Exhibit 4.11
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REGISTRATION RIGHTS AGREEMENT
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This REGISTRATION RIGHTS AGREEMENT dated __________, 1998, is made and
entered into by and between Scottish Annuity & Life Holdings, Ltd., a Cayman
Islands company (the "Company"), and __________________, a _______________ (the
"Initial Holder").
WHEREAS, the Company has issued its Ordinary Shares, par value $.01 per
share ("Ordinary Shares") and its Class A Warrants to purchase Ordinary Shares
to the Initial Holder pursuant to the terms of that certain Securities Purchase
Agreement, dated as of the date hereof, by and between the Company and the
Initial Holder (the "Securities Purchase Agreement"); and
WHEREAS, pursuant to the Securities Purchase Agreement, the Company has
agreed to register Ordinary Shares held by the Initial Holder, the Ordinary
Shares issued to the Initial Holder and the Ordinary Shares for which the Class
A Warrants are exercisable for sale under the Securities Act of 1933, as
amended;
NOW, THEREFORE, in consideration of the completion of the transactions
contemplated by the Securities Purchase Agreement and of the mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows,
intending to be legally bound.
Section 1. Definitions. As used in this Agreement, the following terms
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have the following meanings:
"Business Day" means any day on which the Company's Ordinary Shares are
available for trading on the principal stock exchange or market upon which they
are traded.
"Closing Date" means the date on which is consummated the transactions
contemplated by the Securities Purchase Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, and the rules and
regulations of the SEC thereunder, all as the same shall be in effect at the
relevant time.
"Holders" means the Initial Holder and purchasers from the Company of Class
A Warrants of the Company ("Class A Warrants"), Class B Warrants of the Company
("Class B Warrants"), Class C Warrants (if any are issued) of the Company
("Class C Warrants") or Ordinary Shares issued by the Company pursuant to those
certain Securities Purchase Agreements, dated ___________, 1998, by and between
the Company and certain investors (the "Direct Purchase Agreements") and the
permitted successors or assignees of the Initial Holder and such purchasers, for
so long as (and to the extent that) such Persons own or have the right to
acquire any Registrable Securities.
"Holder Agreements" means this Agreement and any other Agreement between
the Company and one of the Other Investors which is substantially similar to
this Agreement.
"IPO Date" means the date of the consummation of the Company's initial
public offering of its Ordinary Shares.
"Ordinary Shares" means the Company's Ordinary Shares, par value $.01 per
share.
"Other Investors" means Holders of Class A Warrants, Class B Warrants,
Class C Warrants (if any are issued) and Ordinary Shares issued by the Company
pursuant to the Direct Purchase Agreements.
"Person" means an individual, a partnership (general or limited),
corporation, limited liability company, joint venture, business trust,
cooperative, association or other form of business organization, whether or not
regarded as a legal entity under applicable law, a trust (inter vivos or
testamentary), an estate of a deceased, insane or incompetent person, a quasi-
governmental entity, a government or any agency, authority, political
subdivision or other instrumentality thereof, or any other entity.
"Registrable Securities" means (1) "Registrable Securities" as defined in
Holder Agreements with Other Investors; (2) the Ordinary Shares issued to the
Initial Holder prior to issuance of the Ordinary Shares and Class A Warrants
pursuant to the Securities Purchase Agreement and held by the Initial Holder and
permitted transferees of such Ordinary Shares; (3) the Ordinary Shares issued
pursuant to the terms of the Securities Purchase Agreement; (4) the Ordinary
Shares issuable upon exercise of Class A Warrants issued pursuant to the terms
of the Securities Purchase Agreement; and (5) any additional Ordinary Shares or
other equity securities of the Company issued or issuable in respect of such
Ordinary Shares (or other equity securities issued in respect thereof) by way of
a stock dividend or stock split, in connection with a combination, exchange,
reorganization, recapitalization or reclassification of Company securities, or
pursuant to a merger, division, consolidation or other similar business
transaction or combination involving the Company; provided that as to any
particular Registrable Securities, such securities shall cease to constitute
Registrable Securities (a) when a registration statement with respect to the
sale of such securities shall have become effective under the Securities Act and
such securities shall have been disposed of thereunder, (b) when such securities
shall have been disposed of pursuant to Rule 144 (or any successor provision to
such Rule) under the Securities Act, or (c) when such securities shall have
ceased to be outstanding.
"Registration Expenses" means all expenses incident to the Company's
performance of or compliance with the registration requirements set forth in
this Agreement including, without limitation, the following: (a) the fees,
disbursements and expenses of the Company's counsel, accountants, and experts in
connection with the registration under the Securities Act of Registrable
Securities; (b) all expenses in connection with the preparation, printing and
filing of the registration statement, any preliminary prospectus or final
prospectus, any other offering document and amendments and supplements thereto,
and the mailing and delivering of copies thereof to underwriters and dealers, if
any; (c) the cost of printing or producing any agreement(s) among underwriters,
underwriting agreement(s) and blue sky or legal
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investment memoranda, any selling agreements, and any other documents in
connection with the offering, sale or delivery of Registrable Securities to be
disposed of in an underwritten offering; (d) the fees and expenses incurred in
connection with the listing of Registrable Securities on each securities
exchange on which Company securities of the same class are then listed or with
the Nasdaq National Market System; (e) any SEC or blue sky registration or
filing fee attributable to Registrable Securities; (f) any other expenses in
connection with the Registrable Securities for offer and sale under state
securities laws, including the fees and disbursements of counsel for the
underwriters in connection with such qualification and in connection with any
blue sky and legal investment surveys; and (h) the filing fees incident to
securing any required review by the National Association of Securities Dealers,
Inc. of the terms of the sale of Registrable Securities to be disposed of.
