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EXHIBIT 4.1
EXECUTION COPY
VELOCOM INC.
THIRD AMENDED AND RESTATED INVESTORS AGREEMENT
JANUARY 7, 2000
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TABLE OF CONTENTS
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Article I Certain Definitions.....................................................................................1
Article II Registration Rights....................................................................................6
2.1 Demand Registrations ....................................................................................6
2.2 Piggyback Registrations .................................................................................8
2.3 Expenses of Registration ................................................................................8
2.4 Registration Procedures .................................................................................9
2.5 Indemnification ........................................................................................10
2.6 Other Obligations ......................................................................................12
2.7 Termination of Registration Rights .....................................................................13
Article III Restrictions On Transfer Of Stock....................................................................13
3.1 Restrictions on Transfer of Management Stock ...........................................................13
3.2 Right of First Negotiation .............................................................................14
3.3 Tag-Along Rights .......................................................................................16
Article IV Covenants Of The Company..............................................................................17
4.1 Basic Financial Information ............................................................................17
4.2 Additional Information Rights ..........................................................................18
4.3 Prompt Payment of Taxes, Etc ...........................................................................18
4.4 Maintenance of Properties and Leases ...................................................................18
4.5 Insurance ..............................................................................................19
4.6 Accounts and Records ...................................................................................19
4.7 Independent Accountants ................................................................................19
4.8 Compliance with Laws ...................................................................................19
4.9 Maintenance of Corporate Existence, Etc ................................................................20
4.10 Limited Preemptive Rights .............................................................................20
4.11 Additional Investor Rights ............................................................................21
4.12 Negative Covenants ....................................................................................21
Article V Corporate Governance...................................................................................22
5.1 Board of Directors .....................................................................................22
5.2 Meetings of the Board ..................................................................................24
5.3 Committees .............................................................................................24
5.4 Reimbursement of Expenses ..............................................................................24
5.5 Certain Approvals by Stockholders ......................................................................25
5.6 Certain Approvals by Directors .........................................................................25
Article VI Miscellaneous.........................................................................................25
6.1 Governing Law ..........................................................................................25
6.2 Successors and Assigns .................................................................................25
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6.3 Entire Agreement; Amendment and Waiver .................................................................26
6.4 Specific Enforcement ...................................................................................26
6.5 Severability ...........................................................................................26
6.6 Notices, Etc ...........................................................................................26
6.7 Counterparts; Facsimile ................................................................................27
6.8 Delays or Omissions ....................................................................................27
6.9 Termination ............................................................................................27
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THIRD AMENDED AND RESTATED INVESTORS AGREEMENT
This Third Amended and Restated Investors Agreement (this "Agreement")
is dated as of January 7, 2000, by and among (i) VeloCom Inc. a Delaware
corporation (the "Company"), (ii) the holders of the Company's Common Stock,
Series A Preferred Stock, Series B Preferred Stock and/or Series B-1 Preferred
Stock identified as "Investors" on the signature page (the "Investors") and
(iii) the other holders of the Company's Common Stock, Series A Preferred Stock,
Series B Preferred Stock and/or Series B-1 Preferred Stock, including Management
Holders (as defined below) identified as "Other Holders" on the signature page
(the "Other Holders"). The Investors and the Other Holders are referred to
collectively as the "Stockholders."
In consideration of the mutual promises and covenants set forth herein,
the parties agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
As used in this Agreement, the following terms shall have the following
respective meanings:
"AFFILIATE" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by or under common control with,
such Person; for purposes of this definition, "control" shall mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of an entity, whether through the
ownership of voting securities, by contract or otherwise. A follow-on fund of an
Investor, a fund formed by the executives of any Investor and any co-investment
vehicle, shall be deemed to be an Affiliate of such Investor.
"AGREEMENT" shall have the meaning set forth in the Introductory
Paragraph of this Agreement.
"BANK OF AMERICA DIRECTOR" shall have the meaning set forth in Section
5.1(a)(ii)(H) of this Agreement.
"CENTENNIAL ENTITIES" shall have the meaning set forth in Section
5.1(a)(ii)(C) of this Agreement.
"CENTENNIAL ENTITIES DIRECTOR" shall have the meaning set forth in
Section 5.1(a)(ii)(C) of this Agreement.
"CHESTNUT DIRECTOR" shall have the meaning set forth in Section
5.1(a)(ii)(I) of this Agreement.
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"COMMISSION" shall mean the Securities and Exchange Commission or any
other federal agency at the time administering the Securities Act.
"COMMON STOCK" shall mean the Company's Voting Common Stock and
Non-Voting Common Stock, $.0001 par value per share.
"COMMON STOCK DEEMED OUTSTANDING" means, at any given time, the number
of shares of Common Stock actually outstanding at such time, plus (a) the number
of shares of Common Stock which would be issued upon exercise of all of the
Company's outstanding options and warrants and (b) the number of shares of
Common Stock which would be issued upon conversion or exchange of all of the
Company's outstanding convertible securities (including convertible securities
issuable upon exercise of options and warrants).
"COMPANY" shall have the meaning set forth in the introductory
paragraph of this Agreement.
"COMPANY NEGOTIATION PERIOD" shall have the meaning set forth in
Section 3.2(b) of this Agreement.
"CRESCENDO ENTITIES" shall have the meaning set forth in Section
5.1(a)(ii)(D) of this Agreement.
"CRESCENDO ENTITIES DIRECTOR" shall have the meaning set forth in
Section 5.1(a)(ii)(D) of this Agreement.
"DEMAND REGISTRATION" shall have the meaning set forth in Section
2.1(a) of this Agreement.
"EQUITY SECURITIES" shall have the meaning set forth in Section 4.10(a)
of this Agreement.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934 (or any
similar successor federal statute), as amended, and the rules and regulations
thereunder, all as the same shall be in effect from time to time.
"FIRST UNION DIRECTOR" shall have the meaning set forth in Section
5.1(a)(ii)(J) of this Agreement.
"FLOOR PRICE" shall have the meaning set forth in Section 3.2(d) of
this Agreement.
"FORMUS DIRECTOR" shall have the meaning set forth in Section
5.1(a)(ii)(F) of this Agreement.
"INDEMNIFIED PARTY" shall have the meaning set forth in Section 2.5(c)
of this Agreement.
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"INDEMNIFYING PARTY" shall have the meaning set forth in Section 2.5(c)
of this Agreement.
"INITIATING HOLDERS" shall mean holders of Registrable Securities
representing not less than thirty-three percent (33%) of the then-outstanding
Registrable Securities.
"INVESTORS" shall have the meaning set forth in the introductory
paragraph of this Agreement. Permitted Transferees of an Investor shall also be
considered to be Investors.
"INVESTOR STOCK" shall mean (i) shares of Common Stock owned by the
Investors or any transferee thereof; (ii) shares of Common Stock issued or
issuable upon the conversion or exercise of any stock (including, without
limitation, the Series A Preferred Stock and Series B/B-1 Preferred Stock)
warrants, options or other securities of the Company owned by the Investors or
any transferee thereof; and (iii) any shares of Common Stock issued as a
dividend or other distribution with respect to or in exchange for or in
replacement of the shares referenced in (i) and (ii)above.
"INVESTORS PRO RATA NUMBER OF SHARES" shall have the meaning set forth
in Section 3.1 of this Agreement.
"LONG FORM REGISTRATION" shall have the meaning set forth in Section
2.11(a) of this Agreement.
"MANAGEMENT DIRECTORS" shall have the meaning set forth in Section
5.1(a)(ii)(A) of this Agreement.
"MANAGEMENT HOLDERS" shall mean members of the Company's management
that hold shares of Common Stock, Series A Preferred Stock or Series B/B-1
Preferred Stock and are parties to this Agreement or have agreed to be bound by
the provisions of this Agreement. As of the date hereof, the Management Holders
are as set forth on Schedule I. Permitted Transferees of a Management Holder
shall also be considered to be Management Holders.
"MANAGEMENT STOCK" shall mean (i) shares of Common Stock owned by the
Management Holders or any transferee thereof, other than an Investor; (ii)
shares of Common Stock issued or issuable upon the conversion or exercise of any
options, warrants or other securities of the Company owned by the Management
Holders; and (iii) any shares of Common Stock issued as a dividend or other
distribution with respect to or in exchange for or in replacement of the shares
referenced in (i) and (ii) above.
"NEGOTIATION PERIOD" shall have the meaning set forth in Section 3.2(c)
of this Agreement.
"OFFER" shall have the meaning set forth in Section 3.3(b) of this
Agreement.
"OFFEREES" shall have the meaning set forth in Section 3.2(a) of this
Agreement.
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"OFFER NOTICE" shall have the meaning set forth in Section 3.2(a) of
this Agreement.
"OTHER HOLDERS" shall have the meaning set forth in the introductory
paragraph of this Agreement.
"OTHER STOCK" shall mean (i) shares of Common Stock owned by the Other
Holders or any transferee thereof, other than an Investor (including, without
limitation, shares of Management Stock held by any Management Holder or any
Permitted Transferee thereof); (ii) shares of Common Stock issued or issuable
upon the conversion or exercise of any options, warrants or other securities of
the Company owned by the Other Holders (including, without limitation, any
Management Holder); and (iii) any shares of Common Stock issued as a dividend or
other distribution with respect to or in exchange for or in replacement of the
shares referenced in (i) and (ii) above.
"OUTSIDE DIRECTOR" shall have the meaning set forth in Section
5.1(a)(ii)(G) of this Agreement.
"PERSON" shall mean any individual, partnership, joint venture, firm,
corporation, limited liability company, association, trust or other similar
entity or any government or political subdivision or agency, department or
instrumentality thereof.
"PERMITTED TRANSFEREE" shall mean with respect to a Management Holder,
a member of such Management Holder's immediate family, a trust established for
the benefit of members of such Management Holder's immediate family, or a
transferee of such Management Holder by will or the laws of intestate
succession. With respect to an Investor, "Permitted Transferee" shall mean an
Affiliate of such Investor.
"PIGGYBACK REGISTRATION" shall have the meaning set forth in Section
2.2(a) of this Agreement.
"PREFERRED STOCK" shall mean all of the outstanding shares of Series A
Preferred Stock, Series B Preferred Stock and Series B-1 Preferred Stock.
"QUALIFIED HOLDER" shall have the meaning set forth in Section 4.2(a)
of this Agreement.
"QUALIFIED PUBLIC OFFERING" shall mean an underwritten public offering
of Common Stock resulting in proceeds to the Company of not less than
$50,000,000 (prior to expenses and underwriting commissions) and at an offering
price per share of at least $15.00 per share (as adjusted for stock splits,
recapitalizations and the like).
"REGISTRABLE SECURITIES" shall mean the Investor Stock and the Other
Stock; provided, however, that Registrable Securities shall not include any
shares of Investor Stock or Other Stock that have previously been registered
under the Securities Act or that have otherwise been sold to the public in an
open-market transaction under Rule 144.
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The terms "REGISTERS," "REGISTERED" and "REGISTRATION" shall refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act and the declaration or ordering of the
effectiveness of such registration statement by the Commission.
"REGISTRATION EXPENSES" shall mean all expenses incurred in effecting
any registration pursuant to this Agreement, including without limitation all
registration, qualification and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for the Company, blue sky fees and expenses,
expenses of any regular or special audits incident to or required by any such
registration, and the fees and expenses of one counsel chosen by the holders of
a majority of the Registrable Securities included in such registration, but
excluding Selling Expenses.
"REQUIRED HOLDERS" shall have the meaning set forth in Section 4.12 of
this Agreement.
"RESERVED EMPLOYEE STOCK" means the shares of Common Stock issued or
issuable to employees, directors or consultants of the Company and its
subsidiaries pursuant to options granted under the VeloCom Inc. Amended and
Restated 1998 Stock Option Plan.
"RULE 144" shall mean Rule 144 as promulgated by the Commission under
the Securities Act, as such Rule may be amended from time to time, or any
similar successor rule that may be promulgated by the Commission.
"SALE NOTICE" shall have the meaning set forth in Section 3.1(a) of
this Agreement.
"SECURITIES ACT" shall mean the Securities Act of 1933 (or any similar
successor federal statute), as amended, and the rules and regulations
thereunder, all as the same shall be in effect from time to time.
"SELLING EXPENSES" shall mean all underwriting discounts and selling
commissions applicable to the sale of Registrable Securities.
"SELLING INVESTOR" shall have the meaning set forth in Section 3.2(a)
of this Agreement.
"SERIES A PREFERRED STOCK" shall mean the Company's Series A Preferred
Stock, $.0001 par value per share.
"SERIES B/B-1 PREFERRED STOCK" shall mean the Company's Series B
Preferred Stock and Series B-1 Preferred Stock, $.0001 par value per share.
"SHORT FORM REGISTRATION" shall have the meaning set forth in Section
2.1(a) of this Agreement.
