EXHIBIT 4.4
THIS WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD, TRANSFERRED OR
OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR
EXEMPTION FROM REGISTRATION UNDER THE FOREGOING LAWS. ACCORDINGLY, THIS WARRANT
MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF WITHOUT (i) AN OPINION OF
COUNSEL SATISFACTORY TO FIELDWORKS, INCORPORATED THAT SUCH SALE, TRANSFER OR
OTHER DISPOSITION MAY LAWFULLY BE MADE WITHOUT REGISTRATION UNDER THE SECURITIES
ACT OF 1933 AND APPLICABLE STATE SECURITIES LAWS OR (ii) SUCH REGISTRATION.
FIELDWORKS, INCORPORATED
WARRANT
TO PURCHASE
SHARES OF COMMON STOCK
For value received, and in consideration of the execution and delivery
of the Commitment Letter between the issuer of this Warrant and Industrial-Works
Holding Co., LLC., a Delaware corporation dated February 18, 2000 ("Commitment
Letter"), Purchaser and its successors or assigns ("Holder"), is entitled to
purchase from FieldWorks, Incorporated, a Minnesota corporation (the "Company'),
up to 100,000 fully paid and nonassessable shares of the Company's common stock,
$.001 par value per share or such greater or lesser number of such shares as may
be determined by application of the anti-dilution provisions of this Warrant, at
the price of One Dollar $1.00 per share, subject to adjustment as noted below
(the "Warrant Exercise Price").
This Warrant may be exercised by Holder at any time or from time to
time, and shall remain exercisable until the fifth anniversary of the date
hereof. This Warrant, and any portion hereof, shall expire if not exercised
within such five-year period.
This Warrant is subject to the following terms and conditions:
1. Exercise. The rights represented by this Warrant may be exercised by
the Holder, in whole or in part, by written election, in the form set forth
below, by the surrender of this Warrant (properly endorsed if required) at the
principal office of the Company, and by payment to it by cash, certified check
or bank draft of the Warrant Exercise Price for the shares to be purchased. The
shares so purchased shall be deemed to be issued as of the close of business on
the date on which this Warrant has been exercised by payment to the
Company of the Warrant Exercise Price. Certificates for the shares of stock so
purchased, bearing the restrictive legend set forth at the end of this Warrant,
shall be delivered to Holder within fifteen (15) days after the rights
represented by this Warrant shall have been so exercised, and, unless this
Warrant has expired, a new warrant representing the number of shares, if any,
with respect to which this Warrant remains exercisable shall also be delivered
to Holder hereof within such time. No fractional shares shall be issued upon any
exercise of this Warrant.
2. "Cashless" Exercise. At Holder's option, all or any portion of the
Warrant Exercise Price may be paid by surrendering a portion of the shares
issuable upon exercise of this Warrant. The value of the shares so surrendered
shall be the closing price of the Company's common stock on the date of Holder's
notice of exercise.
3. Shares. All shares that may be issued upon the exercise of the
rights represented by this Warrant shall, upon issuance, be duly authorized and
issued, fully paid and nonassessable shares. During the period within which the
rights represented by this Warrant may be exercised, the Company shall at all
times have authorized and reserved for the purpose of issue or transfer upon
exercise of the subscription rights evidenced by this Warrant a sufficient
number of shares of its common stock to provide for the exercise of the rights
represented by this Warrant.
4. Adjustment. The Warrant Exercise Price shall be subject to
adjustment from time to time as hereinafter provided in this Section 4:
(a) If the Company at any time divides the outstanding shares
of its common stock into a greater number of shares (whether pursuant
to a stock split, stock dividend or otherwise), and conversely, if the
outstanding shares of its common stock are combined into a smaller
number of shares, the Warrant Exercise Price in effect immediately
prior to such division or combination shall be proportionately adjusted
to reflect the reduction or increase in the value of each such common
share.
(b) If any stock dividend, capital reorganization or
reclassification of the capital stock of the Company, or consolidation
or merger of the Company with another corporation, or the sale of all
or substantially all of its assets to another corporation shall be
effected in such a way that holders of the Company's common stock shall
be entitled to receive stock, securities or assets with respect to or
in exchange for such common stock, then, as a condition of such stock
dividend, reorganization, reclassification, consolidation, merger or
sale, Holder shall have the right to purchase and receive upon the
basis and upon the terms and conditions specified in this Warrant and
in lieu of the shares of the common stock of the Company immediately
theretofore purchasable and receivable upon the exercise of the rights
represented hereby, such shares of stock, other securities or assets as
would
-2-
have been issued or delivered to the Holder if Holder had exercised
this Warrant and had received such shares of common stock immediately
prior to such stock dividend, reorganization, reclassification,
consolidation, merger or sale. The Company shall not effect any such
consolidation, merger or sale unless prior to the consummation thereof
the successor corporation (if other than the Company) resulting from
such consolidation or merger or the corporation purchasing such assets
shall assume by written instrument executed and mailed to Holder at the
last address of Holder appearing on the books of the Company the
obligation to deliver to Holder such shares of stock, securities or
assets as, in accordance with the foregoing provisions, Holder may be
entitled to purchase.