"Registration Statement" means a registration statement under the
Securities Act filed by the Company pursuant to this Agreement, including all
amendments thereto, all preliminary and final prospectuses included therein and
all exhibits thereto.
"SEC" means the United States Securities and Exchange Commission, or such
other federal agency at the time having the principal responsibility for
administering the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC thereunder, all as the same shall be in effect
at the relevant time.
"Warrant" means the Class A Warrants, the Class B Warrants and the Class C
Warrants, if any are issued, of the Company.
Section 2. Underwritten Demand Registration.
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(a) At any time on or after the first anniversary of the IPO Date, and
before the tenth anniversary of the IPO Date the Holder or Holders of twenty
(20) percent or more of the Ordinary Shares which are, or would be upon exercise
of Class A Warrants, Class B Warrants or Class C Warrants, if any are issued,
Registrable Securities may (by written notice delivered to the Company) require
registration of all or any portion of such Registrable Securities for sale in an
underwritten public offering. In each such case, such notice shall specify the
number of Registrable Securities for which such underwritten offering is to be
made. Within ten Business Days after its receipt of any such notice, the Company
shall give written notice of such request to all other Holders, and all such
Holders shall have the right to have any or all Registrable Securities owned by
them included in the requested underwritten offering as they shall specify in a
written notice received by the Company within ten Business Days after the
Company's notice is given. Within ten Business Days after the expiration of such
ten Business Day period, the Company shall notify all Holders requesting
inclusion of Registrable Securities in the proposed underwriting of (1) the
aggregate number of Registrable Securities proposed to be included by all
Holders in the offering, and (2) the proposed commencement date of the offering,
which shall be a date not more than thirty days after the Company gives such
notice. The managing underwriter for such offering shall be chosen by the
Holders of a majority of the Registrable Securities being included therein and
shall be satisfactory to the Company.
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(b) If any request for an underwriting shall have been made pursuant to
subsection (a), the Company shall prepare and file a Registration Statement with
the SEC as promptly as reasonably practicable, but in any event within 45 days
after the managing underwriter's request therefor.
(c) The Company shall not have any obligation to permit or participate in
more than two underwritten public offerings pursuant to this Section, or to file
a Registration Statement pursuant to this Section with respect to less than the
greater of (i) twenty (20) percent of the Ordinary Shares which are, or would be
upon exercise of Class A Warrants, Class B Warrants or Class C Warrants, if any
are issued, Registrable Securities or (ii) 250,000 Ordinary Shares which are
Registrable Securities.
(d) The Company shall have the right to defer the filing or effectiveness
of a Registration Statement relating to any registration requested under this
Section for a reasonable period of time not to exceed 180 days if (1) the
Company is, at such time, working on an underwritten public offering of its
securities for the account of the Company and is advised by its managing
underwriter that such offering would in its opinion be materially adversely
affected by such filing; or (2) the Company in good faith determines that any
such filing or the offering of any Registrable Securities would (A) materially
impede, delay or interfere with any proposed financing, offer or sale of
securities, acquisition, corporate reorganization or other significant
transaction involving the Company or (B) require the disclosure of material non-
public information, the disclosure of which would materially and adversely
affect the Company.
(e) The Company shall have no obligation to file a Registration Statement
pursuant to this Section earlier than 180 days after the effective date of a
prior registration statement of the Company covering an underwritten public
offering for the account of the Company the effective date of which is after the
first anniversary of the Closing Date if (1) the Company shall have offered
pursuant to Section 4 to include the Holders' Registrable Securities in such
Registration Statement; and (2) no Registrable Securities requested to be
included in such registration statement shall have been excluded therefrom
pursuant to Section 4(c).
(f) The Holders of a majority of Registrable Securities requested to be
included in any offering pursuant to this Section may elect by written notice to
the Company not to proceed with the offering, in which case the Company shall
not be obligated to proceed with such offering. If the Holders so elect, the
Holders that shall have requested Registrable Securities to be included in the
offering shall pay all Registration Expenses incurred by the Company in
connection with such offering prior to receipt of such notice.
(g) Neither the Company nor any other Person shall be entitled to include
any securities held by it in any underwritten offering pursuant to this Section,
unless all Registrable Securities for which inclusion has been requested are
also included.
(h) No registration of Registrable Securities under this Section shall
relieve the Company of its obligation to effect registrations of Registrable
Securities pursuant to Sections 3 and 4.
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Section 3. Shelf Registrations.
