As filed with the Securities and Exchange Commission on June 11, 1999
Registration No. 333-80469
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO.1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
TELIGENT, INC.
(Exact name of registrant as specified in its charter)
Delaware 54-18665620
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Employer Identification No.)
8065 LEESBURG PIKE
SUITE 400
VIENNA, VIRGINIA 22182
703.762.5100
(Name, address, including zip code, and telephone
number, including area code, of registrant's
principal executive offices)
---------------------
LAURENCE E. HARRIS, ESQ.
TELIGENT, INC.
SUITE 400
8065 LEESBURG PIKE
VIENNA, VIRGINIA 22182
703.762.5100
(Name, address, including zip code,
and telephone number, including area
code, of agent for service)
--------------------
WITH COPIES OF NOTICES TO:
PHILIP J. BOECKMAN, ESQ.
CRAVATH, SWAINE & MOORE
WORLDWIDE PLAZA
825 EIGHTH AVENUE
NEW YORK, NEW YORK 10019
212.474.1000
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Approximate date of commencement of proposed sale to the public:
From time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [ ]
If any of the securities being registered on this Form are being offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [X]
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Maximum Maximum
Amount Offering Aggregate Amount of
Title of each class of securities to be to be Price per Offering Registration
registered Registered (1)(2)(3) Unit(1)(2)(3) Price(1)(2)(4) Fee(5)
<S> <C> <C> <C> <C>
Primary Offering
Class A Common Stock..................
Preferred Stock.......................
Debt Securities.......................
Depositary Shares representing
Preferred Stock(6)....................
Subtotal: $1,000,000,000 $278,000
Secondary Offering
Class A Common Stock(7)............... 2,000,000 $54.9375 $ 109,875,000 $30,545.25
Total: $1,109,875,000 $308,545.25
</TABLE>
(1) Such indeterminate number of amount of Class A Common Stock, Preferred
Stock, Debt Securities and Depositary Shares as may from time to time be
issued at indeterminate prices, but with an aggregate initial offering
price not to exceed $1,000,000,000, plus such indeterminate number of
shares of Preferred Stock as may be issued in exchange for, or upon
conversion of, Debt Securities or other Preferred Stock registered
hereunder, and such indeterminate number of shares of Class A Common
Stock as may be issued in exchange for, or upon conversion of, Debt
Securities or Preferred Stock registered hereunder.
(2) Or, if any Debt Securities are issued at original issue discount, such
greater amount as may result in the initial offering prices for Debt
Securities.
(3) Omitted pursuant to General Instruction II.D of Form S-3.
(4) Estimated solely for the purpose of calculating the registration fee. Any
offering of Debt Securities denominated in any foreign currency or
currency unit will be treated as the equivalent in U.S. dollars based on
the exchange rate applicable to the purchase of such Debt Securities from
the Registrant.
(5) Calculated pursuant to Rule 457 of the rules and regulations under the
Securities Act.
(6) To be represented by Depositary Receipts representing an interest in all
or a specified portion of a share of Preferred Stock.
(7) Pursuant to Rule 457 (c), the offering price and registration fee are
computed on the basis of the average high and low prices of Class A
Common Stock, as reported by the Nasdaq Stock Market's National Market on
June 4, 1999.
---------------------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effec tive date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until this Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
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SUBJECT TO COMPLETION, DATED JUNE 11, 1999
PROSPECTUS
[GRAPHIC OMITTED]
$1,000,000,000
TELIGENT, INC.
CLASS A COMMON STOCK, PREFERRED STOCK,
DEBT SECURITIES, AND DEPOSITARY SHARES
We will offer and sell from time to time Teligent Class A common stock,
preferred stock, debt securities, or depositary shares. We will provide
specific terms of these securities in supplements to this prospectus. The
terms of the securities will include the initial offering price, aggregate
amount of the offering, listing on any securities exchange or quotation
system, risk factors and the agents, dealers or underwriters, if any, to be
used in connection with the sale of these securities. You should read this
prospectus and any supplement carefully before you invest.
In addition, up to 2,000,000 shares of our Class A common stock covered
by this prospectus may be offered by a selling stockholder.
Our Class A common stock is traded on the Nasdaq National Market System
under the symbol "TGNT."
-------------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an
offer to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
The date of this prospectus is June , 1999
<PAGE>
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN OR INCORPORATED
BY REFERENCE IN THIS PROSPECTUS AND IN ANY PROSPECTUS SUPPLEMENT. WE HAVE NOT
AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT INFORMATION. WE ARE NOT MAKING
AN OFFER OF THESE SECURITIES IN ANY STATE WHERE THE OFFER IS NOT PERMITTED.
YOU SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED IN OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON
THE FRONT OF THIS PROSPECTUS.
- ----------------------
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TABLE OF CONTENTS
Page
ABOUT THIS PROSPECTUS........................................... 4
WHERE YOU CAN FIND MORE INFORMATION ABOUT TELIGENT.............. 4
NOTE ON FORWARD-LOOKING STATEMENTS.............................. 5
TELIGENT, INC................................................... 6
RATIO OF EARNINGS TO FIXED CHARGES AND PREFERENCE DIVIDENDS..... 7
USE OF PROCEEDS................................................. 8
DESCRIPTION OF CAPITAL STOCK.................................... 8
DESCRIPTION OF DEBT SECURITIES.................................. 14
DESCRIPTION OF DEPOSITARY SHARES................................ 25
MANAGEMENT...................................................... 26
SELLING STOCKHOLDER............................................. 31
PLAN OF DISTRIBUTION............................................ 32
LEGAL MATTERS................................................... 33
EXPERTS......................................................... 34
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ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with
the Securities and Exchange Commission using a "shelf" registration process.
Under the shelf process, we may sell any combination of the securities
described in this prospectus in one or more offerings up to a total dollar
amount of $1,000,000,000. Under the shelf process, the selling stockholder
may, from time to time, sell up to 2,000,000 shares of Class A common stock in
one or more offerings. This prospectus provides you with a general description
of the securities we may offer. Each time we sell securities, we will provide
a prospectus supplement that will contain specific information about the terms
of that offering. The prospectus supplement may also add, update or change
information contained in this prospectus. You should read both this prospectus
and any prospectus supplement, together with additional information described
under the heading "WHERE YOU CAN FIND MORE INFORMATION ABOUT TELIGENT."
As used in this prospectus, "Teligent," "we," "us," and "our" refer to
Teligent, Inc., a Delaware corporation, and its subsidiaries.
WHERE YOU CAN FIND MORE INFORMATION ABOUT TELIGENT
We are subject to the informational requirements of the Securities
Exchange Act of 1934, which requires us to file annual, quarterly and special
reports, proxy statements and other information with the SEC. You may read and
copy any document that we file at the Public Reference Room of the SEC at 450
Fifth Street, N.W., Washington, D.C. 20549. Information on the operation of
the Public Reference Room may be obtained by calling the SEC at
1-800-SEC-0330. You may also inspect our filings at the regional offices of
the SEC located at Citicorp, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661 and 7 World Trade Center, New York, New York 10048 or over the
Internet at the SEC's home page at http://www.sec.gov.
This prospectus constitutes part of a Registration Statement on Form S-3
filed with the SEC under the Securities Act of 1933. It omits some of the
information contained in the Registration Statement, and reference is made to
the Registration Statement for further information with respect to us and the
securities we are offering. Any statement contained in this prospectus
concerning the provisions of any document filed as an exhibit to the
Registration Statement or otherwise filed with the SEC is not necessarily
complete, and in each instance reference is made to the copy of the document
filed.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information that we file
with the SEC will automatically update and supersede this information and the
information in the prospectus. We incorporate by reference the documents
listed below and any future filings made with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until we sell all
the securities covered by this prospectus:
1. Our Annual Report on Form 10-K for the year ended December 31,
1998;
2. Our Quarterly Report on Form 10-Q for the fiscal quarter ended
March 31, 1999;
3. Our Current Report on Form 8-K dated April 19, 1999; and
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4. The description of our Class A common stock in our Form 8-A
filed on November 18, 1997.
You may request a copy of these filings at no cost, by writing or
telephoning the office of Investor Relations, Teligent, Inc., 8065 Leesburg
Pike, Suite 400, Vienna, Virginia 22182, telephone: 703.762.5264.
NOTE ON FORWARD-LOOKING STATEMENTS
This prospectus includes forward-looking statements. Forward-looking
statements can be identified by the use of such forward-looking terminology
terms such as "believes," "expects," "may," "intends," "will," "should" or
"anticipates" or the negative thereof or other variations thereon or similar
terminology, or by discussions of strategy. We have based these
forward-looking statements on our current expectations and projections about
future events. These forward-looking statements are subject to risks,
uncertainties, and assumptions about us, including:
o our pace of entry into new markets;
o the time and expense required for building our planned network,
and our ability to secure building access;
o our ability to acquire customers in our market areas;
o our ability to raise additional capital when needed on a timely
basis and on acceptable terms;
o our ability to integrate and maintain internal management,
technical information and accounting systems;
o the impact of changes in telecommunication laws and
regulations;
o our success in gaining regulatory approval for our products and
services, when required;
o our ability to successfully interconnect with the incumbent
carriers;
o the timely supply of necessary fully functional equipment;
o the intensity of competition;
o the consummation of the acquisition of The Associated Group,
Inc. by Liberty Media Corporation;
o our ability to hire and retain personnel;
o our timely completion of our year 2000 compliance program; and
o general economic conditions.
We undertake no obligation to publicly update or revise any
forward-looking statements,
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whether as a result of new information, future events or otherwise. In light
of these risks, uncertainties and assumptions, the forward-looking events
discussed in this prospectus or in any supplement to this prospectus might not
occur.
TELIGENT, INC.
General
Teligent is a full-service, facilities-based communications company. We
offer small and medium-sized business customers local, long distance,
high-speed data and dedicated Internet services over our digital SmartWave(TM)
local networks. We hold 24 GHz wireless licenses granted by the Federal
Communications Commission covering 74 market areas, comprising more than 750
municipalities in the United States and 130 million people. Our SmartWave(TM)
local networks integrate point-to-multipoint and point-to-point wireless
technologies with traditional broadband wireline technology. We have launched
our commercial service in 28 markets, comprising more than 464 cities and
towns with a combined population of more than 83 million.
Teligent serves its wireless customers by placing a small digital
microwave antenna on the roof of the customer's building. When the customer
picks up the telephone, accesses the Internet or activates a videoconference,
the signal travels over the building's inside wiring to Teligent's equipment
and the rooftop antenna. The antenna sends voice, data and video signals to a
nearby Teligent base station, where the signals are communicated to a Teligent
broadband switching center and then onto their final destination.
Our principal executive offices are located at 8065 Leesburg Pike, Suite
400, Vienna, Virginia 22182. Our main phone number is 703.762.5100. For
additional information about Teligent, you should consult the information
sources listed above under the heading "WHERE YOU CAN FIND MORE INFORMATION
ABOUT TELIGENT."
Recent Developments
On June 1, 1999, Liberty Media Corporation and The Associated Group, Inc.
announced that they had signed a definitive merger agreement pursuant to which
Liberty Media will acquire Associated in a stock-for-stock merger (the
"Associated Acquisition"). Liberty Media Corporation, which holds most of the
assets included in the Liberty Media Group, is a wholly owned subsidiary of
AT&T Corp. Liberty Media operates as an independent business unit with a
governance structure and management that are separate from AT&T Corp.'s.
Liberty Media holds interests in a broad range of video programming,
communications, technology and Internet businesses in the United States,
Europe, South America and Asia. Under the merger agreement, Associated
shareholders will receive, subject to adjustment, an aggregate of 25,889,460
shares of AT&T Corp.'s Class A Liberty Media Group common stock (which tracks
the performance of Liberty Media) and 19,719,274 shares of AT&T Corp. common
stock.
Upon completion of the Associated Acquisition, Liberty Media would
acquire through its ownership of Associated, Associated's interest in
Teligent, representing approximately 41% (as of June 1, 1999) of the total
issued and outstanding shares of Teligent common stock as of June 1, 1999.
Upon consummation of the Associated Acquisition, Telcom DTS Investors, L.L.C.
("Telcom"), the owner of all of the Series B-2 common stock, would, depending
upon Telcom's level of stock ownership, and control of Telcom by certain
individuals at that time, have the right
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pursuant to an agreement with Associated to require Associated to convert all
of its Series B-1 common stock into Class A common stock and to cause one of
the Series B-1 Directors designated by Associated to resign from Teligent's
board of directors so that the Series B-1 Directors will no longer constitute
a majority of the Teligent directors. Associated has further agreed with
Telcom that if Associated is required to convert its Series B-1 common stock,
then it will cause its designees on Teligent's board of directors to cause
Teligent's board of directors to convene a meeting of Teligent's stockholders.
