EXHIBIT 4.3
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
This Amended and Restated Registration Rights Agreement (this
"Agreement") is made this 12th day of November, 1999 among Xxxxxx'x Trading
Company, Inc., an Indiana corporation (the "Company"), the FS Stockholder (as
defined in the Transaction Agreement), G Trademark, Inc. ("Limited
Stockholder"), a Delaware corporation and a wholly owned subsidiary of The
Limited, Inc., a Delaware corporation ("The Limited") and Benchmark Capital
Partners IV, L.P. (the "Benchmark Stockholder"). Each of the FS Stockholder,
the Limited Stockholder and the Benchmark Stockholder is sometimes hereinafter
referred to as a "Holder."
A. The FS Stockholder and The Limited are parties to a Transaction
Agreement dated as of May 3, 1999 (as amended from time to time, the
"Transaction Agreement").
B. In connection with the transactions contemplated by the
Transaction Agreement, the FS Stockholder and Limited Stockholder were granted
certain rights with respect to the Shares held by them pursuant to a
Registration Rights Agreement dated as of August 31, 1999 (the "Existing
Agreement").
C. The Benchmark Stockholder and the Company are party to a Stock
Purchase Agreement dated as of November 12th, 1999 (as amended from time to
time, the "Stock Purchase Agreement") pursuant to which the Benchmark
Stockholder is to be granted certain rights with respect to the Shares held by
it.
D. In order to ensure that such parties are granted such rights, the
parties hereto desire to enter into this Agreement.
NOW, THEREFORE, the parties agree that the Existing Agreement shall be
amended and restated in its entirety as follows:
ARTICLE 1
Definitions
Section 1.01. Definitions. (a) Terms defined in the Stockholders
Agreement (the "Stockholders Agreement") dated as of August 31, 1999 among the
Company, the FS Stockholder and the Limited Stockholder are used herein as
therein defined. In addition, the following terms shall have the following
meanings:
"Commission" means the Securities and Exchange Commission.
"Excess Amount" means the number of Registrable Securities requested
by a Holder or Holders to be sold pursuant to Section 2.01 which the managing
Underwriter or Underwriters determines exceeds the largest number of Registrable
Securities which can successfully be sold in an orderly manner in such offering
within a price range reasonably acceptable to the Company.
"Registrable Security" means any Share outstanding until (i) a
registration statement covering such Share has been declared effective by the
Commission and it has been disposed of pursuant to such effective registration
statement, (ii) it is sold under circumstances in which all of the applicable
conditions of Rule 144 (or any similar provisions then in force) under the 1933
Act are met or it may be sold pursuant to Rule 144(k) under such Act or (iii) it
has been otherwise Transferred, the Company has delivered a new certificate or
other evidence of ownership for it not bearing the legends required pursuant to
the Stockholders Agreement and it may be resold without subsequent registration
under the 1933 Act.
"Requisite Share Number" means a number of Registrable Securities
representing not less than 10% of the total number of Shares then outstanding or
Shares representing not less than $30 million in fair market value as reasonably
determined by the Board, or such lesser number as constitutes all Shares then
held by the relevant Selling Holder and its Affiliates representing not less
than 3% of the total number of Shares than outstanding.
"Selling Holder" means a Holder who is selling or causing its
Affiliates to sell Registrable Securities pursuant to a registration statement
under the 1933 Act.
"Shares" means shares of Class A voting common stock, without par
value, of the Company (the "Class A Common Stock"); provided however, that at
such time as the Class A Common Stock and the Class B voting common stock,
without par value, of the Company converts into a single class of voting stock
pursuant to the Certificate of Incorporation of the Company, all references in
this Agreement to "Shares" shall be mean all the shares of such single class of
voting stock.
"Underwriter" means a securities dealer who purchases any Registrable
Securities as principal in an underwritten offering and not as part of such
dealer's market-making activities.