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(a) At any time on or after the first anniversary of the IPO Date, and
before the tenth anniversary of the IPO Date, the Holder or Holders of Ordinary
Shares which are, or would be upon exercise of Class A Warrants, Class B
Warrants or Class C Warrants, if any are issued, Registrable Securities may (by
written notice to the Company) require registration of all or any portion of
such Registrable Securities for sale in open market transactions or negotiated
block trades. Within ten Business Days after its receipt of such notice, the
Company shall give written notice of such request to all other Holders, and all
such Holders shall have the right to have any or all Registrable Securities
owned by them included in the requested registration as they shall specify in a
written notice received by the Company within ten Business Days after the
Company's notice is given. Within ten Business Days after the expiration of such
ten Business Day period, the Company shall notify all Holders requesting
inclusion of Registrable Securities in the requested registration of the
aggregate number of Registrable Securities proposed to be included by all
Holders in this registration.
(b) If any request for registration shall have been made pursuant to
subsection (a) the Company shall prepare and file a Registration Statement with
the SEC as promptly as reasonably practicable, but in any event within 45 days
after the expiration of the ten Business Day period within which the Holders may
request inclusion in the registration.
(c) The Company shall have no obligation to file a Registration Statement
pursuant to this Section earlier than 180 days after the effective date of any
earlier Registration Statement filed pursuant to this Agreement.
(d) The Holders of a majority of Registrable Securities requested to be
included in any registration pursuant to this Section may elect by written
notice to the Company not to proceed with such registration, in which case the
Company will not be obligated to proceed therewith. If the Holders so elect, the
Holders that shall have requested Registrable Securities to be included in the
registration shall pay all Registration Expenses incurred by the Company in
connection with such offering prior to receipt of such notice.
(e) No registration of Registrable Securities under this Section shall
relieve the Company of its obligation to effect registrations of Registrable
Securities under Sections 2 and 4.
Section 4. Incidental Registration.
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(a) From and after the first anniversary of the IPO Date, and before the
tenth anniversary of the IPO Date, if the Company proposes, other than pursuant
to Section 2 or 3 of this Agreement, to file a Registration Statement under the
Securities Act to register any of its Ordinary Shares for public sale under the
Securities Act (whether proposed to be offered for sale by the Company or by any
other Person), it will give prompt written notice (which notice shall specify
the intended method or methods of disposition) to the Holders of its intention
to do so, and upon the written request of any Holder delivered to the Company
within ten Business Days after any such notice (which request shall specify the
number of Registrable Securities intended to be disposed of by such Holder), the
Company will use commercially reasonable efforts to include
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in such Registration Statement all Registrable Securities which the Company has
been so requested to register by the Holders.
(b) If at any time prior to the effective date of any Registration
Statement described in subsection (a), the Company shall determine for any
reason not to proceed with such registration, the Company may, at its election,
give written notice of such determination to the Holders requesting registration
and thereupon the Company shall be relieved of its obligation to register such
Registrable Securities in connection with such registration.
(c) The Company will not be required to effect any registration of
Registrable Securities pursuant to this Section in connection with an offering
of Ordinary Shares solely for the account of the Company if the Company shall
have been advised in writing (with a copy to the Holders requesting
registration) by a U.S. nationally recognized investment banking firm (which may
be the managing underwriter for the offering) selected by the Company that, in
such firm's opinion, registration of Registrable Securities and of any other
securities requested to be included in such registration by Persons having
rights to include securities therein at that time may interfere with an orderly
sale and distribution of the securities being sold by the Company in such
offering or adversely affect the price of such securities; but if an offering of
less than all of the Registrable Securities requested to be registered by the
Holders and other securities requested to be included in such registration by
such other Persons would not, in the opinion of such firm, adversely affect the
distribution or price of the securities to be sold by the Company in the
offering, the aggregate number of Registrable Securities requested to be
included in such offering by the Holders shall be reduced pro rata in accordance
with the proportion that the number of shares proposed to be included in such
registration by the Holders bears to the number of shares proposed to be
included in such registration by the Holders and all other such Persons.
(d) The Company shall not be required to give notice of, or effect any
registration of Registrable Securities under this Section incidental to, the
registration of any of its securities in connection with mergers,
consolidations, acquisitions, exchange offers, subscription offers, dividend
reinvestment plans or stock options or other employee benefit or compensation
plans.
(e) No registration of Registrable Securities effected under this Section
shall relieve the Company of its obligations to effect registrations of
Registrable Securities pursuant to Sections 2 and 3.
Section 5. Holdbacks and Other Transfer Restrictions.
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(a) No Holder shall, if requested by the managing underwriter in an
underwritten offering: (1) that includes such Holder's Registrable Securities,
effect any public sale or distribution of securities of the Company of the same
class as the securities included in such Registration Statement (or convertible
into or exercisable for such class), including a sale pursuant to Rule 144(k)
under the Securities Act or effect (except as part of such underwritten
registration) any public sale or distribution of securities of the Company of
the same class as the securities included in such Registration Statement (or
convertible into or exercisable for such class), including a sale pursuant to
Rule 144(k) under the Securities Act during the ten day period prior to, and
during the 180-day period beginning on the closing date of each underwritten
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offering made pursuant to such registration statement, to the extent timely
notified in writing by the Company or the managing underwriter; and (2) in the
event of an offering for the account of the Company, to the extent Holder does
not elect (or is not permitted under Section 4(c)) to sell such securities in
connection with such offering, effect any public sale or distribution of
securities of the Company of the same class as the securities included in such
Registration Statement (or convertible into or exercisable for such class),
including a sale pursuant to Rule 144(k) under the Securities Act during the
period of distribution of the Company's securities in such offering and during
the period in which the underwriting syndicate, if any, participates in the
aftermarket. In any such case the Company shall require the managing underwriter
to notify the Company and the Company, in turn, shall notify all Holders of
Registrable Securities included in the offering promptly after such
participation ceases. If the Company or such managing underwriter so requests,
each Holder shall enter into an agreement reflecting such restrictions.