The Associated Acquisition merger agreement provides that, immediately
prior to the effective date of the Associated Acquisition, Associated will
replace three (or such lesser number that Liberty may designate) of the
existing Series B-1 Directors with designees of Liberty Media. However, upon a
conversion of all of the Series B-1 common stock into Class A common stock,
there will be no shares of Series B-1 common stock outstanding. As a result,
if all of the Series B-1 shares are so converted, neither Associated nor
Liberty will have the special right currently held by Associated under
Teligent's certificate of incorporation to elect directors of Teligent (except
for the right to vote generally for Teligent directors together with other
holders of Teligent common stock). See "Description of Capital Stock."
Pursuant to the terms of the Associated Acquisition, Associated has
agreed with certain limited exceptions, not to sell any of its Teligent common
stock or to vote or execute a written consent or proxy with respect to its
Teligent common stock in favor of any acquisition of a 25% or greater equity
interest in Teligent. The Associated Acquisition merger agreement does not
prohibit the Series B-1 Directors from properly discharging their fiduciary
duties in their capacity as directors of Teligent.
The Associated Acquisition is subject to the approval of the stockholders
of Associated, clearance from various governmental authorities, including the
Federal Communications Commission, and satisfaction of the other conditions
set forth in the merger agreement. According to Associated, depending upon the
timing of the foregoing, the Associated Acquisition is currently expected to
close in early 2000.
RATIO OF EARNINGS TO FIXED CHARGES AND PREFERENCE DIVIDENDS
The ratio of earnings to fixed charges is computed by dividing pretax
income from operations before fixed charges (other than capitalized interest)
by fixed charges. Fixed charges consist of interest charges and amortization
of debt expense and discount or premium related to indebtedness, whether
expensed or capitalized, and that portion of rental expense we believe to be
representative of interest. For the period from March 5, 1996 (inception) to
December 31, 1996, the years ended December 31, 1997 and 1998, and the three
months ended March 31, 1998 and 1999, earnings were insufficient to cover
fixed charges by $13.6 million, $138.1 million, $281.5 million, $38.6 million
and $108.1 million, respectively.
The ratio of combined fixed charges and preference dividends to earnings
is computed by adding combined fixed charges to preference dividends and
dividing that total by pretax income from operations before fixed charges
(other than capitalized interest). Combined fixed charges consist of interest
charges and amortization of debt expense and discount or premium related to
indebtedness, whether expensed or capitalized, and that portion of rental
expense we believe to be representative of interest. For the period from March
5, 1996 (inception) to December 31, 1996, the years ended December 31, 1997
and 1998, and the three months ended March 31, 1998 and
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1999, earning were insufficient to cover combined fixed charges and preference
dividends by $13.6 million, $138.1 million, $281.5 million, $38.6 million and
$108.1 million, respectively.
USE OF PROCEEDS
Unless otherwise indicated in the applicable prospectus supplement, the net
proceeds from the sale of shares of Class A common stock, preferred stock,
debt securities, or depositary shares will be used to fund working capital,
capital expenditures, operating losses and other general corporate purposes,
including acquisitions. We will not receive any of the proceeds from the sale
of Class A common stock that may be offered by the selling stockholder.
DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock is based upon our
certificate of incorporation, our by-laws and applicable provisions of law.
The following description is qualified in its entirety by reference to such
certificate of incorporation and by-laws, which have been filed as exhibits to
earlier registration statements filed by us with the SEC. See "WHERE YOU CAN
FIND INFORMATION ABOUT TELIGENT" for information sources at which you can
locate copies of our certificate of incorporation and by-laws.
Certain provisions of our certificate of incorporation and by-laws
summarized in the following paragraphs may be deemed to have an anti-takeover
effect and may delay, defer or prevent a tender offer or takeover attempt that
a stockholder might consider in its best interests, including those attempts
that might result in a premium over the market price for shares held.
Authorized and Outstanding Capital Stock
Our authorized capital stock consists of 265,000,000 shares of common
stock and 10,000,000 shares of preferred stock. Of the 265,000,000 authorized
shares of our common stock, 200,000,000 shares are designated as Class A
common stock and 65,000,000 shares are designated as Class B common stock. Of
the 65,000,000 authorized shares of Class B common stock, 30,000,000 shares
are designated as Class B, Series 1 (the "Series B-1 common stock"),
25,000,000 shares are designated as Class B, Series 2 (the "Series B-2 common
stock") and 10,000,000 shares are designated as Class B, Series 3 (the "Series
B-3 common stock"). As of April 23, 1999, there were 8,314,795 shares of Class
A common stock issued and outstanding, 21,436,689 shares of Series B-1 common
stock issued and outstanding, held by one stockholder of record, 17,206,210
shares of Series B-2 common stock issued and outstanding, held by one
stockholder of record, and 5,783,400 shares of Series B-3 common stock issued
and outstanding, held by one stockholder of record.
Our Class A common stock is admitted for trading on the Nasdaq National
Market and trades under the symbol "TGNT." The Transfer Agent and Registrar
for our Class A common stock is First Union National Bank.
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Common Stock
Voting Rights. In general, the rights of Class A common stock and Class B
common stock shareholders are substantially identical, except that until the
number of shares held by holders of the respective series of Class B common
stock fall below certain thresholds, such holders will have the right to elect
directors to our board of directors as follows: a majority of the directors
will be elected by the holders of the Series B-1 common stock; one director
will be elected by the holders of the Series B-2 common stock; and one
director will be elected by the holders of the Series B-3 common stock.
The holders of Class A common stock and Class B common stock, voting
together as a single class, are entitled to elect all members of our board of
directors, other than any Series B-1 Directors, Series B-2 Director or Series
B-3 Director (the "Common Directors"). There are currently seven directors.
Pursuant to our certificate of incorporation, the holders of Series B-1
common stock, voting as a separate class, are entitled to elect that number of
directors equal to the minimum number necessary to constitute a majority of
members of our board of directors (the "Series B-1 Directors"). However, if at
any time the number of issued and outstanding shares of Series B-1 common
stock is less than 20% of the aggregate number of issued and outstanding
shares of common stock then, without any further action by us or any other
party, all of such issued and outstanding shares of Series B-1 common stock
will automatically be converted into an equal number of shares of Class A
common stock and the holders of the converted Series B-1 common stock will no
longer be entitled to elect Series B-1 Directors.
The holders of Series B-2 common stock, voting as a separate class, are
entitled to elect one member of our board of directors (the "Series B-2
Director"). However, if at any time the number of issued and outstanding
shares of Series B-2 common stock is less than 10% of the aggregate number of
issued and outstanding shares of common stock then, without any further action
by us or any other party, all of such issued and outstanding shares of Series
B-2 common stock will automatically be converted into an equal number of
shares of Class A common stock and the holders of the converted Series B-2
common stock will no longer be entitled to elect the Series B-2 Director.
The holders of Series B-3 common stock, voting as a separate class, are
entitled to elect one member of our board of directors (the "Series B-3
Director"). However, if at any time (A) the number of issued and outstanding
shares of Series B-3 common stock is less than (1) 3% of the aggregate number
of issued and outstanding shares of common stock or (2) 1,156,680 shares of
Series B-3 common stock or (B) Nippon Telegraph and Telephone Corporation or
any person or entity controlled by it chooses at any time to engage in, or
make a material investment in any person or entity whose principal business
is, the provision in the United States of any terrestrial fixed wireless local
telecommunications services offered by Teligent in the same market segments
(i.e., business or residential), then, without any further action by us or any
party, all of such issued and outstanding shares of Series B-3 common stock
will automatically be converted into an equal number of shares of Class A
common stock and the holders of the converted Series B-3 common stock will no
longer be entitled to elect the Series B-3 Director. In the event of any stock
split, reverse stock split, stock dividend or similar transaction with respect
to the Series B-3 common stock, the number referred to in clause (2) of this
paragraph is required to be appropriately adjusted.
Except as otherwise required by law or, as described herein, by the
certificate of incorporation, the holders of shares of common stock vote
together as a single class on all matters presented to a
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vote of stockholders. Each registered holder of common stock is entitled to
one vote per share. There is no cumulative voting.
Removal of Directors. Any Series B-1 Director, Series B-2 Director or
Series B-3 Director may be removed with or without cause, but only by the
affirmative vote of the holders of a majority of the shares of the series of
Class B common stock entitled to elect such director, voting as a separate
class. Any Common Director may be removed with or without cause, but only by
the affirmative vote of the holders of a majority of the shares of Class A
common stock and Class B common stock voting together as a single class.
Vacancy. Any vacancy in the office of a director may be filled by a vote
of holders of, in the case of any Series B-1 Director, Series B-2 Director or
Series B-3 Director, the series of Class B common stock entitled to elect such
director voting as a separate class and, in the case of any Common Director,
the Class A common stock and Class B common stock voting together as a single
class. Any vacancy in the office of a Common Director may, in the absence of a
stockholder vote, be filled by the remaining directors or, if there remains
only one director, by such sole remaining director; provided, further,
however, that any vacancy in the office of a Series B-1 Director may, in the
absence of a stockholder vote, be filled by the remaining Series B-1 Directors
or, if there remains only one Series B-1 Director, by such sole remaining
Series B-1 Director.
Transfers of Certain Common Stock. Under our certificate of
incorporation, no holder of shares of Class B common stock may transfer, and
we may not register, or permit the transfer agent for such common stock to
register, the transfer of any shares of Class B common stock or any interest
therein, whether by sale, assignment, gift, bequest, pledge, hypothecation,
encumbrance, or any other disposition, except to a Permitted Transferee (as
defined below) of such holder. If a holder of shares of Class B common stock
transfers any such shares to any person or entity other than a Permitted
Transferee of such holder, such transfer, without any further action by us or
of any party, will automatically convert such shares into an equal number of
shares of Class A common stock from the date of such transfer. The certificate
of incorporation defines "Permitted Transferee" to mean only: (1) in the case
of any holder of shares of Series B-1 common stock, The Associated Group, Inc.
and any corporation, partnership or other business entity directly or
indirectly controlled by The Associated Group, Inc. at the time of transfer;
(2) in the case of any holder of shares of Series B-2 common stock, Dr.
Rajendra Singh, Neera Singh and any corporation, partnership or other business
entity directly or indirectly controlled by Dr. Rajendra Singh, Neera Singh or
their respective executors (to the extent acting in such capacity) or direct
descendants; provided, however, that if any holder of Series B-2 common stock
ceases to be so controlled, then any shares of Series B-2 common stock held by
such holder will be deemed to have been transferred to a person or entity
other than a Permitted Transferee; and (3) in the case of any holder of shares
of Series B-3 common stock, Nippon Telegraph and Telephone Corporation and any
corporation, partnership or other business entity directly or indirectly
controlled by Nippon Telegraph and Telephone Corporation at the time of
transfer.
Any holder of shares of Class B common stock, or any Permitted Transferee
of such holder, may grant a security interest in, or pledge, pursuant to a
bona fide financing arrangement involving the holder or Permitted Transferee,
all or any portion of the holder's or Permitted Transferee's shares of Class B
common stock, if (1) the grant or pledge does not require registration or
qualification pursuant to any federal or state securities laws and (2) we
receive copies of any instruments evidencing the grant or pledge and the
secured party's or pledgee's written acknowledgment that it has reviewed the
terms of the certificate of incorporation. No such grant or pledge will by
itself cause the conversion of any such shares of Class B common stock into
shares of Class A common
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stock. If any secured party or pledgee (which is not a Permitted Transferee of
the holder making such grant or pledge) forecloses upon any such shares of
Class B common stock, such foreclosure, without any further action by us or
any other party, will automatically and irrevocably convert such shares into
an equal number of shares of Class A common stock from the date of such
foreclosure.
Conversion into Series A Common Stock. Under the certificate of
incorporation, each share of Class B common stock is convertible at any time,
at the option of the registered holder, into one fully paid and nonassessable
share of Class A common stock, subject to adjustment for any stock split.
Liquidation. In the event of any voluntary or involuntary liquidation,
dissolution or winding up of Teligent, after distribution in full of any
amounts to be distributed to holders of shares of preferred stock, unless
otherwise required by law, holders of shares of common stock are entitled to
receive all the remaining assets. Distribution of such remaining assets to the
holders of common stock will be in proportion to the number of shares of
common stock held by them. Under the certificate of incorporation, the holders
of common stock will participate in such assets as if all classes and series
of common stock constituted a single class of stock.
Dividends. The holders of shares of our common stock will be entitled to
receive, when, as and if declared by the board of directors, out of our assets
which are by law available therefor, dividends payable either in cash, in
property or in shares of capital stock. The payment of such dividends are
subject to the preferential rights of holders of preferred stock, if any.
Under the certificate of incorporation, no dividend will be declared or paid
in respect of any class of common stock unless the holders of all classes of
common stock receive the same per share dividend, payable in the same amount
and type of consideration, as if such classes constituted a single class.