(c) If and whenever the Company shall (1) issue or sell any
shares of its common stock for a per-share consideration less than the
Warrant Exercise Price in effect immediately prior to the time of such
issuance or sale, (2) issue or sell any warrants, options or other
rights to acquire shares of its common stock at a purchase price less
than the Warrant Exercise Price in effect immediately prior to the time
of such issuance or sale, or (3) issue or sell any other securities
that are convertible into shares of its common stock for a purchase or
exchange price less than the Warrant Exercise Price in effect
immediately prior to the time of such issuance or sale (except for the
issuance or sale of shares of the Company's common stock pursuant to
stock option plans, stock purchase plans or other employee stock
incentive programs adopted by the Company's Board of Directors, or
pursuant to business acquisition or lease financing transactions),
then, upon such issuance or sale, the Warrant Exercise Price shall be
reduced to the price (calculated to the nearest cent) determined by
dividing (A) an amount equal to the sum of (1) the number of shares of
the Company's common stock outstanding immediately prior to such issue
or sale multiplied by the then existing Warrant Exercise Price and (2)
the consideration, if any, received by the Company upon such issue or
sale plus the consideration to be received by the Company upon the
exercise of such stock purchase rights by (B) an amount equal to the
sum of (1) the number of shares of its common stock outstanding
immediately prior to such issue or sale and (2) the number of its
shares of common stock thus issued or sold or issuable or saleable upon
the exercise of such purchase rights or the conversion of such
convertible securities; provided, however, that in the event that any
such purchase right expires or is terminated prior to the exercise of
this Warrant, the Warrant Exercise Price shall be recalculated by
deleting such purchase right and provided further that if an adjustment
is made to the Warrant Exercise Price as a result of the issuance or
sale of any such purchase rights or convertible securities, no further
adjustment shall be made to the Warrant Exercise Price at the time such
purchase rights are exercised or convertible securities are converted.
(d) Upon any adjustment of the Warrant Exercise Price, Holder
shall thereafter be entitled to purchase, at the Warrant Exercise Price
resulting from such
-3-
adjustment, the number of shares obtained by multiplying the Warrant
Exercise Price in effect immediately prior to such adjustment by the
number of shares purchasable pursuant hereto immediately prior to such
adjustment and dividing the product thereof by the Warrant Exercise
Price resulting from such adjustment.
(e) Upon any adjustment of the warrant exercise price, the
Company shall give written notice thereof to Holder, stating the
Warrant Exercise Price resulting from such adjustment and the increase
or decrease, if any, in the number of shares purchasable at such price
upon the exercise of this Warrant, setting forth in reasonable detail
the method of calculation and the facts upon which such calculation is
based.
5. No Rights as Shareholder. This Warrant shall not entitle Holder to
any voting rights or other rights as a shareholder of the Company.
6. Registration Rights. Holder shall be entitled to certain demand
registration rights and also entitled to participate in any registered offering
of shares of the Company's common stock. Holder's participation in any such
offering shall be in accordance with the procedures, and subject to the
limitations, set forth on Exhibit A to this Warrant.
7. Transfer. This Warrant and all rights hereunder are transferable, in
whole or in part, at the principal office of the Company by the holder hereof in
person or by duly authorized attorney, upon surrender of this Warrant properly
endorsed to any person or entity who represents in writing that such person or
entity is acquiring the Warrant for investment and without any view to the sale
or other distribution thereof. Each holder of this Warrant, by taking or holding
the same, consents and agrees that the bearer of this Warrant, when endorsed,
may be treated by the Company and all other persons dealing with this Warrant as
the absolute owner hereof for any purpose and as the person entitled to exercise
the rights represented by this Warrant, or to the transfer hereof on the books
of the Company, any notice to the contrary notwithstanding; but until such
transfer on such books, the Company may treat the registered owner hereof as the
owner for all purposes.