(b) Each of the following terms is defined in the Section set forth
opposite such term:
Term Section
Demand Registration 2.01
Indemnified Party 4.03
Indemnifying Party 4.03
Inspectors 3.01
Piggy-Back Registration 2.02
Records 3.01
Registration Expenses 3.02
Withdrawal Election 2.03
ARTICLE 2
REGISTRATION RIGHTS
Section 2.01. Demand Registration. (a) Request for Registration. At any time
and from time to time on or after the date which is six months following the
closing of the first
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registered public offering, either of the FS Stockholder or the Limited
Stockholder, on behalf of itself or any of its Affiliates owning, individually
or in the aggregate, at least the Requisite Share Number may make a written
request for registration under the 1933 Act of all or part of As or their
Registrable Securities (a "Demand Registration"); provided that such Holders are
together requesting that the Requisite Share Number be registered, and provided
further that the Company shall not be obligated to effect (i) more than two
Demand Registrations in any 18-month period or (ii) more than (A) two Demand
Registrations for the FS Stockholder and their Affiliates as a group and (B) two
Demand Registrations for the Limited Stockholder and its Affiliates as a group.
Such request will specify the number of shares of Registrable Securities
proposed to be sold and will also specify the intended method of disposition
thereof. The Company shall not include any Registrable Securities which it
wishes to offer for its own account in any Demand Registration without the prior
written consent of the FS Stockholder and The Limited.
(b) Effective Registration. A registration will not count as a
Demand Registration until it has become effective.
(c) Underwritten Offering. If the Holder initiating a Demand
Registration so elects, the offering of such Registrable Securities pursuant to
such Demand Registration shall be in the form of an underwritten offering. The
Company shall select one or more nationally recognized firms of investment
bankers, reasonably acceptable to such Holder, to act as the managing
Underwriter or Underwriters in connection with such offering and shall select
any additional managers to be used in connection with the offering.
Section 2.02. Piggy-Back Registration. If at any time 90 days
following the closing of the Initial Public Offering the Company proposes to
file a registration statement under the 1933 Act with respect to an offering by
the Company for its own account or for the account of any holders of any
Registrable Securities (other than a registration statement on Form S-4 or S-8
(or any substitute form that may be adopted by the Commission) or a registration
statement filed in connection with an exchange offer or offering of securities
solely to the Company's existing securityholders), including without limitation,
any registration filed pursuant to a Demand Registration, then the Company shall
give written notice of such proposed filing to the Holders as soon as
practicable (but in no event less than 10 days before the anticipated filing
date), and such notice shall offer such Holders the opportunity to register such
number of shares of Registrable Securities as each such Holder may request in
writing within 5 days of receipt of such notice on behalf of itself or its
Affiliates (which request shall specify the Registrable Securities intended to
be disposed of by such Holder and its Affiliates and the intended method of
distribution thereof) (a "Piggy-Back Registration"). The Company shall use
reasonable best efforts to cause the managing Underwriter or Underwriters of a
proposed underwritten offering to permit the Registrable Securities requested to
be included in a Piggy-Back Registration on the same terms and conditions as any
similar securities of the Company included therein to permit the sale or other
disposition of such Registrable Securities in accordance with the intended
method of distribution thereof. Subject to Section 2.03(b), any Holder shall
have the right to withdraw its request for inclusion of its Registrable
Securities in any Piggy-Back Registration by giving written notice to the
Company of its request to withdraw within 20 days of its request for inclusion.
To the extent the related registration statement was filed by the Company for
its own account, the Company may withdraw a Piggy-Back Registration at any time
prior to the time it becomes effective; provided that the Company shall
reimburse Holders of Registrable Securities
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requested to be included in such Piggy-Back Registration for all out-of-pocket
expenses (including counsel fees and expenses) incurred prior to such
withdrawal.
Section 2.03. Reduction of Offering. (a) Notwithstanding anything
contained herein, if the managing Underwriter or Underwriters of an offering
described in Section 2.01 or 2.02 determine that the size of the offering that
the Holders, the Company and/or such other Persons intend to make is such that
the success of the offering would be materially adversely affected by inclusion
of the Registrable Securities requested to be included, then (i) with respect to
a Demand Registration, the Company shall not include in such registration an
amount of Registrable Securities requested to be included in such offering by
all Holders equal to the Excess Amount (such reduction to be allocated first,
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pro rata among Persons other than the Holders, second, among Holders (other than
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Holders with Demand Registration rights pursuant to Section 2.01 hereof)
according to the number of Registrable Securities requested for inclusion and
third, among Holders with Demand Registration rights pursuant to Section 2.01
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hereof according to the number of Registrable Securities requested for
inclusion) and (ii) in the case of a Piggy-Back Registration (that does not also
constitute a Demand Registration), if securities are being offered for the
account of other Persons as well as the Company, the securities the Company
seeks to include shall have priority over securities sought to be included by
any other Person (including the Holders) and, with respect to the Registrable
Securities intended to be offered by Holders, the proportion by which the amount
of such class of securities intended to be offered by Holders is reduced shall
not exceed the proportion by which the amount of such class of securities
intended to be offered by such other Persons is reduced (it being understood
that with respect to the Holders and third parties such reduction may be all of
such class of securities).