However, if any dividend is declared that is payable in shares of common
stock, or in other rights to acquire shares of common stock, then (1) such
dividend will be declared and paid at the same rate per share with respect to
each class of common stock, (2) the dividend payable on shares of Class A
common stock will be payable only in shares of, or in other rights to acquire
shares of, Class A common stock and (3) the dividend payable on shares of each
series of Class B common stock will be payable only in shares of, or in other
rights to acquire shares of, the same series of Class B common stock.
Preferred Stock
Under the certificate of incorporation, the board of directors has the
authority to create one or more series of preferred stock, to issue shares of
preferred stock in such series up to the maximum number of shares of preferred
stock authorized, and to determine the preferences, rights, privileges and
restrictions of any series, including the dividend rights, voting rights,
rights and terms of redemption, liquidation preferences, the number of shares
constituting any such series and the designation of such series. The
authorized shares of preferred stock, as well as authorized but unissued
shares of common stock, are available for issuance without further action by
our stockholder, except to the extent stockholder action is required by
applicable law or by the rules of a stock exchange or quotation system on
which any series of our stock may then be listed or quoted, or as required by
our certificate of incorporation or by-laws.
The applicable prospectus supplement will describe the terms of any
preferred stock being offered, including:
o the number of shares and designation or title of the shares;
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o any liquidation preference per share;
o any date of maturity;
o any redemption, repayment or sinking fund provisions;
o any dividend rate or rates and the dates of payment (or the
method for determining the dividend rates or dates of payment);
o any voting rights;
o if other than the currency of the United States, the currency
or currencies including composite currencies in which the
preferred stock is denominated and/or in which payments will or
may be payable;
o the method by which amounts in respect of the preferred stock
may be calculated and any commodities, currencies or indices,
or value, rate or price, relevant to such calculation;
o whether the preferred stock is convertible or exchangeable and,
if so, the securities or rights into which the preferred stock
is convertible or exchangeable, and the terms and conditions of
conversion or exchange;
o the place or places where dividends and other payments on the
preferred stock will be payable;
o any conditions or restrictions on the creation of indebtedness
by us or upon the issuance of any additional stock; and
o any additional voting, dividend, liquidation, redemption and
other rights, preferences, privileges, limitations and
restrictions.
All shares of preferred stock offered will, when issued, be fully paid
and non-assessable. Any shares of preferred stock that are issued would have
priority over the common stock with respect to dividend or liquidation rights
or both.
The transfer agent for each series of preferred stock will be described
in the applicable prospectus supplement.
Restriction on Foreign Ownership
Under our certificate of incorporation, the board of directors has all
the powers necessary to ensure our compliance with the foreign ownership
restrictions under the Communications Act of 1934, and the rules, regulations
and decisions of the Federal Communications Commission. The board of
directors' power includes the power to prohibit the transfer of any shares of
our capital stock to any Foreign Owner and to take or cause to be taken such
action as it deems appropriate to implement such prohibition. "Foreign Owner"
means (a) any person who is a citizen of a country other than the United
States; (b) any corporation or other legal entity organized under the laws of
any government other than the government of the United States or of any state,
territory or possession of the United States; (c) any government other than
the government of the United States
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or of any state, territory or possession of the United States; and (d) any
representative of any of the foregoing or any entity owned, or whose capital
was contributed in whole or in part, by any of the foregoing.
Under the certificate of incorporation, any shares of our capital stock
determined by the board of directors to be beneficially owned by any Foreign
Owner, or with respect to which any Foreign Owner has voting rights, will be
subject to redemption by action of the board of directors to the extent
necessary to comply with foreign ownership restrictions. In such event, the
redemption price of the shares to be redeemed will be equal to the fair market
value of such shares, as determined by the board of directors in good faith.
Under the certificate of incorporation, the redemption price of such shares
may be paid in cash, securities or any combination thereof. Such redemption
will be upon such other terms and conditions as the board of directors shall
determine.
We have entered into a stockholders agreement with holders of the Class B
common stock. The stockholders agreement provides for certain rights and
obligations with respect to our ownership and governance. The stockholders
agreement also provides for certain rights and obligations of the parties
thereto relating to our compliance with the foreign ownership restrictions
under the Communications Act of 1934 and the rules, regulations and decisions
of the Federal Communications Commission.
Under the stockholders agreement, if we are required by a change in law
or other circumstance to reduce the level of foreign ownership of Teligent and
we are unable to obtain a waiver of such requirement, we will have the right,
and will be required, at the holder of the Series B-3 common stock's election,
to refuse to sell our stock to any Foreign Owner if such a transaction would
adversely impact the holder of the Series B-3 common stock's ability to hold
its then existing share ownership in Teligent. In addition, we will have the
right, and will be required, at the election of any party to the stockholders
agreement, to repurchase for cash, to the extent permitted by applicable
Delaware corporation law, shares first from all other Foreign Owners other
than the parties to the stockholders agreement, if applicable, and thereafter
from each party to the stockholders agreement, on a pro rata basis in
accordance with the stockholders agreement.
Anti-takeover Effects of Provisions of Our Certificate of Incorporation and
By-laws and the Delaware General Corporation Law
Our certificate of incorporation provides disproportionate voting rights
of the Class B common stock to elect a majority of the members of our board of
directors relative to the Class A common stock and the authorization of our
board of directors to issue, without stockholder approval, one or more series
of preferred stock having such preferences, powers and relative,
participating, optional and other rights as the board of directors may
determine. The certificate of incorporation further provides that stockholders
are not entitled to call a special meeting of stockholders, nor to require the
board of directors to call such a meeting. The certificate of incorporation
also provides that stockholders are not entitled to act by written consent in
lieu of a meeting; except that in connection with the election or removal of
any Series B-1 Director, Series B-2 Director or Series B-3 Director, the
holders of the series of Class B common stock entitled to elect or remove such
director may vote as a separate class by written consent in lieu of a meeting.
In addition, the by-laws contain certain advance notice requirements that must
be complied with by any stockholder who wishes to nominate any person for
election to our board of directors or who otherwise wishes to properly bring
business before an annual meeting of our stockholders. These provisions of the
certificate of incorporation, together with the ability of The Associated
Group, Inc. to elect a majority of Teligent's board of directors, could
discourage potential acquisition proposals and could delay or prevent a change
of
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control of Teligent.
Delaware Takeover Statute. We are subject to Section 203 ("Section 203")
of the Delaware General Corporation Law, which, subject to certain exceptions,
prohibits a Delaware corporation from engaging in any business combination
with any interested stockholder for a period of three years following the date
that such stockholder became an interested stockholder, unless: (1) prior to
such date, the board of directors of the corporation approved either the
business combination or the transaction that resulted in the stockholder
becoming an interested stockholder; (2) upon consummation of the transaction
that resulted in the stockholder becoming an interested stockholder, the
interested stockholder owned at least 85% of the voting stock of the
corporation outstanding at the time the transaction commenced, excluding for
purposes of determining the number of shares outstanding those shares owned
(a) by persons who are directors and also officers and (b) by employee stock
plans in which employee participants do not have the right to determine
confidentially whether shares held subject to the plan will be tendered in a
tender or exchange offer; or (3) on or subsequent to such date, the business
combination is approved by the board of directors and authorized at an annual
or special meeting of stockholders, and not by written consent, by the
affirmative vote of at least 66 2/3% of the outstanding voting stock that is
not owned by the interested stockholder.
Section 203 defines "business combination" to include: (1) any merger or
consolidation involving the corporation and the interested stockholder; (2)
any sale, transfer, pledge or other disposition of 10% or more of the assets
of the corporation involving the interested stockholder; (3) subject to
certain exceptions, any transaction that results in the issuance or transfer
by the corporation of any stock of the corporation to the interested
stockholder; (4) any transaction involving the corporation that has the effect
of increasing the proportionate share of the stock of any class or series of
the corporation beneficially owned by the interested stockholder; or (5) the
receipt by the interested stockholder of the benefit of any loans, advances,
guarantees, pledges or other financial benefits provided by or through the
corporation. In general, Section 203 defines an interested stockholder as any
entity or person beneficially owning 15% or more of the outstanding voting
stock of the corporation and any entity or person affiliated with or
controlling or controlled by such entity or person. The restrictions on
business combinations contained in Section 203 would not apply to any business
combination between the current holders of the Series B-1 common stock or the
current holders of the Series B-2 common stock, on the one hand, and us, on
the other hand.
DESCRIPTION OF DEBT SECURITIES
This section describes the general terms and provisions of the debt
securities which may be offered by us from time to time. The prospectus
supplement will describe the specific terms of the debt securities offered by
that prospectus supplement.
We may issue debt securities either separately or together with, or upon
the conversion of, or in exchange for, other securities. The debt securities
are to be either senior obligations of ours issued in one or more series and
referred to herein as the "Senior Debt Securities," subordinated obligations
of ours issued in one or more series and referred to herein as the
"Subordinated Debt Securities," or junior subordinated obligations of Teligent
issued in one or more series and referred to herein as the "Junior
Subordinated Debt Securities." The Senior Debt Securities, the Subordinated
Debt Securities and the Junior Subordinated Debt Securities are collectively
referred to as the "Debt Securities." Each series of Debt Securities will be
issued pursuant to a written agreement, known as an "Indenture," to be entered
into by us and an independent third party, known as a "Trustee",
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who will be legally obligated to carry out the terms of the Indenture. The
name(s) of the Trustee(s) will be set forth in the applicable prospectus
supplement. We may issue all the Debt Securities under the same Indenture, as
one or separate series, as specified in the applicable prospectus supplements.
We have summarized certain terms and provisions of the Indentures. The
summary is not complete. If we refer to particular provisions of an Indenture,
the provisions, including definitions of certain terms, are incorporated by
reference as a part of this summary. The Indentures are filed as an exhibit to
the registration statement of which this prospectus is a part, and are
incorporated by reference. The Indentures are subject to and governed by the
Trust Indenture Act of 1939, as amended. You should refer to the applicable
Indenture for the provisions which may be important to you.
General
The Indentures will not limit the amount of Debt Securities which we may
issue. We may issue Debt Securities up to an aggregate principal amount as we
may authorize from time to time. The applicable prospectus supplement will
describe the terms of any Debt Securities being offered, including:
o the designation, aggregate principal amount and authorized
denominations;
o the maturity date;
o the interest rate, if any, and the method for calculating the
interest rate;
o the interest payment dates and the record dates for the
interest payments;
o any mandatory or optional redemption terms or prepayment,
conversion, sinking fund or exchangeability or convertibility
provisions;
o the places where the principal and interest will be payable;
o if other than denominations of $1,000 or multiples of $1,000,
the denominations the Debt Securities will be issued in;
o whether the Debt Securities will be issued in the form of
Global Securities (as defined below) or certificates;
o additional provisions, if any, relating to the defeasance and
covenant defeasance of the Debt Securities;
o whether the Debt Securities will be issuable in registered form
("Registered Securities") or bearer form ("Bearer Securities")
or both and, if Bearer Securities are issuable, any
restrictions applicable to the exchange of one form for another
and the offer, sale and delivery of Bearer Securities;
o whether such Debt Securities will be Senior Debt Securities,
Subordinated Debt Securities or Junior Subordinated Debt
Securities and, if Subordinated Debt Securities or Junior
Subordinated Debt Securities, the subordination provisions and
the applicable
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definition of "Senior Indebtedness";
o any applicable material federal tax consequences;
o the dates on which premium, if any, will be payable;
o our right, if any, to defer payment of interest and the maximum
length of such deferral period;
o any listing on a securities exchange;
o if convertible into Class A common stock or preferred stock,
the terms on which such Debt Securities are convertible;
o the terms, if any, of any guarantee of the payment of principal
of, and premium, if any, and interest on Debt Securities of the
series and any corresponding changes to the provisions of the
Indenture as currently in effect;
o the terms, if any, of the transfer, mortgage, pledge, or
assignment as security for the Debt Securities of the series of
any properties, assets, moneys, proceeds, securities or other
collateral, including whether certain provisions of the Trust
Indenture Act are applicable, and any corresponding changes to
provisions of the Indenture as currently in effect;
o the initial public offering price; and
o other specific terms, including covenants and any additions or
changes to the events of default provided for with respect to
the Debt Securities.
If the purchase price of any Debt Securities is payable in a currency
other than U.S. dollars or if principal of, or premium, if any, or interest,
if any, on any of the Debt Securities is payable in any currency other than
U.S. dollars, the specific terms and other information with respect to such
Debt Securities and such foreign currency will be specified in the applicable
prospectus supplement relating thereto.