(b) No Holder shall, during any period in which any of its Registrable
Securities are included in any effective Registration Statement, (1) effect any
stabilization transactions or engage in any stabilization activity in connection
with the Ordinary Shares or other equity securities of the Company in
contravention of Regulation M under the Exchange Act; (2) permit any Affiliated
Purchaser (as that term is defined in Rule 100(b) of Regulation M under the
Exchange Act) to bid for or purchase for any account in which such Holder has a
beneficial interest, or attempt to induce any other person to purchase, any
Ordinary Shares or Registrable Securities in contravention of Regulation M under
the Exchange Act; or (3) offer or agree to pay, directly or indirectly, to
anyone any compensation for soliciting another to purchase, or for purchasing
(other than for such Holder's own account), any securities of the Company on a
national securities exchange in contravention of Regulation M under the Exchange
Act.
(c) Each Holder shall, in the case of a registration including Registrable
Securities to be offered by it for sale through brokers transactions, furnish
each broker through whom such Holder offers Registrable Securities such number
of copies of the prospectus as the broker may require and otherwise comply with
the prospectus delivery requirements under the Securities Act.
Section 6. Registration Procedures. If and whenever the Company is
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required by the provisions of this Agreement to effect a registration of
Registrable Securities:
(a) The Company will use commercially reasonable efforts to prepare and
file with the SEC, within the time periods specified herein, a Registration
Statement on Form S-3 or its equivalent (or on such other registration form
available to the Company that permits the greatest extent of incorporation by
reference of materials filed by the Company, under the Exchange Act) and will
use commercially reasonable efforts to cause such registration statement to
become effective as promptly as practicable thereafter and to remain effective
under the Securities Act until (1) the earlier of such time as all securities
covered thereby have been disposed of pursuant to such Registration Statement or
180 days after such Registration Statement becomes effective, in the case of
registrations pursuant to Section 2, or (2) 90 days after such Registration
Statement becomes effective, in the case of registrations pursuant to Section 3,
in every case as any such period may be extended pursuant to subsection (h) or
Section 8.
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(b) The Company will prepare and file with the SEC such amendments, post-
effective amendments and supplements to such Registration Statement and the
prospectus used in connection therewith as may be necessary to keep such
Registration Statement effective for such period of time required by subsection
(a), as such period may be extended pursuant to subsection (h) or Section 8.
(c) The Company will comply in all material respects with the provisions of
the Securities Act with respect to the disposition of all securities covered by
such Registration Statement during the period during which any such Registration
Statement is required to be effective.
(d) The Company will furnish to any Holder and any underwriter of
Registrable Securities (1) such number of copies (including manually executed
and conformed copies) of such Registration Statement and of each amendment
thereof and supplement thereto (including all annexes, appendices, schedules and
exhibits), (2) such number of copies of the prospectus used in connection with
such Registration Statement (including each preliminary prospectus, any summary
prospectus and the final prospectus and including prospectus supplements), and
(3) such number of copies of other documents, in each case as the Holder or such
underwriter may reasonably request.
(e) The Company will use commercially reasonable efforts to register or
qualify all Registrable Securities covered by such Registration Statement under
the securities or "blue sky" laws of states of the United States and any other
jurisdiction as any Holder or any underwriter shall reasonably request, and do
any and all other acts and things which may be reasonably requested by such
Holder or such underwriter to consummate the offering and disposition of
Registrable Securities in such jurisdictions; but the Company shall not be
required to qualify generally to do business as a foreign corporation or as a
dealer in securities, subject itself to taxation, or consent to general service
of process in any jurisdiction wherein it is not then so qualified or subject.
(f) The Company will use, as soon as practicable after the effectiveness of
the Registration Statement, commercially reasonable efforts to cause the
Registrable Securities covered by such Registration Statement to be registered
with, or approved by, such other United States and Cayman Islands public,
governmental or regulatory authorities, if any, as may be required in connection
with the disposition of such Registrable Securities.
(g) The Company will use commercially reasonable efforts to list the
Registrable Securities covered by such Registration Statement on any securities
exchange (or if applicable, the Nasdaq National Market System) on which any
securities of the Company are then listed, if the listing of such Registrable
Securities is then permitted under the applicable rules of such exchange (or if
applicable, the Nasdaq National Market System).