(b) If, as a result of the proration provisions of Section 2.03(a),
any Holder shall not be entitled to include all Registrable Securities in a
Demand Registration or Piggy-Back Registration that such Holder has requested to
be included, such Holder may elect to withdraw his request to include
Registrable Securities in such registration (a "Withdrawal Election"); provided
however, that a Withdrawal Election shall be irrevocable and, after making a
Withdrawal Election, a Holder shall no longer have any right to include
Registrable Securities in the registration as to which such Withdrawal Election
was made.
ARTICLE 3
REGISTRATION PROCEDURES
Section 3.01. Filings; Information. Whenever a Holder with Demand
Registration rights pursuant to Section 2.01 hereof requests that any
Registrable Securities be registered pursuant to Section 2.01 hereof, the
Company will use its best efforts to effect the registration and the sale of
such Registrable Securities in accordance with the intended method of
disposition thereof as quickly as practicable, and in connection with any such
request:
(a) The Company will as expeditiously as possible prepare and file
with the Commission a registration statement on any form for which the Company
then qualifies or which counsel for the Company shall deem appropriate and which
form shall be available for the sale of the Registrable Securities to be
registered thereunder in accordance with the intended method of distribution
thereof, and use its best efforts to cause such filed registration statement to
become
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and remain effective until the earlier of (i) 180 days from the date such
registration statement became effective or (ii) the date on which the sale of
Registrable Securities has been completed; provided that, if the Company shall
furnish to the Holder making a request pursuant to Section 2.01 a certificate
signed by either its Chairman or the Vice Chairman stating that in his good
faith judgment it would be significantly disadvantageous to the Company or its
shareholders for such a registration statement to be filed as expeditiously as
possible, the Company shall have a period of not more than 180 days within which
to file such registration statement measured from the date of receipt of the
request in accordance with Section 2.01.
(b) The Company will, prior to filing a registration statement or
prospectus or any amendment or supplement thereto, furnish to each Selling
Holder, one counsel representing all such Selling Holders, and each Underwriter,
if any, of the Registrable Securities covered by such registration statement
copies of such registration statement as proposed to be filed, together with
exhibits thereto, which documents will be subject to prompt review and approval
by the foregoing, and thereafter furnish to such Selling Holder, counsel and
Underwriter, if any, such number of copies of such registration statement, each
amendment and supplement thereto (in each case including all exhibits thereto
and documents incorporated by reference therein), the prospectus included in
such registration statement (including each preliminary prospectus) and such
other documents as such Selling Holder, counsel or Underwriter may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such Selling Holder.
(c) After the filing of the registration statement, the Company will
promptly notify each Selling Holder of Registrable Securities covered by such
registration statement of any stop order issued or threatened by the Commission
and take all reasonable actions required to prevent the entry of such stop order
or to remove it if entered.
(d) The Company will use reasonable best efforts to (i) register or
qualify the Registrable Securities under such other securities or blue sky laws
of such jurisdictions in the United States as any Selling Holder reasonably (in
light of such Selling Holder's intended plan of distribution) requests and (ii)
cause such Registrable Securities to be registered with or approved by such
other governmental agencies or authorities in the United States as may be
necessary by virtue of the business and operations of the Company and do any and
all other acts and things that may be reasonably necessary or advisable to
enable such Selling Holder to consummate the disposition of the Registrable
Securities owned by such Selling Holder; provided that the Company will not be
required to (A) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this paragraph (d), (B)
subject itself to taxation in any such jurisdiction or (C) consent to general
service of process in any such jurisdiction.