-4-
8. Notices. All demands and notices to be given hereunder shall be
delivered or sent by first class mail, postage prepaid; in the case of the
Company, addressed to its corporate headquarters, Attention: Chief Financial
Officer, 0000 Xxxxxxx Xxxxx, Xxxx Xxxxxxx, XX 00000, until a new address shall
have been substituted by like notice; and in the case of Holder, addressed to
Holder at the address written below, until a new address shall have been
substituted by like notice.
[The remainder of this page intentionally is left blank,
signature page follows]
-5-
[SIGNATURE PAGE TO WARRANT]
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed
and delivered by a duly authorized officer.
Dated: February 18, 2000
FIELDWORKS, INCORPORATED
By /s/ Xxxxx X. Xxxxxxxxxxx
-----------------------------
Chief Financial Officer
Name and Address of Holder:
Industrial-Works Holding Co., LLC
00000 Xxx Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
-6-
RESTRICTION ON TRANSFER
The shares represented by this certificate have not been registered
under the Securities Act of 1933, as amended, or the securities laws of any
state and may not be sold, transferred or otherwise disposed of except pursuant
to an effective registration statement or exemption from registration under the
foregoing laws. Accordingly, the shares represented by this certificate may not
be sold, transferred or otherwise disposed of without (i) an opinion of counsel
satisfactory to FieldWorks, Incorporated that such sale, transfer or other
disposition may lawfully be made without registration under the Securities Act
of 1933 and applicable state securities laws or (ii) such registration.
WARRANT EXERCISE
(To be signed only upon exercise of this Warrant)
The undersigned, the Holder of the foregoing Warrant, hereby
irrevocably elects to exercise the purchase right represented by such warrant
for, and to purchase thereunder, _________ shares of common stock of FieldWorks,
Incorporated, to which such warrant relates and herewith makes payment of
[$________] therefor in cash, certified check or bank draft and requests that
the certificates for such shares be issued in the name of, and be delivered to
______________, whose address is set forth below the signature of the
undersigned.
Dated: __________________
Signature
If shares are to be issued
other than to Holder: Social Security or other
Tax Identification No.
Please print present name and address
WARRANT ASSIGNMENT
(To be signed only upon transfer of this Warrant)
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto __________________ the right represented by the foregoing warrant to
purchase the shares of common stock of FieldWorks, Incorporated, and appoints
_____________ attorney to transfer such right on the books of FieldWorks,
Incorporated, with full power of substitution in the premises.
Dated: __________________
Signature
Social Security or other
Tax Identification No.
Please print present name and address
EXHIBIT A
TO
WARRANT
ISSUED BY
FIELDWORKS, INCORPORATED
Registration Rights
1. Definitions. As used in this Exhibit A, the following terms shall have
the following respective meanings:
"Company" means FieldWorks, Incorporated, a Minnesota corporation.
"Common Stock Equivalents" shall mean, with respect to any Eligible
Holder as of any applicable date of determination, a sum equal to (i) the
number of shares of Common Stock owned by such Eligible Holder as of such
date of determination plus (ii) with respect to the Warrant owned by such
Eligible Holder, the number of shares of Common Stock issued or issuable
upon exercise of such Warrant as of the date of determination (in each
case, whether or not such Series B Preferred Stock or Warrant is so
converted or exercised).
"Eligible Holders" means each of Industrial-Works Holding Co., LLC and
any Person to whom it transfers any Registrable Securities, or any of their
respective Permitted Transferees.
"Holder" means (i) any person owning of record Registrable Securities
that have not been sold to the public or (ii) any transferee of record of
such Registrable Securities in accordance with Section 7 of the Warrant.
"Register," "registered," and "registration" refer to a registration
effected by preparing and filing a registration statement in compliance
with the Securities Act, and the declaration or ordering of effectiveness
of such registration statement or document.
"Registrable Securities" means (i) Common Stock of the Company issued
or issuable upon exercise of the Warrants, and (ii) any Common Stock of the
Company issued as (or issuable upon the conversion or exercise of any
Warrant, right or other security which is issued as) a dividend or other
distribution with respect to, or in exchange for or in replacement of, such
above-described securities. Notwithstanding the foregoing, Registrable
Securities shall not include any securities sold by a person to the public
either pursuant to a registration statement or Rule 144, or sold in a
private transaction in which the transferor's rights under this Exhibit A
is are not assigned.
A-1
"Registrable Securities then outstanding" shall be the number of
shares determined by calculating the total number of shares of the
Company's Common Stock that are Registrable Securities and either (i) are
then issued and outstanding or (ii) are issuable pursuant to then
exercisable or convertible securities.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"SEC" or "Commission" means the United States Securities and Exchange
Commission.