(h) The Company will notify each Holder as promptly as practicable and, if
requested by any Holder, confirm such notification in writing, (1) when a
prospectus or any prospectus supplement has been filed with the SEC, and when a
Registration Statement or any post-effective amendment thereto has been filed
with and declared effective by the SEC, (2) of the issuance by the SEC of any
stop order or the coming to its knowledge of the initiation of any
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proceedings for that purpose, (3) of the receipt by the Company of any
notification with respect to the suspension of the qualification of any of the
Registrable Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, (4) of the occurrence of any
event which requires the making of any changes to a Registration Statement or
related prospectus so that such documents will not contain any 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, in light of the
circumstances under which they were made, not misleading (and the Company shall
promptly prepare and furnish to each Holder a reasonable number of copies of a
supplemented or amended prospectus such that, as thereafter delivered to the
purchasers of such Registrable Securities, such prospectus shall not include an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they are made, not misleading), and (5) of the
Company's determination that the filing of a post-effective amendment to a
Registration Statement is necessary or appropriate. Upon the receipt of any
notice from the Company of the occurrence of any event of the kind described in
clause (4), the Holders shall forthwith discontinue any offer and disposition of
Registrable Securities pursuant to the Registration Statement covering such
Registrable Securities until all Holders shall have received copies of a
supplemented or amended prospectus which is no longer defective and, if so
directed by the Company, shall deliver to the Company all copies (other than
permanent file copies) of the defective prospectus covering such Registrable
Securities which are then in the Holders' possession. If the Company shall
provide any notice of the type referred to in the preceding sentence, the period
during which the Registration Statement is required by subsection (a) to be
effective shall be extended by the number of days from and including the date
such notice is provided, to and including the date when the Holders shall have
received copies of the corrected prospectus.
(i) The Company will enter into such agreements and take such other
appropriate actions as are customary and reasonably necessary to expedite or
facilitate the disposition of such Registrable Securities (including, without
limitation, making its management available to the extent reasonably requested
by the Holders to participate in marketing presentations to potential investors
in connection with any underwritten offering), and in that regard, will deliver
to the Holders such documents and certificates as may be reasonably requested by
the Holders of a majority of the Registrable Securities being sold or, as
applicable, the managing underwriters, to evidence the Company's compliance with
this Agreement, including, in the case of any underwritten offering, using
commercially reasonable efforts to cause its independent accountants to deliver
to the managing underwriters an accountants' comfort letter substantially
similar to that in scope delivered in an underwritten public offering and
covering audited and interim financial statements included in the registration
statement, or if such letter can not be obtained through the exercise of
commercially reasonable efforts, cause its independent accountants to deliver to
the managing underwriters a comfort letter based on negotiated procedures
providing comfort with respect to the Company's financial statements included or
incorporated by reference in the registration statement at the highest level
permitted to be given by such accountants under the then applicable standards of
the American Institute of Certified Public Accountants with respect to such
Registration Statement.
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Section 7. Underwriting.
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(a) If requested by the underwriters for any underwritten offering of
Registrable Securities pursuant to a registration under Section 2, the Company
will enter into and perform its obligations under an underwriting agreement with
the underwriters for such offering, such agreement to contain such
representations and warranties by the Company and such other terms and
provisions as are customarily contained in underwriting agreements with respect
to secondary distributions, including, without limitation, customary provisions
relating to indemnitees and contribution and the provision of opinions of
counsel and accountants' comfort letters. If Registrable Securities are to be
distributed by such underwriters on behalf of any Holder, such Holder shall also
be a party to any such underwriting agreement.
(b) If any registration pursuant to Section 4 shall involve an underwritten
offering, the Company may require Registrable Securities requested to be
registered pursuant to Section 4 to be included in such underwriting on the same
terms and conditions as shall be applicable to the securities being sold through
underwriters under such registration. In such case, each Holder requesting
registration shall be a party to any such underwriting agreement. Such agreement
shall contain such representations and warranties by the Holders requesting
registration and such other terms and provisions as are customarily contained in
underwriting agreements with respect to secondary distributions, including,
without limitation, provisions relating to indemnitees and contribution (it
being understood that each Holder shall not be required to make any
representation concerning the Company or its business or to indemnify or
contribute for any liabilities, losses or expenses related to any omission or
misstatements in any registration statement or prospectus except to the extent
based upon information provided in writing by the Holder expressly for use
therein).
(c) In any offering of Registrable Securities pursuant to a registration
hereunder, each Holder requesting registration shall also enter into such
additional or other agreements as may be customary in such transactions, which
agreements may contain, among other provisions, such representations and
warranties as the Company or the underwriters of such offering may reasonably
request (including, without limitation, those concerning such Holder, its
Registrable Securities, such Holder's intended plan of distribution and any
other information supplied by it to the Company for use in such registration
statement), and customary provisions relating to indemnitees and contribution
(it being understood that each Holder shall not be required to make any
representation concerning the Company or its business or to indemnify or
contribute for any liabilities, losses or expenses related to any omission or
misstatements in any registration statement or prospectus except to the extent
based upon information provided in writing by the Holder expressly for use
therein).
Section 8. Information Blackout.
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(a) At any time when a Registration Statement is effective, upon written
notice from the Company to the Holders that the Company has determined in good
faith that sale of Registrable Securities pursuant to the Registration Statement
would require disclosure of non-public material information, the disclosure of
which would have a material adverse effect on the Company, all Holders shall
suspend sales of Registrable Securities pursuant to such Registration Statement
until the earlier of (1) 20 days after the Company notifies the Holders of such
good
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faith determination, and (2) such time as the Company notifies the Holders that
such material information has been disclosed to the public or has ceased to be
material or that sales pursuant to such Registration Statement may otherwise be
resumed (the number of days from such suspension of sales by the Holders until
the day when such sales may be resumed hereunder is hereinafter called a "Sales
Blackout Period").