Debt Securities may be issued as Original Issue Discount Securities (as
defined in the Indentures) to be sold at a substantial discount below their
principal amount. Original Issue Discount Securities may include "zero coupon"
securities that do not pay any cash interest for the entire term of the
securities. In the event of an acceleration of the maturity of any Original
Issue Discount Security, the amount payable to the holder thereof upon such
acceleration will be determined in the manner described in the applicable
prospectus supplement. Conditions pursuant to which payment of the principal
of the Subordinated Debt Securities may be accelerated will be set forth in
the applicable prospectus supplement. Material federal income tax and other
considerations applicable to Original Issue Discount Securities will be
described in the applicable prospectus supplement.
Under the Indentures, the terms of the Debt Securities of any series may
differ and we, without the consent of the holders of the Debt Securities of
any series, may reopen a previous series of Debt Securities and issue
additional Debt Securities of such series or establish additional terms of
such series, unless otherwise indicated in the applicable prospectus
supplement.
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Covenants
Under the Indentures, we will be required to:
o pay the principal, interest and any premium on the Debt
Securities when due;
o maintain a place of payment;
o deliver a report to the Trustee at the end of each fiscal year
reviewing our obligations under the Indentures; and
o deposit sufficient funds with any paying agent on or before the
due date for any principal, interest or any premium.
Any additional covenants will be described in the applicable prospectus
supplement.
Registration, Transfer, Payment and Paying Agent
Unless otherwise indicated in a prospectus supplement, each series of
Debt Securities will be issued in registered form only, without coupons. The
Indentures, however, provide that we may also issue Debt Securities in bearer
form only, or in both registered and bearer form. Bearer Securities shall not
be offered, sold, resold or delivered in connection with their original
issuance in the United States or to any United States person other than
offices located outside the United States of certain United States financial
institutions. "United States person" means any citizen or resident of the
United States, any corporation, partnership or other entity created or
organized in or under the laws of the United States, any estate the income of
which is subject to United States federal income taxation regardless of its
source, or any trust whose administration is subject to the primary
supervision of a United States court and which has one or more United States
fiduciaries who have the authority to control all substantial decisions of the
trust. "United States" means the United States of America (including the
states thereof and the District of Columbia), its territories, its possessions
and other areas subject to its jurisdiction. Purchasers of Bearer Securities
will be subject to certification procedures and may be affected by certain
limitations under United States tax laws. Such procedures and limitations will
be described in the prospectus supplement relating to the offering of the
Bearer Securities.
Unless otherwise indicated in a prospectus supplement, Registered
Securities will be issued in denominations of $1,000 or any integral multiple
thereof, and Bearer Securities will be issued in denominations of $5,000.
Unless otherwise indicated in a prospectus supplement, the principal,
premium, if any, and interest, if any, of or on the Debt Securities will be
payable, and Debt Securities may be surrendered for registration of transfer
or exchange, at an office or agency to be maintained by us in the Borough of
Manhattan, The City of New York, provided that payments of interest with
respect to any Registered Security may be made at our option by check mailed
to the address of the person entitled to payment or by transfer to an account
maintained by the payee with a bank located in the United States. No service
charge shall be made for any registration of transfer or exchange of Debt
Securities, but we may require payment of a sum sufficient to cover any tax or
other governmental charge and any other expenses that may be imposed in
connection with the exchange or transfer.
Unless otherwise indicated in a prospectus supplement, payment of
principal of, premium, if
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any, and interest, if any, on Bearer Securities will be made, subject to any
applicable laws and regulations, at such office or agency outside the United
States as specified in the prospectus supplement and as we may designate from
time to time. Unless otherwise indicated in a prospectus supplement, payment
of interest due on Bearer Securities on any interest payment date will be made
only against surrender of the coupon relating to such interest payment date.
Unless otherwise indicated in a prospectus supplement, no payment of
principal, premium or interest with respect to any Bearer Security will be
made at any office or agency in the United States or by check mailed to any
address in the United States or by transfer to an account maintained with a
bank located in the United States; except that if amounts owing with respect
to any Bearer Securities shall be payable in U.S. dollars, payment may be made
at the Corporate Trust Office of the applicable Trustee or at any office or
agency designated by us in the Borough of Manhattan, The City of New York, if
(but only if) payment of the full amount of such principal, premium or
interest at all offices outside of the United States maintained for such
purpose by us is illegal or effectively precluded by exchange controls or
similar restrictions.
Unless otherwise indicated in the applicable prospectus supplement, we
will not be required to:
o issue, register the transfer of or exchange Debt Securities of
any series during a period beginning at the opening of business
15 days before any selection of Debt Securities of that series
of like tenor to be redeemed and ending at the close of
business on the day of that selection;
o register the transfer of or exchange any Registered Security,
or portion thereof, called for redemption, except the
unredeemed portion of any Registered Security being redeemed in
part;
o exchange any Bearer Security called for redemption, except to
exchange such Bearer Security for a Registered Security of that
series and like tenor that is simultaneously surrendered for
redemption; or
o issue, register the transfer of or exchange any Debt Security
which has been surrendered for repayment at the option of the
holder, except the portion, if any, of the Debt Security not to
be so repaid.
Ranking of Debt Securities
The Senior Debt Securities will be unsubordinated obligations of ours and
will rank equally in right of payment with all other unsubordinated
indebtedness of ours. The Subordinated Debt Securities and Junior Subordinated
Debt Securities will be obligations of ours and will be subordinated in right
of payment to all existing and future Senior Indebtedness. The prospectus
supplement will describe the subordination provisions and set forth the
definition of "Senior Indebtedness" applicable to the Subordinated Debt
Securities or Junior Subordinated Debt Securities, as the case may be, and
will set forth the approximate amount of such Senior Indebtedness outstanding
as of a recent date.
Global Securities
The Debt Securities of a series may be issued in whole or in part in the
form of one or more global securities that will be deposited with, or on
behalf of, a "Depositary" identified in the prospectus supplement relating to
such series. Global Debt Securities may be issued in either
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registered or bearer form and in either temporary or permanent form. Unless
and until it is exchanged in whole or in part for individual certificates
evidencing Debt Securities, a global Debt Security may not be transferred
except as a whole (1) by the Depositary to a nominee of such Depositary, (2)
by a nominee of such Depositary to such Depositary or another nominee of such
Depositary or (3) by such Depositary or any such nominee to a successor of
such Depositary or a nominee of such successor.
The specific terms of the depositary arrangement with respect to a series
of global Debt Securities and certain limitations and restrictions relating to
a series of global Bearer Securities will be described in the prospectus
supplement.
Outstanding Debt Securities
In determining whether the holders of the requisite principal amount of
outstanding Debt Securities have given any request, demand, authorization,
direction, notice, consent or waiver under the relevant Indenture, the amount
of outstanding Debt Securities will be calculated based on the following:
o the portion of the principal amount of an Original Issue
Discount Security that shall be deemed to be outstanding for
such purposes shall be that portion of the principal amount
thereof that could be declared to be due and payable upon a
declaration of acceleration thereof pursuant to the terms of
such Original Issue Discount Security as of the date of such
determination,
o the principal amount of a Debt Security denominated in a
currency other than U.S. dollars shall be the U.S. dollar
equivalent, determined on the date of original issue of such
Debt Security, of the principal amount of such Debt Security;
and
o any Debt Security owned by us or any obligor on such Debt
Security or any affiliate of us or such other obligor shall be
deemed not to be outstanding.
Redemption and Repurchase
The Debt Securities may be redeemable at our option, may be subject to
mandatory redemption pursuant to a sinking fund or otherwise, or may be
subject to repurchase by Teligent at the option of the holders, in each case
upon the terms, at the times and at the prices set forth in the applicable
prospectus supplement.
Conversion and Exchange
The terms, if any, on which Debt Securities of any series are convertible
into or exchangeable for Class A common stock, preferred stock, or other Debt
Securities will be set forth in the applicable prospectus supplement. Such
terms may include provisions for conversion or exchange, either mandatory, at
the option of the holders or at our option.
Absence of Limitation on Indebtedness and Liens; Absence of Event Risk
Protection
The applicable prospectus supplement will specify any prohibitions on the
amount of indebtedness, guarantees or other liabilities that may be incurred
by us and any prohibitions on our ability to create or assume liens on our
property. Unless otherwise provided in a prospectus
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supplement, the Indentures will not require the maintenance of any financial
ratios by, or specified levels of net worth, revenues, income, cash flow or
liquidity of, Teligent, and will not contain provisions which would give
holders of the Debt Securities the right to require us to repurchase their
Debt Securities in the event of a takeover, recapitalization or similar
restructuring or change in control of Teligent.
Consolidation, Merger and Sale of Assets
Each Indenture generally permits a consolidation or merger (subject
to certain limitations and conditions) between us and another corporation.
They also permit the sale by us of all or substantially all of our property
and assets. If this happens, the remaining or acquiring corporation shall
assume all of our responsibilities and liabilities under the Indentures
including the payment of all amounts due on the Debt Securities and
performance of the covenants in the Indentures.
We are only permitted to consolidate or merge with or into any other
U. S. corporation or sell all or substantially all of our assets according to
the terms and conditions of the Indentures, unless otherwise indicated in the
applicable prospectus supplement. The remaining or acquiring corporation will
be substituted for us in the Indentures with the same effect as if it had been
an original party to the Indenture. Thereafter, the successor corporation may
exercise our rights and powers under any Indenture, in our name or in its own
name. Any act or proceeding required or permitted to be done by our board of
directors or any of our officers may be done by the board or officers of the
successor corporation.
Events of Default
Unless otherwise specified in the applicable prospectus supplement, an
Event of Default, as defined in the Indentures and applicable to Debt
Securities issued under such Indentures, will occur with respect to the Debt
Securities of any series under the Indenture upon:
o default for a period to be specified in the applicable
prospectus supplement in payment of any interest with respect
to any Debt Security of such series;
o default in payment of principal or any premium with respect to
any Debt Security of such series when due upon maturity,
redemption, repurchase at the option of the holder or
otherwise;
o default in deposit of any sinking fund payment when due with
respect to any Debt Security of such series;
o default by us in the performance, or breach, of any other
covenant or warranty in such Indenture (other than a covenant
or warranty included therein solely for the benefit of a series
of Debt Securities other than that series) which shall not have
been remedied for a period to be specified in the applicable
prospectus supplement after notice to us by the applicable
Trustee or the holders of not less than a fixed percentage in
aggregate principal amount of the Debt Securities of all series
issued under the applicable Indenture;
o certain events of bankruptcy, insolvency or reorganization of
us; or
o any other Event of Default that may be set forth in the
applicable prospectus supplement,
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including, but not limited to, an Event of Default based on
other debt being accelerated ("cross-acceleration").
No Event of Default with respect to any particular series of Debt
Securities necessarily constitutes an Event of Default with respect to any
other series of Debt Securities. Each Indenture provides that the Trustee
thereunder may withhold notice to the holders of the Debt Securities of any
series outstanding under such Indenture of the occurrence of a default with
respect to the Debt Securities of such series (except a default in payment of
principal, premium, if any, interest, if any, or sinking fund payments, if
any) if the Trustee considers it in the interest of the holders to do so.
Each Indenture provides that if an Event of Default with respect to any
series of Debt Securities issued thereunder shall have occurred and be
continuing, either the relevant Trustee or the holders of at least a fixed
percentage in principal amount of the Debt Securities of such series then
outstanding may declare the principal amount (or if any Debt Securities of
such series are Original Issue Discount Securities, such lesser amount as may
be specified in the applicable prospectus supplement) of all the Debt
Securities of such series to be due and payable immediately, but upon certain
conditions such declaration and its consequences may be rescinded and annulled
by the holders of a majority in principal amount of the Debt Securities of all
series issued under the applicable Indenture.
The applicable prospectus supplement will provide the terms pursuant to
which an Event of Default shall result in acceleration of the payment of
principal of Subordinated Debt Securities or Junior Subordinated Debt
Securities.
In the case of a default in the payment of principal of, or premium, if
any, or interest, if any, on any Subordinated Debt Securities or Junior
Subordinated Debt Securities of any series, the applicable Trustee, subject to
certain limitations and conditions, may institute a judicial proceeding for
the collection thereof.
No holder of any of the Debt Securities issued of any series under either
Indenture has any right to institute any proceeding with respect to the
Indenture or any remedy thereunder, unless the holders of at least a fixed
percentage in principal amount of the outstanding Debt Securities of such
series have made written request, and offered reasonable indemnity, to the
Trustee to institute such proceeding as Trustee, the Trustee has failed to
institute such proceeding within 60 days after receipt of such notice and the
Trustee has not within such 60-day period received directions inconsistent
with such written request by holders of a majority in principal amount of the
outstanding Debt Securities of such series. Such limitations do not apply,
however, to a suit instituted by a holder of a Debt Security for the
enforcement of the payment of the principal of, premium, if any, or any
accrued and unpaid interest on, the Debt Security on or after the respective
due dates expressed in the Debt Security.
