EXECUTION COPY
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XXXXXX COMMUNICATIONS CORPORATION
STOCKHOLDER AND INVESTOR RIGHTS AGREEMENT
dated as of December 23, 1998
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STOCKHOLDER AND INVESTOR RIGHTS AGREEMENT
STOCKHOLDER AND INVESTOR RIGHTS AGREEMENT, dated as of December 23, 1998
(this "Agreement"), by and among the investors listed on Schedule I
(individually, each a "Cash Equity Investor" and, collectively, with any of
its Affiliated Successors, the "Cash Equity Investors") and Xxxxxx
Communications Corporation, an Oklahoma corporation (the "Company"). Each of
the foregoing Persons, together with all other Persons who, in connection
with a Transfer (as hereinafter defined) are required to become a party to
this Agreement (other than the Company) are sometimes referred to herein,
individually, as a "Stockholder" and, collectively, as the "Stockholders."
RECITALS
WHEREAS:
(A) The Company and certain of its stockholders have agreed to enter
into this Agreement following the termination of the Stockholders Agreement
of the Company, dated as of February 26, 1997, and in order to provide for
the management of the Company and to impose certain restrictions with respect
to the sale, transfer or other disposition of Common Stock and Preferred
Stock on the terms and conditions hereinafter set forth; and
(B) The authorized capital stock of the Company consists of: (a)
1,500,000 shares of common stock, par value $0.001 per share ("Common
Stock"), consisting of (i) 1,438,000 shares of Class A Common Stock ("Class
A Common Stock"), of which 491,954 shares are issued and outstanding, (ii)
31,000 shares of Class B Non-Voting Common Stock ("Class B Common Stock"), of
which 28,934 shares are subject to options which have been granted but not
exercised, and (iii) 31,000 shares of Class C Common Stock ("Class C Common
Stock"), of which no shares are issued and outstanding; and (b) 2,500,000
shares of preferred stock, par value $1.00 per share ("Preferred Stock"),
consisting of (i) 550,000 shares designated 12 1/4% Senior Exchangeable
Preferred Stock ("Senior PIK Preferred Stock"), Mandatorily Redeemable 2007,
of which 185,513 shares are issued and outstanding, (ii) 180,000 shares
designated 12 1/4% Senior Exchangeable Preferred Stock ("Sygnet PIK Preferred
Stock"), Mandatorily Redeemable 2008, of which 64,646 shares are issued and
outstanding, (iii) 150,000 shares designated Class A 5% Non-Cumulative,
Non-Voting, Non-Convertible Preferred Stock ("Class A Preferred Stock"), of
which 100,000 shares are issued and outstanding, (iv) 90,000 shares
designated Class D Convertible Preferred Stock ("Class D Preferred Stock"),
of which 75,093.7 shares are issued and outstanding, (v) 405,000 shares
designated Class E Preferred Stock ("Class E Preferred Stock"), of which zero
shares are issued and outstanding, (vi) 30,000 shares designated Class F
Preferred Stock ("Class F Preferred Stock"), of which 30,000 shares are
issued and outstanding, (vii) 62,000 shares designated Class G Preferred
Stock ("Class G Preferred Stock"), of which 37,853 shares are issued and
outstanding, and (viii) 62,000 shares
designated Class H Preferred Stock ("Class H Preferred Stock"), of which zero
shares are issued and outstanding; and
(C) Each Stockholder is the registered owner of the respective shares
of Common Stock and Preferred Stock set forth opposite its name on Schedule
II.
NOW, THEREFORE, in consideration of the premises and the mutual
representations, warranties, covenants, conditions and agreements hereinafter
set forth, the parties agree as follows:
ARTICLE 1.
DEFINITIONS
1.1 CERTAIN DEFINED TERMS. As used herein, the following terms have
the following meanings (unless indicated otherwise, all Section and Article
references are to Sections and Articles in this Agreement, and all Schedule
and Exhibit references are to Schedules and Exhibits to this Agreement):
"ADVICE" shall have the meaning set forth in Section 5(d)(xvii).
"AFFILIATE" shall have the meaning given such term in Rule 501(b) under
the Securities Act.
"AFFILIATED SUCCESSOR" shall mean, with respect to any Person, an
Affiliate thereof that is a transferee or a successor in interest to any or
all of such Person's Company Stock and that is required to become a party to
this Agreement in accordance with the terms hereof; PROVIDED, HOWEVER, that,
for purposes of Section 4, with respect to any Cash Equity Investor,
"Affiliated Successor" shall also include partners, limited partners or
members of a Cash Equity Investor that are transferees of Preferred Stock or
Common Stock pursuant to distributions in accordance with the partnership
agreement or operating agreement of such Cash Equity Investor.
"AVAILABLE CASH" shall have the meaning given to such term in the
Subordinated Put Note.
"BENEFICIALLY OWN" shall have the meaning set forth in Rule 13d-3 of
the Exchange Act.
"BOARD OF DIRECTORS" shall mean the Board of Directors of the Company,
as duly constituted in accordance with this Agreement, or any committee
thereof duly constituted in accordance with this Agreement, the by-laws and
applicable law and duly authorized to make the
relevant determination or take the relevant action. To the extent that the
Board of Directors is required under this Agreement to authorize or approve,
or make a determination in respect of a transaction between the Company, on
the one hand, and a Stockholder, and/or a Stockholder's Affiliates, on the
other hand, the Board of Directors shall be deemed to exclude such
Stockholder, any of its Affiliates, and any of the directors, officers,
employees, agents or representatives of such Stockholder and/or its
Affiliates, who are members of the Board of Directors.
"BTA" shall mean a geographic area established by the Rand XxXxxxx 1992
Commercial Atlas & Marketing Guide, 123rd Edition, as modified by the FCC to
form the initial geographic area of license for the C, D, E and F blocks of
broadband PCS spectrum as defined in Section 24.202 of the FCC's rules.
"CALL NOTICE" shall have the meaning set forth in Section 13.2.
"CASH EQUITY INVESTORS" shall have the meaning set forth in the preamble.
"CELLULAR SYSTEM" shall mean a mobile communication system constructed
and operated in a MSA or a RSA (or any successor territorial designations or
subdivision thereof authorized by the FCC) exclusively using frequencies in
the 800 MHz band, or portions thereof, pursuant to a License therefor issued
by the FCC.
"CELLULAR TERRITORY" shall mean the cellular geographic service area in
an MSA or RSA in which the Company or its Subsidiaries has been granted a
licence to operate a Cellular System by the FCC.
"CERTIFICATES OF DESIGNATION" shall mean collectively the Certificates
of Designation of the Company in respect of each class of Preferred Stock,
substantially in the forms of Exhibits B-1 through B-6 hereto.
"CHANGE OF CONTROL" shall mean (i) prior to an IPO, any transaction as a
result of which Xxxxxxx Xxxxxx and his Affiliates, directly or indirectly,
cease to control 50.1% of the Company's Voting Securities, (ii) following an
IPO, any transaction as a result of which Xxxxxxx Xxxxxx and his Affiliates,
directly or indirectly, cease to control 35% of the Company's Voting
Securities, or (iii) the sale of all or substantially all of the Company's
stock, business or assets (including through a merger or otherwise),
PROVIDED, HOWEVER, that a Change of Control will not be deemed to occur in
connection with (x) the sale or redemption by the Xxxxxx Partnership of up to
$25.0 million in aggregate principal amount of capital stock of the Company,
together with any accrued and unpaid dividends thereon, in one transaction or
a series of transactions in accordance with Section 4.2(e), and (y) an IPO.
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"CLASS A COMMON STOCK" shall have the meaning given such term in recital
(B) hereto.
"CLASS A PREFERRED STOCK" shall have the meaning set forth in recital
(B) hereto.
"CLASS B COMMON STOCK" shall have the meaning given such term in recital
(B) hereto.
"CLASS B PREFERRED STOCK" shall mean the Class B Convertible Preferred
Stock of the Company, which has been redeemed as of the date of this
Agreement.
"CLASS C COMMON STOCK" shall have the meaning set forth in recital (B)
hereto, which is designed to track the financial performance of the Wireless
Subsidiaries.
"CLASS C PREFERRED STOCK" shall mean the Class C 8% Cumulative,
Non-Voting, Non-Convertible, Preferred Stock of the Company, which has been
redeemed as of the date of this Agreement.
"CLASS D PREFERRED STOCK" shall have the meaning set forth in recital
(B) hereto.
"CLASS E PREFERRED STOCK" shall have the meaning set forth in recital
(B) hereto.
"CLASS F PREFERRED STOCK" shall have the meaning set forth in recital
(B) hereto.
"CLASS F PREFERRED STOCK DOCUMENTS" shall mean the Class F Preferred
Stock Investors Agreement, the Class F Preferred Stock Warrants and the Class
F Preferred Stock (and the Certificate of Designation relating thereto).
"CLASS F PREFERRED STOCK SUBSCRIPTION AGREEMENTS" shall mean the
Subscription Agreements between the Company and certain former Sygnet
Wireless, Inc. stockholders, in respect of the Class F Preferred Stock
Warrants.
"CLASS F PREFERRED STOCK WARRANT SHARES" shall mean the Class A Common
Stock to be issued by the Company upon exercise of the Class F Preferred
Stock Warrants.
"CLASS F PREFERRED STOCK WARRANTS" shall mean the Class F Preferred
Stock Warrants issued by the Company in conjunction with the Class F
Preferred Stock.
"CLASS G PREFERRED STOCK" shall have the meaning set forth in recital
(B) hereto. The terms of the Class G Preferred Stock are set forth in the
form of Certificate of Designation on Exhibit B-5 hereto.
"CLASS H PREFERRED STOCK" shall have the meaning set forth in recital
(B) hereto. The
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terms of the Class H Preferred Stock are set forth in the form of Certificate
of Designation set forth on Exhibit B-6 hereto.
"CLAWBACK EXERCISE PRICE" shall have the meaning given such term in
Article 11.
"COMMISSION" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"COMMON STOCK" shall collectively mean the Class A Common Stock, the
Class B Common Stock and the Class C Common Stock.
"COMPANY" shall have the meaning set forth in the preamble.
"COMPANY STOCK" shall mean the Preferred Stock and the Common Stock.
"CONFIDENTIAL INFORMATION" shall have the meaning assigned to such term
in Section 6.3(a).
"CONSOLIDATED LEVERAGE RATIO" shall be calculated in accordance with the
Senior Notes Indenture regardless of whether or not the Senior Notes
Indenture is still in effect.
"CREDIT AGREEMENTS" shall mean (i) the Credit Agreement, dated as of
March 25, 1998, among First Union National Bank (as successor by merger to
CoreStates Bank, N.A.) as Administrative Agent, Xxxxxx Operating Company, as
Borrower, the Company, as Guarantor, and the Company Subsidiaries party
thereto, (ii) the Revolving Credit Agreement, dated as of March 25, 1998,
among Xxxxxx Cellular Operations Company as Borrower, and NationsBank, N.A.
(as successor by merger to NationsBank of Texas, N.A.), as Administrative
Agent, (iii) the 364-Day Revolving Credit and Term Loan Agreement, dated as
of March 25, 1998, between Xxxxxx Cellular Operations Company, as Borrower,
and NationsBank, N.A. (as successor by merger to NationsBank of Texas, N.A.),
as Administrative Agent, (iv) the Credit Agreement, dated the date hereof,
between Xxxxxx/Sygnet Operating Company, as Borrower and NationsBank N.A., as
Administrative Agent and (v) the Term Loan Agreement, dated as of the date
hereof, among Xxxxxx Tower Company and NationsBank, N.A.
"CREDIT DOCUMENTS" shall mean, collectively, the Credit Agreements and
all documents and instruments evidencing or securing or guarantying
indebtedness thereunder.
"XXXXXX PARTNERSHIP" shall mean Xxxxxx XX Limited Partnership, an
Oklahoma limited partnership.
"XXXXXX/SYGNET" shall mean Xxxxxx/Sygnet Communications Company, an
Oklahoma
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corporation.
"XXXXXX/SYGNET NOTE DOCUMENTS" shall mean, collectively, the
Xxxxxx/Sygnet Note Indenture, the Xxxxxx/Sygnet Note Purchase Agreement, the
Xxxxxx/Sygnet Notes and the Xxxxxx/Sygnet Note Registration Rights Agreement.
"XXXXXX/SYGNET NOTE INDENTURE" shall mean the Indenture, dated the date
hereof, among Xxxxxx/Sygnet and United States Trust Company of New York, as
trustee thereunder, in respect of the Xxxxxx/Sygnet Notes.
"XXXXXX/SYGNET NOTE PURCHASE AGREEMENT" shall mean the Purchase
Agreement, dated as of December 16, 1998, among Xxxxxx/Sygnet and NationsBanc
Xxxxxxxxxx Securities LLC.
"XXXXXX/SYGNET NOTES" shall mean the $200 million in aggregate principal
amount of 12 1/4% Senior Notes due 2008 issued by Xxxxxx/Sygnet pursuant to
the Xxxxxx/Sygnet Note Indenture.
"XXXXXX/SYGNET NOTE REGISTRATION RIGHTS AGREEMENT" shall mean the
Registration Rights Agreement, dated the date hereof, among Xxxxxx/Sygnet and
NationsBanc Xxxxxxxxxx Securities LLC.
"EQUITY SECURITIES" shall mean, with respect to any Person, any shares
of stock of, or partnership interest or other ownership or beneficial
interest in, such Person, in each case outstanding at any time.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.
"FCC" shall mean the Federal Communications Commission or similar
regulatory authority established in replacement thereof.
"FINANCING AGREEMENTS" shall mean, collectively, the Senior Note
Documents, the Xxxxxx/Sygnet Notes Documents, the Credit Documents, the
Senior PIK Preferred Stock Certificate of Designation, the Sygnet PIK
Preferred Stock Documents, the Class F Preferred Stock Documents, the
Investment and Transaction Agreement and, as appropriate, all documents,
instruments and agreements evidencing or securing the foregoing and any
amendments or refinancings permitted by Section 12.5. This definition shall
not be construed in accordance with the final sentence of Section 1.2.
"FLEET EQUITY" shall mean collectively Fleet Venture Resources, Inc.,
Fleet Equity Partners VI, L.P. and Xxxxxxx Plaza Partners together with their
respective Affiliates.
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"FLEET EQUITY PURCHASE AGREEMENT" shall mean the Securities Purchase
agreement, dated as of March 19, 1996, among the Company and the Purchasers
named therein as amended by Amendment No.1 thereto, dated as of February 26,
1997.
"FLEET BUYOUT STOCK" shall mean collectively the 17,412 shares of Class
A Common Stock purchased by JWC, the 22,459 shares of Class A Common Stock
purchased by the Company, the 17,412 shares of Class A Common Stock purchased
by the Xxxxxx Partnership and the 20,886 shares of Class A Common Stock
purchased by Xxxxxx Operating Company directly, in each case from Fleet
Equity on the date hereof pursuant to the terms of the Stock Purchase
Agreement among Fleet Equity and each such purchaser.
"FORMER SHAREHOLDERS' AGREEMENT" shall mean the Shareholders' Agreement
of the Company, dated as of February 26, 1996, among the Company and the
shareholders named therein, and which has been terminated, effective as of
the execution of this Agreement.
"FULLY DILUTED BASIS" shall mean with respect to any Equity Securities
issued by any Person, without duplication, (a) all shares or units of, or
interests in, such Equity Securities outstanding at the time of
determination, and (b) all convertible securities, or other rights to acquire
such Equity Securities, whether or not exercisable or convertible at the time
of such determination.
"GOVERNMENTAL AUTHORITY" shall mean a Federal, state or local court,
legislature, governmental agency (including, without limitation, the United
States Department of Justice), commission or regulatory or administrative
authority or instrumentality.
"INDEBTEDNESS" means any indebtedness (including, without limitation,
Senior Indebtedness), whether or not contingent, in respect of borrowed money
or evidenced by bonds, notes, debentures or similar instruments or letters of
credit (or reimbursement agreements in respect thereof) or representing the
deferred and unpaid balance of the purchase price of any property (including
pursuant to capital leases), and any financial hedging obligations, if and to
the extent such indebtedness (other than a financial hedging obligation)
would appear as a liability upon a balance sheet of such person prepared on a
consolidated basis in accordance with generally accepted accounting
principles, other than a trade payable or accrued expense, and also includes,
the guarantee of items that would be included within this definition.
"INDEMNIFIED PARTY" shall have the meaning set forth in Section 5(e)(v).
"INDEMNIFIED STOCKHOLDER" shall have the meaning set forth in Section
5(e)(i).
"INDEMNIFYING PARTY" shall have the meaning set forth in Section 5(e)(v).
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"INVESTMENT AND TRANSACTION AGREEMENT" shall mean the Investment and
Transaction Agreement, dated as of December 23, 1998, among the Company and
the Purchasers named therein.
"IPO" shall mean an initial public offering of Class A Common Stock
pursuant to an effective Registration Statement under the Securities Act, the
aggregate gross proceeds from such public offering equals or exceeds $50.0
million (or, where the context expressly provides otherwise in this
Agreement, such other amount as is expressly stated).
"IPO DATE" shall mean the first date on which an IPO occurs.
"JWC" AND "JWC GROUP STOCKHOLDERS" each mean X.X. Childs Equity Partners
II, L.P., a Delaware limited partnership, and its affiliated funds and
co-investors listed on Schedule I hereto.
"JWC COMMON STOCK" shall mean the 17,412 shares of Class A Common Stock
purchased by JWC from Fleet Equity pursuant to the Fleet Purchase Agreement,
dated the date hereof, among Fleet Equity and the purchasers named.
"JWC SELLDOWN" shall mean the sale by JWC of up to $33.3 million of its
initial investment in Company Stock, pursuant to Section 5.14 of the
Investment and Transaction Agreement.
"LAW" shall mean applicable common law and any statute, ordinance, code
or other law, rule, permit, permit condition, regulation, order, decree,
technical or other standard, requirement or procedure enacted, adopted,
promulgated, applied or followed by any Governmental Authority.