(b) The time period set forth in Section 6(a)(1) or (2) shall be extended
for a number of days equal to the number of days in the Sales Blackout Period.
(c) No Sales Blackout Period shall be commenced by the Company within 90
days after the end of a Sales Blackout Period.
Section 9. Rule 144. After the IPO Date, the Company shall take all
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actions reasonably necessary to comply with the filing requirements described in
Rule 144(c)(1) under the Securities Act so as to enable the Holders to sell
Registrable Securities without registration under the Securities Act. Upon the
written request of any Holder, the Company will deliver to such Holder a written
statement as to whether it has complied with the filing requirements under such
Rule 144(c)(1).
Section 10. Preparation; Reasonable Investigation; Information. In
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connection with the preparation and filing of each Registration Statement
registering Registrable Securities under the Securities Act, (a) the Company
will give the Holders and the underwriters, if any, and their respective counsel
and accountants, drafts of such registration statement for their review and
comment prior to filing and (during normal business hours and subject to such
reasonable limitations as the Company may impose to prevent disruption of its
business) such reasonable and customary access to its books and records and such
opportunities to discuss the business of the Company with its officers and the
independent public accountants who have certified its financial statements as
shall be necessary, in the reasonable opinion of the Holders of a majority of
the Registrable Securities being registered and such underwriters or their
respective counsel, to conduct a reasonable investigation within the meaning of
the Securities Act and (b) as a condition precedent to including any Registrable
Securities of any Holder in any such registration, the Company may require such
Holder to furnish the Company such information regarding such Holder and the
distribution of such securities as the Company may from time to time reasonably
request in writing or as shall be required by law or the SEC in connection with
any registration.
Section 11. Indemnification and Contribution.
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(a) In the case of each offering of Registrable Securities made pursuant to
this Agreement, the Company shall, to the extent permitted by applicable law,
indemnify and hold harmless each Holder, its officers and directors, each
underwriter of Registrable Securities so offered and each Person, if any, who
controls any of the foregoing persons within the meaning of the Securities Act
("Holder Indemnitees"), from and against any and all claims, liabilities,
losses, damages, expenses and judgments, joint or several, to which they or any
of them may become subject, including any amount paid in settlement of any
litigation commenced or threatened, and shall promptly reimburse them, as and
when incurred, for any legal or other expenses incurred by them in connection
with investigating any claims and defending any actions, insofar as such losses,
claims, damages, liabilities or actions shall arise out of, or shall be based
upon, any violation or
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alleged violation by the Company of the Securities Act, any blue sky laws,
securities laws or other applicable laws of any state or country in which the
Registrable Securities are offered, and relating to action taken or action or
inaction required of the Company in connection with such offering, or shall
arise out of, or shall be based upon, any untrue statement or alleged untrue
statement of a material fact contained in the Registration Statement (or in any
preliminary or final prospectus included therein) relating to the offering and
sale of such Registrable Securities, or any amendment thereof or supplement
thereto, or in any document incorporated by reference therein, or 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; but the
Company shall not be liable to any Holder Indemnitee in any such case to the
extent that any such loss, claim, damage, liability or action arises out of, or
is based upon, any untrue statement or alleged untrue statement, or any omission
or alleged omission, if such statement or omission shall have been made in
reliance upon and in conformity with information furnished to the Company in
writing by or on behalf of such Holder specifically for use in the preparation
of the Registration Statement (or in any preliminary or final prospectus
included therein), or any amendment thereof or supplement thereto. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of any Holder and shall survive the transfer of such
securities. The foregoing indemnity agreement is in addition to any liability
which the Company may otherwise have to any Holder Indemnitee.
(b) In the case of each offering of Registrable Securities made pursuant to
this Agreement, each Holder participating in such offering, shall, to the extent
permitted by applicable law, indemnify and hold harmless the Company, its
officers and directors and each person, if any, who controls any of the
foregoing within the meaning of the Securities Act (the "Company Indemnitees"),
from and against any and all claims, liabilities, losses, damages, expenses and
judgments, joint or several, to which they or any of them may become subject,
including any amount paid in settlement of any litigation commenced or
threatened, and shall promptly reimburse them, as and when incurred, for any
legal or other expenses incurred by them in connection with investigating any
claims and defending any actions, insofar as any such losses, claims, damages,
liabilities or actions shall arise out of, or shall be based upon, any violation
by such Holder of the Securities Act, any blue sky laws, securities laws or
other applicable laws of any state or country in which the Registrable
Securities are offered and relating to action taken or action or inaction
required of such Holder in connection with such offering, or shall arise out of,
or shall be based upon, any untrue statement of a material fact contained in the
Registration Statement (or in any preliminary or final prospectus included
therein) relating to the offering and sale of such Registrable Securities or any
amendment thereof or supplement thereto, or any omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, but in each case only to the extent that such untrue
statement is contained in, or such fact is omitted from, information furnished
in writing to the Company by or on behalf of such Holder specifically for use in
the preparation of such Registration Statement (or in any preliminary or final
prospectus included therein). Such indemnity shall remain in full force and
effect regardless of any investigation made by or on behalf of any Company
Indemnitee. In no event shall the liability of a Holder hereunder or under
Section 11(d) be greater in amount than the dollar amount of the net proceeds
received by it upon the sale of Registrable Securities pursuant to such
offering. The foregoing indemnity is in addition to any liability which Holder
may otherwise have to any Company Indemnitee.