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"SLI DIRECTORS" shall have the meaning set forth in Section
5.1(a)(ii)(E) of this Agreement.
"STOCK" shall mean Investor Stock and Other Stock.
"STOCKHOLDERS" shall have the meaning set forth in the Introductory
Paragraph of this Agreement.
"SUBJECT INVESTOR" shall have the meaning set forth in Section 3.3 of
this Agreement.
"SUBSIDIARY" means any subsidiary of the Company over which the Company
exercises control. For purposes of this definition, "control" shall mean the
direct or indirect ownership by the Company of 50% or more of the voting
securities of such subsidiary.
"TAG ALONG SHARES" shall have the meaning set forth in Section 3.3 of
this Agreement.
"TELECOM DIRECTOR" shall have the meaning set forth in Section
5.1(a)(ii)(B) of this Agreement.
"THIRD PARTY" shall have the meaning set forth in Section 3.1(a) of
this Agreement.
"THIRD-PARTY OFFER" shall have the meaning set forth in Section 3.1(a)
of this Agreement.
"UNAFFILIATED DIRECTORS" shall have the meaning set forth in Section
3.2 of this Agreement.
ARTICLE II
REGISTRATION RIGHTS
2.1 DEMAND REGISTRATIONS.
(a) REQUEST FOR REGISTRATION. At any time or times after
January 26, 2002 or, if earlier, at any time following the effective date of the
first registration statement filed by the Company under the Securities Act in
respect of its Common Stock, the Initiating Holders may require that the Company
effect a registration under the Securities Act four times utilizing a
registration on Form S-1 or any similar form (a "Long Form Registration") and as
many times as requested by the Initiating Holders utilizing a Form S-3 or any
similar form, if available (a "Short Form Registration") (each a "Demand
Registration"). Upon receipt of written notice of such demand, the Company shall
promptly give written notice of the proposed registration to all other holders
of Registrable Securities and shall include in such registration all Registrable
Securities specified in such demand, together with all Registrable Securities of
any other holder of Registrable Securities joining in such demand as are
specified in a written request received by the Company within twenty (20) days
after delivery of the Company's notice.
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(b) DEFERRAL OF DEMAND REGISTRATION. The Company shall file a
registration statement with respect to each Demand Registration requested
pursuant to Section 2.1(a) as soon as practicable after receipt of the demand of
the Initiating Holders; provided, however, that if in the good faith judgment of
the Board of Directors of the Company, such registration would be seriously
detrimental to the Company in that such registration would interfere with a
proposed primary registration of securities by the Company or any other material
corporate transaction and the Board of Directors concludes, as a result, that it
is advisable to defer the filing of such registration statement at such time (as
evidenced by an appropriate resolution of the Board), then the Company shall
have the right to defer such filing for the period during which such
registration would be seriously detrimental; provided further, however, that (i)
the Company may not defer the filing for a period of more than one hundred
eighty (180) days after receipt of the demand of the Initiating Holders, (ii)
the Company shall not exercise its right to defer a Demand Registration more
than once, and (iii) if the Company undertakes a primary registration following
an exercise of its deferral right, the holders of Registrable Securities shall
have "piggyback" rights under Section 2.2 hereof with respect to not less than
one-third (1/3) of the number of shares of Common Stock to be sold in such
offering.
(c) UNDERWRITING. If the Initiating Holders intend to
distribute the Registrable Securities covered by a Demand Registration by means
of an underwritten offering, they shall so advise the Company as a part of their
demand made pursuant to Section 2.1 and the Company shall include such
information in its written notice to holders of Registrable Securities.
Initiating Holders holding a majority of the Investor Stock shall have the right
to select investment banker(s) of a recognized national reputation to administer
the offering, subject to the approval of the Company's Board of Directors, such
approval not to be unreasonably withheld or delayed. The right of any holder of
Registrable Securities to participate in an underwritten Demand Registration
shall be conditioned upon such holder's participation in such underwriting in
accordance with the terms and conditions thereof, and the Company and such
holders shall enter into an underwriting agreement in customary form with the
representative of the underwriter or underwriters selected by the Investors and
approved by the Company's Board of Directors.
(d) PRIORITIES. The holders of Registrable Securities shall
have absolute priority over any other securities included in a Demand
Registration. If other securities are included in any Demand Registration that
is not an underwritten offering, all Registrable Securities included in such
offering shall be sold prior to the sale of any of such other securities. In any
Demand Registration that is an underwritten offering, if the managing
underwriter for such offering advises the Company that in its opinion the amount
of securities to be included exceeds the amount of securities which can be sold
in such offering without adversely affecting the marketability thereof, the
priority for including securities in such offering shall be: (i) first, any
Registrable Securities (other than Management Stock) and if necessary, the
number of shares to be included by a holder of Registrable Securities (other
than Management Stock) in such registration shall be reduced pro rata on the
basis of the percentage of the Common Stock Deemed Outstanding held by such
Stockholder, (ii) any Registrable Securities which constitute Management Stock
and if necessary, the number of
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shares of Management Stock to be included by a holder of Registrable Securities
in such registration shall be reduced pro rata on the basis of the percentage of
the Common Stock Deemed Outstanding held by such Stockholder, and (iii) all
securities proposed to be included by other holders exercising similar
registration rights.
2.2 PIGGYBACK REGISTRATIONS.
(a) REQUEST FOR INCLUSION. If the Company shall determine to
register any of its securities for its own account or for the account of other
security holders of the Company on any registration form (other than Form S-4 or
S-8) which permits the inclusion of Registrable Securities (a "Piggyback
Registration"), the Company shall promptly give each holder of Registrable
Securities written notice thereof and, subject to Section 2.2(c), shall include
in such registration all the Registrable Securities requested to be included
therein pursuant to the written requests of holders of Registrable Securities
received within twenty (20) days after delivery of the Company's written notice
to such holders.
(b) UNDERWRITING. If the Piggyback Registration relates to an
underwritten public offering, the Company shall so advise the holders of
Registrable Securities as a part of the written notice given pursuant to Section
2.2(a). In such event, the right of any holder of Registrable Securities to
participate in such registration shall be conditioned upon such holder's
participation in such underwriting in accordance with the terms and conditions
thereof. All holders of Registrable Securities proposing to distribute their
securities through such underwriting shall (together with the Company) enter
into an underwriting agreement in customary form with the representative of the
underwriter or underwriters selected by the Company.
(c) PRIORITIES. If such proposed Piggyback Registration is an
underwritten offering and the managing underwriter for such offering advises the
Company that the securities requested to be included therein exceeds the amount
of securities that can be sold in such offering, except as provided in Section
2.1(b), the priority for including securities in such offering shall be: (i)
first, any securities to be sold by the Company in such offering, (ii) second,
any Registrable Securities (other than Management Stock), and if necessary, the
number of shares to be included by a holder of Registrable Securities (other
than Management Stock) in such registration shall be reduced pro rata on the
basis of the percentage of the Common Stock Deemed Outstanding held by such
Stockholder, (iii) third, any Registrable Securities which constitute Management
Stock and if necessary, the number of shares of Management Stock to be included
by a holder of Registrable Securities in such registration shall be reduced pro
rata on the basis of the percentage of the Common Stock Deemed Outstanding held
by such Stockholder, and (iv) fourth, all securities proposed to be included by
other holders exercising similar registration rights.
2.3 EXPENSES OF REGISTRATION. All Registration Expenses incurred in
connection with up to two Long-Form Registrations and all Short-Form and
Piggyback Registrations shall be borne by the Company; provided, however, that
no registration shall count as one of the Company-paid Long Form Registrations
unless the holders of Registrable Securities are
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able to register and sell at least 90% of the Registrable Securities requested
to be included, it being understood that the Company will in any event pay all
such Registration Expenses. All Selling Expenses relating to Registrable
Securities included in any Demand Registration or Piggyback Registration shall
be borne by the holders of such securities pro rata on the basis of the number
of shares sold by them.
2.4 REGISTRATION PROCEDURES. In the case of each registration effected
by the Company pursuant to this Article II, the Company shall keep each holder
of Registrable Securities advised in writing as to the initiation of such
registration and as to the completion thereof. At its expense, the Company shall
use its best efforts to:
(a) cause such registration to be declared effective by the
Commission and, in the case of a Demand Registration, keep such registration
effective for a period of one hundred eighty (180) days or until the holders of
Registrable Securities included therein have completed the distribution
described in the registration statement relating thereto, whichever first
occurs;
(b) notify each holder of Registrable Securities of the
effectiveness of each registration statement filed hereunder;
(c) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement (including post-effective amendments) as may be
necessary to comply with the provisions of the Securities Act with respect to
the disposition of all securities covered by such registration statement;
(d) obtain appropriate qualifications of the securities
covered by such registration statement under state securities or "blue sky" laws
in such jurisdictions as may be requested by the holders of Registrable
Securities; provided, however, that the Company shall not be required to file a
general consent to service of process in any jurisdiction in which it is not
otherwise subject to service in order to obtain any such qualification;
(e) furnish such number of prospectuses and other documents
incident thereto, including any amendment of or supplement to the prospectus, as
a holder of Registrable Securities from time to time may reasonably request;
(f) notify each holder of Registrable Securities covered by
such registration statement, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading or incomplete in the light of the
circumstances then existing and, at the request of any such holder, prepare and
furnish to such holder a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such shares, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact
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required to be stated therein or necessary to make the statements therein not
misleading or incomplete in the light of the circumstances then existing;
(g) cause all Registrable Securities covered by such
registration to be listed on each securities exchange or inter-dealer quotation
system on which similar securities issued by the Company are then listed;
(h) provide a transfer agent and registrar for all Registrable
Securities covered by such registration and a CUSIP number for all such
Registrable Securities, in each case not later than the effective date of such
registration;
(i) otherwise comply with all applicable rules and regulations
of the Commission, and make available to its security holders, as soon as
reasonably practicable, an earnings statement covering the period of at least 12
months, but not more than 18 months, beginning with the first month after the
effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act; and
(j) in connection with any underwritten Demand Registration,
the Company shall enter into an underwriting agreement reasonably satisfactory
to the Initiating Holders containing customary underwriting provisions,
including indemnification and contribution provisions.
2.5 INDEMNIFICATION.
(a) The Company shall indemnify each holder of Registrable
Securities, each of such holders' officers, directors, partners, agents,
employees and representatives, and each person controlling such holder within
the meaning of Section 15 of the Securities Act, with respect to each
registration, qualification or compliance effected pursuant to this Article II,
against all expenses, claims, losses, damages and liabilities (or actions,
proceedings or settlements in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any prospectus, offering circular or other document (including any related
registration statement, notification or the like) incident to any such
registration, qualification or compliance, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, or any violation by the
Company of the Securities Act or any rule or regulation thereunder applicable to
the Company and relating to action or inaction required of the Company in
connection with any such registration, qualification or compliance, and shall
reimburse on an "as incurred" basis each such indemnified person for any legal
and any other expenses reasonably incurred in connection with investigating and
defending or settling any such claim, loss, damage, liability or action;
provided, however, that the Company shall not be liable in any such case to the
extent that any such claim, loss, damage, liability or expense arises out of or
is based on any untrue statement or omission based upon written information
furnished to the Company by such holder of Registrable Securities and stated to
be specifically for use therein. It is agreed that the indemnity agreement
contained in this Section 2.5(a) shall not apply to amounts paid in settlement
of any such loss, claim, damage, liability or action if such settlement is
effected without the
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consent of the Company (which consent shall not be unreasonably withheld or
delayed) so long as the Company is reimbursing the expenses in accordance with
this Agreement.
(b) Each holder of Registrable Securities included in any
registration effected pursuant to this Article II shall indemnify the Company,
each of its directors, officers, agents, employees and representatives, and each
person who controls the Company within the meaning of Section 15 of the
Securities Act, each other such holder of Registrable Securities and each of
their officers, directors and partners, agents, employees and representatives,
and each person controlling such holder, against all claims, losses, damages and
liabilities (or actions in respect thereof) arising out of or based on any
untrue statement of a material fact contained in any such registration
statement, prospectus, offering circular or other document, or any omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and shall reimburse such indemnified
persons for any legal or any other expenses reasonably incurred in connection
with investigating or defending any such claim, loss, damage, liability or
action, in each case, to the extent, but only to the extent, that such untrue
statement or omission is made in such registration statement, prospectus,
offering circular or other document in reliance upon and in strict conformity
with written information furnished to the Company by such holder of Registrable
Securities specifically for use in such registration statement; provided,
however, that (x) no holder of Registrable Securities shall be liable hereunder
for any amounts in excess of the net proceeds received by such holder pursuant
to such registration, and (y) the obligations of such holder of Registrable
Securities hereunder shall not apply to amounts paid in settlement of any such
claims, losses, damages or liabilities (or actions in respect thereof) if such
settlement is effected without the consent of such holder.
