AMENDMENT NO. 1 TO
PREFERRED STOCK REGISTRATION RIGHTS AGREEMENT
This Amendment No. 1 to Preferred Stock Registration Rights Agreement
dated as of April 30, 1999 is made as of June 1, 1999 by KMC Telecom Holdings,
Inc. (the "Company"), First Union Investors, Inc. ("First Union"), Newcourt
Commercial Finance Corporation ("Newcourt") and Lucent Technologies, Inc.
("Lucent").
W I T N E S S E T H
WHEREAS, First Union owns shares of the Company's Series E Senior,
Redeemable, Exchangeable, PIK Preferred Stock (the "Series E Preferred Stock");
WHEREAS, the Company and First Union are parties to the Preferred Stock
Registration Rights Agreement dated as of April 30, 1999 concerning First
Union's Series E Preferred Stock (the "Agreement");
WHEREAS, Newcourt owns shares of the Company's Series E Preferred
Stock, and shares of the Company's Series F Senior, Redeemable, Exchangeable,
PIK Preferred Stock (the "Series F Preferred Stock"), and Lucent owns shares of
the Series F Preferred Stock;
WHEREAS, the Company wishes to extend the registration rights granted
to First Union with respect to its Series E Preferred Stock to Newcourt and
Lucent with respect to their shares of Series E Preferred Stock and Series F
Preferred Stock, respectively;
WHEREAS, First Union wishes to consent to the granting of such
registration rights to Newcourt and Lucent.
NOW, THEREFORE, in consideration of the premises, the parties hereto
agree as follows:
1. DEFINED TERMS. Unless otherwise defined herein, all capitalized
terms defined in the Agreement and used herein are used as so defined. In
addition, the following terms shall have the meanings set forth below, and, to
the extent that such terms also appear in the Agreement, the meanings set forth
below shall replace the meanings set forth in the Agreement:
"Registrable Securities" means the shares of Series E Preferred Stock
issued and sold to First Union under the Securities Purchase Agreement dated as
of April 30, 1999, the shares of Series E Preferred Stock, the shares of Series
F Preferred Stock issued and sold to Newcourt under the Securities Purchase
Agreement dated as of February 4, 1999, and the shares of Series F Preferred
Stock issued and sold to Lucent under the Securities Purchase Agreement dated as
of February 4, 1999.
2. INSERTION OF NEW SUBHEADING. A new subheading is inserted below the
heading "2. DEMAND REGISTRATION RIGHTS." to read "2.1 DEMAND RIGHTS."
3. AMENDMENT TO SECTION 2.1(A). The first sentence of Section 2.1(a) of
the Agreement is amended to read in its entirety as follows:
"At any time and from time to time after October 30, ▇▇▇▇, ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇▇ and Lucent (each referred to in this Section 2 as the
"Demand Holder") may request the Company to register its Registrable
Securities in the manner set forth herein by written notice (the
"REGISTRATION NOTICE") to the Company only if a disposition of the
Registrable Securities may not, in the opinion of the Demand Holder, be
effected in the public marketplace (as opposed to a private transaction
under the Securities Act) at equally favorable net terms to the Demand
Holder without registration of such shares under the Securities Act."
4. AMENDMENT TO SECTION 2.1(B). The first sentence of Section 2.1(b) of
the Agreement is amended to read in its entirety as follows:
"Each of First Union, Newcourt and Lucent will be entitled to obtain
up to two (2) Long-Form Registrations and two (2) Short-Form
Registrations."
5. AMENDMENT TO SECTION 2.2(A). The first sentence of Section 2.2(a) of
the Agreement is amended by replacing the words "First Union" with the words
"Each of First Union, Newcourt and Lucent".
6. AMENDMENT TO SECTION 2.3. The introductory language of Section 2.3
of the Agreement is amended by replacing the words "First Union" with the words
"any of First Union, Newcourt and Lucent".
7. AMENDMENT TO SECTION 2.3(A), (C), (D), (E), (H), (I) AND (M).
Sections 2.3(a), (c), (d), (e), (h), (i) and (m) of the Agreement are amended,
in each case by replacing each occurrence of the words "First Union" with the
words "First Union, Newcourt or Lucent, as the case may be,". Section 2.3(m) is
further amended by deleting ";and" at the end and replacing the deleted material
with a period. The final paragraph of Section 2.3, which is not designated by an
alphabetic character, is also amended by replacing each occurrence of the words
"First Union" with the words "First Union, Newcourt or Lucent, as the case may
be,".
8. AMENDMENT TO SECTION 2.4(B). Section 2.4(b) of the Agreement is
amended to read in its entirety as follows:
"(b) Except as otherwise expressly provided in this Agreement, in
connection with each Demand Registration, the Company will reimburse
First Union, Newcourt or Lucent, as the case may be, for the reasonable
fees and disbursements of counsel chosen by it. If more than one of
First Union, Newcourt and Lucent are participating in a registration,
whether by virtue of coincident demand or otherwise, they shall jointly
select counsel and the Company will only be obligated to reimburse any
or all of them for the reasonable fees and disbursements of once
counsel chosen by them."
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9. AMENDMENT TO SECTION 2.5(A) AND (B). Sections 2.5(a) and (b) of the
Agreement are amended, in each case by replacing each occurrence of the words
"First Union" with the words "First Union, Newcourt or Lucent, as the case may
be,".
10. AMENDMENT TO SECTION 2.6. Section 2.6 of the Agreement is amended
to read in its entirety as follows:
"2.6. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS. No Person may
participate in any registration hereunder which is underwritten unless
such Person (a) agrees to sell such Person's securities on the basis
provided in any underwriting arrangements approved by the Person or
Persons entitled hereunder to approve such arrangements and (b)
completes and executes all customary questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements;
PROVIDED, that First Union, Newcourt or Lucent, as the case may be,
shall not be required to make any representations or warranties to the
Company or the underwriters other than representations and warranties
regarding itself and its intended method of distribution."
11. AMENDMENT TO SECTION 3.1. Section 3.1 of the Agreement is amended
by adding the following after the address for First Union and its counsel:
if to Newcourt:
Newcourt Commercial Finance Corporation
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Vice President--Credit
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Newcourt Commercial Finance Corporation
▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Vice President--Legal
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
if to Lucent:
Lucent Technologies, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇ 27
Warren, New Jersey 07059
Attn: ▇▇▇ ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Sidley & Austin
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
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12. Except as expressly amended hereby, all of the provisions of the
Agreement are hereby affirmed and shall continue in full force and effect in
accordance with their terms.
13. This Amendment shall be governed and construed in accordance with
the laws of the state of Delaware applicable to agreements made and to be
performed entirely within such state, without regard to the principles of
conflicts of laws thereof.
14. This Amendment may be executed in one or more counterparts, each of
which shall be deemed an original and all of which, taken together, shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the undersigned have executed, or have caused to be
executed, this Amendment on the date first written above.
KMC TELECOM HOLDINGS, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Chief Financial Officer
FIRST UNION INVESTORS, INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
NEWCOURT COMMERCIAL FINANCE
CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇
Title: Vice President
LUCENT TECHNOLOGIES, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Managing Director
Signature Page to
Amendment No. 1 to
Preferred Stock
Registration Rights
Agreement