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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000.
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM TO
COMMISSION FILE NUMBER 000-23387
TELIGENT, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE
(STATE OR OTHER JURISDICTION OF 54-1866562
INCORPORATION OR ORGANIZATION) (I.R.S. EMPLOYER IDENTIFICATION NO.)
8065 LEESBURG PIKE
SUITE 400
VIENNA, VIRGINIA 22182
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (703) 762-5100
SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
NONE
SECURITIES REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
11 1/2 % SENIOR NOTES DUE 2007
11 1/2 % SENIOR DISCOUNT NOTES DUE 2008
COMMON STOCK, CLASS A, PAR VALUE $.01 PER SHARE
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days: Yes [ ] No [X].
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of the registrant's knowledge, in the definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K[ ].
The aggregate market value of the registrant's voting stock held by
non-affiliates of the registrant was approximately $27 million on March 26,
2001, based on the closing sales price of the registrant's Class A Common Stock
as reported on The Nasdaq Stock Market as of such date.
The number of shares outstanding of each of the registrant's classes of
common stock as of March 26, 2001 was as follows:
Common Stock, Class A 42,583,265
Common Stock, Class B 21,260,610
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This Form 10-K/A is being filed to provide information which can not be
incorporated by reference to the Company's definitive proxy statement for its
2001 Annual Meeting of Stockholders. In reviewing the Form 10-K/A and the Form
10-K for the year ended December 31, 2000 (the "Original 10-K"), the reader
should be aware that since the filing of the Original 10-K the Company and all
of its domestic subsidiaries have filed voluntary bankruptcy petitions under
Chapter 11 of the U.S. Bankruptcy Code (see the Company's Form 8-K dated May 21,
2001) and there have been substantial changes in the Company's stock ownership,
Board of Directors and management. The information contained under Part III of
the Form 10-K/A reflects the changes in stock ownership, the Board of Directors
and management which have occurred.
Except for any historical information contained herein, the matters
discussed in this Form 10-K contain certain "forward-looking statements" within
the meaning of the Private Securities Litigation Reform Act of 1995 with respect
to the Company's financial condition, results of operation and business. The
words "anticipate," "believe," "estimate," "expect," "plan," "intend" and
similar expressions, as they relate to the Company, are intended to identify
forward-looking statements. Such statements reflect our current views with
respect to future events and involve known and unknown risks, uncertainties and
other factors. The Company cannot be sure that any of its expectations will be
realized.
In this Annual Report on Form 10-K/A, we will refer to Teligent, Inc., a
Delaware corporation, and, as appropriate, its subsidiaries, as "Teligent," "the
Company," "we," "us," and "our." Where applicable, such references refer to
Teligent's limited liability company predecessor.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
DIRECTORS
The following table sets forth the names of the Company's directors and
certain information about each of them as of May 28, 2001:
NAME AGE POSITION WITH THE COMPANY
---- --- -------------------------
James V. Continenza 38 Chief Operating Officer and Director
Anthony S. Davidson 33 Director
Yoav Krill 59 Chief Executive Officer, President and Director
Morris Lichtenstein 37 Director
Hal B. Perkins 44 Director
Rahul Prakash 39 Director
JAMES V. CONTINENZA, Mr. Continenza has been the Chief Operating Officer and a
director of the Company since May 2001. He served as the Senior Vice President
of Sales and Operations of the Company from October 2000 to May 2001. Mr.
Continenza served Lucent Technologies Product Finance, a CIT Company, as its
President and Chief Executive Officer from April 1999 to September 2000 and as
its Senior Vice President - Worldwide Sales and Marketing from September 1997 to
April 1999.
ANTHONY S. DAVIDSON, Mr. Davidson has been a director of the Company since April
2001. Mr. Davidson has served as the Chief Financial Officer of IDT Nevada
Holdings, Inc., an investment and holding company, and of IDT Investments, Inc.,
a wholly owned subsidiary of IDT Corp. ("IDT"), since January 2001. From January
2000 to December 2000, Mr. Davidson served as the Vice President for Business
Development of IDT, a telecommunications company. From September 1996 to
December 2000, Mr. Davidson served as Treasurer of SkyView Media Group, a
foreign language television and radio provider. SkyView Media Group filed for
Chapter 11 in August 1999 while Mr. Davidson was serving as Treasurer. From June
1990 to August 1996, Mr. Davidson served as an Assistant Vice President of Fleet
Bank.