"LICENSE" shall mean a license, permit, certificate of authority,
waiver, approval, certificate of public convenience and necessity,
registration or other authorization, consent or clearance to construct or
operate a facility, including any emissions, discharges or releases
therefrom, or to transact an activity or business, to construct a tower or to
use an asset or process, in each case issued or granted by a Governmental
Authority.
"LIENS" shall mean, with respect to any asset, any mortgage, lien,
pledge, charge, security interest, right of first refusal or right of others
therein or encumbrance of any nature whatsoever in respect of such asset.
"LIQUIDATION PREFERENCE" shall mean, with respect to each share of
Preferred Stock, the liquidation preference therefore, calculated in
accordance with the Certificate of Designation for
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the relevant class of Preferred Stock.
"LIQUIDITY EVENT" shall mean any of the following events, the occurrence
of the IPO Date, the sale of all or substantially all of the Company Stock or
the Company's business and assets (including through a merger or otherwise),
the substantial recapitalization of the Company or any other event which
provides substantial financial liquidity to the Company's Stockholders in
respect of their investment in the Company.
"LOGIX COMMUNICATIONS" shall mean Logix Communications Enterprises, Inc.
an Oklahoma corporation.
"LOGIX COMMUNICATIONS 1998 STOCK OPTION PLAN" shall mean the Logix
Communications 1998 Stock Option Plan.
"LOGIX COMMUNICATIONS COMMON STOCK" shall mean Common Stock, par value
$1.00 per share, of Logix Communications.
"LOGIX COMMUNICATIONS SPIN-OFF" shall mean the consummation of the
proposed spin-off by the Company of the business of Logix Communications.
"MSA" means a Metropolitan Statistical Area, comprised of one or more
counties in the Unites States, as listed in Public Notice Report No.
CL-92-40, "Common Carrier Public Mobile Services Information, Cellular
MSA/RSA Markets and Counties," dated January 24, 1992. DA 92-109.
"MTA" shall mean a geographic area established by the Rand XxXxxxx 1992
Commercial Atlas & Marketing Guide, 123rd Edition, as modified by the FCC to
form the initial geographic area of license for the A and B blocks of
broadband PCS spectrum as defined in Section 24.202 of the FCC's rules.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"NASDAQ" shall mean the National Association of Securities Dealers'
Automated Quotation System.
"NEW COMPANY STOCK OPTION PLAN" shall mean the Xxxxxx Communications
Corporation 1996 Stock Option Plan, adopted on February 6, 1997, as amended
by Amendment No. 1 thereto, dated December 21, 1998.
"NEW SECURITIES" shall have the meaning set forth in Section 4.7(b).
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"PCS SYSTEM" shall mean a mobile communication system constructed and
operated in a BTA or a MTA (or any successor territorial designations or
subdivision thereof authorized by the FCC) exclusively using the 1850 MHZ to
1910 MHZ and 1930 MHZ to 1990 MHZ frequencies, or portions thereof, pursuant
to a License therefor issued by the FCC.
"PCS TERRITORY" shall mean an MTA or BTA in which the Company or any of
its Subsidiaries has been granted a license to operate a PCS System by the
FCC.
"PERSON" shall mean an individual, corporation, partnership, limited
liability company, association, joint stock company, Governmental Authority,
business trust or other legal entity.
"POPS" shall mean, with respect to any Licensed area, the residents of
such area based on the most recent publication by Equifax Marketing Decision
Systems, Inc.
"PREFERRED STOCK" shall mean collectively, the Senior PIK Preferred
Stock, the Sygnet PIK Preferred Stock, the Class A Preferred Stock, the Class
D Preferred Stock, the Class E Preferred Stock, the Class F Preferred Stock,
the Class G Preferred Stock and the Class H Preferred Stock.
"PREFERRED STOCK PUT RIGHT" shall have the meaning given such term in
Section 12.1.
"PROHIBITED TRANSFEREE" shall mean any Person that is one of the five
largest providers of wireless telecommunications services (based on revenue
derived from the provision of such wireless telecommunications services
during the most recent fiscal year for which such information is available)
in any PCS Territory or Cellular Territory or any entity which is controlled
by any such Person; or a Person (other than the Company) who derives a
material portion of its business by providing wireless telecommunications
services in any PCS Territory or Cellular Territory.
"PROSPECTUS" shall have the meaning set forth in Section 5(d)(i).
"QUALIFIED HOLDER" shall mean any Stockholder or group of Stockholders
that Beneficially Owns shares of Common Stock reasonably expected to, upon
sale, result in aggregate gross proceeds of at least $50.0 million.
"REGISTRABLE SECURITIES" shall mean (a) the Common Stock now owned or
hereafter acquired by any Stockholder or issuable upon conversion of any
Equity Security or exchange of Common Stock, and (b) all Common Stock issued
or issuable upon conversion, exchange or exercise of any Equity Security
which is issued pursuant to a stock split, stock dividend or other similar
distribution or event with respect to Common Stock but with respect to any
Common Stock, only until such time as such Common Stock (i) has been
effectively registered under the
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Securities Act and disposed of in accordance with the Registration Statement
covering it, (ii) has been sold to the public pursuant to Rule 144 (or any
similar provision then in force), (iii) shall otherwise have been
transferred, a new certificate evidencing such Common Stock without a legend
restricting further transfer shall have been delivered by the Company, and
subsequent public distribution of such Common Stock shall neither require
registration under the Securities Act nor qualification (or any similar
filing) under any state securities or "blue sky" law then in effect, or (iv)
shall have ceased to be issued and outstanding.
"REGISTRATION" shall have the meaning set forth in Section 5(d).
"REGISTRATION EXPENSES" shall have the meaning set forth in Section 5(g).
"REGISTRATION STATEMENT" shall have the meaning set forth in Section
5(d)(i).
"REPRESENTATIVES" shall have the meaning set forth in Section 6.3(a).
"RELEVANT PERCENTAGE INTEREST" shall have the meaning given such term in
Section 3.4.
"RESTATED BY-LAWS" shall mean the Amended and Restated By-Laws of the
Company in the form of Exhibit C.
"RESTATED CERTIFICATE" shall mean the Amended and Restated Certificate
of Incorporation of the Company, in the form of Exhibit A.
"RSA" means a Rural Statistical Area, comprised of one or more counties
in the United States, as listed in Public Notice Report No. CL-92-40, "Common
Carrier Public Mobile Services Information, Cellular MSA/RSA Markets and
Counties," dated January 24, 1992, DA 92-109.
"RULE 144" shall mean Rule 144 promulgated under the Securities Act (or
any similar rule as may be in effect from time to time).
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended.
"SELLING STOCKHOLDER" shall have the meaning set forth in Section 4.2(a).
"SENIOR INDEBTEDNESS" shall mean the principal, interest on, premium, if
any, fees (including, without limitation, any attorneys', commitment, agency,
facility, structuring, restructuring or other fee), costs, expenses,
indemnities, and other amounts due on or in connection with the Financing
Agreements and any refinancings or replacements of the
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foregoing prior to the date of issuance of any Subordinated Put Note, in
accordance with Section 12.5 hereof or from the date of issuance of any
Subordinated Put Note, in accordance with the terms of such Subordinated Put
Note, in each case whether or not with new lenders, now or hereafter
incurred, any documents executed under or in connection therewith, and any
amendments, modifications, deferrals, renewals of the Financing Agreements
prior to the date of issuance of any Subordinated Put Note, in accordance
with Section 12.5, or from the date of issuance of any Subordinated Put Note,
in accordance with the terms of such Subordinated Put Note, any amounts owed
in respect of any Indebtedness incurred in refinancing, replacing or
refunding the foregoing prior to the date of issuance of any Subordinated Put
Note, in accordance with Section 12.5 or from the date of issuance of any
Subordinated Put Note, in accordance with the terms of such Subordinated Put
Note, in each case whether or not with new lenders, unless the terms of such
Indebtedness expressly provide that such Indebtedness is not Senior
Indebtedness with respect to any Subordinated Put Note.
"SENIOR NOTE DOCUMENTS" shall mean, collectively, the Senior Note
Indenture, the Senior Notes and the Senior Notes Escrow and Security
Agreement.
"SENIOR NOTE INDENTURE" shall mean the Indenture, dated as of February
28, 1997, among the Company and United States Trust Company of New York, as
Trustee thereunder, in respect of the Senior Notes.
"SENIOR NOTES" shall mean the 11 3/4% Senior Notes due 2007 issued by
the Company pursuant to the Senior Note Indenture.
"SENIOR NOTES ESCROW AND SECURITY AGREEMENT" shall mean the Escrow and
Security Agreement, dated February 28, 1997, among, the Company and the
placement agents, party thereto, and United States Trust Company of New York,
as Trustee thereunder.
"SENIOR PIK PREFERRED STOCK" shall have the meaning set forth in recital
(B) hereto.
"SENIOR PIK PREFERRED STOCK CERTIFICATE OF DESIGNATION" shall mean the
Certificate of Designation in respect of the Senior PIK Preferred Stock.
"STOCKHOLDER" shall have the meaning set forth in the preamble.
"SUBORDINATED PUT NOTE" shall mean any Negotiable Junior Subordinated
Unsecured Note of the Company, substantially in the form of Exhibit D, issued
in accordance with the terms of this Agreement in connection with the
exercise of Preferred Stock Put Rights.
"SUBSIDIARY" means, with respect to any Person, any corporation,
partnership, association or other business entity of which (i) if a
corporation, a majority of the total voting power of
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shares of stock entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a
combination thereof, or (ii) if a partnership, association or other business
entity, a majority of the partnership or other similar ownership interest
thereof is at the time owned or controlled, directly or indirectly, by any
Person or one or more Subsidiaries of that person or a combination thereof.
For purposes hereof, a Person or Persons shall be deemed to have a majority
ownership interest in a partnership, association, or other business entity if
such Person or Persons shall be allocated a majority of partnership,
association or other business entity gains or losses or shall be or control
the managing general partner of such partnership, association or other
business entity.
"SYGNET ACQUISITION" shall mean the acquisition by the Company's wholly
owned subsidiary, Xxxxxx/Sygnet, of all of the outstanding capital stock of
Sygnet Wireless, Inc., an Ohio corporation, pursuant to the Sygnet Merger
Agreement dated July 28, 1998, as amended, between Xxxxxx/Sygnet operating
Company and Sygnet Wireless, Inc.
"SYGNET MERGER AGREEMENT" shall mean the Agreement and Plan of Merger,
dated as of July 28, 1998, between Xxxxxx/Sygnet Operating Company and Sygnet
Wireless, Inc.
"SYGNET PIK PREFERRED STOCK" shall have the meaning set forth in recital
(B) hereof.
"SYGNET PIK PREFERRED STOCK DOCUMENTS" shall mean, collectively, the
Sygnet PIK Preferred Stock Purchase Agreement, the Sygnet PIK Preferred Stock
and the Sygnet PIK Preferred Stock Registration Rights Agreement.
"SYGNET PIK PREFERRED STOCK PURCHASE AGREEMENT" means the Purchase
Agreement, dated December 16, 1998, between the Company and NationsBanc
Xxxxxxxxxx Securities LLC in respect of the Sygnet PIK Preferred Stock.
"SYGNET PIK PREFERRED STOCK REGISTRATION RIGHTS AGREEMENT" shall mean
the Registration Rights Agreement between the Company and NationsBanc
Xxxxxxxxxx Securities LLC in respect of the Signet PIK Preferred Stock.
"TAG-ALONG EVENT" shall have the meaning set forth in Section 4.2(a).
"TAG-ALONG EVENT PURCHASER" shall have the meaning set forth in Section
4.2(a).
"TAG-ALONG NOTICE" shall have the meaning set forth in Section 4.2(a).
"TAG-ALONG STOCK" shall have the meaning set forth in Section 4.2(a).
13
"TERRITORY" shall mean, collectively, all of the PCS Territories and
all of the Cellular Territories.
"TRANSFER" shall have the meaning set forth in Section 4.1(a).
"VOTING SECURITIES" shall mean equity securities of a Person having the
right to vote generally in the election of the directors of such Person.
"WIRELESS SUBSIDIARIES" shall mean collectively DCC PCS Inc., Western
Financial Services, Inc., Xxxxxx Cellular Operations Company, DOC Cellular
Subsidiary Company, Xxxxxx Operating Company, Xxxxxx Tower Company,
Xxxxxx/Sygnet Communications Company and their respective Subsidiaries.
1.2 OTHER DEFINITIONAL PROVISIONS. Each definition or pronoun herein
shall be deemed to refer to the singular, plural, masculine, feminine or
neuter as the context requires. Words such as "herein," "hereinafter,"
"hereof," "hereto" and "hereunder" refer to this Agreement as a whole, unless
the context otherwise requires. References to a document or agreement shall
be to such document or agreement, as the same may be amended, supplemented or
otherwise modified from time to time.
ARTICLE 2.
STOCKHOLDER APPROVAL
2.1 ORGANIZATIONAL DOCUMENTS. The Stockholders consent to the
amendment of the By-Laws and their replacement by the Restated By-Laws and
adopt and approve the Restated By-Laws.
2.2 APPROVAL OF STOCK OPTION PLANS. The Stockholders approve and
adopt the New Company Stock Option Plan and the Logix Communications 1998
Stock Option Plan and consent to the issuance of stock options and common
stock in accordance with the terms thereof and to the consummation of the
other transactions contemplated thereby.
2.3 LOGIX COMMUNICATIONS SPIN-OFF. The Stockholders hereby approve
and consent to the consummation of the Logix Communications Spin-Off provided
that such Logix Communications Spin-Off occurs within 12 months of the
receipt by the Company of a private letter ruling by the Internal Revenue
Service with respect to the Logix Communications Spin-Off under the currently
pending application therefor by the Company. The Stockholders acknowledge
that the holders of Class D Preferred Stock will participate in the Logix
14
Communications Spin-Off on a pro rata basis according to their percentage
ownership of Common Stock on a Fully Diluted Basis at the time of the Logix
Communications Spin-Off (assuming for this purpose that all options issued
under the Logix Communications 1998 Stock Option Plan have been exercised).
The JWC Common Stock shall participate in the Logix Communications Spin-Off
on the same terms as all other shares of Class A Common Stock.
ARTICLE 3.
MANAGEMENT OF THE COMPANY
3.1 BOARD OF DIRECTORS. (a) The Board of Directors shall, subject to
the other provisions hereof, consist of seven (7) directors; PROVIDED,
HOWEVER, that the number of directors constituting the Board of Directors
shall be reduced in the circumstances set forth in this Section 3.1. Each of
the Stockholders hereby agrees that it will vote all of the shares of its
Common Stock and Preferred Stock (to the extent entitled to vote) owned or
held of record by it (whether now owned or hereafter acquired), in person or
by proxy, to cause the election of directors and thereafter the continuation
in office of such directors as follows:
(i) one director selected by JWC, in its sole discretion, so long
as it Beneficially Owns at least 35% of the Class D Preferred Stock (or the
Class A Common Stock or Class E Preferred Stock acquired upon conversion
thereof) it holds as of the date of this Agreement;
(ii) four directors selected by the Xxxxxx Partnership, in its
sole discretion; and
(iii) two directors jointly selected by JWC and the Xxxxxx
Partnership.
JWC shall have the right so long as it holds its Relevant
Percentage Interest to require that Fleet Equity has the right to designate a
Person to serve as a director of the Company (who shall be substituted for
one of the directors referenced in clause (iii) above) in the event that
Fleet Equity purchases from JWC at least $10.0 million in principal amount of
JWC's original investment in Class D Preferred Stock and JWC Common Stock.
In addition, JWC shall have the right to, so long as it holds its Relevant
Percentage Interest, designate one director for the Board of Directors of
each Subsidiary of the Company.
If, for any reason, no director is designated pursuant to clause
(iii) hereof, then such directors will be selected by the Xxxxxx Partnership.
In the event that any Class D Preferred Stock is converted into Class A
Common Stock and Class E Preferred Stock in accordance with the terms
thereof, the rights of the holders of such Preferred Stock to vote to appoint
directors in accordance with the terms hereof shall survive such conversion.
15
Any nomination or designation of directors and the acceptance
thereof pursuant to Section 3.1 shall be evidenced in writing.
(b) The Stockholders acknowledge the rights of the holders of
Senior PIK Preferred Stock to designate an additional 2 directors, the right
of the holders of Sygnet PIK Preferred Stock to designate an additional 2
directors and the right of the holders of the Class F Preferred Stock to
designate one additional director, in the event that the triggering events
described in paragraph (iii) of the Senior PIK Preferred Stock Certificate of
Designation, paragraph (iii) of the Sygnet PIK Preferred Stock Certificate of
Designation, and subparagraph (c)(iii) of the Class F Preferred Stock
Certificate of Designation, respectively occur.
3.2 REMOVAL; FILLING OF VACANCIES. Except as set forth in Section 3.1,
each Stockholder agrees it will not vote any shares of Company Stock
Beneficially Owned by such Stockholder, and shall not permit any Affiliated
Successor of such Stockholder holding any Company Stock, to vote for the
removal without cause of any director designated by any other Stockholder in
accordance with Section 3.1. Any Stockholder or group of Stockholders who
has the right to designate any member(s) of the Board of Directors shall have
the right to replace any member(s) so designated by it (whether or not such
member is removed from the Board of Directors with or without cause or ceases
to be a member of the Board of Directors by reason of death, disability or
for any other reason) upon written notice to the other Stockholders, the
Company and the members of the Board of Directors which notice shall set
forth the name of the member(s) being replaced and the name of the new
member(s). Each of the Stockholders agrees to vote, and to cause its
Affiliated Successors to vote, its shares of Preferred Stock and Common
Stock, or shall otherwise take any action as is necessary to cause the
election of any successor director designated by any Stockholder pursuant to
this Section 3.2.
3.3 DIRECTORS. In accordance with the Oklahoma General Corporation Law
and pursuant to the provisions of Section 3.1 of this Agreement, the
Stockholders hereby consent to the election of and do hereby elect in
accordance with Section 3.1 hereof the persons designated in Schedule III
hereto as directors of the Company. Such persons shall hold office until
their successors are duly elected and qualified, except as otherwise provided
in this Agreement, the Restated Certificate or the Restated By-Laws.