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(c) In case any proceeding (including any governmental investigation) shall
be instituted involving any person in respect of which indemnity may be sought
pursuant to this Section 11, such person (the "indemnified party") shall
promptly notify the person against whom such indemnity may be sought (the
"indemnifying party") in writing, but the failure to give such notice shall not
relieve the indemnifying party or parties from any liability which it or they
may have to the indemnified party. In case any such proceeding shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party and shall pay as
incurred the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel at its own expense. Notwithstanding the foregoing, the indemnifying
party shall pay as incurred the fees and expenses of the counsel retained by the
indemnified party in the event (1) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (2) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. The indemnifying party, if the Company, shall
not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than two
separate firms, one for the Ordinary Shares issued pursuant to the Securities
Purchase Agreement, the Class B Warrants or Ordinary Shares for which the Class
B Warrants have been exercised (the "Class B Holder Indemnitees") and one for
all other Holder Indemnitees (the "Other Holder Indemnitees"). Such firm for the
Class B Holder Indemnitees shall be designated in writing by Holders of a
majority of the Registrable Securities held by the Class B Holder Indemnitees
and disposed of under the applicable Registration Statements. Such firm for the
Other Holder Indemnitees shall be designated in writing by the Holders of a
majority of the Registrable Securities held by the Other Holder Indemnitees and
disposed of under the applicable Registration Statement. The indemnifying
party, if other than the Company, shall not, in connection with any proceeding
or related proceedings in the same jurisdiction be liable for the reasonable
fees and expenses of more than one separate firm for the Company Indemnitee,
which firm shall be designated in writing by the Company. The indemnifying party
shall not be liable for any settlement of any proceeding effected without its
written consent but if settled with such consent or if there be a final
judgement for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested the indemnifying party to reimburse
the indemnified party for fees and expenses of counsel as contemplated by this
Section, the indemnifying party agrees that it shall be liable for any
settlement of any proceeding effected without the indemnifying party's written
consent if (i) such settlement is entered into more than thirty (30) days after
receipt by the indemnifying party of the aforesaid request, and (ii) the
indemnifying party shall not have reimbursed the indemnified party in accordance
with such request prior to the date of such settlement. No indemnifying party
shall, without the consent of the indemnified party, which consent shall not be
unreasonably withheld, consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such indemnified party of a release from all
liability in respect to such claim or litigation or which requires action other
than the payment of money by the indemnifying party.
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(d) If the indemnification provided for in this Section 11 is unavailable
to or insufficient to hold harmless an indemnified party under subsection (a) or
(b) in respect of any losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) referred to therein, or if the indemnified party
failed to give the notice required under subsection (c) and the indemnified
party is actually prejudiced by such failure, then each indemnifying party
shall, to the extent permitted by applicable law, contribute to the amount paid
or payable by the indemnified party as a result of such losses, claims, damages
or liabilities (or actions or proceedings in respect thereof) in such proportion
as is appropriate to reflect the relative fault of all parties in connection
with the statements or omissions which resulted in such losses, claims, damages
or liabilities (or actions or proceedings in respect thereof), as well as any
other relevant equitable considerations. Relative fault 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 party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The parties agree that it would not be just and equitable
if contributions pursuant to this subsection (d) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
referred to above shall be deemed to include 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
subsection (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) Notwithstanding any other provision of this Section 11, the Company
shall not be liable in any such case to the extent that any such loss, claim,
damage, liability or expense arises out of or is based upon an untrue statement
or alleged untrue statement of any material fact contained in any such
registration statement, preliminary prospectus, final prospectus or summary
prospectus contained therein or any omission to state therein a material fact
required to be stated therein or necessary to make the statements therein in
light of the circumstances in which they were made not misleading in a
prospectus or prospectus supplement, if such untrue statement or omission is
completely corrected in an amendment or supplement to such prospectus or
prospectus supplement, the seller of the Registrable Securities has an
obligation under the Securities Act to deliver a prospectus or prospectus
supplement in connection with such sale of Registrable Securities and the seller
of Registrable Securities thereafter fails to deliver such prospectus or
prospectus supplement as so amended or supplemented prior to or concurrently
with the sale of Registrable Securities to the person asserting such loss,
claim, damage or liability after the Company has furnished such seller with a
sufficient number of copies of the same.
Section 12. Expenses. In connection with any registration under this
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Agreement the Company shall pay all Registration Expenses (to the extent not
borne by underwriters or others), except as provided in Section 2(f) or 3(d).
Each Holder shall pay its pro rata share of all other expenses of such
registration, including underwriters' discounts and compensation, broker's
commission or similar selling expenses, and each Holder shall pay its own
transfer taxes, if any, applicable to Registrable Securities.