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YOAV KRILL, Mr. Krill has been a director of the Company since May 2001. Mr.
Krill has served as the Chief Executive Officer and President of the Company
since April 2001. From May 1998 to April 2001, Mr. Krill served as the Senior
Vice President for Global Networks and Managing Director of European Operations
of IDT. From 1994 to 1997, Mr. Krill served as the President of Bezeq Globe Ltd.
MORRIS LICHTENSTEIN, Mr. Lichtenstein has been a director of the Company since
April 2001. Mr. Lichtenstein has served as the Executive Vice President of
Business Development of IDT since January 2000. From January 1999 to December
1999, Mr. Lichtenstein served as Controller for IDT. During the period from 1988
to 1998, Mr. Lichtenstein served as the Controller of Mademoiselle Knitwear,
Inc. Mademoiselle Knitwear, Inc. filed for Chapter 11 bankruptcy protection in
1996 while Mr. Lichtenstein was serving as Controller.
HAL B. PERKINS, Mr. Perkins has been a director of the Company since April 2001.
Mr. Perkins has served as the General Counsel of Telcom Ventures since August
1995 and of Telcom - DTS Investors, L.L.C. since 1997.
RAHUL PRAKASH, Mr. Prakash has been a director of the Company since April 2001.
Mr. Prakash has served as the President of Telcom-DTS Investors, L.L.C. and of
Telcom Ventures, L.L.C. ("Telcom Ventures"), telecommunications investment
firms, since 1997. From 1994 to 1997, Mr. Prakash served as a Vice President and
Special Advisor to the Chairman of Telcom Ventures. Mr. Prakash serves on the
Board of Directors of Aether Systems, Inc.
EXECUTIVE OFFICERS
The current executive officers of the Company who are not directors are as
follows:
Name Age Position with the Company
- ---- --- -------------------------
Norman Klugman 51 Chief Financial Officer and Treasurer
Stuart H. Kupinsky 34 Senior Vice President, General Counsel and Secretary
NORMAN KLUGMAN, Mr. Klugman has been the Chief Financial Officer and Treasurer
of the Company since May 2001. Mr. Klugman served as Chief Executive Officer of
IDT Enterprise Solutions from March 2001 to May 2001. Mr. Klugman served as the
Chief Executive Officer and an investor of Launchview Broadband from May 2000 to
February 2001. Launchview Broadband filed for Chapter 7 bankruptcy protection in
February 2001 while Mr. Klugman was the Chief Executive Officer.
STUART H. KUPINSKY, Mr. Kupinsky has been a Senior Vice President, General
Counsel and Secretary of the Company since May 2001. Mr. Kupinsky served as the
Vice President of Legal and Business Affairs of the Company from April 2000 to
May 2001 and was responsible for providing legal advice regarding corporate,
technology, human resources and other issues. He served as an Associate General
Counsel of the Company from October 1997 to April 2000. Mr. Kupinsky served as a
trial attorney with the U.S. Department of Justice from September 1996 to
October 1997, where he was primarily responsible for telecom antitrust
enforcement actions.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires Teligent's
directors and executive officers, and persons who beneficially own more than 10
percent of a registered class of Teligent's equity securities, to file with the
SEC and The Nasdaq Stock Market initial reports of ownership and reports of
changes in ownership of Teligent's Class A common stock and other equity
securities of Teligent by the tenth of the month following a change. Officers,
directors and greater than 10 percent shareholders are required by SEC
regulations to furnish Teligent with copies of all Section 16(a) forms they
file.
To Teligent's knowledge, based solely on a review of the copies of such
reports furnished to Teligent and written representations that no other reports
were required during the year ended December 31, 2000, the following Section
16(a) filings were late: (a) Mr. Akhavan, a former executive officer, filed a
Form 3 late, and (b) Mr. Wagner, a former executive
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officer, filed a Form 3 late. Otherwise, all Section 16(a) filing requirements
applicable to its officers, directors and greater than 10 percent beneficial
owners were complied with.