(c) Each party entitled to indemnification under this Section
2.5 (the "Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom; provided, however, that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or any
litigation resulting therefrom, shall be approved by the Indemnified Party
(whose approval shall not unreasonably be withheld), and the Indemnified Party
may participate in such defense at such party's expense; and provided further,
however, that the failure of any Indemnified Party to give notice as provided
herein shall not relieve the Indemnifying Party of its obligations under this
Section 2.5 to the extent such failure is not materially prejudicial. No
Indemnifying Party in the defense of any such claim or litigation shall, except
with the consent of each Indemnified Party, consent to entry of any judgment or
enter into any settlement which does not include an unconditional release of
such Indemnified Party from all liability in respect to such claim or
litigation. Each Indemnified Party shall furnish such information regarding
itself or the claim in question as an Indemnifying Party may reasonably request
in writing and as shall be reasonably required in connection with defense of
such claim and litigation resulting therefrom.
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(d) If the indemnification provided for in this Section 2.5 is
held by a court of competent jurisdiction to be unavailable to an Indemnified
Party with respect to any loss, liability, claim, damage or expense referred to
therein, then the Indemnifying Party, in lieu of indemnifying such Indemnified
Party hereunder, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such loss, liability, claim, damage or expense
in such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party on the one hand and of the Indemnified Party on the other in
connection with the statements or omissions which resulted in such loss,
liability, claim, damage or expense as well as any other relevant equitable
considerations. The relative fault of the Indemnifying Party and of the
Indemnified Party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
Indemnifying Party or by the Indemnified Party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission; provided, however, that no holder of Registrable
Securities shall be liable hereunder for any amounts in excess of the net
proceeds received by such holder pursuant to such registration.
(e) Notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in an underwriting
agreement entered into in connection with an underwritten public offering are in
conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control.
2.6 OTHER OBLIGATIONS. With a view to making available the benefits of
certain rules and regulations of the Commission which may effectuate the
registration of Registrable Securities or permit the sale of Registrable
Securities to the public without registration, the Company agrees to:
(a) after its initial registration under the Securities Act,
exercise reasonable efforts to cause the Company to be eligible to utilize Form
S-3 (or any similar form) for the registration of Registrable Securities;
(b) at such time as any Registrable Securities are eligible
for transfer under Rule 144(k), upon the request of the holder of such
Registrable Securities, remove any restrictive legend from the certificates
evidencing such securities at no cost to such holder;
(c) make and keep available public information as defined in
Rule 144 under the Securities Act at all times from and after ninety (90) days
following its initial registration under the Securities Act;
(d) file with the Commission in a timely manner all reports
and other documents required of the Company under the Securities Act and the
Exchange Act at any time after it has become subject to such reporting
requirements; and
(e) furnish any holder of Registrable Securities upon request
a written statement by the Company as to its compliance with the reporting
requirements of Rule 144 (at any time from and after ninety (90) days following
the effective date of the first
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registration statement filed by the Company for an offering of its securities to
the general public), and of the Securities Act and the Exchange Act (at any time
after it has become subject to such reporting requirements), a copy of the most
recent annual or quarterly report of the Company, and such other reports and
documents as a holder of Registrable Securities may reasonably request in
availing itself of any rule or regulation of the Commission (including Rule
144A) allowing a holder of Registrable Securities to sell any such securities
without registration.
2.7 TERMINATION OF REGISTRATION RIGHTS. The right of any holder of
Registrable Securities to request inclusion of Registrable Securities in any
registration pursuant to this Article II shall terminate when (i) all
Registrable Securities beneficially owned by such holder of Registrable
Securities may immediately be sold under Rule 144(k), and (ii) the Company's
Common Stock is listed on a national securities exchange or traded in The Nasdaq
Stock Market; provided, however, that the provisions of this Section 2.7 shall
not apply to any holder of Registrable Securities representing more than five
percent (5%) of the Company's then-outstanding Common Stock.
ARTICLE III
RESTRICTIONS ON TRANSFER OF STOCK
3.1 RESTRICTIONS ON TRANSFER OF MANAGEMENT STOCK.
(a) No shares of Management Stock or any interest therein may
be transferred other than in compliance with the provisions of this Section 3.1.
If at any time a Management Holder receives a bona fide offer from any person (a
"Third Party") to purchase shares of Stock held by such Management Holder (a
"Third-Party Offer") which such Management Holder wishes to accept, such
Management Holder shall cause such Third-Party Offer to be reduced to writing
and shall notify the Company and each holder of Investor Stock of such
Management Holder's desire to accept the Third-Party Offer. The Management
Stockholder's notice (the "Sale Notice") shall contain an irrevocable offer to
sell such Stock to the Company and/or the Investors at a purchase price equal to
the price contained in, and on the same terms and conditions of, the Third-Party
Offer and shall be accompanied by a copy of the Third-Party Offer (which shall
identify the offeror); provided, however, the Company and the Investors may pay
cash to the selling Management Holder equal in amount to the fair market value
of any non-cash consideration offered by the Third Party in the Third-Party
Offer. At any time within 10 business days after the date of receipt by the
Company of the Sale Notice, the Company shall have the right to purchase the
Stock covered by the Third-Party Offer at the same price and on the same terms
and conditions as the Third-Party Offer. If, at the end of such 10-business day
period, the Company has not elected to purchase all Stock covered by such
Third-Party Notice, the Management Holder shall provide the Sale Notice to the
Investors along with a statement as to the number of shares to be purchased by
the Company (if any). Within 10 business days after receipt by the Investors of
such Sale Notice, each Investor, by providing notice to the Management Holder,
shall have the right to purchase that portion of the shares equal to the
Investors Pro Rata Number of Shares (as defined below) at the same price and on
the same terms and conditions as the Third-Party
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Offer. In the event any Investor does not exercise its right to purchase its
respective Investors Pro Rata Number of Shares, the other Investors shall have
the right to purchase such shares, and the purchase of such shares shall be
allocated among the participating Investors pro rata in proportion to the
Investor Stock held by such Investors, or in such other proportions as the
participating Investors may agree upon. To the extent the Investors have not
notified the selling Management Holder in writing of a desire to purchase all of
the Stock as set forth herein, the selling Management Holder may within 90 days
thereafter sell the remaining Management Stock covered by the Third-Party Offer
to the Third Party on the terms set forth in the original Third-Party Offer. Any
Management Stock covered by the Third Party Offer that is not so transferred
during such 90-day period shall again be subject to this Section 3.1. The
Company may assign its rights to purchase Management Stock pursuant to this
Section 3.1 to one or more third parties subject only to compliance with
applicable securities laws; provided, however, that the Company shall offer to
assign such rights to the Investors pro rata prior to offering such rights to
other persons. An Investor may assign its rights to purchase Management Stock
pursuant to this Section 3.1 to any of its Affiliates subject only to compliance
with applicable securities laws. For purposes of this Section 3.1, the
"Investors Pro Rata Number of Shares" shall be equal to that number of shares
derived by multiplying the total number of shares to be purchased by the Third
Party as set forth in the Sale Notice by a fraction, the numerator of which is
the total number of shares of Investor Stock owned by such participating holder
of Investor Stock and the denominator of which is the total number of shares of
Investor Stock.
(b) The restrictions set forth in this Section 3.1 shall not
apply to transfers of Management Stock to a Permitted Transferee of the
transferring Management Holder; provided, however, that such Permitted
Transferee shall agree in writing to be bound by such restrictions in connection
with subsequent transfers.
3.2 RIGHT OF FIRST NEGOTIATION.
(a) TRANSFER NOTICE. Any Investor (the "Selling Investor")
that either (i) receives an offer to sell all or part of the shares of Investor
Stock held by it that it wishes to accept or (ii) wishes to transfer all or part
of the shares of Investor Stock held by it (in each case, the "Offered Shares")
shall deliver a notice (the "Offer Notice") to that effect to the Company and to
each of the other Investors and Other Holders (the "Offerees"), which Offer
Notice shall state the number of Offered Shares it wishes to sell and the price
at which it wishes to sell them.
(b) COMPANY NEGOTIATION PERIOD. Upon receipt by the Company of
the Offer Notice, the Company shall have the exclusive right to negotiate with
the Selling Investor for a period of 15 days from the receipt of the Offer
Notice (the "Company Negotiation Period"). If the Selling Investor and the
Company agree upon the terms of sale for all or a portion of the Offered Shares
prior to the end of the Company Negotiation Period, such parties shall enter
into definitive documentation to effect such transfer as contemplated by Section
3.2(e) of this Agreement. All offers made by the Selling Investor to the Company
shall be delivered to the Company and to all Offerees in writing.
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(c) INVESTOR NEGOTIATION PERIOD. If the Company elects not to
enter into negotiations with the Selling Investor in respect of the Offered
Shares or if the Company Negotiation Period has expired without an agreement
between the Selling Investor and the Company, then the Selling Investor and the
Offerees shall have a period of thirty (30) days (the "Negotiation Period") from
the earlier of (i) the date the Company provides written notice of its election
not to enter into negotiations with the Selling Investor or (ii) the expiration
of the Company Negotiation Period, to reach an agreement on the terms of sale
for the Offered Shares. Upon receipt of the Offer Notice, the Offerees shall
promptly consult with each other prior to responding to the Offer Notice. If the
Selling Investor and one or more Offerees agree upon the terms of sale for all
or a portion of the Offered Shares prior to the end of the Negotiation Period,
such parties shall enter into definitive documentation to effect such transfer
as contemplated by Section 3.2(e). All offers made by the Selling Investor to
any Offeree shall be delivered to all Offerees in writing. If two or more
Offerees so elect to purchase the Offered Shares, unless the Offerees otherwise
agree, the purchase of the Offered Shares by such electing Offerees shall be pro
rata among such Offerees based on their relative ownership percentage of Stock.
The Selling Investor will not be obligated to sell any Offered Shares to the
Company and/or any Offerees unless the Company and/or the Offerees, as the case
may be, agree to purchase all of the Offered Shares.
(d) SALE. If, at the end of the Negotiation Period, the
Selling Investor has not reached an agreement with either the Company or with
one or more Offerees to transfer all of the Offered Shares, or if the transfer
is not completed within the period specified in Section 3.2(e), the Selling
Investor shall have a period of one hundred and twenty (120) days following the
expiration of the Negotiation Period in which to transfer the Offered Shares not
otherwise sold to one or more Offerees to a third party at a price greater than
or equal to (i) the lowest price at which the Selling Investor has agreed to
sell any Offered Shares to the Company or any Offeree pursuant to Section 3.2(b)
or (c), or (ii) if no price was agreed to, the last price offered in writing by
the Selling Investor to the Company or any Offeree during the Company
Negotiation Period or the Negotiation Period, as the case may be, (the "Floor
Price"). If the Selling Investor desires to transfer all or part of such
remaining Offered Shares to a third party at a price less than the Floor Price,
it may do so if it reoffers the Offered Shares to the Company and the Offerees
pursuant to the provisions of this Section 3.2. The Selling Investor shall
provide each Offeree with written proof that any sale to a third party was made
in compliance with this Section 3.2(d).
(e) TRANSFER PROCEDURES. If the Company and/or the Offerees
and the Selling Investor have reached agreement with respect to the transfer of
the Offered Shares, the Company and/or the Offerees and the Selling Investor
shall, as promptly as practicable, but in no event later than thirty (30) days
from the date of termination of the Company Negotiation Period or the
Negotiation Period, as the case may be, prepare and enter into the documentation
necessary to provide for such transfer (including, if necessary, any
modifications or amendment to this Agreement).
(f) EXCEPTION FOR TRANSFERS TO PERMITTED TRANSFEREES. The
restrictions in this Section 3.2 shall not apply to transfers of Investor Stock
by any Investor to a Permitted
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Transferee of the transferring Investor, which may be accomplished without the
consent of any other party to this Agreement. Notwithstanding the foregoing, the
transferring Investor shall give advance written notice to the Company of such
transfer, and any such Permitted Transferee of the transferring Investor shall
agree in writing to be bound by the restrictions of, and shall be given all
rights of an Investor under, this Agreement.
3.3 TAG-ALONG RIGHTS.
(a) Without prejudice to the provisions of Section 3.2 hereof,
no Investor or group of Investors desiring to transfer shares of Investor Stock
to a transferee who would hold 50% or more of the Common Stock Deemed
Outstanding following such transfer, shall transfer such shares of Investor
Stock unless the Company's Board of Directors and the holders of at least
two-thirds of the outstanding Preferred Stock have approved such transfer. In
addition, without prejudice to the provisions of Section 3.2 hereof, no Investor
or a group of Investors (the "Subject Investors") desiring either (i) to
transfer shares of Investor Stock to a transferee who would hold 50% or more of
the Common Stock Deemed Outstanding following such transfer, or (ii) to transfer
50% or more of the Common Stock Deemed Outstanding in any transaction or series
of related transactions other than to Permitted Transferees, shall transfer such
shares of Investor Stock unless such Subject Investors shall have received an
Offer (as defined below) from a proposed transferee which includes an offer to
purchase the Tag-Along Shares held by the other Investors or Other Holders, on
the same terms and conditions as have been extended to the Subject Investors.