(e) The Company will immediately notify each Selling Holder of such
Registrable Securities, at any time when a prospectus relating thereto is
required to be delivered under the 1933 Act, of the occurrence of an event
requiring the preparation of a supplement or amendment to such prospectus so
that, as thereafter delivered to the purchasers of such Registrable Securities,
such prospectus will not contain an untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein not misleading and promptly make available to each
Selling Holder any such supplement or amendment.
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(f) The Company will enter into customary agreements (including, if
applicable, an underwriting agreement in customary form) and take such other
actions as are reasonably required in order to expedite or facilitate the
disposition of such Registrable Securities, and the Selling Holders may, at
their option, require that any or all of the representations, warranties and
covenants of the Company to or for the benefit of such Underwriters also be made
to and for the benefit of such Selling Holders.
(g) The Chairman of the Board of Directors of the Company, the Chief
Executive Officer of the Company and other members of the management of the
Company will cooperate fully in any offering of Registrable Securities
hereunder, including, without limitation, participation in meetings with
potential investors and preparation of all materials for such investors.
(h) The Company will deliver promptly to each Selling Holder of such
Registrable Securities and each Underwriter, if any, subject to restrictions
imposed by the United States federal government or any agency or instrumentality
thereof copies of all correspondence between the Commission and the Company, its
counsel or auditors and all memoranda relating to discussions with the
Commission or its staff with respect to the registration statement and make
available for inspection by any Selling Holder of such Registrable Securities,
any Underwriter participating in any disposition pursuant to such registration
statement and any attorney, accountant or other professional retained by any
such Selling Holder or Underwriter (collectively, the "Inspectors"), (it being
understood that the Company is responsible for payment of the reasonable fees
and expenses of only one counsel pursuant to clause (viii) of Section 3.02) all
financial and other records, pertinent corporate documents and properties of the
Company (collectively, the "Records"), subject to restrictions imposed by any
governmental authority governing access to classified information, as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors and employees to
supply all information reasonably requested by any Inspectors in connection with
such registration statement. Records which the Company determines, in good
faith, to be confidential and which it notifies the Inspectors are confidential
shall not be disclosed by the Inspectors unless (i) the disclosure of such
Records is necessary to avoid or correct a misstatement or omission in such
registration statement or (ii) the disclosure or release of such Records is
requested or required pursuant to oral questions, interrogatories, requests for
information or documents or a subpoena or other order from a court of competent
jurisdiction or other process; provided that prior to any disclosure or release
pursuant to clause (ii), the Inspectors shall provide the Company with prompt
notice of any such request or requirement so that the Company may seek an
appropriate protective order or waive such Inspectors' obligation not to
disclose such Records; and provided, further, that if failing the entry of a
protective order or the waiver by the Company permitting the disclosure or
release of such Records, the Inspectors, upon advice of counsel, are compelled
to disclose such Records, the Inspectors may disclose that portion of the
Records which counsel has advised the Inspectors that the Inspectors are
compelled to disclose. Each Selling Holder of such Registrable Securities agrees
that information obtained by it solely as a result of such inspections (not
including any information obtained from a third party who, insofar as is known
to the Selling Holder after reasonable inquiry, is not prohibited from providing
such information by a contractual, legal or fiduciary obligation to the Company)
shall be deemed confidential and shall not be used by it as the basis for any
market transactions in the securities of the Company or its Affiliates unless
and until
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such is made generally available to the public. Each Selling Holder of such
Registrable Securities further agrees that it will, upon learning that
disclosure of such Records is sought in a court of competent jurisdiction, give
notice to the Company and allow the Company, at its expense, to undertake
appropriate action to prevent disclosure of the Records deemed confidential.
(i) The Company will use its reasonable best efforts to furnish to
each Selling Holder and to each Underwriter, if any, a signed counterpart,
addressed to such Selling Holder or Underwriter, of (i) an opinion or opinions
of counsel to the Company and (ii) a comfort letter or comfort letters from the
Company's independent public accountants, each in customary form and covering
such matters of the type customarily covered by opinions or comfort letters, as
the case may be, as the Selling Holders of Registrable Securities included in
such offering or the managing Underwriter therefor reasonably requests.
(j) The Company will otherwise use its reasonable best efforts to
comply with all applicable rules and regulations of the Commission, and make
available to its securityholders, as soon as reasonably practicable, an earnings
statement covering a period of 12 months, beginning within three months after
the effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the 1933 Act.