ITEM 11. EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE
The following table sets forth information concerning the compensation
paid or granted during 2000 to Teligent's former Chief Executive Officer and the
three other highest paid executive officers that were employed by the Company at
December 31, 2000, in addition to two executive officers that were no longer
with the Company at such date (collectively, the "Executive Officers"). None of
these Executive Officers is currently employed by the Company. Each of the
Executive Officers received perquisites and other personal benefits in addition
to salary and bonus during the periods stated. The aggregate amount of these
perquisites and other personal benefits, however, did not exceed the lesser of
$50,000 or 10% of the total of their salary and bonus and, therefore, has been
omitted as permitted by the rules of the SEC.
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LONG TERM
ANNUAL COMPENSATION COMPENSATION AWARDS
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SECURITIES UNDERLYING ALL OTHER
SALARY BONUS OPTIONS/SARS COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($) ($) (#) ($)
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Alex J. Mandl(2) 2000 500,000 --- --- 4,048(1)
Chairman of the Board and Chief 1999 500,000 600,000 --- 5,000(1)
Executive Officer 1998 500,000 500,000 --- 4,800(1)
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Kirby G. Pickle, Jr. (3) 2000 284,615 --- --- 1,174,208(3)
President and Chief Operating 1999 394,231 350,000 --- 5,000(1)
Officer 1998 350,000 275,000 --- 4,800(1)
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Laurence E. Harris (4) 2000 305,000 --- 200,000 2,112(1)
Senior Vice President, General 1999 303,269 160,000 --- 5,000(1)
Counsel and Secretary 1998 287,692 150,000 --- 4,800(1)
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Hamid Akhavan(5)
Senior Vice President of 2000 278,962 66,301 500,000 5,100(1)
Information Technology and Chief
Technology Officer
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Steven F. Bell 2000 287,885 75,000 200,000 357,844(6)
Senior Vice President for Human 1999 263,269 150,000 --- 377,156(6)
Resources 1998 246,154 120,000 --- 396,114(6)
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Bruce T. Wagner(7)
Senior Vice President of Field 2000 285,154 69,781 200,000 5,100(1)
Operations
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(1) Represents Teligent's contribution to its 401(k) Savings Plan on behalf
of the Executive Officers.
(2) Effective April 2001, Mr. Mandl ceased to be an executive officer of the
Company.
(3) Effective September 2000, Mr. Pickle ceased to be an executive officer of
the Company. Consists of a $2,308 contribution by Teligent to its 401(K)
Savings Plan on behalf of Mr. Pickle as well as loan forgiveness in the
amount of $1,171,900.
(4) Effective May 2001, Mr. Harris ceased to be an executive officer of the
Company.
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(5) Effective May 2001, Mr. Akhavan ceased to be an executive officer of the
Company.
(6) Consists of $5,100, $5,000, and $4,800 in contributions by Teligent to
its 401(k) Savings Plan on behalf of Mr. Bell in 2000, 1999, and 1998,
respectively, as well as loan forgiveness in the amounts of $352,744,
$372,156, and $391,314 in 2000, 1999, and 1998, respectively. Effective
May 2001, Mr. Bell ceased to be an executive officer of the Company.
(7) Effective October 2000, Mr. Wagner ceased to be an executive officer of
the Company.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
The following table sets forth certain information with respect to
employee options to purchase shares of Class A common stock ("options") awarded
during 2000 by the Company to the Executive Officers. All such options are
nonqualified stock options. No stock appreciation rights ("SARs"), alone or in
tandem with such stock options, were awarded in 2000.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
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Individual Grants(1) Potential Realizable Value
Assumed Annual Rate of Stock
Price Appreciation For Option
Term
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Percent Of
Number Of Total
Securities Options/
Underlying SARs Granted Exercise Of
Option/SARs To Employees Base Price Expiration
Name Granted (#) In Fiscal Year(2) ($/Sh) Date 0% ($) 5% ($) 10% ($)
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Alex J. Mandl 0 0.00% N/A N/A N/A N/A N/A
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Hamid Akhavan 500,000 8.05% $22.50 05/21/2010 $0 $7,075,065 $17,929,603
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Laurence E. Harris 200,000 3.22% $11.56 09/19/2010 $500 $1,454,819 $3,686,029
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Steven F. Bell 200,000 3.22% $11.56 09/19/2010 $500 $1,454,819 $3,686,029
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Bruce T. Wagner 200,000 3.22% $22.50 05/21/2010 $0 $2,830,026 $7,171,841
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Kirby G. Pickle, Jr. 0 0.00% N/A N/A N/A N/A N/A
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(1) Options for Executive Officers have been awarded pursuant to the 1997
Stock Incentive Plan, as amended (the "Plan"), approved by the
shareholders of the Company. The terms are governed by the Plan and the
recipient's option agreement. The option exercise price is the fair
market value of the Class A common stock on the date of grant. Options
shown in the table held by Messrs. Harris and Bell become exercisable in
quarterly installments over a three-year period from the date of grant.