For purposes of this Agreement, "Tag-Along Shares" shall mean the number of
Shares obtained by multiplying the number of Shares held by the other Investors
or Other Holders as of the date of the Transfer Notice by a fraction, the
numerator of which is the number of shares of Investor Stock proposed to be
transferred by the Subject Investors, and the denominator of which is the total
number of shares of Investor Stock held by the Subject Investors. A Transfer
Notice must be given by the Subject Investors to the other Investors or Other
Holders and the Company at least forty-five (45) days in advance of the proposed
transfer which: (i) sets forth the number of shares of Investor Stock that such
Subject Investors propose to transfer; (ii) specifies the consideration to be
received by the Subject Investors in exchange for such shares of Investor Stock;
(iii) identifies the name and address of the proposed transferee; (iv) indicates
the date on which the proposed transfer is to occur; and (v) includes a copy of
the offer (and any related correspondence reasonably necessary to understand and
evaluate such offer) (the "Offer"). Each of the other Investors or Other Holders
may accept the offer to purchase included in the Offer for the Tag-Along Shares
by providing written notice of its acceptance of such offer to the Company, the
proposed transferee and the Subject Investors, on or prior to the twentieth
(20th) day after the delivery the Transfer Notice. If, within twenty (20) days
after the receipt of the Transfer Notice, the other Investors or Other Holders
have not accepted the offer to purchase included in the Offer, such Investors
and Other Holders shall be deemed to have waived any and all tag-along rights
with respect to the sale or other disposition of the shares of Investor Stock of
the Subject Investors described in the Transfer Notice.
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(b) If the prospective transferee limits its Offer to a
specified number of shares of Investor Stock, and if the number of shares of
Investor Stock that the Subject Investors propose to sell together with the
number of Tag-Along Shares that the other Investors and Other Holders propose to
sell exceeds such number, then the number of shares of Investor Stock and
Tag-Along Shares to be sold by the Subject Investors, other Investors and Other
Holders will be reduced ratably in proportion to the number of shares of
Investor Stock and Tag-Along Shares proposed to be sold so that the aggregate
number of shares of Investor Stock and Tag-Along Shares does not exceed the
limit set by the prospective transferee.
(c) In the event that an Investor or Other Holder does not
accept the offer from a proposed transferee as specified in Section 3.3(a), the
proposed transferee shall purchase from the Subject Investors the number of
shares of Investor Stock set forth in the Transfer Notice, plus the relevant
number of shares of Investor Stock of the other Investors or Other Holders (if
any) who have accepted such offer. In the event that an Investor or Other Holder
accepts the offer from such proposed transferee, the proposed transferee shall
purchase from the Subject Investors the number of shares of Investor Stock set
forth in the Transfer Notice and from such other Investors and Other Holders,
their Tag-Along Shares.
ARTICLE IV
COVENANTS OF THE COMPANY
The Company hereby covenants and agrees, so long as any Registrable
Securities are outstanding, as follows:
4.1 BASIC FINANCIAL INFORMATION. The Company shall furnish the
following reports to each holder of Registrable Securities:
(a) As soon as practicable after the end of each fiscal year
of the Company and, in any event within ninety (90) days thereafter, (i) a
consolidated balance sheet of the Company and its Subsidiaries, if any, as of
the end of such fiscal year, (ii) consolidated statements of income and cash
flow of the Company and its Subsidiaries, if any, for such year, prepared in
accordance with United States generally accepted accounting principles
consistently applied and setting forth in each case in comparative form the
figures for the previous fiscal year, all in reasonable detail and audited by
independent public accountants of recognized national standing selected by the
Company, and (iii) a fully-diluted capitalization table of the Company.
(b) As soon as practicable after the end of each quarterly
accounting period in each fiscal year of the Company and, in any event within
forty-five (45) days thereafter, (i) a consolidated balance sheet of the Company
and its Subsidiaries, if any, as of the end of each such quarterly period, (ii)
an unaudited consolidated statement of income and cash flow of the Company and
its Subsidiaries, if any, for such period and for the current fiscal year to
date, prepared in accordance with United States generally accepted accounting
principles consistently applied and setting forth in comparative form the
figures for the corresponding periods of the previous fiscal year, subject to
changes resulting from normal year-end audit
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adjustments, all in reasonable detail and certified by the chief financial
officer of the Company (or the chief accounting officer if no chief financial
officer is in place), except that such statements need not contain the notes
required by generally accepted accounting principles, and (iii) a fully-diluted
capitalization table of the Company.
4.2 ADDITIONAL INFORMATION RIGHTS.
(a) The Company shall deliver the reports described below in
this Section 4.2(b) to each holder of Registrable Securities owning at least two
percent (2%) of the Company's Common Stock Deemed Outstanding (a "Qualified
Holder"):
(i) Annually (prior to the commencement of each
fiscal year of the Company), the operating budget and updated five year
strategic plan of the Company, in such manner and form as approved by the Board
of Directors of the Company.
(ii) Monthly financial reports comparing the
Company's actual results to budgeted results.
(iii) Concurrently with delivery thereof, copies of
all reports and other written material submitted to the Board of Directors.
(b) Each Qualified Holder shall have full access during normal
business hours and on reasonable notice to the Company to the books, records,
properties and personnel of the Company.
(c) Each Qualified Holder hereby agrees to hold in confidence
and trust and not to misuse or disclose any confidential information provided
pursuant to this Section 4.2; provided, however, that an Investor shall not be
prohibited from using any such information for the purpose of generating and
delivering portfolio valuation information to its investors and as required to
comply with applicable state and federal securities laws and regulations.
4.3 PROMPT PAYMENT OF TAXES, ETC. The Company shall promptly pay and
discharge, or cause to be paid and discharged, when due and payable, all lawful
taxes, assessments and governmental charges or levies imposed upon the income,
profits, property or business of the Company or any Subsidiary; provided,
however, that any such tax, assessment, charge or levy need not be paid if the
validity thereof shall currently be contested in good faith by appropriate
proceedings and if the Company or such Subsidiary shall have set aside on its
books adequate reserves with respect thereto; and, provided further, however,
that the Company shall pay, and shall cause its Subsidiaries to pay, all such
taxes, assessments, charges or levies forthwith upon the commencement of
proceedings to foreclose any lien which may have attached as security therefore.
The Company shall promptly pay or cause to be paid when due, in conformance with
customary trade terms, all other obligations incident to the operations of the
Company or its Subsidiaries, as the case may be.
4.4 MAINTENANCE OF PROPERTIES AND LEASES. The Company shall keep its
properties and those of its Subsidiaries, if any, in good repair, working order
and condition, reasonable
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wear and tear excepted, and from time to time make all needful and proper
repairs, renewals, replacements, additions and improvements thereto; and the
Company and its Subsidiaries shall at all times comply with each material
provision of all leases and licenses to which any of them is a party or under
which any of them occupies property if the breach of such provision might have a
material and adverse effect on the condition, financial or otherwise, or
operations of the Company or such Subsidiaries.
4.5 INSURANCE. The Company shall keep its assets and those of its
Subsidiaries which are of an insurable character insured by financially sound
and reputable insurers against loss or damage by fire, explosion and other risks
customarily insured against by companies in the Company's line of business, and
the Company shall maintain, with financially sound and reputable insurers,
insurance against other hazards and risks and liability to persons and property
to the extent and in the manner customary for companies in similar businesses
similarly situated.
4.6 ACCOUNTS AND RECORDS. The Company and its Subsidiaries shall keep
true records and books of account in which full, true and correct entries shall
be made of all dealings or transactions in relation to their respective
businesses and affairs in accordance with generally accepted accounting
principles applied on a consistent basis.
4.7 INDEPENDENT ACCOUNTANTS. The Company shall retain a "Big Five"
national accounting firm as its independent public accountants who shall certify
the Company's financial statements at the end of each fiscal year commencing
with its fiscal year ending on December 31, 1999. In the event the services of
the independent public accountants so selected are terminated, the Company shall
promptly thereafter notify the holders of Investor Stock and shall request the
firm of independent public accountants whose services are terminated to deliver
to the Investors a letter from such firm setting forth the reasons for the
termination of their services. In the event of such termination, the Company
shall promptly thereafter engage another "Big Five" national accounting firm as
its independent public accountants. In its notice to the holders of Investor
Stock, the Company shall state whether the change of accounts was recommended or
approved by the Board of Directors of the Company or any committee thereof.
4.8 COMPLIANCE WITH LAWS. The Company shall, shall use reasonable best
efforts to cause its Subsidiaries to, and shall use reasonable best efforts to
cause its and its Subsidiaries' employees and agents to, comply with all
applicable laws, rules, regulations and policies (as they may be amended from
time to time) of: (A) the United States for America, including, without
limitation, the Foreign Corrupt Practices Act, the export controls imposed by
the U.S. Department of Commerce, the International Traffic in Arms Regulations,
the restrictions imposed by the U.S. Office of Foreign Assets Control and the
anti-boycott regulations administered by the U.S. Department of Commerce and
compliance the U.S. Department of the Treasury regulations, and (B) Brazil,
Argentina and all other applicable countries (if any). Furthermore, the Company
shall not, and shall use reasonable best efforts to cause its Subsidiaries not
to, take or fail to take any action that would cause the Company, its
Subsidiaries or their employees to violate or otherwise not comply with all
applicable
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laws, rules, regulations and policies. So long as an Investor still holds shares
of Investor Stock, the Company shall deliver to such Investor, and shall cause
each of its Subsidiaries that qualify as "significant subsidiaries" as defined
in Regulation S-X promulgated under the Securities Act of 1933, as amended, to
deliver to such Investor, an annual compliance certificate evidencing compliance
with this Section 4.8.
4.9 MAINTENANCE OF CORPORATE EXISTENCE, ETC. The Company shall maintain
in full force and effect its corporate existence and shall cause all of its
Subsidiaries, the existence of which is deemed by the Company as necessary to
conduct its business, to maintain in full force and effect their respective
corporate existence. The Company and its Subsidiaries shall maintain in full
force and effect all rights and franchises and all licenses and other rights in
or to use patents, processes, licenses, trademarks, trade names or copyrights
owned or possessed by them and deemed by the Company or such Subsidiary to be
necessary to the conduct of their business.
4.10 LIMITED PREEMPTIVE RIGHTS.
(a) Except for the issuance of Common Stock or any securities
containing options or rights to acquire any shares of Common Stock ("Equity
Securities") (i) representing Reserved Employee Stock, (ii) upon the conversion
of the Series A Preferred Stock and Series B/B-1 Preferred Stock, (iii) pursuant
to a public offering registered under the Securities Act, (iv) pursuant to a
merger, consolidation, acquisition or similar business combination approved by
the Company's Board of Directors, (v) in connection with any stock split, stock
dividend, or recapitalization, (vi) to a lender or equipment lessor in
connection with any loan or lease financing transaction approved by the
Company's Board of Directors, (vii) in connection with strategic transactions
involving the Company and non-affiliates of the Company approved by the
Company's Board of Directors, the primary purpose of which is other than to
raise funds for the Company (including (A) joint ventures, manufacturing,
marketing or distribution arrangements or (B) technology transfer or development
arrangements; provided, however, that such strategic transactions and the
issuance of shares therein, have been approved by the Company's Board of
Directors) or (viii) issuances of Common Stock to the Company's employees
approved by the Company's Board of Directors, if the Company authorizes the
issuance or sale of any Equity Securities (other than as a dividend on the
outstanding Common Stock), the Company shall first offer to sell to each of the
holders of Stock its "pro rata portion" of 80% of such Equity Securities. A
holder's "pro rata portion" shall equal the quotient determined by dividing (1)
the number of shares of Stock held by each such holder by the (2) sum of the
total number of shares of Stock held by all holders of Stock. Each holder of
Stock shall be entitled to purchase such Equity Securities at the most favorable
price and on the most favorable terms as such Equity Securities are to be
offered to any other Persons. The purchase price for all Equity Securities
offered to the holders of the Stock shall be payable in cash.
(b) In order to exercise its purchase rights hereunder, a
holder of Stock must within 15 days after receipt of written notice from the
Company describing in reasonable detail the Equity Securities being offered, the
purchase price thereof, the payment terms and
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such holder's percentage allotment deliver a written notice to the Company
describing its election hereunder. If all of the Equity Securities offered to
the holders of Common Stock are not fully subscribed by such holders, the
remaining Equity Securities shall be reoffered by the Company to the holders
purchasing their full allotment upon the terms set forth in this Section 4.10,
except that such holders must exercise their purchase rights within two days
after receipt of such reoffer.