"Securities Purchase Agreement" shall mean the Agreement dated
November 20, 1999 between the Company and Industrial-Works Holding Corp.,
to which Industrial Works Holding Co., LLC has succeeded.
"Warrant" shall mean this Warrant to purchase common stock issued by
the Company in connection with the termination of the Securities Purchase
Agreement.
2. Demand Registrations
(a) Required Threshold.
Any Eligible Holder owning at least One Hundred Sixty-Five Thousand
(165,000) Common Stock Equivalents (as such number may be equitably
adjusted from time to time to reflect any stock split, stock dividend,
recapitalization, reclassification, consolidation or the like) may request
(such Person, the "Initiating Holder") that the Company file a Registration
Statement under the Securities Act on an appropriate form with respect to
at least fifty percent (50%) of the Registrable Securities owned by such
Initiating Holder (which form shall be available for the sale of the
Registrable Securities in accordance with the intended method or methods of
distribution thereof and shall include all financial statements required by
the SEC to be filed herewith) covering the shares of Registrable Securities
that are the subject of such request and the Company shall file such a
Registration Statement.
(b) Number of Demand Registrations.
The Company shall be obligated to prepare, file and cause to become
effective pursuant to this Section 2 only one (1) Registration Statement in
the aggregate pursuant to Section 2(a) above for the Eligible Holders;
provided, however, that a Registration Statement shall not be counted as
the Demand Registration hereunder unless it becomes effective and is
maintained effective in accordance with the requirements specified in
Section 6(a); provided, further, that if there is an underwriter's cutback
pursuant to Section 2(e) with respect to the request for registration
initiated by an Eligible Holder, such requested registration shall not be
deemed to be the Demand Registration.
A-2
(c) Deferral by Company.
Notwithstanding anything in this Section 2 to the contrary, the
Company shall not be obligated to prepare, file and cause to become
effective pursuant to this Section 2 a Registration Statement if within
five (5) days of receipt of a request for a Demand Registration the Company
furnishes to the Initiating Holder a certificate signed by the Chief
Executive Officer of the Company that, in the good faith judgment of the
Board of Directors, it would be detrimental in any material respect to the
Company and its shareholders for the Company to comply with the Demand
Registration, and it is therefore essential to defer the filing of the
Registration Statement relating thereto. Any such deferral shall be for a
period of not more than six (6) months after the Company's receipt of the
Initiating Holder's written request for registration pursuant to this
Section 2; provided, however, that the Company may not exercise this right
more than once with respect to the Demand Registration and that any
requested registration deferred, and not ultimately effected, by the
Company pursuant to the provisions of this Section 2(c) shall thereafter
not be deemed to be the Demand Registration for purposes of the Section
2(a) above.
(d) Participation.
The Company shall promptly give written notice to all other Eligible
Holders upon receipt of a request for a Demand Registration pursuant to
Section 2(a) above. Such other Eligible Holders may, by written notice to
the Company and the Initiating Holder, within thirty (30) business days of
the Company's notice, elect to join in a request for a Demand Registration
pursuant to Section 2(a) above, with respect to any number of shares of
Registrable Securities owned by such Eligible Holder. The Registrable
Securities of the other Eligible Holders being offered in such Demand
Registration shall be treated pari passu with the Registrable Securities
being offered by the Initiating Holder for all purposes including
"underwriter's cutbacks" under subsection (e) of this Section and any such
request by an Eligible Holder shall not be treated as either a request by
such Eligible Holder for a Piggyback Registration under Section 3 or as a
request by such Eligible Holder for a Demand Registration under this
Section 2. The Company shall include in such Demand Registration such
shares of Registrable Securities for which it has received written requests
to register such shares within thirty (30) days after such written notice
has been given, provided that all the Registrable Securities for which the
Initiating Holder and the other Eligible Holders have requested
registration shall be covered by such registration statement before any
other securities are included.
In addition, the Company shall promptly give written notice to all
eligible Holders upon receipt of a request for a demand registration by any
Person (such Person, the "Initiating Person") pursuant to any other
registration rights agreement with the Company (whether such other
registration rights agreement is entered into before or after the date
hereof). Each Eligible Holder may, by written notice to the Company, within
thirty (30)
A-3
business days of the Company's notice, elect to request a Demand
Registration pursuant to Section 2(a) above, with respect to any shares of
Registrable Securities owned by such Eligible Holder. The Registrable
Securities of the Eligible Holders being offered in such Demand
Registration shall be treated pari passu with the registrable securities
being offered by the Initiating Person for all purposes including
"underwriter's cutbacks" and any such request by an Eligible Holder shall
not be treated as either a request by such Eligible Holder for a Piggyback
Registration under Section 3 or as a request by such Eligible Holder for a
Demand Registration under this Section 2. The Company shall include in such
demand registration such shares of Registrable Securities for which it has
received written requests to register such shares within thirty (30) days
after such written notice has been given, provided that all the Registrable
Securities for which the Initiating Person and the Eligible Holders have
requested registration shall be covered by such registration statement
before any other securities are included.