Options shown in the table held by Messrs. Akhavan and Wagner become
exercisable in annual installments over a three-year period from the date
of the grant. Payment of the exercise price of an option may be made in
cash or, in whole or in part, in full shares of Class A common stock
already owned by the holder of the option. The payment of withholding
taxes due upon exercise of an option may generally be made with shares of
common stock.
(2) Indicates the percentage of all options granted to employees of the
Company during 2000.
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AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
OPTION/SAR VALUES
The following table summarizes for each of the Executive Officers certain
information relating to stock options exercised by him during the fiscal year
ended December 31, 2000 and the value of any unexercised options at fiscal
year-end. Value realized upon exercise is the difference between the fair market
value of the underlying stock on the exercise date and the exercise or base
price of the option. The value of an unexercised, in-the-money option at fiscal
year-end is the difference between its exercise or base price and the fair
market value of the underlying stock on December 29, 2000, which was $1.94 per
share. These values, unlike the amounts set forth in the column "Value
Realized," have not been, and may never be, realized. These options have not
been, and may not ever be, exercised. Actual gains, if any, on exercise will
depend on the value of Teligent Class A common stock on the date of exercise.
There can be no assurance that these values will be realized. Unexercisable
options are those that have not yet vested.
SHARES NUMBER OF SECURITIES VALUE OF UNEXERCISED
ACQUIRED ON VALUE UNDERLYING UNEXERCISED IN-THE-MONEY
EXERCISE REALIZED OPTIONS AT OPTIONS AT
NAME (#) ($) FY-END (#) FY-END ($)
- ----------------- ----------- ----------- ---------- ----------
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EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
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Alex J. Mandl 0 $0 4,006,488 2,003,244 $0 $0
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Steven F. Bell 40,000 $2,189,200 138,442 345,110 $0 $0
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Kirby G. Pickle, Jr. 0 $0 506,660 404,441 $0 $0
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Laurence E. Harris 0 $0 321,994 304,667 $0 $0
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Hamid Akhavan 0 $0 165,444 500,000 $0 $0
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Bruce T. Wagner 0 $0 30,000 306,000 $0 $0
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SEVERANCE ARRANGEMENTS
In connection with the termination of his employment by the Company in
April 2001, Mr. Mandl entered into a separation agreement pursuant to which he
is to receive all of the benefits required in a termination without cause under
his September 1996 employment agreement (including severance pay of $6 million
and continued participation for two years in the Company's welfare benefit
plans), he was released from the noncompete provisions of his employment
agreement and the Company released Mr. Mandl from his obligation to repay $12
million in loans, plus accrued interest, he owed the Company.
In connection with the resignation of Steve Bell in May 2001, Mr. Bell
entered into a separation arrangement with the Company pursuant to which he is
entitled to receive severance pay of $900,000, the vesting of his options under
the Company's 1997 Stock Incentive Plan and continued participation for twelve
months in the Company's welfare benefit plans.
In 1999, Hamid Akhavan entered into a letter agreement that provided that
he is entitled to severance pay equal to two years of his base salary, or
approximately $560,000, and continued vesting of his options under the Company's
1997 Stock Incentive Plan for a period of twelve months following his departure
in the event his employment is terminated for any reason other than for cause.
Mr. Akhavan was removed as the Senior Vice President of Information Technology
and Chief Technology Officer in May 2001.
In connection with the resignation of Bruce Wagner in October 2000, Mr.
Wagner entered into a separation arrangement pursuant to which he agreed to
provide consulting services to the Company for a six-month period beginning
January 2001 and is entitled to severance pay of $300,000, continued vesting of
his options under the Company's 1997 Stock Incentive Plan during his consulting
period, and participation for 18 months in the Company's welfare benefit plans.
Mr. Wagner remains subject to the non-competition provisions of his employment
agreement.