(k) The Company will use its reasonable best efforts (a) to cause all
such Registrable Securities to be listed on a national securities exchange (if
such shares are not already so listed) and on each additional national
securities exchange on which similar securities issued by the Company are then
listed (if any), if the listing of such Registrable Securities is then permitted
under the rules of such exchange or (b) to secure designation of all such
Registrable Securities covered by such registration statement as a NASDAQ
"national market system security" within the meaning of Rule 11Aa2-1 of the
Commission or, failing that, to secure NASDAQ authorization for such Registrable
Securities and, without limiting the generality of the foregoing, to arrange for
at least two market makers to register as such with respect to such Registrable
Securities with the NASD.
(l) The Company may require each Selling Holder of Registrable
Securities to promptly furnish in writing to the Company such information
regarding the distribution of the Registrable Securities as the Company may from
time to time reasonably request and such other information as may be legally
required in connection with such registration.
Each Selling Holder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 3.01(e)
hereof, such Selling Holder will forthwith discontinue and cause its Affiliates
to discontinue disposition of Registrable Securities pursuant to the
registration statement covering such Registrable Securities until such Selling
Holder's receipt of the copies of the supplemented or amended prospectus
contemplated by Section 3.01(e) hereof and, if so directed by the Company, such
Selling Holder will deliver to the Company all copies, other than permanent file
copies then in such Selling Holder's possession, of the most recent prospectus
covering such Registrable Securities at the time of receipt of such notice. In
the event the Company shall give such notice, the Company shall extend the
period during which such registration statement shall be maintained effective
(including the period referred to in Section 3.01(a) hereof) by the number of
days during the
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period from and including the date of the giving of notice pursuant to Section
3.01(e) hereof to the date when the Company shall make available to the Selling
Holders of Registrable Securities covered by such registration statement a
prospectus supplemented or amended to conform with the requirements of Section
3.01(e) hereof.
Section 3.02. Registration Expenses. In connection with any Demand
Registration pursuant to Section 2.01 hereof, and any registration statement
filed pursuant to Section 2.02 hereof, the Company shall pay the following
registration expenses incurred in connection with the registration hereunder,
whether or not such registration becomes effective, (the "Registration
Expenses"): (i) all registration and filing fees, (ii) fees and expenses of
compliance with securities or blue sky laws (including fees and disbursements of
counsel in connection with blue sky qualifications of the Registrable
Securities), (iii) printing expenses, (iv) the Company's internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), (v) the fees and expenses
incurred in connection with the listing of the Registrable Securities, (vi) fees
and disbursements of counsel for the Company and fees and expenses for
independent certified public accountants retained by the Company (including the
expenses of any comfort letters or costs associated with the delivery by
independent certified public accountants of a comfort letter or comfort letters
requested pursuant to Section 3.01(i) hereof), (vii) the fees and expenses of
any special experts retained by the Company in connection with such
registration, and (viii) reasonable fees and expenses of one counsel (who shall
be reasonably acceptable to the Company) for all of the Selling Holders. The
Company shall have no obligation to pay any underwriting fees, discounts or
commissions attributable to the sale of Registrable Securities, or any out-of-
pocket expenses of the Holders.