During the existence of an Event of Default under either Indenture, the
Trustee is required to exercise such rights and powers vested in it under the
Indenture and use the same degree of care and skill in its exercise thereof as
a prudent person would exercise under the circumstances in the conduct of such
person's own affairs. Subject to the provisions of the Indenture relating to
the duties of the Trustee, if an Event of Default shall occur and be
continuing, the Trustee is not under any obligation to exercise any of its
rights or powers under the Indenture at the request or direction of any of the
holders unless such holders shall have offered to the Trustee reasonable
security or indemnity. Subject to certain provisions concerning the rights of
the Trustee, the holders of a majority in principal amount of the outstanding
Debt Securities of any series have the right to direct
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the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust, or power conferred on the
Trustee with respect to such series.
The Indentures provide that the Trustee will, within 45 days after the
occurrence of any Default, give to the holders of the Debt Securities of such
series notice of such Default known to it, unless such Default shall have been
cured or waived; provided that, except in the case of a Default in payment of
principal of or premium, if any, on any Debt Security of such series when due
or in the case of any Default in the payment of any interest on the Debt
Securities of such series, the Trustee shall be protected in withholding such
notice if it determines in good faith that the withholding of such notice is
in the interest of such holders.
Teligent is required to furnish to the Trustee annually a statement as to
compliance with all conditions and covenants under the Indentures.
Modification and Waivers
From time to time, Teligent, when authorized by resolutions of our board
of directors, and the Trustee, without the consent of the holders of Debt
Securities of any series, may amend, waive or supplement the Indentures and
the Debt Securities of such series for certain specified purposes, including,
among other things:
o to cure ambiguities, defects or inconsistencies;
o to provide for the assumption of our obligations to holders of the
Debt Securities of such series in the case of a merger or
consolidation;
o to add to our Events of Default or our covenants or to make any
change that would provide any additional rights or benefits to the
holders of the Debt Securities of such series;
o to add or change any provisions of such Indenture to facilitate the
issuance of Bearer Securities;
o to establish the form or terms of Debt Securities of any series and
any related coupons;
o to add guarantors with respect to the Debt Securities of such
series;
o to secure the Debt Securities of such series;
o to maintain the qualification of the Indenture under the Trust
Indenture Act; or
o to make any change that does not adversely affect the rights of any
holder.
Other amendments and modifications of the Indentures or the Debt
Securities issued thereunder may be made by Teligent and the Trustee with the
consent of the holders of not less than a majority of the aggregate principal
amount of the outstanding Debt Securities of each series affected thereby
(each series voting as a separate class); provided that no such modification
or amendment may, without the consent of the holder of each outstanding Debt
Security affected thereby:
o reduce the principal amount of, or extend the fixed maturity of the
Debt Securities, or
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<PAGE>
alter or waive any redemption, repurchase or sinking fund provisions
of the Debt Securities;
o reduce the amount of principal of any Original Issue Discount
Securities that would be due and payable upon an acceleration of the
maturity thereof, or
o change the currency in which any Debt Securities or any premium or
the accrued interest thereon is payable;
o reduce the percentage in principal amount outstanding of Debt
Securities of any series which must consent to an amendment,
supplement or waiver or consent to take any action under the
Indenture or the Debt Securities of such series;
o impair the right to institute suit for the enforcement of any
payment on or with respect to the Debt Securities;
o waive a default in payment with respect to the Debt Securities or
any guarantee;
o Reduce the rate or extend the time for payment of interest on the
Debt Securities;
o adversely affect the ranking of the Debt Securities of any series;
o release any guarantor from any of its obligations under its
guarantee or the Indenture, except in compliance with the terms of
the Indenture; or
o solely in the case of a series of Subordinated Debt Securities or
Junior Subordinated Debt Securities, modify any of the applicable
subordination provisions or the applicable definition of Senior
Indebtedness in a manner adverse to any holders.
The holders of a majority in aggregate principal amount of the
outstanding Debt Securities of any series may waive compliance by us with
certain restrictive provisions of the relevant Indenture, including and such
other restrictive covenants, if any, as may be set forth in the applicable
prospectus supplement. The holders of a majority in aggregate principal amount
of the outstanding Debt Securities of any series may, on behalf of all holders
of Debt Securities of that series, waive any past default under the applicable
Indenture with respect to Debt Securities of that series and its consequences,
except a default in the payment of the principal of, or premium, if any, or
interest, if any, on any Debt Securities of such series or in respect of a
covenant or provision which cannot be modified or amended without the consent
of a larger fixed percentage or by the holder of each outstanding Debt
Securities of the series affected.
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<PAGE>
Discharge, Defeasance and Covenant Defeasance
When we establish a series of Debt Securities, we may provide that series
is subject to the defeasance and discharge provisions of the applicable
Indenture. If those provisions are made applicable, we may elect either:
o to defease and be discharged from, subject to some limitations, all of
our obligations with respect to those Debt Securities; or
o to be released from our obligations to comply with specified covenants
relating to those Debt Securities as described in the applicable
prospectus supplement.
To effect that defeasance or covenant defeasance, we must irrevocably
deposit in trust with the relevant Trustee an amount in any combination of
funds or government obligations, which, through the payment of principal and
interest in accordance with their terms, will provide money sufficient to make
payments on those Debt Securities and any mandatory sinking fund or analogous
payments on those Debt Securities.
On such a defeasance, we will not be released from certain of our
obligations that will be specified in the applicable prospectus supplement.
To establish such a trust we must, among other things, deliver to the
relevant Trustee an opinion of counsel to the effect that the holders of those
Debt Securities:
o will not recognize income, gain or loss for U.S. federal income tax
purposes as a result of the defeasance or covenant defeasance; and
o will be subject to U.S. federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if the
defeasance or covenant defeasance had not occurred. In the case of
defeasance, the opinion of counsel must be based upon a ruling of the IRS
or a change in applicable U.S. federal income tax law occurring after the
date of the applicable Indenture.
If we effect covenant defeasance with respect to any Debt Securities, the
amount of deposit with the relevant Trustee will be sufficient to pay amounts
due on the Debt Securities at the time of their stated maturity. However,
those Debt Securities may become due and payable prior to their stated
maturity if there is an Event of Default with respect to a covenant from which
we have not been released. In that event, the amount on deposit may not be
sufficient to pay all amount due on the Debt Securities at the time of the
acceleration.
The applicable prospectus supplement may further describe the provisions,
if any, permitting defeasance or covenant defeasance, including any
modifications to the provisions described above.
Governing Law
The Indentures and the Debt Securities will be governed by, and construed
in accordance with, the laws of the State of New York.
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<PAGE>
Regarding the Trustees
The Trust Indenture Act contains limitations on the rights of a trustee,
should it become a creditor of ours, to obtain payment of claims in certain
cases or to realize on certain property received by it in respect of any such
claims, as security or otherwise. Each Trustee is permitted to engage in other
transactions with us and our subsidiaries from time to time, provided that if
such Trustee acquires any conflicting interest it must eliminate such conflict
upon the occurrence of an Event of Default under the relevant Indenture, or
else resign.
DESCRIPTION OF DEPOSITARY SHARES
This section describes the general terms and provisions of Preferred
Stock represented by depositary shares (the "Depositary Shares"). The specific
terms of the Depositary Shares will be delivered in the applicable prospectus
supplement.
We have summarized certain terms and provisions of the Deposit Agreements
(as defined below), the Depositary Shares and the receipts representing
Depositary Shares ("Depositary Receipts"). The following summaries do not
purport to be complete and are subject to, and are qualified in their entirety
by reference to, all the provisions of the Deposit Agreements, the Depositary
Shares and the Depositary Receipts, each of which will be filed as an exhibit
to or incorporated by reference in the Registration Statement of which this
prospectus forms a part.
We may issue Depositary Receipts evidencing the Depositary Shares. Each
Depositary Share will represent a fraction of a share of Preferred Stock.
Shares of Preferred Stock of each class or series represented by Depositary
Shares will be deposited under a separate Deposit Agreement (the "Deposit
Agreement") among us, the depositary (the "Preferred Stock Depositary") and
the holders of the Depositary Receipts. Subject to the terms of the Deposit
Agreement, each owner of a Depositary Receipt will be entitled, in proportion
to the fraction of a share of Preferred Stock represented by the Depositary
Shares evidenced by the Depositary Receipt, to all the rights and preferences
of the Preferred Stock represented by such Depositary Shares. Those rights
include any dividend, voting, conversion, redemption and liquidation rights.
Immediately following the issuance and delivery of the Preferred Stock to the
Preferred Stock Depositary, we will cause the Preferred Stock Depositary to
issue the Depositary Receipts on our behalf.
If Depositary Shares are offered, the applicable prospectus supplement
will describe the terms of such Depositary Shares, the Deposit Agreement and,
if applicable, the Depositary Receipts, including the following, where
applicable:
o the payment of dividends or other cash distributions to the holders
of Depositary Receipts when such dividends or other cash
distributions are made with respect to the Preferred Stock;
o the voting by a holder of Depositary Shares of the Preferred Stock
underlying such Depositary Shares at any meeting called for such
purpose;
o if applicable, the redemption of Depositary Shares upon a redemption
by us of shares of Preferred Stock held by the Preferred Stock
Depositary;
o if applicable, the exchange of Depositary Shares upon an exchange by
us of shares of
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Preferred Stock held by the Preferred Stock Depositary for Debt
Securities or common stock;
o if applicable, the conversion of the shares of Preferred Stock
underlying the Depositary Shares into shares of our common stock,
other shares of our Preferred Stock or our Debt Securities;
o the terms upon which the Deposit Agreement may be amended and
terminated;
o a summary of the fees to be paid by us to the Preferred Stock
Depositary;
o the terms upon which a Preferred Stock Depositary may resign or be
removed by us; and
o any other terms of the Depositary Shares, the Deposit Agreement and
the Depositary Receipts.
If a holder of Depositary Receipts surrenders the Depositary Receipts at
the corporate trust office of the Preferred Stock Depositary (unless the
related Depositary Shares have previously been called for redemption,
converted or exchanged into other securities of Teligent), the holder will be
entitled to receive at this office the number of shares of Preferred Stock and
any money or other property represented by such Depositary Shares. Holders of
Depositary Receipts will be entitled to receive whole and, to the extent
provided by the applicable prospectus supplement, fractional shares of the
Preferred Stock on the basis of the proportion of Preferred Stock represented
by each Depositary Share as specified in the applicable prospectus supplement.
Holders of shares of Preferred Stock received in exchange for Depositary
Shares will no longer be entitled to receive Depositary Shares in exchange for
shares of Preferred Stock. If the holder delivers Depositary Receipts
evidencing a number of Depositary Shares that is more than the number of
Depositary Shares representing the number of shares of Preferred Stock to be
withdrawn, the Preferred Stock Depositary will issue the holder a new
Depositary Receipt evidencing such excess number of Depositary Shares at the
same time.
Prospective purchasers of Depositary Shares should be aware that special
tax, accounting and other considerations may be applicable to instruments such
as Depositary Shares.
MANAGEMENT
Directors and Officers
Set forth below is certain information regarding the directors, executive
officers and certain other officers of Teligent:
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Name Age Position and Offices
Executive Officers
Alex J. Mandl............ 55 Chairman of the Board and Chief Executive
Officer
Kirby G. Pickle, Jr...... 42 President and Chief Operating Officer
Laurence E. Harris....... 63 Senior Vice President, General Counsel and
Assistant Secretary
Abraham L. Morris........ 40 Senior Vice President, Chief Financial
Officer and Treasurer
Steven F. Bell........... 49 Senior Vice President for Human Resources
Other Officers
Richard J. Hanna......... 43 Senior Vice President for Sales and
Marketing
Keith W. Kaczmarek....... 43 Senior Vice President for Engineering and
Operations
Philip C. McKinney....... 38 Vice President and Chief Information Officer
Robert H. Schwartz....... 33 Vice President for Corporate Development
and Strategy
Cindy L. Tallent......... 41 Vice President and Controller
David S. Turetsky........ 42 Vice President for Law and Regulatory
Affairs
Scott G. Bruce........... 37 Secretary
Other Directors
Myles P. Berkman......... 62 Director
David J. Berkman......... 37 Director
William H. Berkman....... 34 Director
Donald H. Jones.......... 61 Director
Tetsuro Mikami........... 47 Director
Rajendra Singh........... 44 Director
Alex J. Mandl has been Chairman and Chief Executive Officer of Teligent
since September 1996. Prior to joining Teligent, Mr. Mandl served as President
and Chief Operating Officer of AT&T and Executive Vice President of AT&T and
CEO of AT&T's Communications Services Group (1993-1995). As President and
Chief Operating Officer, Mr. Mandl oversaw AT&T's operations including its
long-distance, wireless and local communications services, in addition to its
credit card and Internet businesses. As Chief Financial Officer of AT&T from
1991 to 1993, Mr. Mandl directed AT&T's financial strategy, policy and
operations, and managed the acquisition of McCaw Cellular Communications, Inc.