3.4 COMPENSATION AND REIMBURSEMENT. The members of the Board of
Directors (other than the directors selected pursuant to Section 3.1(iii))
shall not be compensated for their services as a director or as a member of
any committee of the Board of Directors. For so long as JWC Beneficially
Owns at least 35% of the number of shares of Class D Preferred Stock (or any
Class A Common Stock or Class E Preferred Stock into which it may have been
converted) which it owns as of the date of this Agreement (the "Relevant
Percentage Interests"), JWC shall
16
have the right to have an observer present at all meetings of the Board of
Directors and any committees thereof (in addition to the director appointed
pursuant to Section 3.1(a)(i) above). The Company will reimburse the
observer appointed pursuant to this Section in connection with such person's
role as observer and each member of the Board of Directors for the reasonable
and documented out-of-pocket expenses and costs (including travel expenses),
incurred by such observer or such director in connection with such the
performance of his service as an observer or as a director or as a member of
any committee of the Board of Directors.
3.5 BUSINESS OF THE COMPANY. The business and affairs of the Company
shall be conducted by the officers of the Company under the supervision of
the Board of Directors. The Board of Directors of the Company shall meet at
least once per fiscal quarter. The Board of Directors of Logix
Communications shall meet at least once in every two month period.
3.6 REQUIRED VOTES. All actions of the Board of Directors of the
Company shall require the vote of at least a majority of the entire Board of
Directors, unless otherwise required by Law, the Restated Certificate, the
Restated By-Laws or this Agreement.
3.7 TRANSACTIONS BETWEEN THE COMPANY AND THE STOCKHOLDERS OR THEIR
AFFILIATES. Any transaction or series of transactions outside the ordinary
course of business and agreements or transactions entered into from time to
time and involving, in any 12-month period, in the aggregate, more than $1.0
million, between the Company or its Subsidiaries, on the one-hand, and its
Stockholders or Affiliates, or any of them, on the other hand, must be
approved by any two of the directors selected in clauses (i) and (iii) of
Section 3.1(a), provided that no such approval will be required in connection
with (A) this Agreement, the Investment and Transaction Agreement, the New
Company Stock Option Plan and the Logix Communications 1998 Stock Option
Plan, any Financing Agreement to be entered into simultaneously herewith, (B)
the Logix Communications Spin-Off, and (C) the proposed arms-length
development and lease by the Company and its Subsidiaries of space in an
office building in which the Xxxxxx family has an ownership interest;
PROVIDED, HOWEVER, that in the event that the two directors in clause (iii)
above have been selected by the Xxxxxx Partnership without the approval of
JWC, then the consent of the director designated by JWC in clause (i) of
Section 3.1(a) shall be required to approve a transaction of the type
described in this Section 3.7.
3.8 BOARD COMMITTEES. If a committee of the Board of Directors is
established, the director selected pursuant to Section 3.1(a)(i) shall be
entitled to be a member of such committee.
3.9 OTHER ACTIONS. The Company shall not, and shall not permit any of
its Subsidiaries to, take any of the following actions without the prior
approval of a majority of directors of the Board of Directors of the Company:
(i) register securities under the Securities Act or grant registration
rights; (ii) change the size of the Board of Directors; (iii) change the
17
Company's independent public accountants; (iv) amend this Agreement; (v)
adversely amend or alter any preferences, rights or powers of the Class D
Preferred Stock, whether such rights be set forth in the Restated Certificate
or Restated Bylaws or in any other agreement; (vi) redeem, repurchase or pay
any dividends on any stock that is junior to, or on a parity with, the Class
D Preferred Stock, except for repurchases of management, employee or
consultant stock or stock options pursuant to contractual rights which do not
exceed $500,000 in any fiscal year of the Company or $1,500,000 in the
aggregate; (vii) issue or authorize any shares of capital stock of the
Company having a preference over, or being on parity with, the Class D
Preferred Stock, including the issuance of additional shares of Class D
Preferred Stock PROVIDED, that the Company may issue and authorize shares of
capital stock in connection with (x) public or private (which provides for
registration within one year of issuance)/144A preferred stock financing in
connection with future acquisitions and capital projects and the financing
thereof, and (y) the Logix Communications Spin-Off; or (viii) merge or
consolidate with or into another Person, or sell all or substantially all of
its assets or liquidate its assets or business. Nothing in this Section 3.9
is intended to imply that by virtue of the approval of the Board of Directors
pursuant to this Section 3.9 the Company can take any action that it is
otherwise prohibited from taking.
ARTICLE 4.
TRANSFERS OF SHARES
4.1 GENERAL.
(a) Each Cash Equity Investor agrees that at all times prior to,
the earliest of (A) the IPO Date (B) the fifth anniversary hereof or (C) a
Change of Control, it shall not, directly or indirectly, transfer, sell,
assign, pledge, or tender or otherwise grant or create a Lien in or upon,
give, or otherwise voluntarily or involuntarily (including transfers by
testamentary or intestate succession) dispose of by operation of law, offer
or otherwise (any such action being referred to herein as a "Transfer") any
of the shares of Company Stock Beneficially Owned by such Stockholder as of
the date hereof or which may hereafter be acquired by such Stockholder,
except that a Cash Equity Investor may Transfer shares of Preferred Stock and
Common Stock (i) to an Affiliate or an Affiliated Successor (notwithstanding
anything else to the contrary in this Article 4), (ii) to family members and
trusts and partnerships which are Affiliates thereof, (iii) to another
Stockholder, (iv) in connection with a public sale in accordance with Rule
144, (v) by JWC under the JWC Selldown, and (vi) to any other Person after
complying with Section 4.2, if applicable, PROVIDED, that in the case of
clauses (i), (ii), (iii), and (v) each such transferee shall execute a
counterpart of and become a party to this Agreement and shall agree in a
writing in form and substance reasonably satisfactory to the Company to be
bound and becomes bound by the terms of this Agreement. Nothing in this
Agreement shall prohibit a bona fide pledge of
18
Company Stock by co-investors in the JWC Group (other than JWC) to a bank or
financial institution.
(b) Notwithstanding anything to the contrary contained in this
Article 4, JWC Common Stock shall not be subject to Section 4.1, provided
that any transferee of such shares shall execute a counterpart of and become
party to this Agreement and shall agree in a writing in form and substance
satisfactory to the Company to be bound and becomes bound by the terms of
this Agreement. Fleet Buyout Stock shall be subject to the provisions of
Section 4.2 and 4.5 of this Agreement.
4.2 TAG-ALONG RIGHTS.
(a) Subject to Section 4.2(e), no Stockholder ("Selling
Stockholder") shall, directly or indirectly, Transfer, in any single
transaction or series or related transactions to one or more Persons who are
not Affiliated Successors of such Stockholder (each such Person a "Tag-Along
Event Purchaser") shares of Preferred Stock or Common Stock (collectively,
"Tag-Along Stock") constituting 5% or more of such Stockholder's investment
in the Company (a "Tag-Along Event"), unless the terms and conditions of such
sale to such Tag-Along Event Purchaser shall include an offer to each
Stockholder (including the Selling Stockholder) to Transfer to such Tag-Along
Event Purchasers up to that number of shares determined as follows:
(i) each JWC Group Stockholder shall have the right to Transfer
to such Tag-Along Event Purchaser up to that number of shares of Tag-Along
Stock then Beneficially Owned by such JWC Group Stockholder (without
duplication) as are equal in value to (x) the aggregate value of the shares
of Tag-Along Stock that such Tag-Along Event Purchaser has offered to
purchase (the "Total Tag-Along Value"), times (y) a fraction, the numerator
of which is the value of the shares of Class A Common Stock and Class E
Preferred Stock (valued at its Liquidation Preference) at that time
Beneficially Owned (without duplication) by such JWC Group Stockholder, and
the denominator of which is the value of all then outstanding Class A
Common Stock (the aggregate value of all of the shares of Tag-Along Stock
that may be purchased by the JWC Group Stockholders is hereinafter referred
to as the "JWC Group Value", and the Total Tag-Along Value minus the JWC
Group Value is hereinafter referred to as the "Remaining Value");
(ii) each Stockholder that is not a JWC Group Stockholder
(together with the Selling Stockholders, the "Remaining Offerees") shall
have the right to Transfer to such Tag-Along Event Purchaser up to that
number of shares of Tag-Along Stock then Beneficially Owned by such
Remaining Offeree (without duplication) as are equal in value to (x) the
Remaining Value, times (y) a fraction, the numerator of which is the
19
value of shares of Class A Common Stock and Class E Preferred Stock (other
than such stock held by Xxxxxx Partnership) (valued at its Liquidation
Preference) at that time Beneficially Owned (without duplication) by such
Remaining Offeree, and the denominator of which is the value of all then
outstanding Class A Common Stock.
If the Selling Stockholders receive a bona fide offer from a Tag-Along
Event Purchaser to purchase shares of Tag-Along Stock in circumstances in
which would result in a Tag-Along Event, and which offer such Selling
Stockholders wish to accept, the Selling Stockholders shall then cause the
Tag-Along Event Purchaser's offer to be reduced to writing (which writing
shall include an offer to purchase shares of Tag-Along Stock from each
Stockholder according to the terms and conditions set forth in this Section
4.2) and the Selling Stockholders shall send written notice of the Tag-Along
Event Purchaser's offer (the "Tag-Along Notice") to each Stockholder, which
Tag-Along Notice shall specify (i) the names of the Selling Stockholders,
(ii) the names and addresses of the proposed acquiring Person, (iii) the
amount of shares proposed to be Transferred and the price, form of
consideration and other terms and conditions of such Transfer (including, if
in a series of related transactions, such information with respect to shares
of Tag-Along Stock theretofore Transferred), (iv) that the acquiring Person
has been informed of the rights provided for in this Section 4.2 and has
agreed to purchase shares of Tag-Along Stock in accordance with the terms
hereof, and (v) the date by which each other Selling Stockholder may exercise
its respective rights contained in this Section 4.2, which date shall not be
less than thirty (30) days after the giving of the Tag-Along Notice. The
Tag-Along Notice shall be accompanied by a true and correct copy of the
Tag-Along Event Purchaser's offer. At any time within thirty (30) days after
receipt of the Tag-Along Notice, each Stockholder may accept the offer
included in the Tag-Along Notice for up to such number of shares of Tag-Along
Stock as is determined in accordance with this Section 4.2, by furnishing
written notice of such acceptance to each Selling Stockholder, and
delivering, to an escrow agent (which shall be a bank or a law or accounting
firm designated by the Company), on behalf of the Selling Stockholders, the
certificate or certificates representing the shares of Tag-Along Stock to be
sold pursuant to such offer by each Stockholder, duly endorsed in blank,
together with a limited power-of-attorney authorizing the escrow agent, on
behalf of the Stockholder, to sell the shares to be sold pursuant to the
terms of such Tag-Along Event Purchaser's offer.
If any Stockholder desires to sell less than its proportionate
amount of shares of Tag-Along Stock that it is entitled to sell pursuant to
this Section 4.2, then each of the other Stockholders shall have the right to
sell to the Tag-Along Event Purchaser an additional amount of shares of
Tag-Along Stock as shall be calculated in accordance with the allocations and
procedures set forth in the immediately preceding paragraph. Such process
shall be repeated in series until all of the remaining Stockholders agree to
sell their remaining proportionate number of shares of Tag-Along Stock.
20
Schedule IV sets forth an illustrative example for this Section 4.2,
PROVIDED, HOWEVER that in the event of any conflict between such illustration
and this Section 4.2, Section 4.2 shall govern.
(b) The purchase from each Tag-Along Event Offeree pursuant to this
Section 4.2 shall be on the same terms and conditions, including the price per
share received by the Selling Stockholders and stated in the Tag-Along Notice
provided to each Stockholder. In the event that the Tag-Along Stock is Common
Stock, all Stockholders shall be required, as a condition of participating in
such transaction (in cases where the Preferred Stock is convertible into Common
Stock), to convert the required amount of its Preferred Stock into Common Stock
and Transfer Common Stock to the Tag-Along Event Purchaser.
(c) Simultaneously with the consummation of the sale of the shares of
Tag-Along Stock to the Tag-Along Event Purchaser pursuant to the Tag-Along
Event Purchaser's offer, the Selling Stockholders shall notify each Stockholder
and shall cause the Tag-Along Event Purchaser to remit to each Stockholder the
total sales price of the shares of Tag-Along Stock held by each Stockholder sold
pursuant thereto and shall furnish such other evidence of the completion and
time of completion of such sale and the terms thereof as may be reasonably
requested by each Stockholder.
(d) If within thirty (30) days after receipt of the Tag-Along Notice,
a Stockholder has not accepted the offer contained in the Tag-Along Notice, such
Stockholder shall be deemed to have waived any and all rights with respect to
the sale described in the Tag-Along Notice (but not with respect to any
subsequent sale, to the extent this Section 4.2 is applicable to such subsequent
sale) and the Selling Stockholders shall have sixty (60) days from the initial
delivery of the last Tag-Along Notice in which to sell not more than the number
of shares of Tag-Along Stock described in the Tag-Along Notice, on terms not
more favorable to the Selling Stockholders than were set forth in the Tag-Along
Notice; PROVIDED, HOWEVER, that if such purchase is subject to the consent of
the FCC or any public service or public utilities commission, the purchase of
such shares shall be closed on the first business day after all such consents
shall have been obtained by Final Order.
(e) Without limiting Section 4.1(a), Section 4.2 will not apply to
(i) Transfers of Company Stock made after the IPO Date in a public offering in
accordance with Section 5 or pursuant to Rule 144(ii) the sale or redemption of
up to $25.0 million in aggregate principal amount by the Xxxxxx Partnership of
Company Stock, together with any dividends thereon, in one transaction or a
series of transactions so long as such sale or redemption is permitted by
Section 5.9 of the Investment and Transaction Agreement, (iii) the sale of any
Class F Preferred Stock and (iv) pursuant to Sections 4(a)(i), (ii), (iii), (v)
or (vi) hereof (and similar Transfers of Fleet Buyout Stock).
21
4.3 ADDITIONAL CONDITIONS TO PERMITTED TRANSFERS.
(a) As a condition to any Transfer to an Affiliated Successor
permitted pursuant to Section 4.1, or any Transfer pursuant to Section 4.2, each
transferee that is not a party hereto shall, prior to such Transfer, agree in
writing to be bound by all of the provisions of this Agreement applicable to the
Stockholders (and shall thereby become a Stockholder for all purposes of this
Agreement). Any Transfer without compliance with such provisions of this
Agreement shall be null and void and such transferee shall have no rights as a
Stockholder of the Company.
(b) Notwithstanding anything to the contrary contained in this
Agreement (other than the next sentence) each Stockholder agrees that it will
not effect a Transfer of shares of Company Stock to a Prohibited Transferee. In
the event that the Xxxxxx Partnership Transfers any Preferred Stock or Common
Stock to a Prohibited Transferee, JWC shall equally be entitled to transfer such
securities to such Person pursuant to Section 4.2. It shall be deemed a breach
of this Section 4.3(b) by a Stockholder Beneficially Owning more than 10% of the
Common Stock outstanding if any Prohibited Transferee shall acquire, directly or
indirectly, in a private sale Beneficial Ownership of more than 33% of any
class of equity securities or equity interest in, such Stockholder and the
Xxxxxx Partnership shall not have Transferred any shares of Company Stock to
such Prohibited Transferee.
4.4 STOP-TRANSFER. The Company agrees not to effect any Transfer of shares
of Company Stock by any Stockholder whose proposed Transfer is subject to
Section 4.2 until it has received evidence reasonably satisfactory to it that
the rights provided to any other Stockholders pursuant to such Section, if
applicable to such Transfer, have been complied with and satisfied in all
respects. No Transfer of any shares of Preferred Stock and/or Common Stock
shall be made except in compliance with all applicable securities laws. Any
Transfer made in violation of this Agreement shall be null and void.
4.5 DRAG ALONG RIGHTS. If at any time the Board of Directors shall
approve the sale or exchange (in a business combination or otherwise) by
Stockholders of Common Stock and Class D Preferred Stock and Class E Preferred
Stock of the Company in a bona fide arm's-length transaction to a third party
pursuant to an agreement that (i) treats equally, on an "as-if-converted basis,"
the value of all holders of Common Stock, Class D Preferred Stock and Class E
Preferred Stock, except as provided in the Restated Certificate of
Incorporation, (ii) is approved by the Board of Directors as fair to all
Stockholders, and (iii) which shall have been approved by Stockholders holding
50.1% of the outstanding Common Stock of the Company on an as-if-converted
basis, then, upon the written request of the Company, each Stockholder shall be
obligated to, and shall, if so requested by such third party, (a) sell, transfer
and deliver or cause to be sold, transferred and delivered to such third party,
shares of Common Stock and Preferred Stock owned by such Stockholder, and (b) if
Stockholder approval of the transaction is required,
22
vote his, her or its shares of Company Stock in favor thereof. Notwithstanding
the previous sentence, a Cash Equity Investor may not be obligated to sell
any shares of Class D Preferred Stock or Class E Preferred Stock unless it
receives as consideration for such shares at least their Liquidation
Preference and it may not be obligated to sell any shares of Common Stock
unless all of the shares of Class D Preferred Stock or Class E Preferred
Stock then held by such Cash Equity Investors are to be sold for cash in such
transaction.
4.6 REDEMPTION RIGHTS. Subject to the terms of the Financing Agreements
and not giving rise to either a default or an event of default thereunder, the
Class D Preferred Stock (or Class E Preferred Stock) will be redeemed within 90
days following the vote of holders of a majority of the outstanding shares of
the Class D Preferred Stock (or Class E Preferred Stock as the case may be), at
any time (a) after twelve years from the date of this Agreement or (b) upon the
completion of an IPO by the Company of Common Stock. Upon redemption of Class D
Preferred Stock, the holders of Class D Preferred Stock so redeemed will receive
a cash payment equivalent to the then current Liquidation Preference per share
plus the number of shares of Class A Common Stock such holders would have
received had they converted such Class D Preferred Stock into shares of Class E
Preferred Stock and Class A Common Stock immediately prior to such redemption.
