDUCATION TRUST
By: /s/ Xxxxx Xxxxx
----------------------------
Name: ____________________________
Title: ____________________________
SPECTRUM EQUITY INVESTORS IV, L.P.
By: Spectrum Equity Associates IV, L.P.,
its General Partner
By: /s/ Xxxxx X. Xxxxxx
----------------------------
Name: Xxxxx X. Xxxxxx
Title: General Partner
[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]
SPECTRUM IV INVESTMENT MANAGERS' FUND, L.P.
By: /s/ Xxxxx X. Xxxxxx
----------------------------
Name: Xxxxx X. Xxxxxx
Title: General Partner
SPECTRUM EQUITY INVESTORS PARALLEL IV, L.P.
By: /s/ Xxxxx X. Xxxxxx
----------------------------
Name: Xxxxx X. Xxxxxx
Title: General Partner
COLUMBIA CAPITAL EQUITY PARTNERS III (QP),
L.P.
By: Columbia Capital Equity Partners III,
L.P., as General Partner
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Financial Officer
COLUMBIA CAPITAL EQUITY PARTNERS III (AI),
L.P.
By: Columbia Capital Equity Partners III,
L.P., as General Partner
By: /s/ Xxxxxx X. Xxxxxxx
-----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Financial Officer
[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]
COLUMBIA CAPITAL EQUITY PARTNERS III
(CAYMAN), L.P.
By: Columbia Capital Equity Partners
(Cayman) III, Ltd., as General
Partner
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Financial Officer
COLUMBIA CAPITAL INVESTORS III, LLC
By: Columbia Capital Equity Partners III,
L.P., as General Partner
By: /s/ Xxxxxx X. Xxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Financial Officer
COLUMBIA CAPITAL EMPLOYEE INVESTORS III,
L.L.C.
By: Columbia Capital III, L.L.C., its
Manager
By: /s/ Xxxxxx X. Xxxxxxx
-------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Chief Financial Officer
[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]
Exhibit A
---------
All correspondence to the Company shall be addressed as follows:
Motient Corporation 000 Xxxxxxxxxxxxx Xxxxxxx Xxxxxxxxxxxx, XX 00000 Attention:
Xxxxxxxxxxx Xxxxxx, Executive Vice President and Chief Operating Officer
Telecopier: (000) 000-0000.
with copies to:
Motient Corporation 000 Xxxxxxxxxxxxx Xxxxxxx Xxxxxxxxxxxx, XX 00000 Attention:
Xxxxxx Xxxxxxx, Esq. Telecopy: (000) 000-0000
Xxxxxxx Xxxxx LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxxxxxxxx, Esq.
Telecopy: (000) 000-0000
All correspondence to the Investors shall be addressed as set forth in Schedule
1 below
Schedule 1
----------
List of Investors
1. Correspondence to the Telcom Stockholders shall be addressed as follows:
Xx. Xxxxxxxx Xxxxx
Xxxxx Xxxxx
The Xxxxx Xxx Xxxxx Education Trust
The Samir Xxx Xxxxx Education Trust, with a copy to:
-------------------------------------------------------------------------------
c/o Telcom Ventures, L.L.C. Steel Xxxxxx & Xxxxx LLP
000 X. Xxxxx Xxxxxx, Xxxxx 000 000 Xxxxx Xxxxxxxx Xxxx., 00xx Xxxxx
Xxxxxxxxxx, XX 00000 Xxxxx, Xxxxxxx 00000-0000
Telecopy: 703-519-2181 Telecopy: (000) 000-0000
Attention: Attention: Xxxxx Xxxxxx
--------------------------------------------------------------------------------
2. Correspondence to Columbia shall be addressed as follows:
Columbia Capital Equity Partners III (QP), L.P.
Columbia Capital Equity Partners III (AI), L.P.
Columbia Capital Equity Partners III (CAYMAN), L.P.
Columbia Capital Investors III, LLC
Columbia Capital Employee Investors III, L.L.C., with a copy to:
--------------------------------------------------------------------------------
000 Xxxxx Xxxxx Xxxxxx Xxxxxxx & Xxxxxx, LLP
Suite 300 101 Federal Street
Alexandria, Virginia 22314 Xxxxxx, XX 00000 XXX
Telecopy: (000) 000-0000 Telecopy: (000) 000-0000
Attention Xxxxx X. Xxxxxxx Attention: Xxxxxxx X. Xxxxxxxx
--------------------------------------------------------------------------------
3. Correspondence to Spectrum shall be addressed as follows:
Spectrum Equity Investors IV, L.P.
Spectrum IV Investment Managers' Fund, L.P.
Spectrum Equity Investors Parallel IV, L.P., with a copy to:
--------------------------------------------------------------------------------
One International Place Xxxxxxx & Xxxxxx, LLP
29th Floor 000 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000 Xxxxxx, XX 00000 XXX
Telecopy: (000) 000-0000 Telecopy: (000) 000-0000
Attention: Xxxxx X. Xxxxxx Attention: Xxxxxxx X. Xxxxxxxx
--------------------------------------------------------------------------------