(e) Underwriter's Cutback.
If the public offering of Registrable Securities is to be underwritten
and, in the good faith judgment of the managing underwriter, the inclusion
of all the Registrable Securities requested to be registered hereunder
would interfere with the successful marketing of such shares of Registrable
Securities, the number of shares of Registrable Securities to be included
shall be reduced and the number of shares to be included in the
underwriting or registration shall be allocated first among the Eligible
Holders pro rata upon the basis of the number of shares of Registrable
Securities sought to be offered by the Eligible Holders pursuant to such
Demand Registration and any remainder shall be allocated among the Company
and the other persons entitled to incidental registrations pro rata upon
the basis of the number of shares of Registrable Securities sought to be
registered thereby. If a person who has requested inclusion in such Demand
Registration does not agree to the terms of any such underwriting, such
person shall be excluded therefrom by written notice from the Company, the
underwriter or the Initiating Holder, and the securities owned by such
person(s) shall be withdrawn from registration (the "Withdrawn
Securities").
If there are any Withdrawn Securities as a result of an Underwriter's
Cutback, then the Company shall offer to those persons who have retained
rights to include securities in the Demand Registration the right to
include additional securities in the registration in an aggregate amount
equal to the number of Withdrawn Securities that would have been included
in the Demand Registration after giving effect to the Underwriter's Cutback
had such securities not been withdrawn, with such shares to be allocated
among such persons in accordance with the allocation of rights set forth in
this paragraph (e).
(f) Managing Underwriter.
The managing underwriter or underwriters of any Underwritten Offering
covered by a Demand Registration shall be selected by a majority in
interest of the Eligible
A-4
Holders participating in such Underwritten Offering and shall be reasonably
acceptable to the Company. The right of any other Holders joining in a
request for registration as provided in Section 2(d) above to registration
pursuant to this Section 2 shall be conditioned upon such Holder's
participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting on the same terms as those of
the Initiating Holder (unless otherwise mutually agreed by a majority in
interest of the Eligible Holders participating in such registration and
such Holder with respect to such participation and inclusion).
3. Piggyback Registrations
(a) Participation.
Each time the Company decides to file a Registration Statement under
the Securities Act (other than registrations on Forms S-4 or S-8 or any
successor form thereto, and other than a Demand Registration or a demand
registration by an Initiating Person) covering the offer and sale by it or
any of its security holders of any of its securities for money, the Company
shall give written notice thereof to all Eligible Holders. The Company
shall include in such Registration Statement such shares of Registrable
Securities for which it has received a written request from any Eligible
Holder to register such shares within twenty (20) days after such written
notice has been given. If the Registration Statement is to cover an
Underwritten Offering, such Registrable Securities shall be included in the
underwriting on the same terms and conditions as the securities otherwise
being sold through the underwriters.
(b) Underwriter's Cutback.
Subject to the requirements of Section 12 hereof, if in the good faith
judgment of the managing underwriter of such offering the inclusion of all
of the shares of Registrable Securities and any other Common Stock
requested to be registered would interfere with the successful marketing of
such shares, then the number of shares of Registrable Securities and other
Common Stock to be included in the offering shall be reduced, with the
participation in such offering to be in the following order of priority:
(1) first, the shares of Common Stock which the Company proposes to sell
for its own account, (2) second, the shares of Registrable Securities of
all Eligible Holders requested to be included, and (3) third, any other
shares of Common Stock requested to be included. Any necessary allocation
among the Holders of shares within each of the foregoing groups shall be
pro rata among such Holders requesting such registration based upon the
number of shares of Common Stock and Registrable Securities owned by such
Holders.
(c) Company Control.
The Company may decline to file a Registration Statement after giving
notice to Eligible Holders pursuant to Section 3(a) above, or withdraw a
Registration Statement after filing and after such notice, but prior to the
effectiveness thereof; provided that the
A-5
Company shall promptly notify each Eligible Holder in writing of any such
action and provided further that the Company shall bear all expenses
incurred by each Eligible Holder or otherwise in connection with such
withdrawn Registration Statement.