4.7 RIGHT OF FIRST REFUSAL FOR NEW SECURITIES; CAPITAL RAISING.
(a) The Company hereby grants to JWC, on the same terms and
conditions, a right of first refusal, to the extent necessary to maintain their
fully diluted ownership in the Company, to purchase shares of any New Securities
(as defined below) which the Company may, from time to time, propose to issue
and sell to private equity investors (and not through a public offering or a
private placement (which provides for registration within one year of
issuance)/Rule 144A offering, which, together with any supplemental or
additional offerings, results in gross proceeds in excess of $50.0 million).
Such right of first refusal shall allow JWC to purchase a pro rata portion of
the New Securities proposed to be issued, determined with reference to the
aggregate number of outstanding shares of Common Stock (on an as-if-converted
basis) held by JWC before the proposed issuance of New Securities. The right of
first refusal granted hereunder shall terminate if unexercised within 30
calendar days after receipt of notice from the Company to the Cash Equity
Investors.
(b) "New Securities" shall mean any authorized but unissued shares,
and any treasury shares, of preferred stock or common stock of the Company and
all rights, options or warrants to purchase common stock, and securities of any
type whatsoever that are, or may become, convertible into common stock;
PROVIDED, HOWEVER, that the term "New Securities" does not include (i) shares of
Common Stock or stock options issued to officers, employees, directors,
consultants of the Company or others in connection with their services pursuant
to a
23
plan or plans approved by the Board of Directors; (ii) securities issued upon
conversion of shares of Class D Preferred Stock to Class A Common Stock and
Class E Preferred Stock or shares issued upon the conversion of any Class G
Preferred Stock for Class H Preferred Stock; (iii) securities issued by the
Company pursuant to the acquisition of another corporation by the Company by
merger, purchase of all or substantially all of the assets or other
reorganization whereby the Company shall become the owner of more than 50% of
the voting power of such corporation; (iv) shares of Common Stock issued in
connection with any stock split or stock dividend of the Company; (v) capital
stock (including warrants, options or other rights to purchase capital stock,
or that are convertible into or exchangeable for capital stock of the
Company) issued directly in connection with any borrowings or the incurrence
of any indebtedness by the Company or its Subsidiaries in connection with
acquisitions or capital projects; (vi) shares of Class A Common Stock issued
pursuant to any IPO in excess of $50.0 million (taken together with any
supplemental or additional offerings) or Rule 144A promulgated thereunder
which provide for registration of such Capital Stock within one year of their
issuance; or (vii) shares issuable upon exercise of the Sygnet PIK Preferred
Stock Warrants.
(c) If the Company or any Subsidiary in the future proposes to raise
equity capital it shall provide JWC with the terms of such proposal prior to
approaching other potential investors and shall grant JWC the initial
opportunity to make any such investment, provided that nothing herein shall
require the Company to enter into any agreement or sale with the Company on
terms less favorable than the prevailing market terms and rates offered to
comparable companies to the Company.
ARTICLE 5.
REGISTRATION RIGHTS
The Company will not grant registration rights for Company capital stock to
a Person other than the Cash Equity Investors on terms pari passu with or senior
to or more favorable than those granted to the Cash Equity Investors.
(a) DEMAND REGISTRATION RIGHTS.
(i) RIGHT TO DEMAND REGISTRATION. At any time following 180 days
after the IPO Date (or such longer period as may be reasonably required by the
managing underwriters of the Company's IPO) and (A) the Xxxxxx Partnership shall
have the right to make one written request and (B) JWC shall have the right to
make two written requests, (each a "Demanding Stockholder" and, collectively,
the "Demanding Stockholders") to the Company for registration with the
Commission, under and in accordance with the provisions of the Securities Act,
of all or
24
part of their Registrable Securities pursuant to an underwritten offering (a
"Demand Registration"), which request shall specify the number of Registrable
Securities proposed to be sold in the offering; PROVIDED, HOWEVER, that (x)
the Company need not effect a Demand Registration unless the sale of the
Registrable Securities proposed to be sold by the Demanding Stockholder shall
reasonably be expected to result in aggregate gross proceeds of at least
$25.0 million, and (y) if the Board of Directors determines that a Demand
Registration would interfere with any pending or contemplated material
acquisition, disposition, financing or other material transaction, the
Company may defer a Demand Registration (including by withdrawing any
Registration Statement filed in connection with a Demand Registration); so
long as that the aggregate of all such deferrals shall not exceed ninety (90)
days in any 360-day period. A Demand Registration shall not be deemed a
Demand Registration hereunder until such Demand Registration has been
declared effective by the Commission (without interference by any stop order,
injunction or other order or requirement of the Commission or other
governmental agency, for any reason), and maintained continuously effective
for a period of at least six (6) months or such shorter period when all
Registrable Securities included therein have been sold in accordance with
such Demand Registration. A Demanding Stockholder may make a written request
for a Demand Registration in accordance with the foregoing in respect of
Company Stock that it intends to convert into shares of Common Stock upon the
effectiveness of the Registration Statement prepared in connection with such
demand, and the Company shall fulfill its obligations under this Article 5 in
a manner that permits such Demanding Stockholder to exercise its conversion
rights in respect of such Company Stock and substantially contemporaneously
sell the shares of Common Stock issuable upon such conversion under such
Registration Statement.
In addition to the rights set forth above, each of the Demanding
Stockholders shall have the right to demand that the Company file a registration
statement on Form S-3 (or any successor form to Form S-3) for an offering of
Registrable Securities in which at least $15.0 million of gross proceeds are
reasonably expected therefrom, PROVIDED that the Company is not obligated to
participate in any "road-show" or exceptional marketing, diligence or other
efforts in connection with such offering. This additional demand registration
may be a one year "shelf-registration." The procedures and limitations for
effecting the registration of the Registrable Securities on Form S-3 (or any
successor form to Form S-3), including the procedure used for any underwriting
limitation, shall be as set forth in this Article 5.
Within ten (10) days after receipt of the request for a Demand
Registration, the Company will send written notice (the "Demand Notice") of such
Registration request and its intention to comply therewith to all Stockholders
who are holders of Registrable Securities and, subject to Section 5(a)(ii), the
Company will include in such Demand Registration all Registrable Securities of
such Stockholders with respect to which the Company has received written
requests for inclusion therein within twenty (20) days after the last date such
Demand Notice was deemed
25
to have been given pursuant to Section 14.1.
(ii) PRIORITY ON REGISTRATION. If the managing underwriter or
underwriters advise the Company and the holders of the Registrable Securities to
be registered in writing that in its or their opinion the number of Registrable
Securities proposed to be sold in any Registration (including, without
limitation, a Piggyback Registration) and any other securities of the Company
requested or proposed to be included in such Registration exceeds the number
that can be sold in such offering without (A) creating a substantial risk that
the proceeds or price per share that will be derived from such Registration will
be materially reduced or that the number of Registrable Securities to be
registered is too large a number to be reasonably sold, or (B) materially and
adversely affecting such Registration in any other respect, the Company will (x)
include in such Registration the aggregate number of Registrable Securities
recommended by the managing underwriter (the number of Registrable Securities to
be registered for each Stockholder to be reduced FIRSTLY, against the Xxxxxx
Partnership, SECONDLY, against the other Stockholders (other than JWC) and
LASTLY, against JWC; in each case PRO RATA based on the amount of Registrable
Securities of the Stockholders in the applicable class requested to be included
in such Registration), and (y) not allow any securities other than Registrable
Securities to be included in such Registration unless all Registrable Securities
requested to be included shall have been included therein, and then only to the
extent recommended by the managing underwriter or determined by the Company
after consultation with an investment banker of nationally recognized standing
(notification of which number shall be given by the Company to the holders of
Registrable Securities).
(iii) SELECTION OF UNDERWRITERS. The offering of such Registrable
Securities pursuant to such Demand Registration shall be in the form of an
underwritten offering. The Demanding Stockholder that initiated such Demand
Registration will select a managing underwriter or underwriters of recognized
national standing to administer the offering, which managing underwriter or
underwriters shall be reasonably acceptable to the Company.
(b) PIGGYBACK REGISTRATION RIGHTS.
RIGHT TO PIGGYBACK. If the Company proposes to register any shares of
Common Stock (or securities convertible into or exchangeable for Common Stock)
with the Commission under the Securities Act (other than a Registration on Form
S-4 or Form S-8, or any successor forms), and the Registration form to be used
may be used for the Registration of the Registrable Securities (a "Piggyback
Registration"), the Company will give written notice (a "Piggyback Notice") to
all Stockholders, at least thirty (30) days prior to the anticipated filing
date, of its intention to effect such a Registration, which notice will specify
the proposed offering price (if determined at that time), the kind and number of
securities proposed to be registered, the distribution arrangements and will,
subject to Section 5(a)(ii), include in such Piggyback
26
Registration all Registrable Securities with respect to which the Company has
received written requests (which requests have not been withdrawn) for
inclusion therein within twenty (20) days after the last date such Piggyback
Notice was deemed to have been given pursuant to Section 15.1. If at any
time after giving the Piggyback Notice and prior to the effective date of the
Registration Statement filed in connection with such Registration, the
Company determines for any reason not to register or to delay Registration,
the Company may, at its election, give written notice of such determination
to each holder of Registrable Securities that has requested inclusion of
Registrable Securities in such Registration and (A) in the case of a
determination not to register, shall be relieved of its obligation to
register any Registrable Securities in connection with such Registration, and
(B) in the case of a determination to delay registering, shall be permitted
to delay registering any Registrable Securities for the same period as the
delay in registering such other securities.
No Stockholder may obtain a Piggyback Registration on a Demand
Registration initiated by JWC.
(c) SELECTION OF UNDERWRITERS. Except as set forth in Section
5.1(a)(iii), the Company (by action of the Board of Directors) will select the
managing underwriter or underwriters to administer offerings of its capital
stock, which managing underwriter or underwriters will be of nationally
recognized standing.
(d) REGISTRATION PROCEDURES. With respect to any Demand Registration
or Piggyback Registration (each, a "Registration"), the Company shall, subject
to Sections 5(a)(i) and (5)(a)(ii) and Section 5(b)(i), as expeditiously as
practicable:
(i) prepare and file with the Commission, as promptly as
reasonably practicable (but in no event more than forty-five (45) days) after
the receipt of the Registration requests under Sections 5(a) or 5(b), a
registration statement or registration statements (each, a "Registration
Statement") relating to the applicable Registration on any appropriate form
under the Securities Act, which form shall be available for the sale of the
Registrable Securities in accordance with the intended method or methods of
distribution thereof; cooperate and assist in any filings required to be made
with the NASD; and use its reasonable best efforts to cause such Registration
Statement to become and (to the extent provided herein) remain effective;
PROVIDED, HOWEVER, that before filing a Registration Statement or prospectus
related thereto (a "Prospectus") or any amendments or supplements thereto, the
Company shall furnish to the holders of the Registrable Securities covered by
such Registration Statement and the underwriters, if any, copies of all such
documents proposed to be filed, which documents will be subject to the
reasonable review of such holders and underwriters and their respective counsel,
and the Company shall not file any Registration Statement or amendment thereto
or any Prospectus or any supplement thereto to which the holders of a majority
of the Registrable
27
Securities covered by such Registration Statement or the underwriters, if
any, shall reasonably object;
(ii) prepare and file with the Commission such amendments and
supplements to the Registration Statement as may be necessary to keep each
Registration Statement effective for six (6) months (nine (9) months in the case
of any shelf registration requested by a Qualified Holder pursuant to this
Section 5) or such shorter period that will terminate when all Registrable
Securities covered by such Registration Statement have been sold; cause each
Prospectus to be supplemented by any required Prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 under the Securities Act; and
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by such Registration Statement during the applicable
period in accordance with the intended method or methods of distribution by the
sellers thereof set forth in such Registration Statement or supplement to the
Prospectus;
(iii) promptly notify the selling holders of Registrable
Securities and the managing underwriters, if any (and, if requested by any such
Person or entity, confirm such advice in writing), (A) when the Prospectus or
any Prospectus supplement or post-effective amendment has been filed, and, with
respect to the Registration Statement or any post-effective amendment, when the
same has become effective; (B) of any request by the Commission for amendments
or supplements to the Registration Statement or the Prospectus or for additional
information; (C) of the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose; (D) if at any time the representations and
warranties of the Company contemplated by subsection (xiv) of this subsection
(d) below cease to be true and correct; (E) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Registrable Securities for sale under the securities or blue sky laws of any
jurisdiction or the initiation or threatening of any proceeding for such
purpose; and (F) of the happening of any event which makes any statement made in
the Registration Statement, the Prospectus or any document incorporated therein
by reference untrue or which requires the making of any changes in the
Registration Statement, the Prospectus or any document incorporated therein by
reference in order to make the statements therein not misleading;
(iv) use its reasonable best efforts to obtain the withdrawal
of any order suspending the effectiveness of (I) the Registration Statement, or
(II) the qualification of the Registrable Securities for sale under the
securities or blue sky laws of any jurisdiction at the earliest possible time;
(v) if requested by the managing underwriter or underwriters
or a holder of Registrable Securities being sold in connection with an
underwritten offering, promptly
28
incorporate in a Prospectus supplement or post-effective amendment such
information as the managing underwriters and the holders of a majority of the
Registrable Securities being sold agree should be included therein relating
to the plan of distribution with respect to such Registrable Securities,
including, without limitation, information with respect to the number of
Registrable Securities being sold to such underwriters, the purchase price
being paid therefor by such underwriters and any other terms of the
underwritten (or best efforts underwritten) offering of the Registrable
Securities to be sold in such offering; and make all required filings of such
Prospectus supplement or post-effective amendment as soon as notified of the
matters to be incorporated in such Prospectus supplement or post-effective
amendment;
(vi) furnish to each selling holder of Registrable Securities
and each managing underwriter, without charge, at least one signed copy of the
Registration Statement and any amendment thereto, including financial statements
and schedules, all documents incorporated therein by reference and all exhibits
(including those incorporated by reference);
(vii) deliver to each selling holder of Registrable Securities
and the underwriters, if any, without charge, as many copies of the Prospectus
(including each preliminary prospectus) and any amendment or supplement thereto
as such selling holder of Registrable Securities underwriters may reasonably
request in order to facilitate the public sale or other disposition of the
securities owned by such selling holder;
(viii) prior to any public offering of Registrable Securities,
use its reasonable best efforts to register or qualify or cooperate with the
selling holders of Registrable Securities, the underwriters, if any, and their
respective counsel in connection with the Registration or qualification of such
Registrable Securities for offer and sale under the securities or "blue sky"
laws of such jurisdictions in the United States as any seller or underwriter
reasonably requests in writing, use its reasonable best efforts to obtain all
appropriate registrations, permits and consents required in connection
therewith, and do any and all other acts or things reasonably necessary or
advisable to enable the disposition in such jurisdictions of the Registrable
Securities covered by the Registration Statement; PROVIDED, HOWEVER, that the
Company will not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified or to take any action that would
subject it to taxation or general service of process in any such jurisdiction
where it is not then so subject;
(ix) cooperate with the selling holders of Registrable
Securities and the managing underwriters, if any, to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be sold and not bearing any restrictive legends and to be in such denominations
and registered in such names as the managing underwriters may request at least
two (2) business days prior to any sale of Registrable Securities to the
underwriters;
29
(x) use its reasonable best efforts to cooperate with any
selling holder to cause the Registrable Securities covered by the applicable
Registration Statement to be registered with or approved by such other
governmental agencies or authorities in the United States as may be necessary to
enable the seller or sellers thereof or the underwriters, if any, to consummate
the disposition of such Registrable Securities;
(xi) upon the occurrence of any event contemplated by
subsection (iii)(F) above, promptly prepare a supplement or post-effective
amendment to the Registration Statement or the related Prospectus or any
document incorporated therein by reference or file any other required document
so that, as thereafter delivered to the purchasers of the Registrable
Securities, the Prospectus will not contain an untrue statement of a material
fact or omit to state any material fact necessary to make the statements therein
not misleading;
(xii) cause all Registrable Securities covered by any
Registration Statement to be listed on each securities exchange on which similar
securities issued by the Company are then listed, or, if not so listed, cause
such Registrable Securities to be authorized for trading on the NASDAQ National
Market System if any similar securities issued by the Company are then so
authorized, if requested by the holders of a majority of such Registrable
Securities or the managing underwriters, if any;
(xiii) not later than the effective date of the applicable
Registration, provide a CUSIP number for all Registrable Securities;
(xiv) enter into such customary agreements (including in the
case of a Demand Registration that is an underwritten offering, an underwriting
agreement in customary form) and take all such other actions reasonably required
in connection therewith in order to expedite or facilitate the disposition of
such Registrable Securities and in such connection, whether or not an
underwriting agreement is entered into and whether or not the Registration is an
underwritten Registration, (A) make such representations and warranties to the
holders of such Registrable Securities and the underwriters, if any, in form,
substance and scope as are customarily made by issuers to underwriters in
primary underwritten offerings; (B) use reasonable best efforts to obtain
opinions of counsel to the Company and updates thereof (which opinions of
counsel shall be in form, scope and substance reasonably satisfactory to the
managing underwriters, if any, and to the holders of a majority of the
Registrable Securities being sold), addressed to each selling holder and the
underwriters, if any, covering the matters customarily covered in opinions
requested in underwritten offerings and such other matters as may be reasonably
requested by such holders and underwriters; (C) use reasonable best efforts to
obtain "cold comfort" letters and updates thereof from the Company's independent
certified public accountants addressed to the selling holders of Registrable
Securities and the underwriters, if any, such letters to be in customary form
and covering matters of the type
30
customarily covered in "cold comfort" letters by underwriters in connection
with primary underwritten offerings; and (D) deliver such documents and
certificates as may be reasonably requested by the holders of a majority of
the Registrable Securities being sold and the managing underwriters, if any,
to evidence compliance with subsection (xi) above and with any customary
conditions contained in the underwriting agreement or other agreement entered
into by the Company. All the above in this Section 5(d)(xiv) shall be done at
each closing under each underwriting or similar agreement or as and to the
extent required thereunder;
(xv) make available for inspection by a representative of each
Demanding Stockholder or selling holder, any underwriter participating in any
disposition pursuant to such Registration, and any attorney or accountant
retained by the sellers or underwriter, copies or extracts of all financial and
other records, pertinent corporate documents and properties of the Company as
shall be reasonably necessary, in the opinion of the holders' or underwriter's
counsel, to enable them to fulfill their due diligence responsibilities; and
cause the Company's officers, directors and employees to supply all information
reasonably requested by any such representative, underwriter, attorney or
accountant in connection with such Registration Statement; PROVIDED, HOWEVER,
that the Company shall not be required to comply with this paragraph (xv) unless
such Person executes confidentiality agreements whereby such person agrees that
any records, information or documents that are designated by the Company in
writing as confidential shall be kept confidential by such Persons and used only
in connection with the proposed Registration unless disclosure of such records,
information or documents is required by court or administrative order or any
regulatory body having jurisdiction; and each seller of Registrable Securities
agrees that it will, upon learning that disclosure of such records, information
or documents is sought in a court of competent jurisdiction or by a governmental
agency, give notice to the Company and allow the Company, at the Company's
expense, to undertake appropriate action to prevent disclosure of any records,
information or documents deemed confidential; PROVIDED FURTHER, HOWEVER,
notwithstanding any designation of confidentiality by the Company, confidential
information shall not include information which (i) becomes generally available
to the public other than as a result of a disclosure by or on behalf of any such
Person, or (ii) becomes available to any such Person on a non-confidential basis
from a source other than the Company or its advisors, provided that such source
is not to such Person's knowledge bound by a confidentiality agreement with or
other obligations of secrecy to the Company or another party with respect to
such information;
(xvi) otherwise use its reasonable best efforts to comply with
all applicable rules and regulations of the Commission, and make generally
available to its security holders, earnings statements satisfying the provisions
of Section 11(a) of the Securities Act, no later than forty-five (45) days after
the end of any twelve (12)-month period (or ninety (90) days, if such period is
a fiscal year) (A) commencing at the end of any fiscal quarter in which
Registrable Securities are sold to underwriters in a firm or best efforts
underwritten offering, or
31
(B) if not sold to underwriters in such an offering, beginning with the first
month of the Company's first fiscal quarter commencing after the effective
date of the Registration Statement, which statements shall cover said twelve
(12)-month periods; and
(xvii) promptly prior to the filing of any document that is to
be incorporated by reference into any Registration Statement or Prospectus
(after initial filing of the Registration Statement), provide copies of such
document to counsel to the selling holders of Registrable Securities and to the
managing underwriters, if any, make the Company's executive officers and other
representatives available for discussion of such document and make such changes
in such document prior to the filing thereof as counsel for such selling holders
or underwriters may reasonably request.