Earlier, Mr. Mandl served as Chairman and CEO of Sea- Land Services, Inc., an
ocean transportation and distribution services company. Mr. Mandl serves on
the boards of the Warner-Lambert Company, Dell Computer Corporation, Forstmann
Little & Co. and General Instrument Corp.
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Kirby G. Pickle, Jr., has served as President and Chief Operating Officer
since February 1997. Prior to that, Mr. Pickle served as Executive Vice
President of MFS Communications Company, Inc. and President and Chief
Operating Officer of one of its subsidiaries, UUNET Technologies, Inc.
Earlier, as President and COO of MFS Intelenet, Inc., Mr. Pickle managed three
businesses that generated a majority of MFS' revenues. Prior to his service
for MFS, Mr. Pickle was a Vice President at US Sprint (now known as Sprint), a
regional sales manager for MCI Communications Corporation, Inc. and held
various management positions at AT&T.
Laurence E. Harris has been Senior Vice President and General Counsel
since December 1996. Prior to joining the Company, Mr. Harris served as Senior
Vice President of Law and Public Policy for MCI Communications Corporation.
Earlier, Mr. Harris was President and Chief Operating Officer of Metromedia
Telecommunications, Inc. and CRICO Communications, a privately-held paging
company. Mr. Harris also served as chief of the FCC's Mass Media Bureau where
he was responsible for regulation and policy for cable, television and radio
broadcasting. Mr. Harris was also responsible for regulatory and antitrust
activities at MCI before serving at the FCC.
Abraham L. Morris joined Teligent in April 1997 as Senior Vice President,
Chief Financial Officer and Treasurer. Prior to that, he served as Senior Vice
President for Operations Support at MFS Communications Company, Inc., where
Mr. Morris was involved in business development, revenue assurance and
co-carrier/local service activities. Earlier, Mr. Morris was Vice President
and Chief Transition Officer for MFS Intelenet, Inc., and previously was
Treasurer of MFS. Mr. Morris was involved in MFS' capital raising activities,
including its initial public offering. Before joining MFS, Mr. Morris served
as General Manager, Mergers and Acquisitions at Peter Kiewit Sons', Inc., a
diversified industrial services company.
Steven F. Bell joined Teligent as its Senior Vice President for Human
Resources in April 1997. Prior to joining Teligent, Mr. Bell served as Vice
President for Human Resources and Organization Development at COMSAT
Corporation where he was responsible for executive and staff recruitment and
development at the 4,000-employee satellite communications company. Earlier,
Mr. Bell was Vice President, Human Resources for the worldwide technologies
division of American Express Corporation.
Richard J. Hanna joined Teligent in April 1997 as Senior Vice President
for Sales and Marketing. Prior to joining Teligent, Mr. Hanna served as
President and Chief Executive Officer of MFS Intelenet, Inc. Prior to that, he
served as Vice President of Sales and Marketing for AT&T where he was
responsible for developing its commercial sales channel. Mr. Hanna also served
in senior sales and marketing positions at MCI Communications Corporation and
Sprint.
Keith W. Kaczmarek joined Teligent in May 1997 as Senior Vice President
of Engineering and Operations. Prior to joining Teligent, he served as Vice
President of Engineering and Operations for AirTouch/PCS PrimeCo, where he
managed the development and installation of PCS deployment of CDMA wireless
technology. Between 1993 and 1995, as Vice President of Technology Development
and Product Development for Nextel Communications, Mr. Kaczmarek managed
technology development for the company's digital mobile wireless networks. He
has also held senior positions at AirTouch Communications, GTE Corp. and GTE
Mobilnet, Inc.
Philip C. McKinney, Teligent's Vice President and Chief Information
Officer, joined Teligent in March 1997 as Vice President for Information
Technology. Prior to joining the Company, Mr. McKinney was Director of
Consulting Services for Computer Sciences Corporation where he oversaw client
engagements for start-up and established providers in the communication
industry.
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Earlier, Mr. McKinney was Director of Operations where he managed customer
care, billing and information technology outsourcing services to
telecommunication clients in North America.
Robert H. Schwartz joined Teligent upon inception in March 1996 as Vice
President of Corporate Development and Strategy. Previously, Mr. Schwartz
served as Director of Corporate Development for Nextel where he was involved
in strategic planning, mergers and acquisitions and various investment
transactions including public fundraising activities. Prior to that, Mr.
Schwartz performed consulting work in the communications industry including
satellite, cable television, and wireless telecommunications companies.
Cindy L. Tallent joined Teligent in September 1997 as Vice President and
Controller. Prior to joining the Company, Ms. Tallent was Senior Vice
President, Finance for Global TeleSystems Group, Inc. There she was involved
in establishing and managing international joint ventures, securing financing
and implementing systems and controls. Ms. Tallent also held various finance
positions at GTE where she was employed for ten years and was Vice President
and Chief Financial Officer for GTE Spacenet when she left in 1995. Prior to
GTE, Ms. Tallent was a senior accountant with Price Waterhouse LLP.
David S. Turetsky joined Teligent in May 1997 as Vice President for Law
and Regulatory Affairs. He served in the Antitrust Division of the U.S.
Department of Justice as Deputy Assistant Attorney General for Civil and
Regulatory Affairs and originally as senior counsel to the Assistant Attorney
General. He assisted in developing the Clinton Administration's
telecommunications policy, including the Telecommunications Act of 1996, and
was responsible for the Division's telecommunications work. While at the U.S.
Department of Justice, he represented the United States in international
telecommunications and antitrust matters and assisted in overseeing a
telecommunications services accord through the World Trade Organization.
Earlier, he was a partner in the law offices of LeBoeuf, Lamb, Leiby & MacRae.
Scott G. Bruce has been Secretary of the Company since its inception in
March 1996. Mr. Bruce is also Vice President, General Counsel and Secretary of
Associated and served as the Company's General Counsel until December 1996.
Mr. Bruce has experience in the fields of corporate mergers and acquisitions
and securities law. Between 1987 and 1992, he was a corporate attorney at
Wolf, Block, Schorr and Solis-Cohen in Philadelphia. Earlier, he worked in the
New York office of Touche Ross & Co., the predecessor to Deloitte & Touche
LLP.
Myles P. Berkman has been a director of Teligent since its inception in
March 1996. Mr. Berkman is Chairman, Chief Executive Officer, President and
Treasurer of The Associated Group, Inc. ("Associated"), positions he has held
since 1994 with the exception of Chairman which he has held since November
1995. In addition to beneficially owning 48.3% of Teligent's Class B common
stock, Associated is engaged in the ownership and operation of various
communications related businesses, including a provider of wireless location
services, international wireless telephony, radio broadcasting and a portfolio
of marketable equity securities. From 1979 to 1994, Mr. Berkman was President,
Chief Operating Officer and Treasurer of Associated Communications Corporation
("ACC"), the parent corporation of Associated prior to 1995, which also was a
publicly traded company. Mr. Berkman developed ACC into one of the largest
independent U.S. cellular operators at the time of its sale to SBC
Communications Inc. in 1994. Mr. Berkman is the father of William H. Berkman
and David J. Berkman, each of whom is also a director of Teligent.
David J. Berkman has been a director of Teligent since its inception in
March 1996. Since 1994, Mr. Berkman has served as Executive Vice President and
a director of Associated. In addition,
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Mr. Berkman serves as Chairman and Chief Executive Officer of TruePosition,
Inc., a wholly owned subsidiary of Associated. From 1993 to 1994, Mr. Berkman
was Executive Vice President and a member of the Board of Directors of ACC.
Mr. Berkman serves as director and Vice Chairman of Grupo Portatel, S.A. de
C.V., a company operating cellular systems in Mexico in which Associated has a
significant interest. Mr. Berkman is also a director of Entercom
Communications Corp., a public company, which is the sixth largest radio
broadcasting company in the U.S., and V-SPAN, Inc., a private company that
specializes in teleconferencing services. David J. Berkman is the son of Myles
P. Berkman and the brother of William H. Berkman, each of whom is also a
director of Teligent.
William H. Berkman has been a director of Teligent since its inception in
March 1996. Mr. Berkman is currently President of Microwave Services, Inc., a
wholly owned subsidiary of Associated. Since June 5, 1997, Mr. Berkman has
served as an Assistant Secretary of Associated. Before joining Associated, Mr.
Berkman held several executive positions at The News Corporation, Ltd. Mr.
Berkman also serves as a director of CMG Information Services Inc., a public
company that provides Internet solutions through its operating companies and
strategic venture investments. William H. Berkman is the son of Myles P.
Berkman and the brother of David J. Berkman, each of whom is also a director
of Teligent.
Donald H. Jones has been a director of Teligent since November 1997. He
has served as a director of Associated since 1994. Prior to 1994, Mr. Jones
served as a director of ACC beginning in 1986, as well as a consultant to ACC
beginning in 1982. Mr. Jones is Chairman of Triangle Capital Corporation, a
firm engaged in the development of new business enterprises and investment
activities. Until April 1997, Mr. Jones was Vice Chairman of Nets Inc.,
formerly Industry.Net Corporation, a company that was engaged in internet
commerce, and from 1992 to June 1996, was its Chairman. Mr. Jones is a
director of Respironics Inc., a corporation engaged in the development,
manufacturing and marketing of medical equipment, and PNC Equity Management
Corporation, a corporation engaged in the investment in growth companies. Mr.
Jones also serves as an adjunct professor of entrepreneurship at the Carnegie
Mellon Graduate School of Business.
Tetsuro Mikami has been a director of Teligent since November 1997. Since
January 1999, Mr. Mikami has served as Director, Overseas Carrier Business
Group, Global Business Division of Nippon Telegraph and Telephone Corporation
("NTT"). From April 1993 to December 1998, Mr. Mikami served as General
Manager, Business Solutions Group, Long Distance, of NTT. Mr. Mikami has been
with NTT for over twenty years and has served in various senior management
roles. He currently resides in Tokyo, Japan.
Dr. Rajendra Singh has been a director of Teligent since its inception in
March 1996. Since December 1993, Dr. Singh has served as Chairman of the Board
and Chief Executive Officer of Telcom Ventures, L.L.C. ("Telcom Ventures").
Dr. Singh also served as President of Telcom Ventures, through September 1997.
Dr. Singh also serves as President and Treasurer of Digital Services
Corporation, an affiliate of Telcom Ventures. Dr. Singh founded Telcom
Ventures in 1993 and, together with his family, is one of the principal owners
of that company. From October 1998 to June 1999, Dr. Singh served as Chairman
of the Board and acting Chief Executive Officer of LCC International, Inc., a
worldwide provider of wireless engineering and design services and related
products which he co-founded in 1983 and which is an affiliate of Telcom
Ventures. Dr. Singh continues to serve on the Board of Directors of LCC
International, Inc. The Singh family and The Carlyle Group are the principal
owners of Telcom Ventures. Dr. Singh has created widely- used standards of
system design and methodology in the cellular industry.
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On April 22, 1999, Lucent Technologies announced that it had agreed to
sell its U.S. business communications systems sales group that serves small
and medium-sized businesses to a newly- formed company which will be led by
Susan Mandl. Susan Mandl is the wife of Alex Mandl, the CEO of Teligent. Susan
Mandl was formerly president and CEO of Newcourt Communications Finance and
will be Chairman and CEO and the principal stockholder of the new company. It
has been announced that the new company intends to provide communication
equipment, supplies and a full range of other communications services,
including, as an agent, services comparable to those offered by Teligent, to
the small and medium-sized business market. Teligent has, from time to time,
explored business relationships with other companies which offer equipment and
supplies similar to those offered by the new company. In this regard, Teligent
is exploring a business relationship with the new company. Alex Mandl will
have no equity interest in the new company, but he will be jointly liable with
Susan Mandl for the borrowings which will be used to finance the purchase of a
portion of Susan Mandl's equity in the new company.
SELLING STOCKHOLDER
The following table sets forth, as of April 23, 1999, certain information
regarding the share ownership of the selling stockholder. The registration of
the selling stockholder's common stock does not necessarily mean that the
selling stockholder will offer or sell any of the shares.
<TABLE>
<CAPTION>
Common Stock (1)
Shares Shares
Beneficially Beneficially
Owned Percent Shares Owned
Prior to This Of Offered for If All Shares
Name of Selling Stockholder(2) Offering Ownership Sale Are Sold
<S> <C> <C> <C> <C>
Telcom Ventures, L.L.C.(3) 17,206,210 32.6% (4) 2,000,000 (5) 15,206,210
200 N. Union Street, Suite 300
Alexandria, VA 22201
</TABLE>
(1) Unless otherwise indicated, the selling stockholder listed above has
represented that it possesses sole voting and sole investment power with
respect to the shares beneficially owned by such entity includes all
options, warrants and convertible securities currently exercisable or
exercisable within 60 days of April 23, 1999. The percentages of
beneficial ownership as to such entity assumes the exercise or conversion
of all options, warrants and convertible securities held by such entity.