(c) Upon the expiration of the offering periods described
above, the Company shall be entitled to sell such Equity Securities which the
holders of Stock have not elected to purchase during the 90 days following such
expiration on terms and conditions no more favorable to the purchasers thereof
than those offered to such holders. Any Equity Securities offered or sold by the
Company after such 90-day period must be reoffered to the holders of Stock
pursuant to the terms of this paragraph.
(d) An Investor may assign its purchase rights pursuant to
this Section 4.10 to a Permitted Transferee subject only to compliance with
applicable securities laws.
4.11 ADDITIONAL INVESTOR RIGHTS. The Investors that are investment
funds or investment partnerships shall, in addition to the aforementioned
rights, have further rights as required for the purpose of qualifying the
Investors' ownership of Stock as a "venture capital investment" for purposes of
the United States Department of Labor "plan assets" regulations,
29 C.F.R.(degree) 2510.3-101 including, without limitation (a) the right to
consult with and advise management of the Company on significant business issues
including management's proposed annual operating plans, (b) the right to inspect
the Company's facilities and books and records at reasonable times and at
reasonable intervals and (c) the right to request information about the Company;
provided that access to highly confidential proprietary information and
facilities need not be provided. The rights set forth in this Section 4.11 may
be exercised by an Affiliate of any Investor acting on behalf of such Investor.
4.12 NEGATIVE COVENANTS. So long as any of the Preferred Stock remains
outstanding, without the prior written consent of the holders of at least
sixty-six and two-thirds percent (66 2/3%) of the outstanding shares of
Preferred Stock (the "Required Holders"), the Company shall not:
(a) create, issue or authorize the issuance of any additional
Common Stock or Preferred Stock or create or authorize any new class or series
of the Company's capital stock (except for issuances of Reserved Employee Stock,
issuances upon conversion of Preferred Stock, issuances in connection with
strategic transactions involving the Company and non-affiliates of the Company
approved by the Company's Board of Directors, the primary purpose of which is
other than to raise funds for the Company (including (i) joint ventures,
manufacturing, marketing or distribution arrangements or (ii) technology
transfer or development arrangements));
(b) amend the Company's Certificate of Incorporation or
Bylaws;
21
<PAGE> 25
(c) engage in (i) any merger, consolidation, business
combination, recapitalization, or reorganization in which (1) the stockholders
of the Company immediately prior to such transaction own capital stock
representing less than seventy percent (70%) of the surviving company's voting
power in the election of directors immediately after such transaction, or (2)
the stockholders of the Company immediately prior to such transaction do not own
substantially the same proportion of capital stock of the surviving company
after the transaction as they owned of the Company immediately prior to the
transaction (a "Disproportionate Change"); provided, however, that any change in
a Stockholder's ownership percentage of less than ten percentage points shall
not be deemed to be a Disproportionate Change, (ii) a liquidation or sale of
substantially all of the assets by the Company or any of its subsidiaries
outside the ordinary course of business, or (iii) a purchase of substantial
assets by the Company or any of its subsidiaries outside the ordinary course of
business;
(d) engage in any business other than telecommunications and
multimedia communications services, including but not limited to data, voice or
video transmission, cable, IP telephony, MMDS, Internet access or any other
telecommunications service using wireless, wireline, fiber, LMDS or broadband
access or any other technology, and also including any Internet content
business;
(e) increase the amount of Reserved Employee Stock above
twelve percent (12%) of the Company's Common Stock Deemed Outstanding; or
(f) engage in any transaction with an Affiliate of the
Company, except for transactions involving wholly-owned subsidiaries, that is
not approved by a majority of the Company's disinterested directors.
ARTICLE V
CORPORATE GOVERNANCE
5.1 BOARD OF DIRECTORS.
(a) Each Stockholder agrees to vote all securities of the
Company over which such Stockholder has voting control and to take all other
necessary or desirable actions within its control (whether as a stockholder,
director or officer of the Company or otherwise, and including without
limitation attendance at meetings in person or by proxy for purposes of
obtaining a quorum and execution of written consents in lieu of meetings), and
the Company shall take all necessary and desirable actions within its control
(including, without limitation, calling special board and stockholder meetings),
so that:
(i) the Company shall have a Board of Directors
comprising no more than thirteen (13) members;
(ii) subject to subsection (iii) below, the following
persons shall be elected to the Board of Directors:
22
<PAGE> 26
(A) Three representatives designated by the
holders of a majority of the outstanding Management Stock (the "Management
Directors"); provided, however, that, until the next annual meeting of the
Company's stockholders, Nicolas Kauser, David J. Leonard and Bernard Schotters
shall serve as the Management Directors;
(B) One representative designated by Telecom
Partners III, L.P. (such representative, the "Telecom Director"); provided,
however, that, until the next annual meeting of the Company's stockholders,
William J. Elsner shall serve as the Telecom Director;
(C) One representative designated jointly by
Centennial Fund V, L.P. and Centennial Fund VI, L.P. (together, the "Centennial
Entities," and such representative, the "Centennial Entities Director");
provided, however, that, until the next annual meeting of the Company's
stockholders, Steven C. Halstedt shall serve as the Centennial Entities
Director;
(D) One representative designated jointly by
Crescendo World Fund, L.L.C., Eagle Ventures WF, L.L.C., Crescendo III, GbR,
Crescendo III Executive Fund, L.P. and Crescendo III, L.P. (together, the
"Crescendo Entities," and such representative, the "Crescendo Entities
Director"); provided, however, that, until the next annual meeting of the
Company's stockholders, Anthony Daffer shall serve as the Crescendo Entities
Director;
(E) Two representatives designated by SLI
Wireless S.A. (the "SLI Directors"); provided, however, that until the next
annual meeting of the Company's stockholders, Guillermo Liberman and Luis
Gonzalez Lanuza shall serve as the SLI Directors;
(F) One representative designated by Formus
Communications, Inc. (the "Formus Director"); provided, however, that until the
next annual meeting of the Company's stockholders, Bernard G. Dvorak shall serve
as the Formus Director;
(G) One director (the "Outside Director")
approved by a Nominating Committee of the Board of Directors consisting of one
of the Telecom Directors, one of the SLI Directors, the Centennial Entities
Director, the Crescendo Entities Director and one of the Management Directors;
provided, however, that, until the next annual meeting of the Company's
stockholders, Fred A. Vierra shall serve as the Outside Director;
(H) One director designated by Bank of
America (the "Bank of America Director"); provided, however, that until the next
annual meeting of the Company's stockholders, Jacques Gliksberg shall serve as
the Bank of America Director;
(I) One director designated by Chestnut Hill
VeloCom, LLC (the "Chestnut Director"); provided, however, that until the next
annual meeting of the Company's stockholders, Michael Greeley shall serve as the
Chestnut Director; and
23
<PAGE> 27
(J) One director designated by First Union
Investors, Inc. (the "First Union Director"); provided, however, that until the
next annual meeting of the Company's stockholders, Scott Perper shall serve as
the First Union Director.
(iii) the director appointment provisions set forth
in subsection (ii)(B), (C), (D), (E), (F), (H), (I) and (J) shall only be
effective, with respect to each particular Investor, so long as such Investor
entitled to appoint a director owns an aggregate of two percent (2%) or more of
the Company's Common Stock Deemed Outstanding. In the event this ownership
threshold is not satisfied by any of such Investors, such particular Investor's
appointment provisions shall be exercised by the Company;
(iv) in the event that any director for any reason
ceases to serve as a member of the Board during his term of office, the
resulting vacancy on the Board shall be filled by a majority vote of the
Stockholders entitled to elect such director as provided in this Section 5.1;
(v) if the Stockholders fail within sixty (60) days
of a directorship being vacated to designate a representative to fill such
directorship pursuant to the terms of this Section 5.1, the election of such
director shall be accomplished in accordance with the Company's certificate of
incorporation and bylaws and applicable law; and
(vi) any Investor who is entitled to appoint a
director pursuant to this Section 5.1 (as well as Taquari Participacoes S.A.,
Mellon Ventures II, L.P. and Qualcomm Incorporated) shall be entitled to have an
observer present at any meeting of the Board of Directors of the Company in the
event such Investor is no longer entitled to appoint a director to the Board of
Directors of the Company or no longer exercises its right to appoint a director
to the Board of Directors of the Company.
(b) To the extent that any provision of the Company's
certificate of incorporation or bylaws is inconsistent with the provisions of
this Agreement, the Stockholders agree to take all actions necessary to effect
such amendments to the certificate of incorporation or bylaws as may be
necessary and appropriate to give full effect to the provisions of this
Agreement.
5.2 MEETINGS OF THE BOARD. The Board of Directors shall meet at least
six times each calendar year in accordance with an agreed-upon schedule.
5.3 COMMITTEES. The Board of Directors shall establish audit,
nominating and compensation committees and shall delegate to such committees
those duties and powers as are customarily performed by committees of such type.
The audit committee shall not include any of the Management Directors.
5.4 REIMBURSEMENT OF EXPENSES. The reasonable travel expenses of each
director incurred in attending or observing Board or committee meetings shall be
reimbursed by the Company.
24
<PAGE> 28
5.5 CERTAIN APPROVALS BY STOCKHOLDERS. Without the approval of the
holders of a majority of the Investor Stock, which shall not be unreasonably
withheld, the Company shall not (i) engage any underwriter or placement agent
for any public or private offering of securities other than an investment
banking firm of recognized national reputation, (ii) issue any stock or options
to employees of the Company that are not subject to vesting and/or buy-back
restrictions, or (iii) waive or accelerate any vesting or buy-back restrictions
with respect to Management Stock.
5.6 CERTAIN APPROVALS BY DIRECTORS. Without limiting any other matters
which shall be subject to the approval of the Board of Directors, the Company
shall not, without the approval of a majority of the Board of Directors:
(a) approve its annual business plan and budget;
(b) incur any indebtedness, whether in a single transaction or
any series of related transactions, which, together with all indebtedness
incurred in that fiscal year, exceeds that fiscal year's budget by more than
$10,000,000;
(c) make capital expenditures which exceed that fiscal year's
budget by more than $10,000,000 in the aggregate;
(d) alter or amend in any way its policy regarding dividends;
(e) make distributions in any form to its Stockholders;
(f) approve of compensation to senior management of the
Company;
(g) approve and/or adopt (i) grants of stock options to senior
management of the Company, (ii) amendments to its Amended and Restated 1998
Stock Option Plan, or (iii) create any new stock option plans; or
(h) terminate or hire its chief executive officer, chief
financial officer or chief technical officer.
ARTICLE VI
MISCELLANEOUS
6.1 GOVERNING LAW. This Agreement shall be governed in all respects by
the laws of the State of Colorado as such laws are applied to agreements between
Colorado residents entered into and performed entirely in Colorado, except that
the General Corporation Law of the State of Delaware shall govern as to matters
of corporate law.
6.2 SUCCESSORS AND ASSIGNS. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto.
25
<PAGE> 29
6.3 ENTIRE AGREEMENT; AMENDMENT AND WAIVER. This Agreement supersedes
any other agreement, whether written or oral, that may have been made or entered
into by the parties hereto relating to the matters contemplated hereby and
constitutes the full and entire understanding and agreement between the parties
with regard to the subject hereof, and no party shall be liable or bound to any
other in any manner by any representations, warranties, covenants and agreements
except as specifically set forth herein and therein. In particular, the
execution of this Agreement shall terminate all prior stockholders agreements
and registration rights agreements, or any similar agreement to the foregoing,
among any Investor or Other Holder and the Company. Neither this Agreement nor
any term hereof may be amended, waived, discharged or terminated except by a
written instrument signed by the Company and the holders of two-thirds of the
outstanding Stock, and any such amendment, waiver, discharge or termination
shall be binding on all the Stockholders. Notwithstanding the foregoing, in the
event that any such amendment would have a disproportionate effect on the Series
A Preferred Stock and the Series B/B-1 Preferred Stock, such amendment must be
approved by the holders of two-thirds of the Stock that is Series A Preferred
Stock, and also by the holders of two-thirds of the Stock that is Series B/B-1
Preferred Stock. In addition, any amendment to Section 5.1 that has the effect
of taking away or adversely affecting an Investor's right to designate a
director shall not be made without the affected Investor's consent.
Notwithstanding the foregoing, additional Management Holders may be added as
parties to this Agreement by the execution of a Joinder Agreement executed
solely by the Company and the new Management Holders.
6.4 SPECIFIC ENFORCEMENT. Any holder of Stock shall be entitled to
specific enforcement of its rights under this Agreement. The parties acknowledge
that money damages would be an inadequate remedy for a breach of this Agreement
and consent to an action for specific performance or other injunctive relief in
the event of any such breach. The Company shall reimburse the holders of Stock
for all reasonable expenses incurred in securing the relief provided by this
Section 6.4.