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In connection with the resignation of Kirby G. Pickle, Jr. in September
2000, Mr. Pickle entered into a separation arrangement pursuant to which he
agreed to provide consulting services to the Company for an 18-month period and
300,000 of his options under the Company's 1997 Stock Incentive Plan vested in
January 2001.
2000 COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The following report was prepared for inclusion in the Company's 2001
proxy statement to explain the compensation policies and practices of the
Compensation Committee of the Board of Directors for the year ended December 31,
2000. During 2000, Gary Howard (Chairman), Tetsuro Mikami, Thomas Hicks and
Neera Singh served as members of the Compensation Committee. These individuals
are no longer members of the Compensation Committee or the Company's Board of
Directors. The Company's Board of Directors currently considers all compensation
issues since the Company does not currently have a Compensation Committee. Since
Thomas Hicks is no longer on the Compensation Committee or a member of the Board
of Directors, he has not consented to having his name placed under this report
of the Compensation Committee.
The 2000 Compensation Committee was composed entirely of non-employee
directors and was responsible for developing and making recommendations to the
Board of Directors with respect to Teligent's executive compensation policies
and practices. In addition, the 2000 Compensation Committee determined the
compensation to be paid to the Chief Executive Officer and each of the other
Executive Officers for the year ended December 31, 2000.
COMPENSATION PHILOSOPHY
The philosophy of the Company's compensation program was, generally, to
provide a performance-based executive compensation program that rewards
executives whose efforts enable Teligent to achieve its business objectives and
enhance shareholder value. Specifically, Teligent's executive compensation
program was designed to provide an overall level of compensation opportunity
that was competitive within the telecommunications industry, as well as with a
broader group of high technology companies that share the complexity of
achieving aggressive growth targets in a competitive marketplace. The 2000
Compensation Committee used its discretion to set individual executive
compensation levels warranted in its judgment by market practice, Company
performance and individual performance thereby enabling Teligent to attract,
motivate, reward and retain individuals who possess the skills, experience and
talents necessary to advance Teligent's growth and financial performance.
The compensation of the Company's executive officers, including the
Executive Officers, was comprised of three elements: base salary, annual cash
bonus and stock options.
Base Salary. Base salary was the primary mechanism used to compensate
executive officers for their management responsibilities. Base salaries were
determined by evaluating the responsibilities of the position, the experience
and knowledge of the individual, the contribution of the individual to the
Company's achievements during the prior year and the competitive marketplace for
executive talent. The Chief Executive Officer recommended annual salary
adjustments for executive officers after consideration of these factors. The
Chief Executive Officer's recommendations were considered by the 2000
Compensation Committee in determining executive officers' annual salary levels.
Annual Bonus. The annual bonuses paid to Teligent's Executive Officers
were dependent upon individual and overall company performance. At the beginning
of the year, the 2000 Compensation Committee approved specific performance
measures and goals based upon the business plan for that year. At the conclusion
of the year, the 2000 Compensation Committee compared actual achievements
against these goals. The Company paid 50% of the annual bonuses for 2000 since
the 2000 Compensation Committee determined that the Company did not achieve the
performance measures or goals set for the second six months of 2000.
Stock Options. Stock options provide an incentive for retention of
executive talent and the creation of shareholder value in the long-term since
their full benefits cannot be realized unless the price of Teligent's stock
appreciates over a specified number of years and the executive officer continues
to perform services for Teligent. The 2000 Compensation Committee believed that
stock options serve as an important component of compensation by closely
aligning management's interests and actions with those of Teligent's
shareholders. During 2000, Mr. Harris, Mr. Bell, and Mr. Akhavan were granted
new stock options. Each of the Executive Officers continues to hold a
significant number of stock options granted at the time of their employment.
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Compensation of the Executive Officers
The 2000 Compensation Committee reviewed the compensation of the
Company's Executive Officers and concluded that their 2000 compensation was
reasonable in view of the Company's performance and the contribution of those
officers to that performance.
Compensation of the Chief Executive Officer
Pursuant to his employment agreement, Mr. Mandl was paid a base salary of
$500,000 for services rendered in 2000. Mr. Mandl was not granted any new stock
options in 2000 although he continues to hold a significant number of stock
options granted at the time of employment.
162(m) of the Internal Revenue Code
In adopting and administering executive compensation plans and
arrangements, the 2000 Compensation Committee considered whether the
deductibility of such compensation would be limited under section 162(m) of the
Internal Revenue Code, as amended, and, in appropriate cases, served to
structure arrangements so that any such limitation will not apply.