(2) The names of additional selling stockholders may be provided subsequent
hereto.
(3) Dr. Rajendra Singh, Chairman of the Board and Chief Executive Officer of
Telcom Ventures, L.L.C., is a member of the board of directors of
Teligent. Teligent is or was a party to numerous agreements with Telcom
Ventures, L.L.C. All shares are held of record by Telcom-DTS Investors,
L.L.C., an affiliate of Telcom Ventures L.L.C.
(4) Reflects ownership as percentage of Class A common stock and Class B
common stock issued and outstanding.
(5) Assumes conversion of the Series B-2 common stock beneficially owned by
Telcom Ventures, L.L.C. and offered for sale into shares of Class A
common stock.
In November 1998, Telcom filed, pursuant to its registration rights
agreement with Teligent, a "demand" registration request with respect to
8,603,000 of its Teligent shares of common stock. On June 8, 1999, Telcom
withdrew its "demand" registration. The shares of common stock being
registered by Telcom hereby are being registered pursuant to Telcom's
"piggyback" registration
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rights under its registration rights agreement.
PLAN OF DISTRIBUTION
Teligent and the selling stockholder may sell the securities in any of
three ways, or in any combination thereof, as follows:
o through underwriters or dealers;
o directly to a limited number of purchasers or to a single
purchaser; or
o through agents.
A prospectus supplement will set forth the terms of the offering of the
securities offered thereby, including:
o the name or names of any underwriters and the respective
amounts of such securities underwritten or purchased by each of
them;
o the initial public offering price of such securities and the
proceeds to Teligent or the selling stockholder, if any, and
any discounts, commissions or concessions allowed or paid to
dealers;
o any securities exchanges on which such securities may be
listed; and
o the number of shares of Class A common stock to be sold by the
selling stockholder, if any.
Only underwriters named in such prospectus supplement are deemed to be
underwriters in connection with the securities offered thereby.
If underwriters are used in the sale of any securities, such securities
will be acquired by the underwriters for their own account and may be resold
from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. Such securities may be either offered to the public
through underwriting syndicates represented by managing underwriters, or
directly by underwriters. Unless otherwise set forth in the applicable
prospectus supplement, the obligations of the underwriters to purchase such
securities will be subject to certain conditions precedent and the
underwriters will be obligated to purchase all of such securities if any are
purchased. Any initial public offering price and any discounts or concessions
allowed or paid to dealers may be changed from time to time.
The securities may be sold directly by us or the selling stockholder or
through agents designated by us or the selling stockholder from time to time.
Any agent involved in the offer or sale of the securities in respect of which
a prospectus supplement is delivered will be named, and any commissions
payable by us or the selling stockholder to such agent will be set forth, in
the prospectus supplement. Unless otherwise indicated in the prospectus
supplement, any such agent will be acting on a best efforts basis for the
period of its appointment.
If so indicated in the applicable prospectus supplement, we or the
selling stockholder will
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authorize underwriters, dealers or agents to solicit offers by institutional
investors to purchase the securities from us and the selling stockholder at
the public offering price set forth in the prospectus supplement pursuant to
delayed delivery contracts providing for payment and delivery on a specified
date in the future. There may be limitations on the minimum amount which may
be purchased by any such institutional investor or on the portion of the
aggregate principal amount of the particular securities which may be sold
pursuant to such arrangements. Institutional investors to which such offers
may be made, when authorized, include commercial and savings banks, insurance
companies, pension funds, investment companies, educational and charitable
institutions, and such other institutions as may be approved by us and the
selling stockholder, if applicable. The obligations of any such purchasers
pursuant to such delayed delivery and payment arrangements will be subject
only to those conditions set forth in the prospectus supplement, and the
prospectus supplement will set forth the commission payable for solicitation
of such contracts. Underwriters will not have any responsibility in respect of
the validity of such arrangements or the performance of Teligent, the selling
stockholder or such institutional investors thereunder.
Securities offered other than Class A common stock may be a new issue of
securities with no established trading market. Any underwriters to whom such
securities are sold by us for public offering and sale may make a market in
such securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. No assurance can be
given as to the liquidity of or the trading markets for any such securities.
Stockholders may sell their shares through various arrangements involving
mandatorily exchangeable securities, and this prospectus may be delivered in
conjunction with such sales.
We will not receive any proceeds from the sale of shares of Class A
common stock by the selling stockholder. We will, however, bear certain
expenses in connection with the registration of the securities being offered
under this prospectus by the selling stockholder, including all costs incident
to the offering and sale of the securities to the public other than any
commissions and discounts of underwriters, dealers or agents and any transfer
taxes.
Agents and underwriters may be entitled under agreements entered into
with us or the selling stockholder to indemnification by us and, if
applicable, the selling stockholder against certain civil liabilities,
including liabilities under the Securities Act of 1933, or to contribution
with respect to payments which the agents or underwriters may be required to
make in respect thereof. We will also indemnify the selling stockholder, if
any, against such liabilities and agree to make such contributions on behalf
of the selling stockholder. Agents and underwriters may be customers of,
engage in transactions with, or perform services for us or the selling
stockholder in the ordinary course of business.
LEGAL MATTERS
The validity of the securities in respect of which this prospectus is
being delivered will be passed on for us by Cravath, Swaine & Moore, New York,
New York.
33
<PAGE>
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements included in our Annual Report on Form 10-K for the year
ended December 31, 1998, as set forth in their report, which is incorporated
by reference in this prospectus. Our financial statements are incorporated by
reference in reliance on Ernst & Young LLP's report, given on their authority
as experts in accounting and auditing.
34
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the costs and expenses payable by Teligent
in connection with sale of the securities being registered hereby. All amounts
are estimates, except the registration fee.
Item Amount
Registration Fee $
Rating Agency Fees*
Trustees Fees and Expenses*
Printing*
Legal Fees and Expenses*
Listing Fees*
Accounting Fees and Expenses*
Miscellaneous Expenses* --------------
Total $
==============
*Estimated
Item 15. Indemnification of Directors and Officers
Section 102 of the Delaware General Corporation Law ("DGCL"), as amended,
allows a corporation to eliminate the personal liability of directors of a
corporation to the corporation or its stockholders for monetary damages for a
breach of fiduciary duty as a director, except where the director breached his
duty of loyalty, failed to act in good faith, engaged in intentional
misconduct or knowingly violated a law, authorized the payment of a dividend
or approved a stock repurchase in violation of Delaware corporate law or
obtained an improper personal benefit. Section 145 of the DGCL, as amended,
provides that a corporation may indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the corporation), by
reason of the fact that he is or was a director, officer, employee or agent of
the corporation or is or was serving at its request in such capacity in
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred by him in connection with
such action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.
Certificate of Incorporation
Article Eighth of Teligent's certificate of incorporation provides that
Teligent will indemnify its directors and officers to the fullest extent
authorized or permitted by law, as now or hereafter in
35
<PAGE>
effect, and such right to indemnification will continue as to a person who has
ceased to be a director or officer of Teligent and will inure to the benefit
of his or her heirs, executors and personal and legal representatives;
provided, that except for proceedings to enforce rights to indemnification,
Teligent will not be obligated to indemnify any director or officer (or his or
her heirs, executors or personal or legal representatives) in connection with
a proceeding (or part thereof) initiated by such person unless such proceeding
(or part thereof) was authorized or consented to by the Board of Directors.
The right to indemnification conferred by Article Eighth includes the right to
be paid by Teligent the expenses as incurred in defending or otherwise
participating in any proceeding in advance of its final disposition. The
rights to indemnification and to the advance of expenses conferred in Article
Eighth are not exclusive of any other right which any person may have or
hereafter acquire under the certificate of incorporation, the by-laws of
Teligent, any statute, agreement, vote of stockholders or disinterested
directors or otherwise.
By-laws
Section 1 of Article VIII of the By-laws provides that, subject to
Section 3 of Article VIII, Teligent will indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative (other than an action by or in the right of Teligent) by
reason of the fact that such person is or was a director or officer of
Teligent, or is or was a director or officer of Teligent serving at the
request of Teligent as a director or officer, employee or agent of another
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by such person in
connection with such action, suit or proceeding if such person acted in good
faith and in a manner such person reasonably believed to be in or not opposed
to the best interests of Teligent, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe such person's conduct was
unlawful. The termination of any action, suit or proceeding by judgment,
order, settlement, conviction, or upon a plea of nolo contendere or its
equivalent, will not, of itself, create a presumption that the person did not
act in good faith and in a manner which such person reasonably believed to be
in or not opposed to the best interests of Teligent, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that such
person's conduct was unlawful.
Section 2 of Article VIII of the By-laws provides that, subject to
Section 3 of Article VIII, Teligent will indemnify any person who was or is a
party or is threatened to be made a party to any threatened, pending or
completed action or suit by or in the right of Teligent to procure a judgment
in its favor by reason of the fact that such person is or was a director or
officer of Teligent, or is or was a director or officer of Teligent serving at
the request of Teligent as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise, against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection with the defense or
settlement of such action or suit if such person acted in good faith and in a
manner such person reasonably believed to be in or not opposed to the best
interests of Teligent; except that no indemnification shall be made in respect
of any claim, issue or matter as to which such person shall have been adjudged
to be liable to Teligent unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought shall determine
upon application that, despite the adjudication of liability but in view of
all the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the Court of Chancery or such
other court shall deem proper.
36
<PAGE>
Section 3 of Article VIII of the By-laws provides that any
indemnification under Article VIII (unless ordered by a court) will be made by
Teligent only as authorized in the specific case upon a determination that
indemnification of the director or officer is proper in the circumstances
because such person has met the applicable standard of conduct set forth in
Section 1 or Section 2 of Article VIII, as the case may be. Such determination
shall be made (i) by a majority vote of the directors who are not parties to
such action, suit or proceeding, even though less than a quorum, or (ii) if
there are no such directors, or if such directors so direct, by independent
legal counsel in a written opinion or (iii) by the stockholders. To the
extent, however, that a director or officer of Teligent has been successful on
the merits or otherwise in defense of any action, suit or proceeding described
above, or in defense of any claim, issue or matter therein, such person will
be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by such person in connection therewith, without the
necessity of authorization in the specific case.
Section 5 of Article VIII of the By-laws provides that, notwithstanding
any contrary determination in the specific case under Section 3 of Article
VIII, and notwithstanding the absence of any determination thereunder, any
director or officer may apply to the Court of Chancery in the State of
Delaware for indemnification to the extent otherwise permissible under
Sections 1 and 2 of Article VIII. The basis of such indemnification by a court
will be a determination by such court that indemnification of the director or
officer is proper in the circumstances because such person has met the
applicable standards of conduct set forth in Section 1 or 2 of Article VIII,
as the case may be. Neither a contrary determination in the specific case
under Section 3 of Article VIII nor the absence of any determination
thereunder will be a defense to such application or create a presumption that
the director or officer seeking indemnification has not met any applicable
standard of conduct. Notice of any application for indemnification pursuant to
Section 5 shall be given to Teligent promptly upon the filing of such
application. If successful, in whole or in part, the director or officer
seeking indemnification will also be entitled to be paid the expense of
prosecuting such application.
Section 7 of Article VIII of the By-laws provides that the
indemnification and advancement of expenses provided by or granted pursuant to
Article VIII will not be deemed exclusive of any other rights to which those
seeking indemnification or advancement of expenses may be entitled under the
certificate of incorporation, any by-law, agreement, vote of stockholders or
disinterested directors or otherwise, both as to action in such person's
official capacity and as to action in another capacity while holding such
office, it being the policy of Teligent that indemnification of the persons
specified in Sections 1 and 2 of Article VIII shall be made to the fullest
extent permitted by law. The provisions of Article VIII are not deemed to
preclude the indemnification of any person who is not specified in Section 1
or 2 of Article VIII but whom Teligent has the power or obligation to
indemnify under the provisions of the DGCL, or otherwise.
Section 8 of Article VIII of the By-laws provides that Teligent may
purchase and maintain insurance on behalf of any person who is or was a
director or officer of Teligent, or is or was a director or officer of
Teligent serving at the request of Teligent as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust, employee
benefit plan or other enterprise, against any liability asserted against such
person and incurred by such person in any such capacity, or arising out of
such person's status as such, whether or not Teligent would have the power or
the obligation to indemnify such person against such liability under the
provisions of Article VIII. Section 11 of Article VIII of the By-laws provides
that notwithstanding anything contained in Article VIII to the contrary,
except for proceedings to enforce rights to indemnification (which shall be
governed by Section 5 thereof), Teligent will not be obligated to indemnify
any director or officer in connection with a proceeding (or part thereof)
initiated by such person unless
37
<PAGE>
such proceeding (or part thereof) was authorized or consented to by the Board
of Directors of Teligent.