6.5 SEVERABILITY. Unless otherwise expressly provided herein, a
Stockholder's rights hereunder are several rights, not rights jointly held with
any of the other Stockholders. In case any provision of this Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
6.6 NOTICES, ETC. All notices and other communications required or
permitted hereunder shall be in writing and shall be deemed effectively given:
(i) upon personal delivery to the party to be notified, (ii) when sent by
confirmed telex or facsimile if sent during normal business hours of the
recipient, if not, then on the next business day, (iii) five (5) days after
having been sent by registered or certified mail, return receipt requested,
postage prepaid, or (iv) one (1) day after deposit with a nationally recognized
overnight courier, special next day delivery, with verification of receipt. All
communications shall be sent to the Company at 6400 South Fiddlers Green Circle,
Suite 710, Englewood, CO 80111, Attention: VP Strategic and Legal Affairs, with
a copy to Holland & Hart LLP, 555 Seventeenth Street, Suite 3200, Denver, CO
80202, Attention: Mark D. Ebel, and to a
26
<PAGE> 30
Stockholder at the address reflected in the Company's stock ledger or at such
other address as such Stockholder shall have furnished to the Company in
writing.
6.7 COUNTERPARTS; FACSIMILE. This Agreement may be executed in any
number of counterparts, each of which shall be an original, but all of which
together shall constitute one instrument. This Agreement may be executed and
delivered by facsimile.
6.8 DELAYS OR OMISSIONS. No delay or omission to exercise any right,
power or remedy accruing to any Stockholder under this Agreement shall impair
any such right, power or remedy of such Stockholder nor shall it be construed to
be a waiver of any such breach or default, or an acquiescence therein, or of or
in any similar breach or default thereafter occurring; nor shall any waiver of
any single breach or default be deemed a waiver of any other breach or default
theretofore or thereafter occurring. Any waiver, permit, consent or approval of
any kind or character on the part of any Stockholder of any breach or default
under this Agreement or any waiver on the part of any Stockholder of any
provisions or conditions of this Agreement must be made in writing and shall be
effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement or by law or otherwise afforded to any
Stockholder, shall be cumulative and not alternative.
6.9 TERMINATION. The provisions of this Agreement (other than Article
II hereof and related definitions) shall terminate (i) upon consummation of a
Qualified Public Offering, (ii) upon consummation of the sale of all of the
capital stock of the Company or (iii) on the effective date and immediately
prior to: (a) the closing of any agreement for a merger or consolidation of the
Company with another entity; provided that there shall be no termination of this
Agreement if the persons and entities who were the stockholders of the Company
immediately before such merger or consolidation continue to own, directly or
indirectly, shares of the corporation resulting from such merger or
consolidation having more than 70% of the total number of votes that may be cast
for the election of directors of such corporation, in substantially the same
proportion as their ownership of the voting securities of the Company
outstanding immediately before such merger or consolidation; or (b) the closing
of any sale, exchange or other disposition of all or substantially all of the
Company's assets; or (c) a dissolution or liquidation of the Company's assets.
The provisions of Article II shall terminate on the eighth anniversary of the
date hereof.
* * * * *
27
<PAGE> 31
IN WITNESS WHEREOF, the parties hereto have executed this Third Amended
and Restated Investors Agreement effective as of the day and year first above
written.
COMPANY:
VELOCOM INC.
-----------------------------------------
Name:
Title:
INVESTORS:
TELECOM PARTNERS II, L.P.
BY: TELECOM MANAGEMENT II, L.L.C.
ITS: GENERAL PARTNER
By:
--------------------------------------
Name:
Title:
TELECOM PARTNERS III, L.P.
BY: TELECOM MANAGEMENT III, L.L.C.
ITS: GENERAL PARTNER
By:
--------------------------------------
Name:
Title:
CENTENNIAL FUND V, L.P.
BY: CENTENNIAL HOLDINGS V, L.P.
ITS: GENERAL PARTNER
By:
--------------------------------------
Name:
Title:
28
<PAGE> 32
CENTENNIAL ENTREPRENEURS FUND V, L.P.
BY: CENTENNIAL HOLDINGS V, L.P.
ITS: GENERAL PARTNER
By:
--------------------------------------
Name:
Title:
CENTENNIAL FUND VI, L.P.
BY: CENTENNIAL HOLDINGS VI, LLC
ITS: GENERAL PARTNER
By:
--------------------------------------
Name:
Title: Managing Principal
CENTENNIAL ENTREPRENEURS FUND VI, L.P.
BY: CENTENNIAL HOLDINGS VI, LLC
ITS: GENERAL PARTNER
By:
--------------------------------------
Name:
Title: Managing Principal
CENTENNIAL HOLDINGS I, LLC
By:
--------------------------------------
Name:
Title:
29
<PAGE> 33
CENTENNIAL STRATEGIC PARTNERS VI,
L.P.
BY: CSP VI MANAGEMENT, LLC
ITS: GENERAL PARTNER
BY: CENTENNIAL HOLDINGS VI, LLC
ITS: MANAGING MEMBER
By:
--------------------------------------
Name:
Title: Managing Principal
CRESCENDO WORLD FUND, LLC
BY: CRESCENDO VENTURES WORLD FUND,
LLC
ITS: GENERAL PARTNER
By:
--------------------------------------
Name:
Title:
CRESCENDO III, L.P.
BY: CRESCENDO VENTURES III, LLC
ITS: GENERAL PARTNER
By:
--------------------------------------
Name:
Title:
EAGLE VENTURES WF, LLC
By:
--------------------------------------
Name:
Title:
30
<PAGE> 34
CRESCENDO III, GbR
By:
--------------------------------------
Name:
Title:
CRESCENDO III EXECUTIVE FUND, L.P.
By:
--------------------------------------
Name:
Title:
SLI WIRELESS S.A.
By:
--------------------------------------
Name:
Title:
FORMUS COMMUNICATIONS-LATIN
AMERICA HOLDINGS, LLC
BY: FORMUS INTERNATIONAL, INC.
ITS: MANAGER
By:
--------------------------------------
Name:
Title:
JANCO CAPITAL MANAGEMENT, LLC
By:
--------------------------------------
Name:
Title:
BRAD PEERY CAPITAL, L.P.
By:
--------------------------------------
Name:
Title:
31
<PAGE> 35
BRAD PEERY CAPITAL VENTURES, L.P.
By:
--------------------------------------
Name:
Title:
BRAD PEERY CAPITAL INTERNATIONAL
By:
--------------------------------------
Name:
Title:
BRAD PEERY CAPITAL, INC.
By:
--------------------------------------
Name:
Title:
MELLON VENTURES II, L.P.
By: MVMA II, L.P., a Delaware Limited
Partnership
Its: General Partner
By: MVMA, Inc., a Delaware
Corporation
Its: General Partner
By:
--------------------------------------
Name: Jeffrey H. Anderson
Title:
TAQUARI PARTICIPACOES S.A.
By:
--------------------------------------
Name:
Title:
32
<PAGE> 36
BLACK CORAL ENTERPRISES, INC.
By:
--------------------------------------
Name:
Title:
BANKAMERICA INVESTMENT CORPORATION
By:
--------------------------------------
Name:
Title:
QUALCOMM INCORPORATED
By:
--------------------------------------
Name:
Title:
FIRST UNION INVESTORS, INC.
By:
--------------------------------------
Name:
Title:
DOLPHIN COMMUNICATIONS FUND, L.P.
By: Dolphin Communications, L.P.
Its: General Partner
By: Dolphin Communications,
L.L.C.
Its: General Partner
By:
--------------------------------------
Name: Barry W. Stewart
Its: Member
33
<PAGE> 37
DOLPHIN COMMUNICATIONS PARALLEL
FUND, L.P.
By: Dolphin Communications, L.P.
Its: General Partner
By: Dolphin Communications,
L.L.C.
Its: General Partner
By:
--------------------------------------
Name: Barry W. Stewart
Its: Member
TORONTO DOMINION INVESTMENTS, INC.
By:
--------------------------------------
Name:
Title:
CRI MEDIA PARTNERS, L.P.
By:
--------------------------------------
Name:
Title:
CRI MEDIA PARTNERS II, L.P.
By:
--------------------------------------
Name:
Title:
CHESTNUT HILL VELOCOM, LLC
By:
--------------------------------------
Name:
Title:
NORTHWOOD VENTURES LLC
By:
--------------------------------------
Name:
Title:
34
<PAGE> 38
TD SECURITIES (USA), INC.
By:
--------------------------------------
Name:
Title:
-----------------------------------------
Aleks Acimovic
-----------------------------------------
Orlin R. Jacobson
-----------------------------------------
Ravi Mhatre
OTHER HOLDERS:
-----------------------------------------
David J. Leonard
-----------------------------------------
Gregory P. Sadler
-----------------------------------------
Nicolas Kauser
-----------------------------------------
R. Dwayne House
-----------------------------------------
Michael S. Quinn
-----------------------------------------
Bradley T. Johnson
-----------------------------------------
Barry L. Rowan
-----------------------------------------
Barry L. Rowan and Linda N. Rowan
-----------------------------------------
Fred A. Vierra
35
<PAGE> 39
-----------------------------------------
Roxanne Vierra
-----------------------------------------
Robert McKenzie
-----------------------------------------
C. James Frank
-----------------------------------------
Clarence Endy
-----------------------------------------
Michael Lisogurski
-----------------------------------------
Bernard Schotters
-----------------------------------------
David Tomizuka
REINCO CORP.
By:
--------------------------------------
Name:
Title:
COMMUNICATIONS CAPITAL PARTNERS, INC.
By:
--------------------------------------
Name:
Title:
36
<PAGE> 40
SCHEDULE I
MANAGEMENT HOLDERS
David J. Leonard
Gregory P. Sadler
Nicolas Kauser
R. Dwayne House
Michael S. Quinn
Bradley T. Johnson
Barry Rowan
David Tomizuka
Reinco Corp. (John Gowen)
1
<PAGE> 41
FIRST AMENDMENT
TO
THIRD AMENDED AND RESTATED INVESTORS AGREEMENT
This First Amendment to the Third Amended and Restated Investors
Agreement dated as of January 7, 2000 (the "Investors Agreement") is entered
into as of February 11, 2000, by and among (i) VeloCom Inc., a Delaware
corporation (the "Company"), (ii) the parties identified on the signature pages
hereto as additional investors (the "Additional Investors"), (iii) the holders
of the Company's Common Stock, Series A Preferred Stock, Series B Preferred
Stock and/or Series B-1 Preferred Stock identified on the signature pages hereto
as existing investors (the "Existing Investors"), and (iv) the additional
stockholders of the Company and holders of securities that are convertible into,
or exercisable or exchangable for, shares of the Company's Common Stock,
identified on the signature pages hereto as other holders (the "Other Holders").
The Additional Investors, the Existing Investors and the Other Holders are
referred to collectively as the "Stockholders."
RECITALS
WHEREAS, the Company, the Existing Investors and the Other Holders are
parties to the Investors Agreement;
WHEREAS, in connection with and as a condition to the purchase by the
Additional Investors of 833,333 shares of the Company's Series B Preferred Stock
and warrants to purchase 125,000 shares of the Company's Common Stock, the
Company has agreed to provide the Additional Investors the rights set forth in
the Investors Agreement; and
WHEREAS, under Section 6.3 of the Investors Agreement, the Investors
Agreement may be amended with the written consent of the Company and the holders
of two-thirds of the outstanding Stock (as such term is defined in the Investors
Agreement).
In consideration of the mutual agreements, covenants and considerations
contained herein, the parties hereto agree as follows:
1. DEFINITIONS. All capitalized terms used herein without definition
shall have the meanings given to them in the Investors Agreement.
2. AMENDMENT. The definition of "Investors" set forth in the Investors
Agreement is hereby amended to include the Additional Investors.
3. ADDITIONAL INVESTORS. Upon the effectiveness of this First
Amendment, the Additional Investors agree to be bound by all of the terms and
conditions of the Investors Agreement applicable to Investors, as that term is
defined in the Investors Agreement.
1
<PAGE> 42
4. NOTICES. All notices sent to the Company, to the Existing Investors,
or to the Other Holders shall be sent to the addresses indicated in the
Investors Agreement. All notices to the Additional Investors shall be sent to
the addresses set forth below their signatures to this First Amendment.
5. EFFECT OF AMENDMENT. Except as amended as set forth above, the
Investors Agreement shall continue in full force and effect.
[THIS SPACE INTENTIONALLY LEFT BLANK]
2
<PAGE> 43
IN WITNESS WHEREOF, the undersigned parties have executed this First
Amendment to Third Amended and Restated Investors Agreement as of the date set
forth in the first paragraph hereof.
COMPANY:
VELOCOM INC.
Suite 710
6400 South Fiddlers Green Circle
Englewood, CO 80111
--------------------------------------------
Name:
Title:
ADDITIONAL INVESTORS:
INTEL CORPORATION
2200 Mission College Blvd.
SC4-203
Santa Clara, CA 95052
By:
-----------------------------------------
Name:
Title:
EXISTING INVESTORS:
TELECOM PARTNERS II, L.P.