The Company may require each seller of Registrable Securities as to
which any Registration is being effected to furnish to the Company such
information regarding the proposed distribution of such securities as the
Company may from time to time reasonably request in writing. Each holder of
Registrable Securities agrees by acquisition of such Registrable Securities
that, upon receipt of any notice from the Company of the happening of any event
of the kind described in Section 5(d)(xi), such holder shall forthwith
discontinue disposition of Registrable Securities until such holder's receipt of
the copies of the supplemented or amended prospectus contemplated by Section
5(d)(xi), or until it is advised in writing (the "Advice") by the Company that
the use of the Prospectus may be resumed, and has received copies of any
additional or supplemental filings that are incorporated by reference in the
Prospectus; and, if so directed by the Company, such holder shall deliver to the
Company (at the Company's expense) all copies, other than permanent file copies
then in such seller's possession, of the Prospectus covering such Registrable
Securities current at the time of receipt of such notice. In the event the
Company gives any such notice, the time periods regarding the maintenance of the
effectiveness of any Registration Statement in Sections 5(d)(ii) shall be
extended by the number of days during the period from and including the date of
the receipt of such notice pursuant to Section 5(d)(iii)(F) hereof to and
including the date when each seller of Registrable Securities covered by such
Registration Statement shall have received the copies of the supplemented or
amended prospectuses contemplated by Section 5(d)(xi) or the Advice.
(e) INDEMNIFICATION.
(i) In the event of the Registration or qualification of any
Registrable Securities under the Securities Act or any other applicable
securities laws pursuant to the provisions of this Section 5, the Company agrees
to indemnify and hold harmless each Stockholder thereby offering such
Registrable Securities for sale (an "Indemnified Stockholder"), underwriter,
broker or dealer, if any, of such Registrable Securities, and each other person,
if any, who controls any such Indemnified Stockholder, underwriter, broker or
dealer within the
32
meaning of the Securities Act or any other applicable securities laws, from
and against any and all losses, claims, damages, expenses or liabilities (or
actions in respect thereof), joint or several, to which such Indemnified
Stockholder, underwriter, broker or dealer or controlling person may become
subject under the Securities Act or any other applicable federal or state
securities laws or otherwise, insofar as such losses, claims, damages,
expenses or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement under which such Registrable
Securities were registered or qualified under the Securities Act or any other
applicable securities laws, any preliminary prospectus or final prospectus
relating to such Registrable Securities, or any amendment or supplement
thereto, or arise out of or are based upon 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 any rule or regulation under the Securities Act or any other
applicable federal or state securities laws applicable to the Company or
relating to any action or inaction required by the Company in connection with
any such Registration or qualification, and will reimburse each such
Indemnified Stockholder, underwriter, broker or dealer and each such
controlling person for any legal or other expenses reasonably incurred by
such Indemnified Stockholder, underwriter, broker or dealer or controlling
person in connection with investigating or defending any such loss, claim,
damage, expense, liability or action; PROVIDED, HOWEVER, that the Company
will not be liable in any such case to the extent that any such loss, claim,
damage, expense or liability arises out of or is based upon an untrue
statement or omission contained in such Registration Statement, such
preliminary prospectus, such final prospectus or such amendment or supplement
thereto, made in reliance upon and in conformity with written information
furnished to the Company by such Indemnified Stockholder, underwriter,
broker, dealer or controlling person specifically and expressly for use in
the preparation thereof or by the failure of such Indemnified Stockholder,
underwriter, broker or dealer, or controlling person to deliver a copy of the
Registration Statement, such preliminary prospectus, such final prospectus or
such amendment or supplement thereto after the Company has furnished such
party with a sufficient number of copies of the same and such party failed to
deliver or otherwise provide a copy of the final prospectus to the person
asserting an untrue statement or omission or alleged untrue statement or
omission at or prior to the written confirmation of the sale of securities to
such person, if such statement or omission was in fact corrected in such
final prospectus.
(ii) In the case of an underwritten offering in which the
Registration Statement covers Registrable Securities, the Company agrees to
enter into an underwriting agreement in customary form and substance with
such underwriters and to indemnify the underwriters, their officers and
directors, if any, and each person, if any, who controls such underwriters
within the meaning of Section 15 of the Securities Act and Section 20 of the
Exchange Act, to the same extent as provided in the preceding paragraph with
respect to the indemnification of the holders of Registrable Securities;
PROVIDED, HOWEVER, the Company shall not be required to indemnify
33
any such underwriter, or any officer or director of such underwriter or any
person who controls such underwriter within the meaning of Section 15 of the
Securities Act and Section 20 of the Exchange Act, to the extent that the
loss, claim, damage, expense or liability (or actions in respect thereof) for
which indemnification is sought results from such underwriter's failure to
deliver or otherwise provide a copy of the final prospectus to the person
asserting an untrue statement or omission or alleged untrue statement or
omission at or prior to the written confirmation of the sale of securities to
such person, if such statement or omission was in fact corrected in such
final prospectus.
(iii) In the event of the Registration or qualification of any
Registrable Securities of the Stockholders under the Securities Act or any other
applicable federal or state securities laws for sale pursuant to the provisions
hereof, each Indemnified Stockholder agrees severally, and not jointly, to
indemnify and hold harmless the Company, each person who controls the Company
within the meaning of the Securities Act, and each officer and director of the
Company from and against any losses, claims, damages, expenses or liabilities
(or actions in respect thereof), joint or several, to which the Company, such
controlling person or any such officer or director may become subject under the
Securities Act or any other applicable securities laws or otherwise, insofar as
such losses, claims, damages, expenses or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue statement of any material
fact contained in any Registration Statement under which such Registrable
Securities were registered or qualified under the Securities Act or any other
applicable securities laws, any preliminary prospectus or final prospectus
relating to such Registrable Securities, or any amendment or supplement thereto,
or arise out of or are based upon an untrue statement therein or the omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, which untrue statement or omission was
made therein in reliance upon and in conformity with written information
furnished to the Company by such Indemnified Stockholder specifically and
expressly for use in connection with the preparation thereof, and will reimburse
the Company, such controlling person and each such officer or director for any
legal or any other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, expense, liability or
action; PROVIDED, HOWEVER, an Indemnified Stockholder's liability under this
Section 5(e)(iii) shall not exceed the net proceeds received by such Indemnified
Stockholder with respect to the sale of any Registrable Securities.
(iv) In the case of an underwritten offering of Registrable
Securities, each holder of a Registrable Security included in a Registration
Statement shall agree to enter into an underwriting agreement in customary form
and substance with such underwriters, and to indemnify such underwriters, their
officers and directors, if any, and each person, if any, who controls such
underwriters within the meaning of Section 15 of the Securities Act and Section
20 of the Exchange Act, to the same extent as provided in the preceding
paragraph with respect to indemnification by such holder of the Company, but
subject to the same limitation as provided in
34
Section 5(e)(ii) with respect to indemnification by the Company of such
underwriters, officers, directors and control persons.
(v) Promptly after receipt by a person entitled to indemnification
under this Section 5(e) (an "Indemnified Party") of notice of the commencement
of any action or claim relating to any Registration Statement filed under this
Section 5 as to which indemnity may be sought hereunder, such Indemnified Party
will, if a claim for indemnification hereunder in respect thereof is to be made
against any other party hereto (an "Indemnifying Party"), give written notice to
each such Indemnifying Party of the commencement of such action or claim, but
the omission to so notify each such Indemnifying Party will not relieve any such
Indemnifying Party from any liability which it may have to any Indemnified Party
otherwise than pursuant to the provisions of this Section 5(e) and shall also
not relieve any such Indemnifying Party of its obligations under this Section
5(e) except to the extent that any such Indemnifying Party is actually
prejudiced thereby. In case any such action is brought against an Indemnified
Party, and such Indemnified Party notifies an Indemnifying Party of the
commencement thereof, such Indemnifying Party will be entitled (at its own
expense) to participate in and, to the extent that it may wish, jointly with any
other Indemnifying Party similarly notified, to assume the defense, with counsel
reasonably satisfactory to such Indemnified Party, of such action and/or to
settle such action and, after notice from the Indemnifying Party to such
Indemnified Party of its election so to assume the defense thereof, the
Indemnifying Party will not be liable to such Indemnified Party for any legal or
other expenses subsequently incurred by such Indemnified Party in connection
with the defense thereof, other than the reasonable cost of investigation;
PROVIDED, HOWEVER, that no Indemnifying Party shall consent to the entry of any
judgment or enter into any settlement agreement without the prior written
consent of the Indemnified Party unless such Indemnified Party is fully released
and discharged from any such liability, and no Indemnified Party shall consent
to the entry of any judgment or enter into any settlement of any such action the
defense of which has been assumed by an Indemnifying Party without the consent
of each Indemnifying Party. Notwithstanding the foregoing, the Indemnified Party
shall have the right to employ its own counsel in any such case, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Party
unless (a) the employment of such counsel shall have been authorized in writing
by the Indemnifying Party in connection with the defense of such suit, action,
claim or proceeding; (b) the Indemnifying Party shall not have employed counsel
(reasonably satisfactory to the Indemnified Party) to take charge of the defense
of such action, suit, claim or proceeding; or (c) such Indemnified Party shall
have reasonably concluded, based upon the advice of counsel, that there may be
defenses available to it which are different from or additional to those
available to the Indemnifying Party which, if the Indemnifying Party and the
Indemnified Party were to be represented by the same counsel, could result in a
conflict of interest for such counsel or materially prejudice the prosecution of
the defenses available to such Indemnified Party. If any of the events specified
in clauses (a), (b) or (c) of the preceding sentence shall have occurred or
shall otherwise be applicable, then the fees
35
and expenses of one counsel or firm of counsel selected by a majority in
interest of the Indemnified Parties (and reasonably acceptable to the
Indemnifying Party) shall be borne by the Indemnifying Party. If, in any such
case, the Indemnified Party employs separate counsel, the Indemnifying Party
shall not have the right to direct the defense of such action, suit, claim or
proceeding on behalf of the Indemnified Party and the Indemnified Party shall
assume such defense and/or settle such action; PROVIDED, HOWEVER, that an
Indemnifying Party shall not be liable for the settlement of any action,
suit, claim or proceeding effected without its prior written consent, which
consent shall not be unreasonably withheld.
The provisions of this Section 5(e) shall be in addition to any
liability which any party may have to any other party and shall survive any
termination of this Agreement.
(f) CONTRIBUTION. If for any reason the indemnification provided for
in Section 5(e)(i) or 5(e)(iii) is unavailable to an Indemnified Party as
contemplated therein, then the Indemnifying Party, in lieu of indemnification
shall contribute to the amount paid or payable by the Indemnified Party as a
result of such loss, claim, damage, expense or liability (or action in respect
thereof) in such proportion as is appropriate to reflect not only the relative
benefits received by the Indemnified Party and the Indemnifying Party, but also
the relative fault of the Indemnified Party and the Indemnifying Party, as well
as any other relevant equitable considerations, provided that no Stockholder
shall be required to contribute in an amount greater than the net proceeds
received by such Stockholder with respect to the sale of any Registrable
Securities less all amounts already contributed by such Stockholder with respect
to such claims, including amounts paid for any legal or other fees or expenses
incurred by such Stockholder. No person guilty of a fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of any such
fraudulent misrepresentation. The relative fault of such Indemnifying Party and
Indemnified Party shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of 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.
(g) REGISTRATION EXPENSES. Except as hereinafter provided, all
expenses incident to the Company's performance of or compliance with this
Section 5 will be borne by the Company, including, without limitation, all
Registration and filing fees under the Securities Act and the Exchange Act, the
fees and expenses of the counsel and accountants for the Company (including the
expenses of any "cold comfort" letters and special audits required by or
incident to the performance of such persons), all other costs and expenses of
the Company incident to the preparation, printing and filing under the
Securities Act of the Registration Statement (and all amendments and supplements
thereto), and furnishing copies thereof and of the Prospectus
36
included therein, all out-of-pocket expenses of underwriters customarily paid
for by issuers to the extent provided for in any underwriting agreement, the
costs and expenses incurred by the Company in connection with the
qualification of the Registrable Securities under the state securities or
"blue sky" laws of various jurisdictions, the costs and expenses associated
with filings required to be made with the NASD, the costs and expenses of
listing the Registrable Securities for trading on a national securities
exchange or authorizing them for trading on NASDAQ and all other costs and
expenses incurred by the Company in connection with any Registration
hereunder. In addition, the Company shall pay or reimburse the sellers of
Registrable Securities the reasonable fees and expenses of one law firm to
such sellers incurred in connection with a registration (collectively, with
the expenses referred to in the immediately preceding sentence, the
"Registration Expenses"). Except as provided in the immediately preceding
sentence, each Stockholder shall bear the costs and expenses of any
underwriters' discounts and commissions, brokerage fees or transfer taxes
relating to the Registrable Securities sold by such Stockholder and the fees
and expenses of any attorneys, accountants or other representatives retained
by the Stockholder.
(h) PARTICIPATION IN UNDERWRITTEN REGISTRATIONS. No Stockholder may
participate in any underwritten Registration hereunder unless such Stockholder
(i) agrees to sell its Registrable Securities on the basis provided in any
customary and reasonable underwriting arrangements approved by the persons
entitled hereunder to select the underwriter, and (ii) accurately completes in a
timely manner and executes all questionnaires, powers of attorney, underwriting
agreements, indemnities and other documents customarily required under the terms
of such underwriting arrangements.
(i) HOLDBACK AGREEMENTS.
(i) Each holder of Registrable Securities whose securities
are included in a Registration Statement agrees not to effect any sale, transfer
or other disposition of Company Stock or any securities convertible into
Company Stock or other interest in the Company, including through any hedging or
derivative transaction or to effect any distribution of the issue being
registered or a similar security of the Company, or any securities convertible
into or exchangeable or exercisable for such securities, including a sale
pursuant to Rule 144 or Rule 144A under the Securities Act, during the fifteen
(15) days prior to, and during the one hundred eighty (180)-day period (or such
longer period as reasonably requested by the managing underwriter or
underwriters in the case of an underwritten public offering) beginning on, the
effective date of such Registration Statement (except as part of such
Registration), if and to the extent requested by the managing underwriter or
underwriters in an underwritten public offering.
(ii) The Company agrees not to effect any public sale or
distribution of the issue being registered or a similar security of the Company,
or any securities convertible into
37
or exchangeable or exercisable for such securities (other than any such sale
or distribution of such securities in connection with any merger or
consolidation by the Company or any Subsidiary or the acquisition by the
Company or any Subsidiary of the capital stock or substantially all of the
assets of any other Person), during the fifteen (15) days prior to, and
during the ninety (90)-day period beginning on, the effective date of each
Demand Registration.
(j) PUBLIC INFORMATION REPORTING. (i) The Company hereby covenants
and agrees to and with the Stockholders that at all times following the IPO Date
it shall provide and file such financial and other information concerning the
Company as may from time to time be required by the Commission and any other
governmental authority having jurisdiction, so as to comply with all reporting
requirements under the Exchange Act, and shall, upon request, state in writing
that it has complied with all such requirements, and further agrees that, for so
long as (following the IPO Date) the Company is not subject to Section 13 or
15(d) of the Exchange Act, the Company shall comply in all respects with
paragraph (c)(2) of Rule 144.