4. Registration on Form S-3
(a) Right to Request Registrations on Form S-3.
After the Company has qualified for the use of Form S-3, in addition
to the rights contained in the foregoing provisions of this Agreement, the
Eligible Holders shall have the right to request registrations on Form S-3
or any comparable or successor form. Each such request shall be in writing
and shall state the anticipated number of shares of Registrable Securities
to be disposed of and the anticipated gross proceeds of such shares, and
the intended methods of disposition of such shares by such Eligible Holder
or Eligible Holders, including whether such resales are to be made on a
delayed or continuous basis pursuant to Rule 415. The Company shall not be
obligated to effect any registration pursuant to this Section 4 if (i) the
Eligible Holders propose to sell Registrable Securities representing less
than fifteen percent (15% ) of the shares of the Registrable Securities
then held by all Eligible Holders or (ii) the circumstances described in
Section 2(c) shall apply (but subject to the limitations set forth
therein).
(b) Application of Certain Provisions.
If the registration is for an Underwritten Offering, the provisions of
Sections 2(d) and 2(f) hereof shall also apply to such registration, except
the Company may not include any shares for its own account.
5. Hold-back Agreements
(a) By Holders of Registrable Securities.
Upon the written request of the managing underwriter of any
Underwritten Offering of the Company's securities, a Holder of Registrable
Securities shall not sell or otherwise dispose of any Registrable
Securities (other than those included in such registration) without the
prior written consent of such managing underwriter for a period (not to
exceed thirty (30) days before the effective date and one hundred twenty
(120) days thereafter) that such managing underwriter reasonably determines
is necessary in order to effect the Underwritten Offering; provided that
each of the officers and directors of the Company, and each Holder of more
than one percent (1%) of the Common Stock of the Company, shall have
entered into substantially similar holdback agreements with such managing
underwriter covering at least the same period.
A-6
(b) By the Company and Others.
The Company agrees:
(1) not to effect any public or private sale or distribution of
any of its equity securities during the 30-day period prior to, and
during the 120-day period after, the effective date of each
Underwritten Offering made pursuant to a Demand Registration or a
Piggyback Registration, if so requested in writing by the managing
underwriter (except as part of such Underwritten Offering, pursuant to
registrations on Forms S-4 or S-8 or any successor forms thereto), and
(2) not to issue any Equity Securities other than for sale in a
registered public offering unless each of the Persons to which such
securities are issued has entered a written agreement binding on its
transferees not to effect any public sale or distribution of such
securities during such 130-day period, including without limitation a
sale pursuant to Rule 144 under the Securities Act (except as part of
such Underwritten Registration, if and to the extent permitted
hereunder).
6. Registration Procedures
If and whenever the Company is required to register Registrable Securities
pursuant to this Agreement, the Company will use all commercially reasonable
efforts to effect such registration to permit the sale of such Registrable
Securities in accordance with the intended plan of distribution thereof and will
as expeditiously as practicable:
(a) prepare and file with the SEC as soon as practicable a
Registration Statement with respect to such Registrable Securities and use
all commercially reasonable efforts to cause such Registration Statement to
become effective and remain continuously effective until the date that is
the earlier to occur of (i) the date six months from the date such
Registration Statement was declared effective, and (ii) the date the last
of the Registrable Securities covered by such Registration Statement have
been sold, provided that before filing a Registration Statement or
Prospectus or any amendments or supplements thereto, the Company shall
furnish to Holders of Registrable Securities covered by such Registration
Statement and the underwriters, if any, draft copies of all such documents
proposed to be filed, which documents will be subject to the review of each
Eligible Holder and such underwriters, and the Company shall not file any
Registration Statement or amendment thereto or any Prospectus or any
supplement thereto to which the Eligible Holders or the underwriters, if
any, shall reasonably object;
(b) prepare and file with the SEC such amendments and post-effective
amendments to the Registration Statement, and such supplements to the
Prospectus, as may be requested by any underwriter of Registrable
Securities or as may be required by the rules,
A-7
regulations or instructions applicable to the registration form used by the
Company or by the Securities Act or rules and regulations thereunder to
keep the Registration Statement effective until all Registrable Securities
covered by such Registration Statement are sold in accordance with the
intended plan of distribution set forth in such Registration Statement or
supplement to the Prospectus;
(c) promptly notify the selling Holders of Registrable Securities and
the managing underwriter, if any, and (if requested by any such Person)
confirm such advice in writing,
(1) when the Prospectus or any supplement or post-effective
amendment has been filed, and, with respect to the Registration
Statement or any post-effective amendment, when the same has become
effective,
(2) of any request by the SEC for amendments or supplements to