Submitted by the 2000 Compensation Committee,
Gary Howard (Chairperson)
Neera Singh
Tetsuro Mikami
STOCK PERFORMANCE GRAPH
The line graph below compares the cumulative total shareholder return on
Teligent's Class A common stock to the cumulative total return of the S&P Midcap
400 Index and a custom peer index (the "Peer Index") for the period November 21,
1997 (the date of Teligent's initial public offering) through December 31, 2000.
The graph assumes an initial investment of $100 at November 21, 1997 and
reinvestment of all dividends.
[GRAPH]
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11/21/97 12/31/97 12/31/98 12/31/99 12/31/00
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Teligent, Inc. 100.00 96.10 112.20 240.98 7.56
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S&P Midcap 400 Index 100.00 103.20 122.92 141.02 159.69
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Peer Index(1) 100.00 99.32 97.24 281.62 67.01
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(1.) The Peer Index consists of corporations (other than Teligent) who (a) are
U.S. based and whose operations are principally within the U.S., (b) are
classified, along with Teligent, by industry analysts as Competitive Local
Exchange Carriers (CLECs), and (c) were publicly traded throughout the period
November 21, 1997 to December 31, 2000. Specifically, the Peer Group consists of
the following corporations: Advanced Radio Telecom Corporation, e.spire
Communications, Inc., Electric Lightwave, Inc., GST Telecommunications, Inc.,
ICG Communications, Inc., Intermedia Communications, Inc., ITC Deltacom, Inc.,
McLeodUSA Incorporated, XO Communications, Inc., RCN Corporation and Winstar
Communications, Inc.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The following table presents information regarding the beneficial
ownership of Teligent voting stock as of April 23, 2001, by:
- persons or entities (or group of affiliated persons or entities)
known by management to beneficially own more than five percent of
the outstanding voting stock of Teligent;
- each current director of Teligent named in Item 10;
- each former executive officer named in the "Summary Compensation
Table" in Item 11; and
- all of the former executive officers of Teligent named in the
"Summary Compensation Table" appearing below and current directors
of Teligent as a group.
The persons named in the following table have sole voting power for all
shares of voting stock shown as beneficially owned by them, subject to community
property laws where applicable and except as indicated in the footnotes to this
table. The address of each of the beneficial owners, except where otherwise
indicated, is the same address as Teligent. An asterisk (*) in the table
indicates that an individual beneficially owns less than one percent of the
outstanding voting stock of Teligent.
The following table reflects the acquisition by IDT Corp. of Microwave
Services, Inc., a wholly-owned subsidiary of Liberty Media Corporation, on April
17, 2001. Microwave Services, Inc. holds 21,436,689 shares of Teligent's Class A
common stock. Microwave Services, Inc. has the right to elect three directors to
Teligent's Board of Directors pursuant to the terms of the stockholders
agreement by and among Alex Mandl, Liberty Media Corporation, Telcom - DTS
Investors, L.L.C. and Microwave Services, Inc., dated as of January 13, 2000. In
addition, IDT Corp. has entered into an agreement to acquire 219,998 shares of
Teligent's Series A Convertible Preferred Stock from affiliates of Hicks, Muse,
Tate & Furst Incorporated.
Beneficial ownership is determined in accordance with the rules of the
SEC. In computing the number of shares beneficially owned by a person and the
percentage ownership of that person, shares of voting stock subject to
outstanding options, warrants and convertible securities held by that person
that are currently exercisable or exercisable within 60 days after April 23,
2001, are deemed outstanding. These shares, however, are not deemed outstanding
for the purpose of computing the percentage ownership of any other person. As of
April 23, 2001, there were 73,409,058 shares of Teligent voting stock
outstanding.
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CLASS A COMMON STOCK(1) CLASS B COMMON STOCK(2) PERCENTAGE OF
TOTAL VOTING
BENEFICIAL OWNERS STOCK
OUTSTANDING
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SHARES PERCENT CLASS B-SERIES 2 CLASS B-SERIES 3 PERCENT
BENEFICIALLY OF SHARES BENEFICIALLY SHARES BENEFICIALLY OF
OWNED CLASS OWNED OWNED CLASS
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GREATER THAN 5 PERCENT BENEFICIAL OWNERS
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IDT Corporation
520 Broad Street
Newark, New Jersey 07102 21,436,689 41.1% --- --- --- 29.2%
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Telcom Ventures, L.L.C.