ARTICLE 4
INDEMNIFICATION AND CONTRIBUTION
Section 4.01. Indemnification by the Company. The Company agrees to
indemnify and hold harmless each Selling Holder, its officers, directors and
agents, and each Person, if any, who controls such Selling Holder within the
meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act from and
against any loss, claim, damage or liability and any action in respect thereof
to which such Selling Holder, its officers, directors and agents, and any such
controlling Person may become subject under the 1933 Act or otherwise, insofar
as such loss, claim, damage, liability or action arises out of, or is based
upon, any untrue statement or alleged untrue statement of a material fact
contained in any registration statement or prospectus relating to the
Registrable Securities (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) or any preliminary prospectus,
or arises out of, or is based upon, 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, and shall reimburse each Selling Holder, its
officers, directors and agents, and each such controlling Person for any legal
and other expenses reasonably incurred by that Selling Holder, its officers,
directors and agents, or any such controlling Person in investigating or
defending or preparing to defend against any such loss, claim, damage, liability
or action. The Company also agrees to indemnify any Underwriters of the
Registrable Securities, their officers and directors and each Person who
controls such Underwriters on substantially the same basis as that of the
indemnification of the Selling Holders provided in this Section 4.01; provided,
that the indemnity agreement contained
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in this Section 4.01 shall not apply to amounts paid in settlement of any such
loss, claim, damage or liability and any action in respect thereof if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld), nor shall the Company be liable in any such case
for any loss, claim damage, liability and any action in respect thereof to the
extent that it arises from or is based upon written information relating to a
Person furnished expressly for use in connection with such registration by such
Person, nor shall the (Company be liable to any Person for any such loss, claim,
damage or liability and any action in respect thereof to the extent it arises
from or is based upon (i) any untrue statement or alleged untrue statement of a
material fact contained in any registration statement or prospectus relating to
the Registrable Securities delivered by such Person after the Company had
provided written notice to such Person that such registration statement or
prospectus contained such untrue statement or alleged untrue statement of a
material fact, (ii) 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 after the Company had provided written notice to such Person that
such registration statement or prospectus contained such omission or alleged
omission, or (iii) the failure of such Person to deliver any preliminary or
final prospectus, or any amendments or supplements thereto, required under
applicable securities laws, including the 1933 Act, to be so delivered, provided
that a sufficient number of copies thereof had been provided by the Company to
such Person.
Section 4.02. Indemnification by Holders of Registrable Securities.
Each Selling Holder agrees, severally but not jointly, to indemnify and hold
harmless the Company, its officers, directors and agents and each Person, if
any, who controls the Company within the meaning of Section 15 of the 1933 Act
or Section 20 of the 1934 Act to the same extent as the foregoing indemnity from
the Company to such Selling Holder, but only with reference to information
related to such Selling Holder furnished in writing by such Selling Holder or on
such Selling Holder's behalf expressly for use in any registration statement or
prospectus relating to the Registrable Securities, or any amendment or
supplement thereto, or any preliminary prospectus. Each Selling Holder also
agrees to indemnify and hold harmless Underwriters of the Registrable
Securities, their officers and directors and each Person who controls such
Underwriters on substantially the same basis as that of the indemnification of
the Company provided in this Section; provided that in no event shall any
indemnity obligation under this Section exceed the net proceeds from the
offering received by such Selling Holder.
Section 4.03. Conduct of Indemnification Proceedings. Promptly after
receipt by any person in respect of which indemnity may be sought pursuant to
Section 4.01 or 4.02 (an "Indemnified Party") of notice of any claim or the
commencement of any action, the Indemnified Party shall, if a claim in respect
thereof is to be made against the person against whom such indemnity may be
sought (an "Indemnifying Party"), notify the Indemnifying Party in writing of
the claim or the commencement of such action; provided that the failure to
notify the Indemnifying Party shall not relieve it from any liability which it
may have to an Indemnified Party otherwise than under Section 4.01 or 4.02 and
except to the extent of any actual prejudice resulting therefrom. If any such
claim or action shall be brought against an Indemnified Party, and it shall
notify the Indemnifying Party thereof, the Indemnifying Party shall be entitled
to participate therein, and, to the extent that it wishes, jointly with any
other similarly notified Indemnifying Party, to assume the defense thereof with
counsel reasonably satisfactory to the Indemnified Party. After notice from the
Indemnifying Party to the Indemnified Party of its election to
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assume the defense of such claim or action, the Indemnifying Party shall not be
liable to the Indemnified Party for any legal or other expenses subsequently
incurred by the Indemnified Party in connection with the defense thereof other
than reasonable costs of investigation; provided that the Indemnified Party
shall have the right to employ separate counsel to represent the Indemnified
Party and its controlling Persons who may be subject to liability arising out of
any claim in respect of which indemnity may be sought by the Indemnified Party
against the Indemnifying Party, but the fees and expenses of such counsel shall
be for the account of such Indemnified Party unless (i) the Indemnifying Party
and the Indemnified Party shall have mutually agreed to the retention of such
counsel or (ii) based upon the written opinion of counsel of such Indemnified
Party representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. No Indemnifying
Party shall, without the prior written consent of the Indemnified Party, effect
any settlement of any claim or pending or threatened proceeding in respect of
which the Indemnified Party is a party and indemnity could have been sought
hereunder by such Indemnified Party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability arising out
of such claim or proceeding.