In connection with any offering by the selling stockholder pursuant to
this registration statement, the selling stockholder has agreed to indemnify
Teligent, its directors and officers and each such person who controls
Teligent, against any and all liability arising from inaccurate information
provided to Teligent by the selling stockholder and contained in the
prospectus or any applicable supplement.
Insurance
The directors and officers of Teligent are covered by insurance policies
indemnifying against certain liabilities, including certain liabilities
arising under the Securities Act of 1933, as amended, which might be incurred
by them in such capacities and against which they cannot be indemnified by
Teligent.
Item 16. Exhibits
1.1 Form of Debt Securities Underwriting Agreement**
1.2 Form of Preferred Stock Underwriting Agreement**
1.3 Form of Common Stock Underwriting Agreement**
1.4 Form of Depositary Shares Underwriting Agreement**
4.1 Form of Stockholders Agreement, filed as Exhibit 4.1 to the
Registration Statement on Form S-1 (Registration No. 333-37381),
dated November 26, 1997, and incorporated herein by reference.
4.2 Form of Certificate for the Class A Common Stock, filed as Exhibit
4.5 to the Company's Registration Statement on Form S-1
(Registration No. 333-37381), dated November 26, 1997, and
incorporated herein by reference.
4.3 Form of Indenture relating to Senior Debt Securities, including
form of Debt Security, to be issued hereunder*
4.4 Form of Indenture relating to Subordinated Debt Securities and
Junior Subordinated Debt Securities, including form of Debt
Security, to be issued hereunder*
4.5 Form of Deposit Agreement**
5.1 Opinion of Cravath, Swaine & Moore as to legality of the
securities being registered*
10.1 Form of Indenture between the Registrant, as issuer, and First
Union National Bank, as Trustee, relating to Registrant's Senior
Notes due 2007, including form of Note, filed as Exhibit 4.2 to
the Registrant's Registration Statement on Form S-1 (Registration
No. 333-37381), dated November 26, 1997, and incorporated herein
by reference.
10.2 Form of Pledge Agreement between Registrant, as issuer, and First
Union National Bank,
38
<PAGE>
as Escrow Agent, relating to Registrant's Senior Notes due 2007,
filed as Exhibit 4.3 to the Company's Registration Statement on
Form S-1 (Registration No. 333-37381), dated November 26, 1997,
and incorporated herein by reference.
10.3 Form of Indenture between the Registrant, as issuer, and First
Union National Bank, as Trustee, relating to Registrant's Senior
Discount Notes due 2008, including form of Note, filed as Exhibit
4.4 to Teligent's Form of Annual Report on Form 10-K, filed on
March 31, 1998, and incorporated by reference herein.
10.4 Agreement, dated September 29, 1997, among Teligent, L.L.C.,
Digital Services Corporation, Telcom-DTS Investors, L.L.C.,
Microwave Services, Inc., The Associated Group, Inc. and certain
other parties.***
12.1 Statement regarding computation of ratios
12.2 Statement regarding computation of ratios
23.1 Consent of Cravath, Swaine & Moore*
23.2 Consent of Ernst & Young LLP, Independent Auditors
24 Power of Attorney (set forth on signature page)
25.1 Statement of Eligibility of Trustee for Senior Debt Securities*
25.2 Statement of Eligibility of Trustee for the Subordinated Debt
Securities and Junior Subordinated Debt Securities*
* To be filed by amendment
** To be incorporated by reference herein in connection with the offering of
each series of securities
*** Incorporated by reference to Registrant's Registration Statement on Form
S-1 (Registration No. 333-37373)
Item 17. Undertakings
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made of
securities registered hereby, a post-effective amendment to this registration
statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any increase
or decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range
39
<PAGE>
may be reflected in the form of prospectus filed with the Securities and
Exchange Commission pursuant to Rule 424(b) under the Securities Act of
1933 if, in the aggregate, the changes in volume and price represent no
more than a 20% change in the maximum aggregate offering price set forth
in the "Calculation of Registration Fee" table in the effective
registration statement;
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
provided, however, that the undertakings set forth in paragraph (i) and
(ii) above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the registrant pursuant to section 13 or section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by reference
in this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
(b) The undersigned registrant hereby understands that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the SEC such
indemnification is against public policy as expressed in the Securities Act of
1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
The undersigned Registrant hereby undertakes to file an application for
the purpose of determining eligibility of the applicable Trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act of 1939 ("Act") in
accordance with the rules and regulations prescribed by the Commission under
Section 305(b) (2) of the Act.
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<PAGE>
SIGNATURE PAGE
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Vienna, Commonwealth of Virginia, on
June 11, 1999.
TELIGENT, INC.
By: /s/ Alex J. Mandl
------------------------------------
Name: Alex J. Mandl
Title: Chairman of the Board and CEO
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Each person in so signing, also makes, constitutes and appoints Alex J.
Mandl and Laurence E. Harris, and each of them acting alone, his true and
lawful attorney-in-fact, with full power of substitution, to execute and cause
to be filed with the Securities and Exchange Commission pursuant to the
requirements of the Securities Act of 1933, as amended, any and all amendments
and post- effective amendments to this registration statement, with exhibits
thereto and other documents in connection therewith, and any related
registration statement and its amendments and post-effective amendments filed
pursuant to Rule 462(b) under the Act, with exhibits thereto and other
documents in connection therewith, and hereby ratifies and confirms all that
said attorney-in-fact or his substitute or substitutes may do or cause to be
done by virtue thereof.
Signature Title Date
/s/ Alex J. Mandl
- -------------------------- Chairman of the Board, June 11, 1999
Alex J. Mandl CEO and Director
/s/ Abraham L. Morris
- -------------------------- Senior Vice President and CFO June 11, 1999
Abraham L. Morris (Principal Financial Officer)
/s/ Cindy L. Tallent
- -------------------------- Vice President and Controller June 11, 1999
Cindy L. Tallent (Principal Accounting Officer)
<PAGE>
Signature Title Date
/s/ Myles P. Berkman
- -------------------------- Director June 11, 1999
Myles P. Berkman
/s/ David J. Berkman
- -------------------------- Director June 11, 1999
David J. Berkman
/s/ William H. Berkman
- -------------------------- Director June 11, 1999
William H. Berkman
/s/ Donnald H. Jones
- -------------------------- Director June 11, 1999
Donald H. Jones
/s/ Tetsuro Mikami
- -------------------------- Director June 11, 1999
Tetsuro Mikami
/s/ Rajendra Singh
- -------------------------- Director June 11, 1999
Rajendra Singh
<PAGE>
EXHIBIT INDEX
The following Exhibits are filed as part of this Registration Statement.
1.1 Form of Debt Securities Underwriting Agreement**
1.2 Form of Preferred Stock Underwriting Agreement**
1.3 Form of Common Stock Underwriting Agreement**
1.4 Form of Depositary Shares Underwriting Agreement**
4.1 Form of Stockholders Agreement, filed as Exhibit 4.1 to
the Registration Statement on Form S-1 (Registration No.
333-37381), dated November 26, 1997, and incorporated
herein by reference.
4.2 Form of Certificate for the Class A Common Stock, filed as
Exhibit 4.5 to the Company's Registration Statement on
Form S-1 (Registration No. 333-37381), dated November 26,
1997, and incorporated herein by reference.
4.3 Form of Indenture relating to Senior Debt Securities,
including form of Debt Security, to be issued hereunder*
4.4 Form of Indenture relating to Subordinated Debt Securities
and Junior Subordinated Debt Securities, including form of
Debt Security, to be issued hereunder*
4.5 Form of Deposit Agreement**
5.1 Opinion of Cravath, Swaine & Moore as to legality of the
securities being registered*
10.1 Form of Indenture between the Registrant, as issuer, and
First Union National Bank, as Trustee, relating to
Registrant's Senior Notes due 2007, including form of
Note, filed as Exhibit 4.2 to the Registrant's
Registration Statement on Form S-1 (Registration No.
333-37381), dated November 26, 1997, and incorporated
herein by reference.
10.2 Form of Pledge Agreement between Registrant, as issuer,
and First Union National Bank, as Escrow Agent, relating
to Registrant's Senior Notes due 2007, filed as Exhibit
4.3 to the Company's Registration Statement on Form S-1
(Registration No. 333-37381), dated November 26, 1997, and
incorporated herein by reference.
10.3 Form of Indenture between the Registrant, as issuer, and
First Union National Bank, as Trustee, relating to
Registrant's Senior Discount Notes
<PAGE>
due 2008, including form of Note, filed as Exhibit 4.4 to
Teligent's Form of Annual Report on Form 10-K, filed on
March 31, 1998, and incorporated by reference herein.
10.4 Agreement, dated September 29, 1997, among Teligent,
L.L.C., Digital Services Corporation, Telcom-DTS
Investors, L.L.C., Microwave Services, Inc., The
Associated Group, Inc. and certain other parties.
12.1 Statement regarding computation of ratios
12.2 Statement regarding computation of ratios
23.1 Consent Cravath, Swaine & Moore*
23.2 Consent of Ernst & Young LLP, Independent Auditors
24 Power of Attorney (set forth on signature page)
25.1 Statement of Eligibility of Trustee for Senior Debt
Securities*
25.2 Statement of Eligibility of Trustee for the Subordinated
Debt Securities and the Junior Subordinated Debt
Securities*
* To be filed by amendment
** To be incorporated by reference herein in connection with
the offering of each series of securities
*** Incorporated by reference to Registrant's Registration
Statement on Form S-1 (Registration No. 333-37373)
2
Exhibit 12.1
Ration of Earnings to Fixed Charges
(dollars in thousands)
Three Three
March 5, 1996 Year Months Months
(inception) to Ended Ended Ended
December 31, December 31, March 31, March 31,
1996 1997 1998 1998 1999
---- ---- ---- ---- ----
Fixed charges:
Interest expense on
indebtedness
(including
amortization of debt
expense and discount) 879 5,859 66,880 11,929 19,761
Interest expense on
portion of rent
expense
representative
of interest 127 756 904 458 1,813
------- -------- -------- ------- --------
Total Fixed Charges 1,006 6,615 67,784 12,387 21,574
======= ======== ======== ======= ========
Earnings (Loss):
Net loss before
provisions for
income taxes (13,633) (138,054) (281,471) (38,558) (108,112)
Fixed charges
per above 1,006 6,615 67,784 12,387 21,574
------- -------- -------- ------- --------
Total Earnings (Loss) (12,627) (131,439) (213,687) (26,171) (86,538)
Ratio of Earnings to
Fixed Charge (12.55) (19.87) (3.15) (2.11) (4.01)
======= ======== ======== ======= ========
Coverage deficiency (13,633) (138,054) (281,471) (38,558) (108,112)
======= ======== ======== ======= ========
Exhibit 12.2
Ration of Combined Charges and Preference Dividends to Earnings
(dollars in thousands)
Three Three
March 5, 1996 Year Months Months
(inception) to Ended Ended Ended
December 31, December 31, March 31, March 31,
1996 1997 1998 1998 1999
---- ---- ---- ---- ----
Fixed charges
and Preference
Dividends:
Interest expense on
indebtedness
(including amortization
of debt expense and
discount) 879 5,859 66,880 11,929 19,761
Interest expense on
portion of rent expense
representative of
interest 127 756 904 458 1,813
Preference Dividends - - - - -
-------- -------- -------- -------- --------
Total Fixed Charges and
Preference Dividends 1,006 6,615 67,784 12,387 21,574
-------- -------- -------- -------- --------
Earnings (Loss):
Net loss before
provisions for
income taxes (13,633) (138,054) (281,471) ( 38,558) (108,112)
Fixed charges per above 1,006 6,615 67,784 12,387 21,574
-------- -------- -------- -------- -------
Total Earnings (Loss) (12,627) (131,439) (213,687) (26,171) (86,538)
======== ======== ======== ======== ========
Ratio of Earnings to
Fixed Charge (0.08) (0.05) (0.32) (0.47) (0.25)
======== ======== ======== ======== ========
Coverage deficiency (13,633) (138,054) (281,471) (38,558) (108,112)
======== ======== ======== ======== ========
Exhibit 23.2
Consent of Ernst & Young LLP, Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3 No. 333- ) and related Prospectus of
Teligent, Inc. and to the incorporation by reference therein of our report
dated February 12, 1999, with respect to the consolidated financial
statements of Teligent, Inc. included in its Annual Report (Form 10-K) for
the year ended December 31, 1998, filed with the Securities and Exchange
Commission.
/s/ Ernst & Young LLP
---------------------
Vienna, Virginia
June 10, 1999