the Registration Statement or the Prospectus or for additional
information,
(3) of the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose,
(4) if at any time the representations and warranties of the
Company contemplated by clause (1) of paragraph (o) below cease to be
accurate in all material respects,
(5) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Registrable
Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, and
(6) of the existence of any fact which results in the
Registration Statement, the Prospectus or any document incorporated
therein by reference containing a misstatement;
(d) make all commercially reasonable efforts to obtain the withdrawal
of any order suspending the effectiveness of the Registration Statement at
the earliest practicable time;
(e) unless the Company objects in writing on reasonable grounds, if
requested by the managing underwriter or any Eligible Holder holding more
than twenty-five percent (25%) of the Registrable Securities then
outstanding, as promptly as practicable incorporate in a supplement or
post-effective amendment such information as the managing underwriter and
such Eligible Holder agree should be included therein relating to the sale
of the Registrable Securities, including, without limitation, information
with respect to the
A-8
number of shares of Registrable Securities being sold to underwriters, the
purchase price being paid therefor by such underwriters and with respect to
any other terms of the Underwritten Offering of the Registrable Securities
to be sold in such offering; and make all required filings of such
supplement or post-effective amendment as soon as notified of the matters
to be incorporated in such supplement or post-effective amendment;
(f) only with respect to Demand Registrations, promptly prior to the
filing of any document which is to be incorporated by reference into the
Registration Statement or the Prospectus (after initial filing of the
Registration Statement) provide copies of such document to counsel to each
of the Eligible Holders and to the managing underwriter, if any, and make
the Company's representatives available for discussion of such document and
make such changes in such document prior to the filing thereof as counsel
for each Eligible Holder or underwriters may reasonably request;
(g) furnish to each selling Holder of Registrable Securities and the
managing underwriter, without charge, at least one signed copy of the
Registration Statement and any post-effective amendments thereto, including
financial statements and schedules, all documents incorporated therein by
reference and all exhibits (including those incorporated by reference);
(h) deliver to each Eligible Holder and the underwriters, if any,
without charge, as many copies of each Prospectus (and each preliminary
prospectus) as such Persons may reasonably request (the Company hereby
consenting to the use of each such Prospectus (or preliminary prospectus)
by each of the selling Holders of Registrable Securities and the
underwriters, if any, in connection with the offering and sale of the
Registrable Securities covered by such Prospectus (or preliminary
prospectus));
(i) prior to any public offering of Registrable Securities, use all
commercially reasonable efforts to register or qualify or cooperate with
the selling Holders of Registrable Securities, the underwriters, if any,
and their respective counsel in connection with the registration or
qualification of such Registrable Securities for offer and sale under the
securities or blue sky laws of such jurisdictions as such underwriters may
designate in writing and do anything else necessary or advisable to enable
from a legal perspective the disposition in such jurisdictions of the
Registrable Securities covered by the Registration Statement; provided that
the Company shall not be required to qualify generally to do business in
any jurisdiction where it is not then so qualified or to take any action
which would subject it to general service of process in any such
jurisdiction where it is not then so subject;
(j) cooperate with the selling Holders of Registrable Securities and
the managing underwriter, if any, to facilitate the timely preparation and
delivery of certificates not bearing any restrictive legends representing
the Registrable Securities to be sold and cause such Registrable Securities
to be in such denominations and registered in such names
A-9
as the managing underwriter may request at least three business days prior
to any sale of Registrable Securities to the underwriters;
(k) use all commercially reasonable efforts to cause the Registrable
Securities covered by the Registration Statement to be registered with or
approved by such other governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof or the underwriters, if
any, to consummate the disposition of such Registrable Securities;
(l) if the Registration Statement or the Prospectus contains a
misstatement, prepare a supplement or post-effective amendment to the
Registration Statement or the related Prospectus or any document
incorporated therein by reference or file any other required document so
that, as thereafter delivered to the purchasers of the Registrable
Securities, the Prospectus will not contain a misstatement;
(m) use all commercially reasonable efforts to cause all Registrable
Securities covered by the Registration Statement to be listed on any
national securities exchange on which the Company's securities are listed
or authorized for quotation on Nasdaq, if requested by any Eligible Holder
or the managing underwriter, if any; provided, however, that the payment of
any required listing or other fee shall always be deemed to be
"commercially reasonable" for purposes of this Section 6(m);
(n) provide a CUSIP number for all Registrable Securities not later
than the effective date of the Registration Statement;