BY: TELECOM MANAGEMENT II, L.L.C.
ITS: GENERAL PARTNER
By:
-----------------------------------------
Name:
Title:
3
<PAGE> 44
TELECOM PARTNERS III, L.P.
BY: TELECOM MANAGEMENT III, L.L.C.
ITS: GENERAL PARTNER
By:
-----------------------------------------
Name:
Title:
CENTENNIAL FUND V, L.P.
BY: CENTENNIAL HOLDINGS V, L.P.
ITS: GENERAL PARTNER
By:
-----------------------------------------
Name:
Title:
CENTENNIAL ENTREPRENEURS FUND V, L.P.
BY: CENTENNIAL HOLDINGS V, L.P.
ITS: GENERAL PARTNER
By:
-----------------------------------------
Name:
Title:
CENTENNIAL FUND VI, L.P.
BY: CENTENNIAL HOLDINGS VI, LLC
ITS: GENERAL PARTNER
By:
-----------------------------------------
Name:
Title: Managing Principal
4
<PAGE> 45
CENTENNIAL ENTREPRENEURS FUND VI, L.P.
BY: CENTENNIAL HOLDINGS VI, LLC
ITS: GENERAL PARTNER
By:
-----------------------------------------
Name:
Title: Managing Principal
CENTENNIAL HOLDINGS I, LLC
By:
-----------------------------------------
Name:
Title:
CENTENNIAL STRATEGIC PARTNERS VI, L.P.
BY: CSP VI MANAGEMENT, LLC
ITS: GENERAL PARTNER
BY: CENTENNIAL HOLDINGS VI, LLC
ITS: MANAGING MEMBER
By:
-----------------------------------------
Name:
Title: Managing Principal
CRESCENDO WORLD FUND, LLC
BY: CRESCENDO VENTURES WORLD FUND, LLC
ITS: MANAGING MEMBER
By:
-----------------------------------------
Name:
Title:
CRESCENDO III, L.P.
BY: CRESCENDO VENTURES III, LLC
ITS: GENERAL PARTNER
By:
-----------------------------------------
Name:
Title:
5
<PAGE> 46
EAGLE VENTURES WF, LLC
By:
-----------------------------------------
Name:
Title:
CRESCENDO III, GbR
BY: CRESCENDO VENTURES III, LLC
ITS: GENERAL PARTNER
By:
----------------------------------
Name:
Title:
CRESCENDO III EXECUTIVE FUND, L.P.
BY: CRESCENDO VENTURES III, LLC
ITS: GENERAL PARTNER
By:
----------------------------------
Name:
Title:
SLI WIRELESS S.A.
By:
-----------------------------------------
Name:
Title:
FORMUS COMMUNICATIONS-LATIN AMERICA HOLDINGS,
LLC
BY: FORMUS INTERNATIONAL, INC.
ITS: MANAGER
By:
-----------------------------------------
Name:
Title:
6
<PAGE> 47
JANCO CAPITAL, L.P.
BY: JANCO CAPITAL MANAGEMENT, LLC
ITS: GENERAL PARTNER
By:
----------------------------------
Name:
Title:
BRAD PEERY CAPITAL, L.P.
By:
-----------------------------------------
Name:
Title:
BRAD PEERY CAPITAL VENTURES, L.P.
By:
-----------------------------------------
Name:
Title:
BRAD PEERY CAPITAL INTERNATIONAL
By:
-----------------------------------------
Name:
Title:
BRAD PEERY CAPITAL, INC.
By:
-----------------------------------------
Name:
Title:
7
<PAGE> 48
MELLON VENTURES II, L.P.
BY: MVMA II, L.P., A DELAWARE LIMITED
PARTNERSHIP
ITS: GENERAL PARTNER
BY: MVMA, INC., A DELAWARE
CORPORATION
ITS: GENERAL PARTNER
By:
-----------------------------------------
Name: Jeffrey H. Anderson
Title:
TAQUARI PARTICIPACOES S.A.
By:
-----------------------------------------
Name:
Title:
BLACK CORAL ENTERPRISES, INC.
By:
-----------------------------------------
Name:
Title:
BANKAMERICA INVESTMENT CORPORATION
By:
-----------------------------------------
Name:
Title:
QUALCOMM INCORPORATED
By:
-----------------------------------------
Name:
Title:
8
<PAGE> 49
FIRST UNION MERCHANT BANKING, LLC-1999
By: FUCP Management Company,
LLC-1999
Its: Managing Member
By:
----------------------------------
Ted A. Gardner
Managing Member
DOLPHIN COMMUNICATIONS FUND, L.P.
BY: DOLPHIN COMMUNICATIONS, L.P.
ITS: GENERAL PARTNER
BY: DOLPHIN COMMUNICATIONS, L.L.C.
ITS: GENERAL PARTNER
By:
-----------------------------------------
Name: Barry W. Stewart
Its: Member
DOLPHIN COMMUNICATIONS PARALLEL FUND, L.P.
BY: DOLPHIN COMMUNICATIONS, L.P.
ITS: GENERAL PARTNER
BY: DOLPHIN COMMUNICATIONS, L.L.C.
ITS: GENERAL PARTNER
By:
-----------------------------------------
Name: Barry W. Stewart
Its: Member
TORONTO DOMINION INVESTMENTS, INC.
By:
-----------------------------------------
Name:
Title:
9
<PAGE> 50
CRI MEDIA PARTNERS, L.P.
By:
-----------------------------------------
Name:
Title:
CRI MEDIA PARTNERS II, L.P.
By:
-----------------------------------------
Name:
Title:
CHESTNUT HILL VELOCOM, LLC
By:
-----------------------------------------
Name:
Title:
NORTHWOOD VENTURES LLC
By:
-----------------------------------------
Name:
Title:
TD SECURITIES (USA), INC.
By:
-----------------------------------------
Name:
Title:
--------------------------------------------
Aleks Acimovic
--------------------------------------------
Orlin R. Jacobson
--------------------------------------------
Ravi Mhatre
10
<PAGE> 51
OTHER HOLDERS:
--------------------------------------------
David J. Leonard
--------------------------------------------
Gregory P. Sadler
--------------------------------------------
Nicolas Kauser
--------------------------------------------
R. Dwayne House
--------------------------------------------
Michael S. Quinn
--------------------------------------------
Bradley T. Johnson
--------------------------------------------
Barry L. Rowan
--------------------------------------------
Barry L. Rowan and Linda M. Rowan
--------------------------------------------
Fred A. Vierra
--------------------------------------------
Roxanne Vierra
--------------------------------------------
Robert McKenzie
--------------------------------------------
C. James Frank
--------------------------------------------
Clarence Endy
11
<PAGE> 52
--------------------------------------------
Michael Lisogurski
--------------------------------------------
Bernard Schotters
--------------------------------------------
David Tomizuka
REINCO CORP.
By:
-----------------------------------------
Name:
Title:
COMMUNICATIONS CAPITAL PARTNERS, INC.
By:
-----------------------------------------
Name:
Title:
12
<PAGE> 53
SECOND AMENDMENT
TO
THIRD AMENDED AND RESTATED INVESTORS AGREEMENT
This Second Amendment to the Third Amended and Restated Investors
Agreement dated as of January 7, 2000, as amended by the First Amendment thereto
dated February 11, 2000 (the "Investors Agreement"), is entered into as of April
20, 2000, by and among (i) VeloCom Inc., a Delaware corporation (the "Company"),
(ii) the parties identified on the signature pages hereto as the holders of the
Company's Series C Preferred Stock (the "Series C Investors"), (iii) the holders
of the Company's Common Stock, Series A Preferred Stock, Series B Preferred
Stock and/or Series B-1 Preferred Stock identified on the signature pages hereto
as existing investors (the "Existing Investors"), and (iv) the additional
stockholders of the Company and holders of securities that are convertible into,
or exercisable or exchangable for, shares of the Company's Common Stock,
identified on the signature pages hereto as other holders (the "Other Holders").
The Series C Investors, the Existing Investors and the Other Holders are
referred to collectively as the "Stockholders."
RECITALS
WHEREAS, the Company, the Existing Investors and the Other Holders are
all of the parties to the Investors Agreement;
WHEREAS, in connection with and as a condition to the purchase by the
Series C Investors of up to 5,150,000 shares of the Company's Series C Preferred
Stock, the Company has agreed to provide the Series C Investors the rights set
forth in the Investors Agreement; and
WHEREAS, under Section 6.3 of the Investors Agreement, the Investors
Agreement may be amended with the written consent of the Company and the holders
of two-thirds of the outstanding Stock (as such term is defined in the Investors
Agreement).
In consideration of the mutual agreements, covenants and considerations
contained herein, the parties hereto agree as follows:
1. DEFINITIONS. All capitalized terms used herein without
definition shall have the meanings given to them in the Investors Agreement.
The Investors Agreement shall be amended by inserting the following definitions
into Article I:
"El Paso Director" shall have the meaning set forth in Section
5.1(a)(ii)(K).
1
<PAGE> 54
"Series C Preferred Stock" shall mean the Company's Series C
Preferred Stock, $.0001 par value per share.
The definition of "Agreement" is amended as follows:
"Agreement" shall have the meaning set forth in the
introductory paragraph of this Investors Agreement, as amended from
time to time.
The definition of "Investor Stock" is amended as follows:
"Investor Stock" shall mean (i) shares of Common Stock owned
by the Investors or any transferee thereof; (ii) shares of Common Stock
issued or issuable upon the conversion or exercise of any stock
(including, without limitation, the Series A Preferred Stock, Series
B/B-1 Preferred Stock, and Series C Preferred Stock) warrants, options
or other securities of the Company owned by the Investors or any
transferee thereof; and (iii) any shares of Common Stock issued as a
dividend or other distribution with respect to or in exchange for or in
replacement of the shares referenced in (i) and (ii) above.
The definition of "Management Holders" is amended as follows:
"Management Holders" shall mean members of the Company's
management that hold shares of Common Stock, Series A Preferred Stock,
Series B/B-1 Preferred Stock or Series C Preferred Stock and are
parties to this Agreement or have agreed to be bound by the provisions
of this Agreement. As of the date hereof, the Management Holders are as
set forth on Schedule I. Permitted Transferees of a Management Holder
shall also be considered to be Management Holders.
The definition of "Preferred Stock" is amended as follows:
"Preferred Stock" shall mean all of the outstanding shares of
Series A Preferred Stock, Series B Preferred Stock, Series B-1
Preferred Stock and Series C Preferred Stock.
The definition of "Stockholders" is amended as follows:
"Stockholders" shall have the meaning set forth in the
introductory paragraph of this Investors Agreement, as may be amended
from time to time.
2. AMENDMENT. The definition of "Investors" set forth in the
Investors Agreement is hereby amended to include the Series C Investors.
2
<PAGE> 55
3. LIMITED PREEMPTIVE RIGHTS. Section 4.10(a) is amended by
deleting subsection (ii) in its entirety and replacing it with the following:
"(ii) upon the conversion of the Series A Preferred Stock, the
Series B/B-1 Preferred Stock, and Series C Preferred Stock,"
4. BOARD OF DIRECTORS. Section 5.1 of the Investors Agreement
is hereby deleted in its entirety and replaced with the following:
5.1 BOARD OF DIRECTORS.
"(a) Each Stockholder agrees to vote all securities
of the Company over which such Stockholder has voting control
and to take all other necessary or desirable actions within
its control (whether as a stockholder, director or officer of
the Company or otherwise, and including without limitation
attendance at meetings in person or by proxy for purposes of
obtaining a quorum and execution of written consents in lieu
of meetings), and the Company shall take all necessary and
desirable actions within its control (including, without
limitation, calling special board and stockholder meetings),
so that:
(i) the Company shall have a Board of Directors
comprising no more than fourteen (14) members;
(ii) subject to subsection (iii) below, the following
persons shall be elected to the Board of Directors:
(A) Three representatives designated by the
holders of a majority of the outstanding
Management Stock (the "Management
Directors"); provided, however, that, until
the next annual meeting of the Company's
stockholders, Nicolas Kauser, David J.