14
Section 13. Notices. Except as otherwise provided below, whenever it is
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provided in this Agreement that any notice, demand, request, consent, approval,
declaration or other communication shall or may be given to or served upon any
of the parties hereto, or whenever any of the parties hereto, wishes to provide
to or serve upon the other party any other communication with respect to this
Agreement, each such notice, demand, request, consent, approval, declaration or
other communication shall be in writing and shall be delivered in person or sent
by telecopy, as follows: (a) if to a Holder, at the most current address given
by such Holder to the Company by means of a notice given in accordance with the
provisions of this Section 13, and with respect to all other holders is as set
forth in the register for the Registrable Securities; and (b) if to the Company,
initially at the Company's principal address and thereafter at such other
address, notice of which is given in accordance with the provisions of this
Section 13. The furnishing of any notice required hereunder may be waived in
writing by the party entitled to receive such notice. Every notice, demand,
request, consent, approval, declaration or other communication hereunder shall
be deemed to have been duly furnished or served on the party to which it is
addressed, in the case of delivery in person or by telecopy, on the date when
sent (with receipt personally acknowledged in the case of telecopied notice),
and in all other cases, five business days after it is sent. Failure or delay in
delivering copies of any notice, demand, request, consent, approval, declaration
or other communication to the persons designated above to receive copies shall
in no way adversely affect the effectiveness of such notice, demand, request,
consent, approval, declaration or other communication.
Section 14. Entire Agreement. This Agreement represents the entire
----------------
agreement and understanding among the parties hereto with respect to the subject
matter hereof and supersedes any and all prior oral and written agreements,
arrangements and understandings among the parties hereto with respect to such
subject matter; and this Agreement can be amended, supplemented or changed, and
any provision hereof can be waived or a departure from any provision hereof can
be consented to, only by a written instrument making specific reference to this
Agreement signed by the Company and the Holder.
Section 15. Term. This Agreement shall become effective upon the IPO
----
Date and shall have a term of ten years, expiring at 5:00 P.M. (United States
Eastern Time) on the tenth anniversary of the IPO Date.
Section 16. Headings. The section headings contained in this Agreement
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are for general reference purposes only and shall not affect in any manner the
meaning, interpretation or construction of the terms or other provisions of this
Agreement.
Section 17. Applicable Law. This Agreement shall be governed by,
--------------
construed and enforced in accordance with the laws of the State of New York,
applicable without regard to the conflicts of law provisions thereof.
Section 18. Severability. If any provision of this Agreement shall be
------------
held by any court of competent jurisdiction to be illegal, void or
unenforceable, such provision shall be of no force and effect, but the
illegality or unenforceability of such provision shall have no effect upon and
shall not impair the enforceability of any other provision of this Agreement.
15
Section 19. No Waiver. The failure of any party at any time or times to
---------
require performance of any provision hereof shall not affect the right at a
later time to enforce the same. No waiver by any party of any condition, and no
breach of any provision, term, covenant, representation or warranty contained in
this Agreement, whether by conduct or otherwise, in any one or more instances,
shall be deemed to be construed as a further or continuing waiver of any such
condition or of the breach of any other provision, term, covenant,
representation or warranty of this Agreement.
Section 20. Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute but one and the same original instrument. Not all
parties need sign the same counterpart. Delivery by facsimile of a signature
page to this Agreement shall have the same effect or delivery of an original
executed counterpart.
Section 21. Successors and Assigns. This Agreement shall inure to the
----------------------
benefit of and be binding upon the successors, assigns and transferees of each
of the parties, including, without limitation and without the need for an
express assignment, subsequent Holders; but nothing herein shall be deemed to
permit any assignment, transfer or other disposition of Registrable Securities
in violation of applicable law. If any Holder shall acquire Registrable
Securities, in any manner, whether by operation of law or otherwise, such
Registrable Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such Registrable Securities such Holder
shall be conclusively deemed to have agreed to be bound by and to perform all of
the terms and provisions of this Agreement, including the restrictions on resale
set forth in this Agreement, and such Holder shall be entitled to receive the
benefits hereof.
Section 22. Consent to Jurisdiction and Service of Process. All judicial
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proceedings arising out of or relating to this Agreement may be brought in any
state or federal court of competent jurisdiction in the State of New York, and
by execution and delivery of this Agreement, the Company accepts the
nonexclusive jurisdiction of the aforesaid courts and waives any defense of
forum non conveniens. The Company designates and appoints CT Corporation
System, 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx, and such other persons as may
hereafter be selected by the Company irrevocably agreeing in writing to so
serve, as its agent to receive on its behalf service of all process in any such
proceedings in any such court, such service being hereby acknowledged by the
Company to be effective and binding service in every respect. A copy of any
such process so served shall be mailed by registered mail to the Company at
Xxxxxx House, 113 South Church Street, Xxxxxx Town, Grand Cayman, Cayman
Islands, British West Indies; provided, however, that, unless otherwise provided
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by applicable law, any failure to mail such copy shall not affect the validity
of service of such process. If any agent appointed by the Company refuses to
accept service, the Company hereby agrees that service of process sufficient for
personal jurisdiction in any action against the Company under this Agreement in
the State of New York may be made by registered or certified mail, return
receipt requested, to the Company at its address set forth above, and the
Company hereby acknowledges that such service shall be effective and binding in
every respect. Nothing herein shall affect the right to serve process in any
other manner permitted by law or shall limit the right of the Investor to bring
proceedings against the Company in the courts of any other jurisdiction.
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IN WITNESS WHEREOF, this Agreement has been executed and delivered as of
the date first above written.
SCOTTISH ANNUITY & LIFE HOLDINGS, LTD.
By:
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Name:
Title:
[INITIAL HOLDER]
By:
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Name:
Title:
17