Section 4.04. Contribution. If the indemnification provided for in
this Article 4 is unavailable to the Indemnified Parties in respect of any
losses, claims, damages or liabilities referred to herein, then each such
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages or liabilities (i) as between the (Company and
the Selling Holders, on the one hand, and the Underwriters, on the other, in
such proportion as is appropriate to reflect the relative benefits received by
the Company and the Selling Holders, on the one hand, and the Underwriters, on
the other, from the offering of the Registrable Securities, or if such
allocation is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits but also the relative
fault of the Company and the Selling Holders, on the one hand, and of the
Underwriters, on the other, in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations and (ii) as between the Company, on the one
hand, and each Selling Holder, on the other, in such proportion as is
appropriate to reflect the relative fault of the Company and of each Selling
Holder in connection with such statements or omissions, as well as any other
relevant equitable considerations. The relative benefits received by the Company
and, the Selling Holders, on the one hand, and the Underwriters, on the other,
shall be deemed to be in the same proportion as the total proceeds from the
offering (net of underwriting discounts and commissions but before deducting
expenses) received by the Company and the Selling Holders bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the prospectus. The relative
fault of the Company and the Selling Holders, on the one hand, and of the
Underwriters, on the other, shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company and the Selling Holders or by the Underwriters. The
relative fault of the Company, on the one hand, and of each Selling Holder, on
the other, shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by such party,
and the parties' relative intent, knowledge, access-to information and
opportunity to correct or prevent such statement or omission.
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The Company and the Selling Holders agree that it would not be just
and equitable if contribution pursuant to this Section were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an Indemnified Party as a result of the losses,
claims, damages or liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such Indemnified Party
in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 4.04, no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages which
such Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission, and no Selling Holder
shall be required to contribute any amount in excess of the amount by which the
total price at which the Registrable Securities of such Selling Holder were
offered to the public (less underwriting discounts and commissions) exceeds the
amount of any damages which such Selling Holder has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 1l(f) of the 0000 Xxx) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. Each Selling
Holder's obligations to contribute pursuant to this Section 4.04 are several in
proportion to the proceeds of the offering received by such Selling Holder bears
to the total proceeds of the offering received by all the Selling Holders and
not joint.
ARTICLE 5
MISCELLANEOUS
Section 5.01. Participation in Underwritten Registrations. No Person
may participate in any underwritten registration hereunder unless such Person
(a) agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreement-s -and other documents reasonably
required under the terms of such underwriting arrangements and this Agreement;
provided that (i) if the FS Stockholder, the Limited Stockholder or any of their
Affiliates participates in such registration, they will not be required to make
any representations or warranties except those which relate solely to themselves
and (ii) the liability of the FS Stockholder, the Limited Stockholder or any of
their Affiliates to any Underwriter under such underwriting agreement will be
limited to liability arising from misstatements in, or omissions from, written
information regarding such Person provided by or on behalf of such Person for
inclusion in the prospectus.
Section 5.02. Rule 144. The Company covenants that it will use its
reasonable best efforts to file any reports required to be filed by it under the
1933 Act and the 1934 Act and that it will take such further action as any
Holder may reasonably request, all to the extent reasonably required from time
to time to enable Holders and their Affiliates to sell Registrable Securities
without registration under the 1933 Act within the limitation of the exemptions
provided by (a) Rule 144 or Rule 144A under the 1933 Act, as such Rules may be
amended from
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time to time, or (b) any similar rule or regulation hereafter adopted by the
Commission. Upon the request of any Holder, the Company will deliver to such
Holder a written statement as to whether it has complied with such requirements.
Section 5.03. Holdback Agreements. (a) Restrictions on Public Sale by
Holder of Registrable Securities. To the extent not inconsistent with applicable
law, each Holder of Registrable Securities agrees not to effect any sale or
distribution or to permit its Affiliates to effect any sale or distribution of
the issue being registered or of a similar security of the Company, or any
securities convertible into or exchangeable or exercisable for such securities,
including a sale pursuant to Rule 144 or Rule 144A under the 1933 Act, during
the 14 days prior to, and during the 120-day period beginning on, the effective
date of the registration statement filed by the Company (except as part of such
registration) if, and to the extent, requested by the managing Underwriter or
Underwriters in the case of an underwritten public offering.