(ii) If the Company shall have filed a registration statement
pursuant to the requirements of Section 12 of the Exchange Act or a registration
statement pursuant to the requirements of the Securities Act, the Company
covenants that it will file the reports required to be filed by it under the
Securities Act and the Exchange Act and the rules and regulations adopted by the
Commission thereunder (or, if the Company is not required to file such reports,
it will, upon the request of any holder of Registrable Securities, make publicly
available other information), and it will take such further action as any holder
of Registrable Securities may reasonably request, all to the extent required
from time to time to enable such holder to sell shares of Registrable Securities
without registration under the Securities Act within the limitation of the
exemptions provided by (i) Rule 144 under the Securities Act, as such Rule may
be amended from time to time, or (ii) any similar rule or regulation hereafter
adopted by the Commission. Upon the request of any holder of Registrable
Securities, the Company will deliver to such holder a written statement as to
whether it has complied with such requirements. Upon the request of a holder of
Registrable Securities, the Company covenants and agrees to provide the
information required by Rule 144A(d)(4) under the Securities Act.
ARTICLE 6.
ADDITIONAL RIGHTS AND COVENANTS
6.1 WHOLLY-OWNED SUBSIDIARIES. All of the Company's Subsidiaries shall be
direct or indirect wholly owned Subsidiaries of the Company, and the Company
shall not, and shall not permit any Subsidiary to, sell or issue, transfer,
encumber or otherwise dispose of any shares of capital stock of any of the
Company's Subsidiaries to any Person other than the Company and its
38
direct or indirect wholly owned Subsidiaries, except for a pledge of any such
shares in connection with the incurrence of indebtedness.
6.2 AMENDMENTS OF THE RESTATED CERTIFICATE AND BY-LAWS. Prior to the IPO
Date, the Company shall not authorize or adopt any amendment, modification or
repeal of any provision of the Restated Certificate or the Restated By-Laws,
unless such amendment is consistent with the terms of this Agreement, and the
Restated Certificate and has been approved by a majority of directors of the
Board of Directors.
6.3 CONFIDENTIALITY.
(a) Each party shall, and shall cause each of its Affiliates, and its
and their respective stockholders, members, managers, directors, officers,
employees and agents (collectively "Representatives") to, keep secret and retain
in strictest confidence any and all information relating to the Company or any
other party that is designated in writing by the party providing such
information or the Company as confidential ("Confidential Information") and
shall not disclose such information, and shall cause its Representatives not to
disclose such information, to anyone except such Affiliates, Representatives or
any other Person that agrees in writing to keep in confidence all such
information in accordance with the terms of this Section 6.3. Each party agrees
to use such information received from another party or the Company only in
connection with its ownership interest in the Company but not for any other
purpose. All such information furnished pursuant to this Agreement shall be
returned promptly to the party to whom it belongs upon request by such party.
(b) To the fullest extent permitted by law, if a party or any of its
Affiliates or Representatives breaches, or threatens to commit a breach of, this
Section 6.3, the party whose Confidential Information shall be disclosed, or
threatened to be disclosed, shall have the right and remedy to have this Section
6.3 specifically enforced by any court having jurisdiction, it being
acknowledged and agreed that money damages will not provide an adequate remedy
to such party. Nothing in this Section 6.3 shall be construed to limit the
right of any party to collect money damages in the event of breach of this
Section 6.3.
(c) Anything else in this Agreement notwithstanding, each party shall
have the right to disclose any information, including Confidential Information
of the other party or such other party's Affiliates, in any filing with any
regulatory agency, court or other authority or any disclosure to a trustee of
public debt of a party to the extent that the disclosing party determines in
good faith that it is required by Law, regulation or the terms of such debt to
do so; PROVIDED, HOWEVER, that any such disclosure shall be as limited in scope
as possible and shall be made only after giving the other party as much notice
as practicable of such required disclosure and an opportunity to contest such
disclosure if possible.
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6.4 JWC SALE OF LOGIX COMMUNICATIONS STOCK. If JWC proposes to sell any
number of shares of Logix Communications Common Stock which sale would result in
a reduction in the ownership interest of JWC in Logix Communications below 35%
of the JWC Logix Communications ownership interest on the Logix Communications
Spin-Off (calculated with reference only to shares of Logix Communications
issued with respect to the Class D Preferred Stock (or any Class A Common Stock
or other capital stock issued with respect thereto other than the JWC Common
Stock) issued at the closing under the Investment and Transaction Agreement),
JWC shall give 10 Business Days written notice thereof to the Company (the "JWC
NOTICE PERIOD") and during such JWC Notice Period the Company may elect to
purchase such Logix Communications Common Stock at a price which is the average
of the daily closing prices for Logix Communications Stock on the market on
which such stock is traded during such JWC Notice Period. In the event the
Company elects to purchase such Logix Communications Common Stock, it shall have
30 days from the date of receipt of the JWC written notice in which to purchase
such Logix Communications Common Stock. This purchase right shall terminate
upon the earliest to occur of (i) the consummation by the Company of an IPO,
(ii) the fifth anniversary of the date of this Agreement, (iii) the exercise by
the Stockholders of the call right pursuant to the terms of Article 11, or (iv)
the expiration of the call right pursuant to the terms of Article 11.
6.5 CLASS PROTECTION. The Company shall not, without first obtaining
consent or approval of the holders of at least a majority of the holders of each
affected class of Company Stock, voting as a separate class: (i) adversely amend
or alter any preferences, rights or powers of any such class of Company Stock;
or (ii) redeem, repurchase or pay any dividends on any junior stock or parity
stock, except for repurchases of stock or stock options issued to management,
employees or consultants which do not exceed $500,000 in any fiscal year of the
Company or in any event $1,500,000 in the aggregate.
6.6 NEW SECURITIES. (a) Subject to the terms of the Class D Preferred
Stock Certificate of Designation, any Common Stock (other than JWC Common Stock)
and any Logix Communications Common Stock issued to holders of Class D Preferred
Stock or to the Cash Equity Investors after conversion of the Class D Preferred
Stock shall receive anti-dilution protection, as determined reasonably in good
faith by the Board of Directors to protect the holders thereof in connection
with (i) dilution from the issuance or the exercise of warrants issued in
connection with the Sygnet Acquisition, (ii) any dilution relating to options
then issued or committed as of the Closing Date under the New Company Stock
Option Plan, (iii) any dilution resulting from the issuance of options with
respect to an aggregate maximum of 5% of the Logix Communications Stock, (iv)
the redemption of all shares of Class B Preferred Stock and Class C Preferred
Stock pursuant to the terms of the Investment and Transaction Agreement and (v)
dilution relating to the conversion of the Class G Preferred Stock into Class H
Preferred Stock and Class A Common Stock.
40
(b) Without the prior written consent of JWC (except where any such
issuance would not have a dilutive effect on JWC's Beneficial Ownership
interest in either the Common Stock (including Common Stock issuable upon
conversion of Class D Preferred Stock) or the Logix Communications Common
Stock, or both) (as determined reasonably and in good faith by the Board of
Directors) the corporation shall not (i) issue any options pursuant to the
New Corporation Stock Option Plan other than such options as are committed on
the Closing Date, or (ii) issue options with respect to more than 5% in the
aggregate of Logix Communications Common Stock.
6.7 LOGIX COMMUNICATIONS SPIN-OFF. (a) Upon the consummation of the
Logix Communications Spin-off, the holders of Class D Preferred Stock and the
holders of Class E Preferred Stock (including Common Stock issuable upon
conversion of Class D Preferred Stock) shall immediately receive their PRO
RATA share, calculated on a Fully Diluted Basis, of such number of shares of
Class A Common Stock equal to the value of the 4,454 options to purchase
shares of Class C Common Stock outstanding on the Closing Date (the "Wireless
Options"), as determined reasonably and in good faith by the Board of
Directors (the "Wireless Option Value Shares").
(b) In the event that the Logix Communications Spin-off is not
consummated, the holders of Class D Preferred Stock and the holders of Class
E Preferred Stock will receive, immediately prior to the consummation of a
Liquidity Event, Wireless Option Value Shares plus their PRO RATA share,
calculated on a Fully-Diluted Basis as determined reasonably, and in good
faith by the Board of Directors, of Class A Common Stock equal to the value
of Logix Communications stock options that are issued (up to a maximum of 5%
of Logix Communications Common Stock).
(c) An example of the implementation and intent of this Section 6.7 is
set forth on Exhibit E hereto.
6.8 REGULATION M. In the event of any IPO, the Cash Equity Investors
shall not sell, transfer or otherwise dispose any Company Stock or purchase
Company Stock or securities convertible into Company Stock or any interests
in the Company, or otherwise engage in any transaction that would involve a
prohibited market manipulation, whether under Regulation M under the
Securities Act, or otherwise.
6.9 (a) POOLING OF INTERESTS. In the event that the Company is sold
in a transaction involving a "pooling of interests" transaction, for a period
of not more than 90 days following consummation of such transaction, no
Stockholder shall sell, transfer or otherwise dispose of any Company Stock,
securities convertible into Company Stock or any other interest in the
Company, if any such sale, transfer or other disposition would limit or deny
the applicability of
41
the treatment of such pooling of interests.
(b) In the event of the Logix Communications Spin-off, the Company
shall enter into a stockholders agreement with the stockholders of Logix
Communications, substantially similar to this Agreement except that there
shall be no transfer restrictions analogous to Section 4.1.
6.10 OTHER TAX MATTERS. JWC intend that (i) pay in kind dividends on
the Class D Preferred Stock when paid and (ii) any constructive distribution
on the Class D Preferred Stock when deemed paid, will not be includible in
JWC's gross income for Federal, state or local tax purposes. Accordingly,
unless the Company reasonably concludes in good faith that it cannot make or
file any tax return that is consistent with the Purchaser's intention in the
preceding sentence, the Company shall not make or file any tax return that is
inconsistent with such intention. In the event the Company concludes it is
required to file any tax return that is inconsistent with the Purchaser's
intention in the preceding sentence, the Company will notify the holders of
Class D Preferred Stock at least 60 days before filing such return and will
attempt, through discussions with the holders and their representatives, to
reach mutual agreement on such filing requirement.
6.11 CLASS A PREFERRED STOCK TRANSFER RESTRICTION. In the event that
any share of Class D Preferred Stock or Class E Preferred Stock is at any
time outstanding and held by JWC, (A) the Class A Preferred Stock held by
Xxxxxx Operating Company as of December 23, 1998 shall not be transferred,
directly or indirectly, to any Person; provided, however, that such shares of
Class A Preferred Stock may be transferred at any time (i) by Xxxxxx
Operating Company to any wholly owned Subsidiary of the Company and (ii) by
any wholly-owned Subsidiary of the Company to any other wholly-owned
Subsidiary of the Company, and (B) such shares of Class A Preferred Stock
must be owned by a wholly-owned Subsidiary of the Company.
ARTICLE 7.
EXCLUSIVITY
7.1 EXCLUSIVITY. Prior to the earlier of five years after the date of
this Agreement or the date on which the relevant Cash Equity Investor
Beneficially Owns less than 50% of the Common Stock it Beneficially Owns as
of the date of this Agreement on an "as-if converted" basis, none of the
Stockholders or their respective Affiliates will provide or resell, or act as
the agent for any Person offering, within the Territory, mobile wireless
telecommunications services that compete with those provided by the Company
using wireless technologies and frequencies licensed by the FCC without the
Company's prior written consent. Nothing in this Article 7 shall (i) prohibit
JWC or its Affiliates from providing such services in any part of the
Territory in
42
which the Company did not provide such services at the time that JWC or any
Affiliate initially began providing them or (ii) restrict the ability of
limited partners of any of JWC or its Affiliates to invest in Persons
engaged, directly or indirectly, in the mobile wireless telecommunications
industry.
ARTICLE 8.
AFTER-ACQUIRED SHARES; RECAPITALIZATION.
8.1 AFTER ACQUIRED SHARES; RECAPITALIZATION.
(a) Except as expressly set forth herein, all of the provisions of
this Agreement shall apply to all of the shares of Company Stock now owned or
hereafter issued or transferred to a Stockholder or to his, her or its
Affiliated Successors as a consequence of any additional issuance,
conversion, purchase, exchange or reclassification of shares of Company
Stock, corporate reorganization, or any other form of recapitalization, or
consolidation, or merger, or share split, or share dividend, or which are
acquired by a Stockholder or its Affiliated Successors in any other manner.
(b) Whenever the number of outstanding shares of Company Stock is
changed by reason of a stock dividend or a subdivision or combination of
shares effected by a reclassification of shares, each specified number of
shares referred to in this Agreement shall be adjusted accordingly.
8.2 AMENDMENT OF RESTATED CERTIFICATE. Whenever the number of shares
of authorized Common Stock is not sufficient in order to issue shares of
Common Stock upon conversion of Class D Preferred Stock and Class G Preferred
Stock or upon exercise of the Class F Preferred Stock Warrants in accordance
with the Restated Certificate and the Certificates of Designation, (i) the
Company shall promptly amend the Restated Certificate in order to authorize a
sufficient number of shares of Common Stock, and (ii) each Stockholder agrees
to vote its shares of Preferred Stock and Common Stock in favor of such
amendment.
ARTICLE 9.
SHARE CERTIFICATES
9.1 RESTRICTIVE ENDORSEMENTS; REPLACEMENT CERTIFICATES. (a) Each
certificate representing the shares of Company Stock now or hereafter held by
a Stockholder (including any
43
such certificate delivered upon conversion of the Preferred Stock) or
delivered in substitution or exchange for any of the foregoing certificates
shall be stamped with legends in substantially the following form:
The shares represented by this Certificate have been acquired for
investment and have not been registered under the Securities Act of
1933, as amended (the "Act"), or under any state securities or "Blue
Sky" laws. Said securities may not be sold, transferred, assigned,
pledged, hypothecated or otherwise disposed of, unless and until
registered under the Act and the rules and regulations thereunder and
all applicable state securities or "Blue Sky" laws or exempted
therefrom under the Act and all applicable state securities or "Blue
Sky" laws.
The shares represented by this Certificate are also subject to a
Stockholder and Investor Rights Agreement dated as of December 23,
1998, a copy of which is on file at the offices of the Company and
will be furnished by the Company to the holder hereof upon written
request. Such Stockholder and Investor Rights Agreement provides,
among other things, for the granting of certain restrictions on the
sale, transfer, pledge hypothecation or other disposition of the
shares represented by this Certificate, and that under certain
circumstances, the holder hereof may be required to sell the shares
represented by this Certificate. By acceptance of this Certificate,
each holder hereof agrees to be bound by the provisions of such
Stockholder and Investor Rights Agreement. The Company reserves the
rights to refuse to transfer the shares represented by this
Certificate unless and until the conditions to transfer set forth in
such Stockholder and Investor Rights Agreement have been fulfilled.
Each Stockholder agrees that he, she or it will deliver all certificates
for shares of Company Stock owned by him, her or it to the Company for the
purpose of affixing such legends thereto.
(b) Upon receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of any certificate
representing shares of Company Stock subject to this Agreement and of a bond
or other indemnity reasonably satisfactory to the Company, and upon
reimbursement to the Company of all reasonable expenses incident thereto, and
upon surrender of such certificate, if mutilated, the Company will make and
deliver a new certificate of like tenor in lieu of such lost, stolen,
destroyed or mutilated certificate.
ARTICLE 10.
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EQUITABLE RELIEF
10.1 EQUITABLE RELIEF. The parties hereto agree and declare that legal
remedies may be inadequate to enforce the provisions of this Agreement and
that, in addition to being entitled to exercise all of the rights provided
herein or in the Restated Certificate or granted by law, including recovery
of damages, equitable relief, including specific performance and injunctive
relief, may be used to enforce the provisions of this Agreement.
ARTICLE 11.
STOCKHOLDER CALL RIGHT
11.1 STOCKHOLDER CALL RIGHT. The Xxxxxx Partnership and the other
Stockholders (including optionholders under the New Company Stock Option Plan
at closing under the Investment and Transaction Agreement) and their
respective assignees will have the right to call up to 35% of the Class D
Preferred Stock issued at closing under the Investment and Transaction
Agreement (and/or Class A Common Stock, Class E Preferred Stock, Logix
Communications Stock or other capital stock, issued upon conversion,
exchange, as a distribution or otherwise in respect of the Class D Preferred
Stock and the Class E Preferred Stock, other than the JWC Common Stock) on a
Fully Diluted basis, together, in each case, with all accrued and unpaid
dividends thereon (collectively, the "Equity Investor Package") at (i) a
price payable by wire transfer of immediately available funds to an account
designated by the JWC Representative, equal to 35% times the following
valuations (each, the "Clawback Exercise Price"), (A) at any time prior to
the twenty-fourth month anniversary of the date of issuance of the Class D
Preferred Stock at a valuation which is equal to three times the original
purchase price of the original purchase of the Class D Preferred Stock, and
(B) at any time following the twenty-fourth month anniversary of the date of
issuance of such shares and prior to the sixtieth-month anniversary thereof,
at a valuation which is equal to an amount equal to the sum of (x) three
times the original purchase price of the Class D Preferred Stock, plus (y)
one times such original purchase price multiplied by a fraction, the
numerator of which is the number of quarterly periods elapsed after such
twenty-fourth month anniversary of their date of issuance (measured from the
commencement of such twenty-fifth month anniversary), up to 12 quarterly
periods, and the denominator of which is 12. Schedule V set forth an
illustrative example for this Article 11, PROVIDED, HOWEVER that in the case
of any conflict between such illustration and this Article 11, this Article
11 shall govern. In the event of a sale or sales by JWC of any portion of
the final 35% of its investment in Logix Communications Common Stock as of
the date of the Logix Communications Spin-off (calculated with reference only
to shares of Logix Communications issued with respect to the Class D
Preferred Stock (or any Class A Common Stock or other capital stock issued in
respect thereto other than the JWC Common Stock) issued at closing
45
under the Investment and Transaction Agreement), then the Clawback Exercise
Price shall, if applicable, be reduced by the aggregate amount of the net
proceeds of such sales, PROVIDED that proceeds received by JWC from the
exercise by the Company of its purchase right under Section 6.4 shall not so
reduce the Clawback Exercise Price.