200 N. Union Street, Suite 300
Alexandria, VA 22201 --- --- 15,477,210 --- 72.8% 21.1%
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Nippon Telegraph and Telephone
Corporation
Kowa Nishi-Shimbashi Bldg. -B
14-1 Nishi-Shimbashi 2-chome,
Minato-ku, Tokyo 105-0003
Japan --- --- --- 5,783,400 27.2% 7.9%
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Microsoft Corporation(3)
One Microsoft Way
Building 8/2126
Redmond, WA 98052 3,826,087 7.3% --- --- --- 5.2%
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Hicks, Muse, Tate & Furst
Incorporated(3)
200 Crescent Court, Suite 16
Dallas, TX 75201 3,826,052 7.3% --- --- --- 5.2%
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RGC International Investors, LDC(4)
Three Bala Plaza - East
Suite 501
Bala Cynwyd, PA 19004-3481 3,729,278 6.7% --- --- --- 4.8%
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CURRENT DIRECTORS
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Jim Continenza(5) 402,500 * --- --- --- *
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Anthony S. Davidson(6) --- --- --- --- --- ---
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Yoav Krill --- --- --- --- --- ---
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Morris Lichtenstein(7) --- --- --- --- --- ---
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Hal Perkins(8) --- --- --- --- --- ---
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Rahul Prakash(9) 500 * --- --- --- *
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CLASS A COMMON STOCK(1) CLASS B COMMON STOCK(2) PERCENTAGE OF
BENEFICIAL OWNERS TOTAL VOTING
STOCK
OUTSTANDING
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SHARES PERCENT CLASS B-SERIES 2 CLASS B-SERIES 3 PERCENT
BENEFICIALLY OF SHARES BENEFICIALLY SHARES BENEFICIALLY OF
OWNED CLASS OWNED OWNED CLASS
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FORMER EXECUTIVE OFFICERS NAMED IN THE "SUMMARY COMPENSATION TABLE" WHO ARE NOT DIRECTORS
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Alex J. Mandl(10) 4,234,488 7.5% --- --- --- 5.5%
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Kirby G. Pickle, Jr.(11) 821,660 1.6% --- --- --- 1.1%
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Laurence E. Harris(12) 338,661 * --- --- --- *
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Hamid Akhavan(13) 332,502 * --- --- --- *
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Steven F. Bell(14) 235,997 * --- --- --- *
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Bruce T. Wagner(15) 96,660 * --- --- --- *
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Directors and executive officers 6,462,968 11.0% 15,477,210 --- 72.8% 27.5%
of Teligent named in the "Summary
Compensation Table" as a group
(12 persons)(16)
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(1) Includes the Series A preferred stock on an as-converted basis.
(2) Each share of Class B common stock is convertible at any time, at the
option of the registered holders thereof, into one fully paid and
nonassessable share of Class A common stock. Teligent has granted the
registered holders of the shares of Class B common stock rights to have
its shares of Class B common stock, which have been or are convertible
into shares of Class A common stock, registered under the Securities Act
of 1933.
(3) Represents the number of shares of Class A common stock issuable upon
conversion of the Series A preferred stock held by such person or entity.
(4) Represents the number of shares of Class A common stock issuable upon
exercise of the warrant held by RGC International Investors, LDC.
(5) Includes 400,000 shares of Class A common stock issuable upon exercise of
Mr. Continenza's stock options.
(6) Does not include 21,436,689 shares of Class A common stock held of record
by Microwave Services, Inc., an entity controlled by IDT. Mr. Davidson is
the Chief Financial Officer of IDT Nevada Holdings, Inc., an investment
and holding company, and of IDT Investments, Inc., a wholly-owned
subsidiary of IDT and the holder of all of the outstanding shares of
Microwave Services, Inc. Mr. Davidson expressly disclaims beneficial
ownership of any shares held by Microwave Services, Inc.
(7) Does not include 21,436,689 shares of Class A common stock held of record
by Microwave Services, Inc., an entity controlled by IDT. Mr.