(b) Restrictions on Sale by the Company and Others. The Company
agrees (i) not to effect any sale or distribution of any securities similar to
those being registered in accordance with Section 2.01 hereof, or any securities
convertible into or exchangeable or exercisable for such securities, during the
14 days prior to, and during the 120-day period beginning on, the effective date
of any registration statement (except as part of such registration statement
where the Holder making such Demand Registration consents) or the commencement
of a public distribution of Registrable Securities; and (ii) that any agreement
entered into after the date hereof pursuant to which the Company issues or
agrees to issue any privately placed securities shall contain a provision under
which holders of such securities agree not to effect any sale or distribution of
any such securities during the periods described in (i) above, in each case
including a sale pursuant to Rule 144 under the 1933 Act (except as part of any
such registration, if permitted); provided, however, that the provisions of this
paragraph (b) shall not prevent the conversion or exchange of any securities
pursuant to their terms into or for other securities and shall not prevent the
issuance of securities by the Company under any employee benefit, stock option
or stock subscription plans or in private placements.
Section 5.04. Stockholders Agreement. Notwithstanding anything herein
to the contrary, all Transfers of Registrable Securities subject to the
provisions of the Stockholders Agreement shall be made only in accordance with
such provisions.
Section 5.05. No Waivers; Amendments. No failure or delay by any party
in exercising any right, power or privilege under this Agreement shall operate
as a waiver thereof nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege. The rights and remedies herein provided shall be cumulative and
not exclusive of any rights or remedies provided by law. Any provision of this
Agreement may be amended only if such amendment is in writing and is signed by
all of the parties hereto; provided, however, that in the case of any amendment
-------- -------
or waiver signed by the Limited Stockholder and the FS Stockholder, no consent
or signature shall be required from any other party hereto who is not materially
adverse affected by such amendment or waiver.
Section 5.06. Successors and Assigns. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties and their
respective successors and assigns. No party may assign its rights under this
Agreement, except that a Holder may assign its rights
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hereunder to a Permitted Transferee of such Holder; provided that, prior to such
assignment, such Permitted Transferee shall enter into a written agreement to be
bound by the terms and conditions of this Agreement applicable to such Holder.
Section 5.07. Governing Law. This Agreement shall be construed in
accordance with and governed by the law of the State of New York (without regard
to the choice of law provisions thereof).
Section 5.08. Counterparts; Effectiveness. This Agreement may be
signed in any number of counterparts, each of which shall be an original, with
the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto or
thereto shall have received a counterpart hereof signed by the other parties
hereto.
Section 5.09. Jurisdiction. Any suit, action or proceeding seeking to
enforce any provision of, or based on any matter arising out of or in connection
with, this Agreement may be brought against any of the parties in the United
States District Court for the Southern District of New York or any state court
sitting in the City of New York, Borough of Manhattan, and each of the parties
hereby consents to the exclusive jurisdiction of such court (and of the
appropriate appellate courts) in any such suit, action or proceeding and waives
any objection to venue laid therein. Process in any such suit, action or
proceeding may be served on any party anywhere in the world, whether within or
without the State of New York.
Section 5.10. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
Section 5.11. Captions. The captions herein are included for
convenience of reference only and shall be ignored in the construction or
interpretation hereof.
[Remainder of page intentionally left blank]
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IN WITNESS WHEREOF, the parties hereto caused this Agreement to be
duly executed by their respective authorized officers on the day and year first
above written.
XXXXXX'X TRADING COMPANY, INC.
By:
-----------------------------
Name:
Title:
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FS EQUITY PARTNERS IV, L.P.
By: FS CAPITAL PARTNERS, LLC
Its: General Partner
By:
-----------------------------
Name:
Title:
15
G TRADEMARK, INC.
By:
-----------------------------
Name:
Title:
16
BENCHMARK CAPITAL PARTNERS IV, L.P.
as nominee for
Benchmark Capital Partners IV, L.P.
Benchmark Founders' Fund IV, L.P.
Benchmark Founders' Fund IV-A, L.P.
and related individuals
By: Benchmark Capital Management Co. IV, L.L.C.
Its: General Partner
By:
-----------------------------
Name:
Title: Managing Member
17