This call right may only be exercised in respect of the entire part of
the Equity Investor Package subject thereto and the initial determination
whether to exercise this call right will be made by the Xxxxxx Partnership on
behalf of all the Stockholders, PROVIDED that after such determination, each
Stockholder will make its own determination whether to consummate the call
right. This call right shall terminate upon the earlier of the occurrence of
(A) the IPO Date, (B) the fifth anniversary of issuance of the Class D
Preferred Stock, (C) a Change of Control or (D) the exercise in full of this
call right, PROVIDED, that this call right may be exercised in connection and
concurrently with an IPO and the proceeds resulting from such public offering
may be applied by the Company in payment of the Clawback Exercise Price.
Except pursuant to Sections 4.2, 4.5 and Article 12 of this Agreement, each
Cash Equity Investor will agree not to sell or transfer the securities
included in their Equity Investor Package (excluding Logix Communications
Common Stock) until the call right expires if, after such sale or transfer,
such Cash Equity Investor would hold less than 35% of (x) the Class D
Preferred Stock it had originally acquired, (y) any class of securities
issued in respect of the Class D Preferred Stock (other than Logix
Communication Stock), or (z) each class of securities included in the Equity
Investor Package (excluding Logix Communications Common Stock).
ARTICLE 12.
CLASS D AND CLASS E PREFERRED STOCK PUT RIGHT
12.1 RIGHT TO PUT. At any time upon the earliest to occur of (i) the
seventh anniversary of the date of this Agreement, (ii) a Change of Control,
or (iii) the consummation of an IPO, each Cash Equity Investor shall have the
right to sell all of the Class D Preferred Stock or Class E Preferred Stock
held by it to the Company (the "Preferred Stock Put Right") following a vote
by a majority of the holders of shares of Class D Preferred Stock or Class E
Preferred Stock (as the case may be) to require the Company to redeem all of
the shares of Class D Preferred Stock or Class E Preferred Stock then held by
holders of Class D Preferred Stock or Class E Preferred Stock and the Company
shall have the obligation to purchase the shares as to which the Preferred
Stock Put Rights are exercised. The Company shall, within 120 days (or
immediately in the case of a Change of Control) pay (A) in the case of a put
of Class D Preferred Stock a cash amount per share equal to the then current
Liquidation Preference thereon plus the number of shares of Class A Common
Stock that the holder of such Class D Preferred Stock would have received
upon conversion immediately prior to such put and (B) in the case of Class E
Preferred Stock a
46
cash amount per share held by such Stockholder equal to its Liquidation
Preference. The closing of any redemption pursuant to this Section 12 shall
take place at the Company's offices or at such reasonable other location as
the Company may notify in writing.
12.2 PAYMENT; RESTRICTIONS ON PAYMENT. Upon the surrender of the
certificate or certificates evidencing the shares of Class D Preferred Stock
or Class E Preferred Stock to be repurchased by the Company, the repurchase
price in respect of such shares shall be paid to the order of the Person
whose name appears on such certificate or certificates in cash by wire
transfer of immediately available funds, provided, that if there is no
Available Cash under the Financing Agreements and consistent with the
limitations set forth in Section 12.3, the Company shall arrange additional
credit facilities or borrowing availability to obtain cash to meet its
obligations upon the exercise of the Preferred Stock Put Right. If the
Company cannot, within the time periods stated in Section 12.1, obtain cash
to meet its obligations upon the exercise of the Preferred Stock Put Right,
then the Company shall issue to the Cash Equity Investor exercising the
Preferred Stock Put Right a Subordinated Put Note, dated as of the date of
exercise of the Preferred Stock Put Right, which shall rank senior to each
class of Preferred Stock existing on the date hereof other than the Senior
PIK Preferred Stock and the Sygnet PIK Preferred Stock. Each surrendered
certificate evidencing shares of Class E Preferred Stock shall be canceled
and/or retired. In the event that a Cash Equity Investor receives a
Subordinated Put Note, such Cash Equity Investors shall be entitled to all of
the rights of the holders of Preferred Stock hereunder as if such Cash Equity
Investors were holders of Preferred Stock until the Subordinated Put Notes
are paid in full. In the event that Subordinated Put Notes are issued, all
such Subordinated Put Notes will rank pari passu and shall share pro rata in
any Available Cash, PROVIDED, HOWEVER, that in the event that any
Subordinated Put Note shall have matured, such Subordinated Put Note shall
rank senior to any Subordinated Put Note which has not yet matured.
12.3 RESTRICTIONS ON PAYMENTS BY THE COMPANY. Notwithstanding anything
to the contrary contained in this Agreement, the payment of cash upon
exercise of the Preferred Stock Put Rights and pursuant to any Subordinated
Put Notes pursuant to this Article shall be subject to (i) applicable
restrictions contained in any applicable law, including the availability of
adequate capital and surplus for corporate law purposes and (ii) restrictions
contained in the Financing Agreements (other than the Class F Preferred Stock
Documents) each as refinanced or amended and in effect from time to time in
accordance with Section 12.5, and restrictions contained in any Senior
Indebtedness. If any such restrictions or unavailability prohibit the
repurchase of Securities or other capital stock of the Company hereunder
which the Company is otherwise entitled or required to make, the Company
shall make such repurchases as soon as it is permitted to do so under such
restrictions.
12.4 PAYMENT OF CASH. Notwithstanding anything else in this Article 12
to the
47
contrary, in the event of a Change of Control, and in each case in which
Stockholders receive cash, cash equivalents or marketable securities for the
sale or transfer of the Company's Voting Securities, then the holders of the
Class D Preferred Stock and Class E Preferred Stock shall be paid cash upon
exercise of the Class E Preferred Stock Put Right and shall not be issued
Subordinated Put Notes in lieu of cash.
12.5 FINANCING AGREEMENTS; INDEBTEDNESS. The Class D Preferred Stock
and Class E Preferred Stock, including any redemptions (except as set forth
below), puts and calls and any Subordinated Put Notes issued pursuant to such
puts, are subject to the terms and restrictions contained in the Financing
Agreements. The Company will be permitted to refinance or replace (whether or
not with new lenders) any Financing Agreement and/or incur additional
indebtedness in connection with acquisitions and capital projects at any time
prior to the issuance of any Subordinated Put Note issued in connection with
the Preferred Stock Put Right, so long as such refinancing, replacement or
additional indebtedness (i) is not more restrictive with respect to the
Preferred Stock than the Financing Agreements and (ii) specifically permits
the payment of amounts owing by the Company upon exercise of such Preferred
Stock Put Right or to the holder of any such Subordinated Put Note if after
giving pro forma effect to any such payment, the Consolidated Leverage Ratio
would be less than 8 to 1. Following the issuance of any Subordinated Put
Note issued in connection with the Preferred Stock Put Right, the Company may
not undertake any refinancing or replacement (but shall be free to obtain
waivers from the holders of existing indebtedness) or incur additional
financing indebtedness in excess of $1,000,000, in the aggregate, without the
prior written consent of the holder of such Subordinated Put Note. Nothing
herein shall limit the right of the Company to incur indebtedness in order to
discharge all amounts owing under any such outstanding Subordinated Put
Notes. No refinancing replacement or additional financing indebtedness shall
adversely affect, and shall be expressly subordinate to, the redemption
rights of the Preferred Stock set forth in the Certificates of Designation of
the Preferred Stock. The Cash Equity Investors shall deliver acknowledgments
of the foregoing to the Company's creditors under the Financing Agreements
upon the request of the Company.
ARTICLE 13.
COMPANY CALL RIGHT
13.1 COMPANY RIGHT TO CALL AGAINST CASH EQUITY INVESTORS. On or
immediately prior to an IPO, the Company or its assignees shall have the
right to purchase all or any portion of the outstanding shares of Class D
Preferred Stock held by a Cash Equity Investor and upon the exercise of such
right, each Cash Equity Investor shall have the obligation to sell such
shares of Class D Preferred Stock held by such Cash Equity Investor to the
Company. The call purchase
48
price for each share of Class D Preferred Stock shall be the Liquidation
Preference thereof plus the number of shares of Class A Common Stock that
would have been received by the holder of such Class D Preferred Stock had
such Class D Preferred Stock been converted immediately prior to the exercise
of the call. Notwithstanding anything herein to the contrary, a holder of
Class D Preferred Stock may upon receiving a Call Notice (as defined below)
elect to convert his Class D Preferred Stock into Class E Preferred Stock and
Class A Common Stock, in which event the Company's right pursuant to this
Article 13 will apply to such Class E Preferred Stock. The call purchase
price of any such Class E Preferred Stock shall be the Liquidation Preference
thereof.
13.2 PROCEDURE. The Company may exercise the Call Rights by providing
to the Cash Equity Investors a written notice (a "Call Notice") that the
Company will repurchase the shares of Company Stock described in Section
13.1. The Company shall within thirty (30) days after the determination of
the relevant call price, and the notification of the Cash Equity Investors
and in any event no later than the receipt by the Company of the proceeds of
the IPO, redeem the shares held by the Stockholders to whom the Company
provided a Call Notice by paying to such Stockholders an amount for each
share held by such Stockholder equal to the relevant call price by wire
transfer of immediately available funds. The closing of the repurchase of
the shares pursuant to this Article 13 shall take place at the office of the
Company, or at such other reasonable location, as it shall notify the
relevant party to whom the Call Notice was sent.
13.3 PAYMENT. Upon the surrender of the certificate or certificates
evidencing the shares of Class D Preferred Stock or Class E Preferred Stock
to be repurchased by the Company pursuant to this Article 13, the applicable
call price in respect of such shares shall be paid by wire transfer of
immediately available funds to the order of the Person whose name appears on
such certificate or certificates in cash in immediately available funds
(which shall include any accrued and unpaid dividends to the date of
repurchase of such shares of Class D Preferred Stock or Class E Preferred
Stock). Each surrendered certificate evidencing the shares of Class D
Preferred Stock or Class E Preferred Stock being repurchased shall be
canceled and/or retired.
ARTICLE 14.
MISCELLANEOUS
14.1 JWC GROUP STOCKHOLDER REPRESENTATIVE. (a) Each JWC Group
Stockholder hereby designates and irrevocably appoints Xxxx X. Xxxxxxxx, as
his attorney-in-fact with full power of substitution (the "JWC Group
Stockholder Representative"), to serve as the representative of each such JWC
Group Stockholder to (i) perform all such acts as are required, authorized or
contemplated by this Agreement to be performed by such JWC Group Stockholder
49
and (ii) exercise such rights, power and authority as are incidental to this
Agreement and hereby acknowledges that the JWC Group Stockholder
Representative shall be the only person authorized to take any action so
required, authorized or contemplated by this Agreement by each such person.
Any such actions taken, exercises of rights, power or authority and any
decision or determination made by the JWC Group Stockholder Representative
consistent therewith, shall be absolutely and irrevocably binding on each JWC
Group Stockholder as if such JWC Group Stockholder personally had taken such
action, exercised such rights, power or authority or made such decision or
determination in such Stockholder's individual capacity. Each such JWC Group
Stockholder further acknowledges that the foregoing appointment and
designation shall be deemed to be coupled with an interest and shall survive
the death or incapacity of such JWC Group Stockholder. The other parties
hereto are and will be entitled to rely on any action taken or any notice
given by the JWC Group Stockholder Representative and are and will be
entitled and authorized to give notices only to the JWC Group Stockholder
Representative for any notice contemplated by this Agreement to be given to
any such person. A successor to the JWC Group Stockholder Representative may
be chosen by a majority in interest of the JWC Group Stockholders, provided
that notice thereof is given by the new JWC Group Stockholder Representative
to the Company.
(b) The JWC Group Stockholder Representative shall not be liable
to the JWC Group Stockholders for the performance of any act or the failure
to act under or in connection with this Agreement so long as he acted or
failed to act in good faith in what he believed to be the scope of his
authority and for a purpose which he believed to be in the best interests of
the JWC Group Stockholders. Each of the JWC Group Stockholders will
indemnify the JWC Group Stockholder Representative, from and against any
loss, liability, damage, deficiency, cost and expense (including without
limitation reasonable expenses of investigation and reasonable attorney's
fees incurred in connection with any claim, suit or proceeding brought
against him) incurred or sustained by him as a result of his individual acts
or omissions in connection with this Agreement, so long as he acted or failed
to act in good faith.
14.2 NOTICES. All notices or other communications hereunder shall be in
writing and shall be given (and shall be deemed to have been duly given upon
receipt) by delivery in person, by facsimile transmission, or by registered
or certified mail (return receipt requested), postage prepaid, with an
acknowledgment of receipt signed by the addressee or an authorized
representative thereof, addressed as follows (or to such other address for a
party as shall be specified by like notice; provided that notice of a change
of address shall be effective only upon receipt thereof:
50
If to a Cash Equity Investor, to:
X. X. Childs Associates, L.P.
Xxx Xxxxxxx Xxxxxx
Xxxxxx-Xxxxx Xxxxx
Xxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxxxxx
With a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Xxx Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxx Xxxxxxx
If to the Company, to it:
Xxxxxx Communications Corporation
00000 X. Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx, President
With a copy to the Company at the same address to:
Attention: Xxx Xxxxxx, Senior Corporate Counsel
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
With a further copy to:
Xxxxx, Xxxxx & Xxxxx
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx X. Xxxxxxx
51
14.3 ENTIRE AGREEMENT; AMENDMENT; CONSENTS.
(a) This Agreement constitutes the entire agreement among the parties
with respect to the subject matter hereof and supersedes all other prior
agreements and understandings, both written and oral, among the parties or any
of them with respect to the subject matter hereof, including, without
limitation, the Former Shareholders' Agreement.
(b) No change or modification of this Agreement shall be valid,
binding or enforceable unless the same shall be in writing and signed by the
Company, the Xxxxxx Partnership and the holders of a majority of the shares of
each class of Common Stock and Preferred Stock; PROVIDED, HOWEVER, that in the
event any party hereto shall cease to own any shares of Company Stock such party
hereto shall cease to be a party to this Agreement and the rights and
obligations of such party hereunder shall terminate.
(c) Whenever in this Agreement the consent or approval of a
Stockholder is required, except as expressly provided herein, such consent or
approval may be given or withheld in the sole and absolute discretion of each
Stockholder.
14.4 TERM.
(a) This Agreement shall terminate upon the earliest to occur of any
of the following events and provided that no Subordinated Put Notes are
outstanding:
(i) The consent in writing of all of the parties hereto; or
(ii) The expiration of twelve (12) years from the date of
execution and delivery of this Agreement; or
(iii) One Stockholder shall Beneficially Own all of the Common
Stock.
(b) In the event that JWC shall Beneficially Own less than 35% of
shares of Common Stock or Class E Preferred Stock received from conversion of
the original Class D Preferred Stock investment (in each case on an
"as-if-converted" basis) Beneficially Owned by JWC on the date hereof, the
provisions of Section 3.1(a)(i) shall terminate. In the event the provisions
of either Section 3.1(a)(i) is terminated pursuant to this Section 14.3(b),
the director designated by JWC pursuant to Section (i), shall resign (or the
other directors or Stockholders shall remove such director from the Board of
Directors) and the remaining directors shall take such action so that the
number of directors constituting the entire Board of Directors is accordingly
reduced.
52
Notwithstanding anything in this Agreement to the contrary, the holder
of any Subordinated Put Note shall be entitled to all of the rights and benefits
of the Cash Equity Investors hereunder and under the Certificate of Designations
for the Class D Preferred Stock and the Investment and Transaction Agreement, as
if such holder still held the shares of Class D Preferred Stock for which such
Subordinated Put Note was issued until such Subordinated Put Note has been paid
in full.
14.5 SURVIVAL. Nothing contained in Section 14.5 shall impair any rights
or obligations of any party hereto arising prior to the time of the termination
of this Agreement, or which may arise by an event causing the termination of
this Agreement. The provisions of Article 5 shall survive any termination of
this Agreement and shall continue in full force and effect until the twentieth
anniversary of the date hereof. The provisions of Section 6.3 and Section 14
shall survive the termination of this Agreement.
14.6 WAIVER. No failure or delay on the part of any Stockholder in
exercising any right, power or privilege hereunder, nor any course of dealing
between the Company and any Stockholder shall operate as a waiver thereof nor
shall any single or partial exercise of any right, power or privilege hereunder
preclude the simultaneous or later exercise of any other right, power or
privilege. The rights and remedies herein expressly provided are cumulative and
not exclusive of any rights and remedies which any Stockholder would otherwise
have. No notice to or demand on the Company in any case shall entitle the
Company to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of the Stockholders or any of
them to take any other or further action in any circumstances without notice or
demand.
14.7 OBLIGATIONS SEVERAL. The obligations of each Stockholder under this
Agreement shall be several with respect to each such Stockholder.
14.8 GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the law of the State of New York without reference to the
conflicts of law principles thereof.
14.9 DISPUTE RESOLUTION; WAIVER OF JURY TRIAL.
(a) The parties shall use and strictly adhere to the following
dispute resolution processes, except as otherwise expressly provided in this
Section 14.9, to resolve any and all disputes, controversies or claims, whether
based on contract, tort, statute, fraud, misrepresentation or any other legal or
equitable theory (hereinafter, "Dispute(s)"), arising out of or relating to this
Agreement (and any prior agreement this Agreement supersedes), including without
limitation, its making, termination, non-renewal, its alleged breach and the
subject matter of this Agreement (e.g., products or services furnished hereunder
or those related to those
53
furnished):
(b) The parties shall first attempt to settle each Dispute through
good faith negotiations. The aggrieved party shall initiate such negotiations
by giving the other party(ies) written notice of the existence and nature of the
Dispute. The other party(ies) shall in a writing to the aggrieved party
acknowledge such notice of Dispute within ten (10) business days. Such
acknowledgment may also set forth any Dispute that the acknowledging party
desires to have resolved in accordance with this Section.