(o) enter into such agreements (including an underwriting agreement)
and do anything else reasonably necessary or advisable in order to expedite
or facilitate the disposition of such Registrable Securities, and in such
connection, whether or not the registration is an Underwritten
Registration:
(1) make such representations and warranties to the Holders of
such Registrable Securities and the underwriters, if any, in form,
substance and scope as are customarily made by issuers to holders and
underwriters, respectively, in similar Underwritten Offerings;
(2) obtain opinions of counsel to the Company and updates thereof
(which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the managing underwriter, if any, and each
Eligible Holder) addressed to each selling Holder and the underwriter,
if any, covering the matters customarily covered in opinions delivered
to holders and underwriters, respectively, in similar Underwritten
Offerings and such other matters as may be reasonably requested by any
Eligible Holder or such underwriters;
A-10
(3) obtain "cold comfort" letters and updates thereof from the
Company's independent certified public accountants addressed to the
selling Holders of Registrable Securities and the underwriters, if
any, such letters to be in customary form and covering matters of the
type customarily covered in "cold comfort" letters to holders and
underwriters, respectively, in connection with similar Underwritten
Offerings;
(4) if an underwriting agreement is entered into, cause the same
to include customary indemnification and contribution provisions and
procedures with respect to such underwriters; and
(5) deliver such documents and certificates as may be reasonably
requested by any Eligible Holder and the managing underwriter, if any,
to evidence compliance with clause (1) above and with any customary
conditions contained in the underwriting agreement or other agreement
entered into by the Company.
The above shall be done at each closing under such underwriting or similar
agreement or as and to the extent otherwise reasonably requested by any
Eligible Holder;
(p) make available for inspection by representatives of any Eligible
Holder, any underwriter participating in any disposition pursuant to such
Registration Statement, and any attorney or accountant retained by the
sellers or any such underwriter, all financial and other records and
pertinent corporate documents and properties of the Company, and cause the
Company's officers, directors and employees to supply all information
reasonably requested by any such seller or underwriter in connection with
the Registration; provided that any records, information or documents that
are designated by the Company in writing as confidential shall be kept
confidential by such Persons unless disclosure of such records, information
or documents is required by court or administrative order; and
(q) otherwise use all commercially reasonable efforts to comply with
all applicable rules and regulations of the SEC relating to such
Registration, and make generally available to its security holders earnings
statements satisfying the provisions of Section 12(a) of the Securities
Act, no later than forty-five (45) days after the end of any 12-month
period (or ninety (90) days, if such period is a fiscal year) commencing at
the end of any fiscal quarter in which Registrable Securities are sold to
underwriters in an Underwritten Offering, or, if not sold to underwriters
in such an offering, beginning with the first month of the Company's first
fiscal quarter commencing after the effective date of the Registration
Statement, which statements shall cover said 12-month period.
A-11
7. Registration Expenses
(a) Demand Registrations and S-3 Registrations.
The Company shall bear all Expenses incurred in connection with any
Demand Registrations, S-3 Registrations or any Registrations which do not
become or are not maintained effective in accordance with the requirements
specified in Section 6(a), including expenses and fees of one counsel for
all Holders. Notwithstanding the foregoing, the Underwriters' Commissions
related or attributable to Registrable Securities sold or incurred in
connection with a Demand Registration or S-3 Registration that becomes
effective shall be shared by the Holders of the Registrable Securities
whose Registrable Securities are included in such Registration, pro rata,
in accordance with the aggregate amount of Registrable Securities sold by
such Holders.
(b) Piggyback Registrations.
The Company shall bear all Registration Expenses incurred in
connection with any Piggyback Registrations, including expenses and fees of
one counsel for all Holders, except that each Holder of the Registrable
Securities whose Registrable Securities are included in such Registration
shall pay its pro rata share of the Underwriters' Commissions related or
attributable to Registrable Securities sold or incurred in such
Registration, in accordance with the amount of Registrable Securities sold
by all such Holders.
(c) Company Expenses.
The Company also will, in any event, pay its internal expenses
(including, without limitation, all salaries and expenses of its officers
and employees performing legal or accounting duties), the expense of any
annual audit, the fees and expenses incurred in connection with any listing
of the securities to be registered on a securities exchange, and the fees
and expenses of any Person, including special experts, retained by the
Company.
8. Termination of Registration Rights. A Holder's registration rights under
this Exhibit A shall terminate and be of no further force and effect one year
following the issuance of the Warrant if all the Registrable Securities held by
and issuable to such Holder may be sold under Rule 144 during any ninety (90)
day period.
A-12