Lichtenstein is an Executive Vice President of Business Development of
IDT. Mr. Lichtenstein expressly disclaims beneficial ownership of any
shares held by Microwave Services, Inc.
(8) Does not include 15,477,210 shares of Class B common stock held of record
by Telcom-DTS Investors, L.L.C., an entity controlled by Telcom Ventures.
Mr. Perkins is the General Counsel of Telcom Ventures and Telcom-DTS
Investors, L.L.C. Mr. Perkins expressly disclaims beneficial ownership in
any shares held by Telcom-DTS Investors, L.L.C.
(9) Does not include 15,477,210 shares of Class B common stock held of record
by Telcom-DTS Investors, L.L.C., an entity controlled by Telcom Ventures.
Mr. Prakash is the President of Telcom Ventures and Telcom-DTS Investors,
L.L.C. Mr. Prakash expressly disclaims beneficial ownership in any shares
held by Telcom-DTS Investors, L.L.C.
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(10) Includes 4,006,488 shares of Class A common stock issuable upon exercise
of Mr. Mandl's stock options. Also includes 228,000 shares of Class A
common stock held by Mr. Mandl's wife. As of April 2001, Mr. Mandl ceased
to be an executive officer of the Company.
(11) Includes 806,660 shares of Class A common stock issuable upon exercise of
Mr. Pickle's stock options. As of September 2000, Mr. Pickle ceased to be
an executive officer of Teligent.
(12) Includes 338,661 shares of Class A common stock issuable upon exercise of
Mr. Harris' stock options. As of May 2001, Mr. Harris ceased to be an
executive officer of Teligent.
(13) Includes 332,094 shares of Class A common stock issuable upon exercise of
Mr. Akhavan's stock options. As of May 2001, Mr. Akhavan ceased to be an
executive officer of the Company.
(14) Includes 235,997 shares of Class A common stock issuable upon exercise of
Mr. Bell's stock options. As of May 2001, Mr. Bell ceased to be an
executive officer of Teligent.
(15) Includes 96,660 shares of Class A common stock issuable upon exercise of
Mr. Wagner's stock options. As of October 2000, Mr. Wagner ceased to be
an executive officer of Teligent.
(16) Includes shares held directly, jointly with family members, in retirement
accounts, in a fiduciary capacity, by certain of the group members'
families, or by trusts of which the group member is a trustee or
substantial beneficiary, with respect to which shares the group member
may be deemed to have sole or shared voting and/or investment powers.
Also includes 6,219,060 shares of Class A common stock issuable upon
exercise of stock options held by all directors and executive officers as
a group and Class B common stock reported as beneficially owned by Telcom
Ventures. Does not include the shares of Class B common stock reported as
beneficially owned by Nippon Telegraph and Telephone Corporation.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Messrs. Pickle, Morris and Bell received loans each in the aggregate
principal amounts of $1,000,000. Such loans bore interest at annual interest
rates of 5.73%, 5.76% and 5.83%, respectively. The principal amount and accrued
interest on such loans became due and payable generally on February 1, 2000,
April 10, 2000 and April 7, 2000, respectively. The remaining principal balance
and interest accrued on each of the loans was forgiven in 2000; generally, these
provisions become applicable either incrementally during the term of the loan or
as of its maturity date (in any case, subject to the executive's continued
employment with Teligent as of such date) or, among other things, in the event
the executive's employment is terminated under certain circumstances. Mr. Harris
received a loan in the aggregate principal amount of $600,000, bearing interest
at an annual rate of 6.54%. In January 2001, the Company forgave the principal
amount due on Mr. Harris' loan. In addition, Mr. Akhavan received a loan in the
aggregate principal amount of $1,600,000, bearing interest at an annual rate of
7.54%. The loan provides for forgiveness of the principal amount and accrued
interest thereon in the event executive's employment is terminated without
cause. Mr. Continenza received a loan in the aggregate principal amount of
$300,000, bearing interest at an annual rate of 7.45%. The principal balance and
accrued interest was forgiven in April 2001 upon the termination of Mr. Mandl as
Chief Executive Officer and Chairman of the Company.
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SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
TELIGENT, INC.
(REGISTRANT)
Date: June 4, 2001
BY: /s/ YOAV KRILL
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YOAV KRILL
CHIEF EXECUTIVE OFFICER, PRESIDENT AND DIRECTOR
(PRINCIPAL EXECUTIVE OFFICER)
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