(c) Thereafter, if any Dispute is not resolved by the parties through
negotiation within thirty (30) calendar days of the date of the notice of
acknowledgment, either party may terminate informal negotiations with respect to
that Dispute and have the right, by delivery of written notice thereof (the
"Arbitration Notice") to the other party, to submit the matter to be finally
settled by arbitration in accordance with the Commercial Arbitration Rules then
in effect of the American Arbitration Association, as modified herein (the "AAA
Rules"). The place of arbitration shall be Oklahoma City, Oklahoma. All
matters so submitted to arbitration shall be settled by three arbitrators. JWC
and the Company shall each designate one arbitrator within 20 days of the
delivery of the Arbitration Notice. If either JWC or the Company fails so to
timely designate an arbitrator, the matter shall be resolved by the one
arbitrator timely designated. JWC and the Company shall cause the designated
arbitrators to mutually agree upon and to designate a third arbitrator,
provided, however, that failing such agreement within 45 days of delivery of the
Arbitration Notice, the third arbitrator shall be appointed in accordance with
the AAA Rules. JWC and the Company shall be responsible for the payment of the
fees and expenses of their respectively designated arbitrators and shall bear
equally the fees and expenses of the third arbitrator. JWC and the Company
shall cause the arbitrators to decide the matter to be arbitrated pursuant
hereto within 60 days after the appointment of the last arbitrator. The
arbitral tribunal is not empowered to award damages in excess of compensatory
damages and each party hereby irrevocably waives any right to recover punitive,
exemplary or similar damages with respect to any Dispute. The final decision of
the majority of the arbitrators shall be furnished to JWC, the Company and each
of the Stockholders in writing and shall constitute a conclusive determination
of the matter in question, binding upon JWC, the Company and the Stockholders
and shall not be contested by any of them. Such decision may be used in a court
of law only for the purpose of seeking enforcement of the arbitrators' award.
Any arbitration proceeding, decision or award rendered hereunder and the
validity, effect and interpretation of this arbitration agreement shall be
governed by the Federal Arbitration Act, 9 U.S.C. Sections 1-16, and judgment
upon any award may be entered in any court of competent jurisdiction.
(d) The Company and each of the Stockholders hereby irrevocably
consents to the exclusive jurisdiction of the state or federal courts in the
State of New York, and all state or federal courts competent to hear appeals
therefrom, over any actions which may be commenced
54
against any of them under or in connection with this Agreement. The Company
and each Stockholder hereby irrevocably waive, to the fullest extent
permitted by applicable law, any objection which any of them may now or
hereafter have to the laying of venue of any such dispute brought in such
court or any defense of inconvenient forum for the maintenance of such
dispute in the Xxxxxxxx Xxxxxxxx xx Xxx Xxxx xxx Xxx Xxxx Xxxxxx. The Company
and each Stockholder hereby agree that a judgment in any such dispute may be
enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. The Company and each Stockholder hereby consent to
process being served by any party to this Agreement in any actions by the
transmittal of a copy thereof in accordance with the provisions of Section 14.2.
14.10 BENEFIT AND BINDING EFFECT; SEVERABILITY. This Agreement shall be
binding upon and shall inure to the benefit of the Company, its successors and
assigns, and each of the Stockholders and their respective executors,
administrators and personal representatives and heirs and permitted assigns. If
any term or other provision of this Agreement is invalid, illegal or incapable
of being enforced by any law or public policy or any listing requirement
applicable to the Common Stock, all other terms and provisions of this Agreement
shall nevertheless remain in full force and effect. Upon such determination that
any term or other provision is invalid, illegal or incapable of being enforced,
the parties hereto affected by such determination in any material respect shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner in order
that the provisions hereof are given effect as originally contemplated to the
greatest extent possible.
14.11 AMENDMENT OF BY-LAWS. The Stockholders agree that the terms of
this Agreement shall supersede any inconsistent provision that is contained in
the Restated By-Laws and, to the extent required by Oklahoma law or the Restated
By-Laws, this Agreement shall be deemed to constitute a written action taken by
the Stockholders of the Company and shall be deemed an amendment of the Restated
By-Laws.
14.12 FCC AND REGULATORY APPROVALS. Notwithstanding anything contained
in this Agreement to the contrary, no transaction or action contemplated herein
shall be consummated and no interests or rights transferred, converted or
exchanged prior to receiving FCC approvals with respect thereto to the extent
such FCC approvals are necessary.
14.13 EXPENSES. The Company shall pay the reasonable fees and expenses
of counsel and accountants to the Stockholders incurred in connection with the
preparation, negotiation and execution of this Agreement and of any amendment or
modification hereof. Except as provided in Section 14.14, all other attorneys'
fees incurred by the Stockholders in connection with this Agreement (including,
without limitation, in the preparation of notices (and responses thereto) and
consents) shall be borne by the Stockholder(s) incurring such fees.
14.14 ATTORNEYS' FEES. In any action or proceeding brought to enforce
any provision of this Agreement, or where any provision
55
hereof is validly asserted as a defense, the successful party shall be
entitled to recover reasonable attorneys' fees in addition to any other
available remedy.
14.15 HEADINGS. The captions in this Agreement are for convenience
only and shall not be considered a part of or affect the construction or
interpretation of any provision of this Agreement.
14.16 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
56
IN WITNESS WHEREOF, each of the parties has executed or consent this
Agreement to be executed by its duly authorized officers as of the date first
written above.
COMPANY:
XXXXXX COMMUNICATIONS CORPORATION
By: /s/ Xxxxxxx Xxxxxx
--------------------------
Name: Xxxxxxx Xxxxxx
Title: President
CASH EQUITY INVESTORS:
XXXXXX XX LIMITED PARTNERSHIP
By: RLD, Inc., its General Partner
By: /s/ Xxxxxxx Xxxxxx
--------------------------
Name: Xxxxxxx Xxxxxx
Title: President
XXXXXX OPERATING COMPANY
By: /s/ Xxxxxxx Xxxxxx
--------------------------
Name: Xxxxxxx Xxxxxx
Title: President
X.X. CHILDS EQUITY PARTNERS II, L.P.
By: X.X. Childs Advisors II, L.P.,
its general partner
By: X.X. Childs Associates, L.P.,
its general partner
By: X.X. Childs Associates, Inc.,
its general partner
By: /s/ Xxxx X. Xxxxxxxx
--------------------------
Name: Xxxx X. Xxxxxxxx
Title: Vice President
/s/ Xxxx X. Xxxxxxxx
-----------------------------
Xxxx X. Xxxxxxxx, as agent and attorney-in-fact
for the JWC Group Stockholders under Purchaser
Appointment of Agent and Power of Attorney
and not in his individual capacity
Schedule I
CASH EQUITY INVESTORS:
Xxxxxx XX Limited Partnership
c/x Xxxxxx Communications Corporation
00000 X. Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxx Xxxx, XX 00000
Telephone: (000) 000-0000
Attention: Senior Corporate Counsel
Xxxxxx Operating Company
c/x Xxxxxx Communications Corporation
00000 X. Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxxx Xxxx, XX 00000
Telephone: (000) 000-0000
Attention: Senior Corporate Counsel
X.X. Childs Equity Partners II, L.P.
Xxx Xxxxxxx Xxxxxx
Xxxxxx-Xxxxx Xxxxx
Xxxxxx, XX 00000
Telephone No. (000) 000-0000
Attention: Xxxx Xxxxxxxx
JWC Group Stockholders:
(See attached sheet)
ATTACHMENT
JWC GROUP STOCKHOLDERS
X.X. Childs Equity Partners II, L.P.
JWC Equity Funding II, Inc.
Xxxx Family Trust
Xxxx X. Childs
Xxxxxxx X. Childs
Xxxxx X. Childs
Xxxxxxx X. Xxxxx
Xxxxx X. Xxxxxxx
Xxxxx X. Xxxx
X. Xxxx XxxXxxxxx
Xxxxxxx X. Xxxx
Xxxx X. Xxxxxxxx
Chechesse Creek Trust
Xxxxxx X. Xxxxx
SGS 1995 Family Limited Partnership
Xxxxxx X. Xxxxx 1995 Irrevocable Trust
SGS-III Family Limited Partnership
Xxxx X. Xxxxxx
Xxxx X. Xxxxxx Irrevocable Family Trust
Suttin Family Trust II
Xxxxxx X. Xxxxxx XXX
Xxxxxx X. Xxx
Xxx Family Trust
Xx Xxxxxxxxx
Xxx Xxxxxx
Rebacliff, Xxxxx & Xxxxx, LLC
Xxxxx X. Xxxxxxx
Xxxxx Xxxxxxx
Xxxx Xxxxx
OFS Investment Partners II
Schedule II
CAPITALIZATION
Filed under Exhibit 10.8.1 Schedule 4.9.
Schedule III
NEW DIRECTORS
Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
Xxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxx
[Initially Vacant]
SCHEDULE IV
EXAMPLE: OFFER BY TAG-ALONG EVENT PURCHASER TO PURCHASE COMMON STOCK OF A
STOCKHOLDER 1 YEAR AFTER CLOSING
Shares of Common Stock to be Purchased Under Tag-Along Event 100,000.0
Total Common Equity Valuation $ 1,000,000,000
Total Shares of Common Stock Equivalents Outstanding 595,981.7
Total Value Allocations of
to Calculate JWC 100,000
Class A Common Stock(1) Class E Preferred Stock Allocation of Shares to be
----------------------- -------------------------- Tag-Along Stock Sold if All
Shares Value(2) Shares Value(3) as per Section 4.2 Investors Tag(4)
------ ----- ------ ----- ------------------ ----------------
DCC LP 474,921.8 $ 796,873,125 3,533.8 $ 4,599,972 $ - 70,961.8
X. Xxxxxx 3,154.0 5,292,109 - - - 471.3
Mgmt Options 28,934.0 48,548,471 - - - 4,323.3
JWC 88,971.9 149,286,295 71,559.9 93,150,028 242,436,323 24,243.6
--------- -------------- -------- ----------- --------------- ---------
595,981.7 $1,000,000,000 75,093.7 $97,750,000 $ 1,000,000,000 100,000.0
--------------------
(1) CALCULATED ON AN AS-IF CONVERTED BASIS FOR THE SERIES D PREFERRED STOCK
(2) HYPOTHETICAL COMMON EQUITY VALUE FOR PURPOSES OF ILLUSTRATION.
(3) ESTIMATED AT $85.0 MILLION OF SERIES D PREFERRED OUTSTANDING FOR ONE YEAR
WITH 15% ACCRUED DIVIDENDS.
(4) FORMULA FOR JWC REPRESENTS TOTAL SHARES TO BE SOLD UNDER TAG-ALONG EVENT
MULTIPLIED BY A FRACTION EQUAL TO (X) THE VALUE OF JWC'S COMMON STOCK
PLUS THE VALUE OF JWC'S CLASS E PREFERRED STOCK DIVIDED BY (Y) THE TOTAL
VALUE OF THE COMMON STOCK. ALLOCATIONS OF THE TAG-ALONG SHARES NOT
ALLOCATED TO JWC SHALL BE OFFERED PRO RATA BASED ON COMMON STOCK
OWNERSHIP OF THE NON-JWC STOCKHOLDERS.
SCHEDULE V
EXAMPLE: CALL EXERCISED IN YEAR 5, PRIOR TO SPIN-OFF OF LOGIX COMMUNICATIONS,
NO SALES BY STOCKHOLDERS
Original Purchase Price for Series D Preferred/Equity Investor Package: $ 85,000,000
Multiple of Original Purchase Price in Year 5 4.0x
---------------
Valuation for Calculating the Clawback Exercise Price $ 340,000,000
Amount of Equity Investor Package Subject to Call 35.00%
---------------
Clawback Exercise Price $ 119,000.000
EXAMPLE: CALL EXERCISED IN YEAR 5, AFTER SPIN-OFF OF LOGIX COMMUNICATIONS,
STOCKHOLDERS HAVE SOLD 80% OF LOGIX STOCK
Original Purchase Price for Series D Preferred/Equity Investor Package $ 85,000,000
Multiple of Original Purchase Price in Year 5 4.0x
---------------
Valuation for Calculating the Clawback Exercise Price $ 340,000,000
Amount of Equity Investor Package Subject to Call 35.00%
---------------
Clawback Exercise Price Pre-Credit $ 119,000,000
% of Logix Communications Stock Sold by Stockholders 80.00%
Sales by Stockholders of Final 35% of Logix Communications Stock 15.00%
Net Proceeds Realized on Sale of Such 15.00% of Logix
Communications Stock $ 20,000,000
Clawback Exercise Price Pre-Credit $ 119,000,000
Amount of Credit from Sales of Logix Communications Stock (20,000,000)
---------------
Clawback Exercise Price $ 99,000,000
TABLE OF CONTENTS
SECTION PAGE
------- ----
ARTICLE 1. Definitions
1.1 Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 Other Definitional Provisions . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE 2. Stockholder Approval
2.1 Organizational Documents. . . . . . . . . . . . . . . . . . . . . . . . . 13
2.2 Approval of Stock Option Plans. . . . . . . . . . . . . . . . . . . . . . 13
2.3 Logix Communications Spin-Off . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE 3. Management of the Company
3.1 Board of Directors. . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.2 Removal; Filling of Vacancies . . . . . . . . . . . . . . . . . . . . . . 15
3.3 Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.4 Compensation and Reimbursement. . . . . . . . . . . . . . . . . . . . . . 15
3.5 Business of the Company . . . . . . . . . . . . . . . . . . . . . . . . . 15
3.6 Required Votes. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.7 Transactions between the Company and the Stockholders or their
Affiliates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.8 Board Committees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.9 Other Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE 4. Transfers of Shares
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4.1 General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.2 Tag-Along Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
4.3 Additional Conditions to Permitted Transfers. . . . . . . . . . . . . . . 20
4.4 Stop-Transfer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
4.5 Drag Along Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
4.6 Redemption Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
4.7 Right of First Refusal for New Securities; Capital Raising. . . . . . . . 21
ARTICLE 5. Registration Rights
(a) Demand Registration Rights. . . . . . . . . . . . . . . . . . . . . . . . 22
(b) Piggyback Registration Rights . . . . . . . . . . . . . . . . . . . . . . 24
(c) Selection of Underwriters . . . . . . . . . . . . . . . . . . . . . . . . 25
(d) Registration Procedures . . . . . . . . . . . . . . . . . . . . . . . . . 25
(e) Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
(f) Contribution. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
(g) Registration Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 33
(h) Participation in Underwritten Registrations . . . . . . . . . . . . . . . 34
(i) Holdback Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
(j) Public Information Reporting. . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE 6. Additional Rights and Covenants
6.1 Wholly-Owned Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . 35
6.2 Amendments of the Restated Certificate and By-Laws. . . . . . . . . . . . 36
6.3 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
6.4 JWC Sale of Logix Communications Stock. . . . . . . . . . . . . . . . . . 36
6.5 Class Protection. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.6 New Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
6.7 Logix Communications Spin-off . . . . . . . . . . . . . . . . . . . . . . 38
6.8 Regulation M. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
6.9 Pooling of Interests. . . . . . . . . . . . . . . . . . . . . . . . . . . 38
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6.10 Other Tax Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
6.11 Class A Preferred Stock Transfer Restriction. . . . . . . . . . . . . . . 39
ARTICLE 7.
Exclusivity
7.1 Exclusivity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
ARTICLE 8. After-Acquired Shares; Recapitalization
8.1 After Acquired Shares; Recapitalization . . . . . . . . . . . . . . . . . 39
8.2 Amendment of Restated Certificate . . . . . . . . . . . . . . . . . . . . 40
ARTICLE 9. Share Certificates
9.1 Restrictive Endorsements; Replacement Certificates. . . . . . . . . . . . 40
ARTICLE 10.
Equitable Relief
10.1 Equitable Relief. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE 11.
Stockholder Call Right
11.1 Stockholder Call Right. . . . . . . . . . . . . . . . . . . . . . . . . . 41
ARTICLE 12. Class D and Class E Preferred Stock Put Right
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12.1 Right to Put. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
12.2 Payment; Restrictions on Payment. . . . . . . . . . . . . . . . . . . . . 43
12.3 Restrictions on Payments by the Company . . . . . . . . . . . . . . . . . 44
12.4 Payment of Cash. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
12.5 Financing Agreements; Indebtedness. . . . . . . . . . . . . . . . . . . 44
ARTICLE 13. Company Call Right
13.1 Company Right to Call Against Cash Equity Investors . . . . . . . . . . . 45
13.2 Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
13.3 Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE 14. Miscellaneous
14.1 JWC Group Stockholder Representative. . . . . . . . . . . . . . . . . . . 46
14.2 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
14.3 Entire Agreement; Amendment; Consents . . . . . . . . . . . . . . . . . . 48
14.4 Term. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
14.5 Survival. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
14.6 Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
14.7 Obligations Several . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
14.8 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
14.9 Dispute Resolution; WAIVER OF JURY TRIAL. . . . . . . . . . . . . . . . . 49
14.10 Benefit and Binding Effect; Severability. . . . . . . . . . . . . . . . . 51
14.11 Amendment of By-Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . 51
14.12 FCC and Regulatory Approvals. . . . . . . . . . . . . . . . . . . . . . . 51
14.13 Expenses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
14.14 Attorneys' Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
14.15 Headings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
14.16 Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
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SCHEDULES
Schedule I -- Cash Equity Investors
Schedule II -- Capitalization
Schedule III -- New Directors
Schedule IV -- Tag Along Exercise Illustrative Calculation
Schedule V -- Stock Call Rights Illustrative Calculation
EXHIBITS
Exhibit A -- Form of Restated Certificate
Exhibit B-1 -- Form of Class A Preferred Stock Certificate of
Designation
Exhibit B-2 -- Form of Class D Preferred Stock Certificate of
Designation
Exhibit B-3 -- Form of Class E Preferred Stock Certificate of
Designation
Exhibit B-4 -- Form of Class F Preferred Stock Certificate of
Designation
Exhibit B-5 -- Form of Class G Preferred Stock Certificate of
Designation
Exhibit B-6 -- Form of Class H Preferred Stock Certificate of
Designation
Exhibit C -- Form of Restated By-Laws
Exhibit D -- Form of Subordinated Put Note
Exhibit E -- Logix Spin-Off Dilution Protection Example
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