Leonard and Bernard Schotters shall serve as
the Management Directors;
(B) One representative designated by Telecom
Partners III, L.P. (such representative, the
"Telecom Director"); provided, however,
that, until the next annual meeting of the
Company's stockholders, William J. Elsner
shall serve as the Telecom Director;
(C) One representative designated jointly by
Centennial Fund V, L.P. and Centennial Fund
VI, L.P. (together, the "Centennial
Entities," and such representative, the
"Centennial Entities
3
<PAGE> 56
Director"); provided, however, that, until
the next annual meeting of the Company's
stockholders, Steven C. Halstedt shall serve
as the Centennial Entities Director;
(D) One representative designated jointly by
Crescendo World Fund, L.L.C., Eagle Ventures
WF, L.L.C., Crescendo III, GbR, Crescendo
III Executive Fund, L.P. and Crescendo III,
L.P. (together, the "Crescendo Entities,"
and such representative, the "Crescendo
Entities Director"); provided, however,
that, until the next annual meeting of the
Company's stockholders, Anthony Daffer shall
serve as the Crescendo Entities Director;
(E) Two representatives designated by SLI
Wireless S.A. (the "SLI Directors");
provided, however, that until the next
annual meeting of the Company's
stockholders, Guillermo Liberman and Luis
Gonzalez Lanuza shall serve as the SLI
Directors;
(F) One representative designated by Formus
Communications, Inc. (the "Formus
Director"); provided, however, that until
the next annual meeting of the Company's
stockholders, Bernard G. Dvorak shall serve
as the Formus Director;
(G) One director (the "Outside Director")
approved by a Nominating Committee of the
Board of Directors consisting of one of the
Telecom Directors, one of the SLI Directors,
the Centennial Entities Director, the
Crescendo Entities Director and one of the
Management Directors; provided, however,
that, until the next annual meeting of the
Company's stockholders, Fred A. Vierra shall
serve as the Outside Director;
(H) One director designated by Bank of America
(the "Bank of America Director"); provided,
however, that until the next annual meeting
of the Company's stockholders, Jacques
Gliksberg shall serve as the Bank of America
Director;
(I) One director designated by Chestnut Hill
VeloCom, LLC (the "Chestnut Director");
provided, however, that until the next
annual meeting of the Company's
stockholders, Michael Greeley shall serve as
the Chestnut Director;
(J) One director designated by First Union
Investors, Inc. (the "First Union
Director"); provided, however, that until
the next annual
4
<PAGE> 57
meeting of the Company's stockholders, Scott
Perper shall serve as the First Union
Director; and
(K) One director designated by El Paso Energy
Communications Company (the "El Paso
Director"); provided, however, that until
the next annual meeting of the Company's
stockholders, William Smith shall serve as
the El Paso Director; and
(iii) the director appointment provisions set forth in
subsection (ii)(B), (C), (D), (E), (F), (H), (I), (J)
and (K) shall only be effective, with respect to each
particular Investor, so long as such Investor
entitled to appoint a director owns an aggregate of
two percent (2%) or more of the Company's Common
Stock Deemed Outstanding. In the event this ownership
threshold is not satisfied by any of such Investors,
such particular Investor's appointment provisions
shall be exercised by the Company;
(iv) in the event that any director for any reason ceases
to serve as a member of the Board during his term of
office, the resulting vacancy on the Board shall be
filled by a majority vote of the Stockholders
entitled to elect such director as provided in this
Section 5.1;
(v) if the Stockholders fail within sixty (60) days of a
directorship being vacated to designate a
representative to fill such directorship pursuant to
the terms of this Section 5.1, the election of such
director shall be accomplished in accordance with the
Company's certificate of incorporation and bylaws and
applicable law; and
(vi) any Investor who is entitled to appoint a director
pursuant to this Section 5.1 (as well as Taquari
Participacoes S.A., Mellon Ventures II, L.P. and
Qualcomm Incorporated) shall be entitled to have an
observer present at any meeting of the Board of
Directors of the Company in the event such Investor
is no longer entitled to appoint a director to the
Board of Directors of the Company or no longer
exercises its right to appoint a director to the
Board of Directors of the Company.
(b) To the extent that any provision of the Company's certificate
of incorporation or bylaws is inconsistent with the provisions
of this Agreement, the Stockholders agree to take all actions
necessary to effect such amendments to the certificate of
incorporation or bylaws as may be necessary and appropriate to
give full effect to the provisions of this Agreement."
5
<PAGE> 58
5. ENTIRE AGREEMENT; AMENDMENT AND WAIVER. The fourth sentence of
Section 6.3 is deleted and replaced with the following sentence:
"Notwithstanding the foregoing, in the event that any such
amendment would have a disproportionate effect on the Series A
Preferred Stock, the Series B/B-1 Preferred Stock, or the Series C
Preferred Stock, such amendment must be approved by the holders of
two-thirds of the series of Preferred Stock that would be so affected
by the amendment."
6. AGREEMENT. Upon the effectiveness of this Second Amendment, each
Series C Investor agrees to be bound by all of the terms and conditions of the
Investors Agreement applicable to Investors, as that term is defined in the
Investors Agreement.
7. NOTICES. All notices sent to the Company, to the Existing Investors,
or to the Other Holders shall be sent to the addresses indicated in the
Investors Agreement. All notices to the Series C Investors shall be sent to the
addresses set forth below their signatures to this Second Amendment.
8. EFFECT OF AMENDMENT. Except as amended as set forth above, the
Investors Agreement shall continue in full force and effect.
6
<PAGE> 59
IN WITNESS WHEREOF, the undersigned parties have executed this Second
Amendment to Third Amended and Restated Investors Agreement as of the date set
forth in the first paragraph hereof.
COMPANY:
VELOCOM INC.
Suite 710
6400 South Fiddlers Green Circle
Englewood, CO 80111
--------------------------------------------------
Name: Michael S. Quinn
Title: Chief Corporate Development Officer
SERIES C INVESTORS:
EL PASO ENERGY COMMUNICATIONS COMPANY
1001 Louisiana Street
P.O. Box 2511
Houston, TX 77002
By:
---------------------------------------------
Name:
Title:
------------------------------------------------
Billi R. McCullough
------------------------------------------------
Patti Reichman
7
<PAGE> 60
------------------------------------------------
Anne Doris
------------------------------------------------
William Ricke
------------------------------------------------
Rafael Steinhauser
------------------------------------------------
Gilberto Geraldo Garbi
------------------------------------------------
Aleks Acimovic
------------------------------------------------
Bradley T. Johnson
[signatures continued on following pages]
8
<PAGE> 61
EXISTING INVESTORS:
TELECOM PARTNERS II, L.P.
BY: TELECOM MANAGEMENT II, L.L.C.
ITS: GENERAL PARTNER
By:
---------------------------------------------
Name:
Title:
TELECOM PARTNERS III, L.P.
BY: TELECOM MANAGEMENT III, L.L.C.
ITS: GENERAL PARTNER
By:
---------------------------------------------
Name:
Title:
CENTENNIAL FUND V, L.P.
BY: CENTENNIAL HOLDINGS V, L.P.
ITS: GENERAL PARTNER
By:
---------------------------------------------
Name:
Title:
CENTENNIAL ENTREPRENEURS FUND V, L.P.
BY: CENTENNIAL HOLDINGS V, L.P.
ITS: GENERAL PARTNER
By:
---------------------------------------------
Name:
Title:
9
<PAGE> 62
CENTENNIAL FUND VI, L.P.
BY: CENTENNIAL HOLDINGS VI, LLC
ITS: GENERAL PARTNER
By:
---------------------------------------------
Name:
Title: Managing Principal
CENTENNIAL ENTREPRENEURS FUND VI, L.P.
BY: CENTENNIAL HOLDINGS VI, LLC
ITS: GENERAL PARTNER
By:
---------------------------------------------
Name:
Title: Managing Principal
CENTENNIAL HOLDINGS I, LLC
By:
---------------------------------------------
Name:
Title:
CENTENNIAL STRATEGIC PARTNERS VI, L.P.
BY: CSP VI MANAGEMENT, LLC
ITS: GENERAL PARTNER
BY: CENTENNIAL HOLDINGS VI, LLC
ITS: MANAGING MEMBER
By:
---------------------------------------------
Name:
Title: Managing Principal
CRESCENDO WORLD FUND, LLC
BY: CRESCENDO VENTURES WORLD FUND, LLC
ITS: MANAGING MEMBER
By:
---------------------------------------------
Name:
Title:
10
<PAGE> 63
CRESCENDO III, L.P.
BY: CRESCENDO VENTURES III, LLC
ITS: GENERAL PARTNER
By:
---------------------------------------------
Name:
Title:
EAGLE VENTURES WF, LLC
By:
---------------------------------------------
Name:
Title:
CRESCENDO III, GBR
BY: CRESCENDO VENTURES III, LLC
ITS: GENERAL PARTNER
By:
---------------------------------------
Name:
Title:
CRESCENDO III EXECUTIVE FUND, L.P.
BY: CRESCENDO VENTURES III, LLC
ITS: GENERAL PARTNER
By:
---------------------------------------
Name:
Title:
SLI WIRELESS S.A.
By:
---------------------------------------------
Name:
Title:
11
<PAGE> 64
FORMUS COMMUNICATIONS-LATIN AMERICA HOLDINGS,
LLC
BY: FORMUS INTERNATIONAL, INC.
ITS: MANAGER
By:
---------------------------------------------
Name:
Title:
JANCO CAPITAL, L.P.
BY: JANCO CAPITAL MANAGEMENT, LLC
ITS: GENERAL PARTNER
By:
----------------------------------------
Name:
Title:
BRAD PEERY CAPITAL, L.P.
By:
---------------------------------------------
Name:
Title:
BRAD PEERY CAPITAL VENTURES, L.P.
By:
---------------------------------------------
Name:
Title:
BRAD PEERY CAPITAL INTERNATIONAL
By:
---------------------------------------------
Name:
Title:
12
<PAGE> 65
BRAD PEERY CAPITAL, INC.
By:
---------------------------------------------
Name:
Title:
MELLON VENTURES II, L.P.
BY: MVMA II, L.P., A DELAWARE LIMITED PARTNERSHIP
ITS: GENERAL PARTNER
BY: MVMA, INC., A DELAWARE CORPORATION
ITS: GENERAL PARTNER
By:
---------------------------------------------
Name: Jeffrey H. Anderson
Title:
TAQUARI PARTICIPACOES S.A.
By:
---------------------------------------------
Name:
Title:
BLACK CORAL ENTERPRISES, INC.
By:
---------------------------------------------
Name:
Title:
BANKAMERICA INVESTMENT CORPORATION
By:
---------------------------------------------
Name:
Title:
13
<PAGE> 66
QUALCOMM INCORPORATED
By:
---------------------------------------------
Name:
Title:
FIRST UNION MERCHANT BANKING, LLC-1999
By: FUCP Management Company, LLC-1999
Its: Managing Member
By:
--------------------------------------
Ted A. Gardner
Managing Member
DOLPHIN COMMUNICATIONS FUND, L.P.
BY: DOLPHIN COMMUNICATIONS, L.P.
ITS: GENERAL PARTNER
BY: DOLPHIN COMMUNICATIONS, L.L.C.
ITS: GENERAL PARTNER
By:
---------------------------------------------
Name: Barry W. Stewart
Its: Member
DOLPHIN COMMUNICATIONS PARALLEL FUND, L.P.
BY: DOLPHIN COMMUNICATIONS, L.P.
ITS: GENERAL PARTNER
BY: DOLPHIN COMMUNICATIONS, L.L.C.
ITS: GENERAL PARTNER
By:
---------------------------------------------
Name: Barry W. Stewart
Its: Member
14
<PAGE> 67
TORONTO DOMINION INVESTMENTS, INC.
By:
---------------------------------------------
Name:
Title:
CRI MEDIA PARTNERS, L.P.
By:
---------------------------------------------
Name:
Title:
CRI MEDIA PARTNERS II, L.P.
By:
---------------------------------------------
Name:
Title:
CHESTNUT HILL VELOCOM, LLC
By:
---------------------------------------------
Name:
Title:
NORTHWOOD VENTURES LLC
By:
---------------------------------------------
Name:
Title:
TD SECURITIES (USA), INC.
By:
---------------------------------------------
Name:
Title:
15
<PAGE> 68
--------------------------------------------------
Aleks Acimovic
--------------------------------------------------
Orlin R. Jacobson
--------------------------------------------------
Ravi Mhatre
INTEL CORPORATION
By:
---------------------------------------------
Name:
Title:
OTHER HOLDERS:
--------------------------------------------------
David J. Leonard
--------------------------------------------------
Gregory P. Sadler
--------------------------------------------------
Nicolas Kauser
--------------------------------------------------
R. Dwayne House
--------------------------------------------------
Michael S. Quinn
--------------------------------------------------
Bradley T. Johnson
--------------------------------------------------
Barry L. Rowan
--------------------------------------------------
Linda M. Rowan
16
<PAGE> 69
--------------------------------------------------
Fred A. Vierra
--------------------------------------------------
Roxanne Vierra
--------------------------------------------------
Robert McKenzie
--------------------------------------------------
C. James Frank
--------------------------------------------------
Clarence Endy
--------------------------------------------------
Michael Lisogurski
--------------------------------------------------
Bernard Schotters
--------------------------------------------------
David Tomizuka
REINCO CORP.
By:
---------------------------------------------
Name:
Title:
COMMUNICATIONS CAPITAL PARTNERS, LLC
By:
---------------------------------------------
Name:
Title:
17
