Exhibit 99.1
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REGISTRATION RIGHTS AGREEMENT
By and Among
WEBHIRE, INC.,
a Delaware corporation,
and
THE PRINCIPAL STOCKHOLDERS,
as defined herein
July 9, 1999
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TABLE OF CONTENTS
PAGE
ARTICLE I. REGISTRATION RIGHTS.............................................................................1
Section 1.01. Form S-3 Shelf Registration Statement..................................................1
Section 1.02. Registrable Securities.................................................................3
Section 1.03. Further Obligations of the Company and the Principal Stockholders......................3
Section 1.04. Indemnification........................................................................5
Section 1.05. Rule 144 Requirements..................................................................7
Section 1.06. Transfer of Registration Rights........................................................7
Section 1.07. Market Stand-Off.......................................................................7
ARTICLE II. MISCELLANEOUS PROVISIONS........................................................................7
Section 2.01. Legend on Securities...................................................................7
Section 2.02. Amendment and Waiver...................................................................8
Section 2.03. Notices................................................................................8
Section 2.04. Headings..............................................................................10
Section 2.05. Counterparts..........................................................................10
Section 2.06. Severability..........................................................................10
Section 2.07. Entire Agreement......................................................................10
Section 2.08. Term of Agreement.....................................................................11
Section 2.09. Law Governing.........................................................................11
(i)
REGISTRATION RIGHTS AGREEMENT
THIS AGREEMENT is dated as of the 9th day of July, 1999, by and among
Webhire, Inc., a Delaware corporation (the "Company"), and Xxxxx X. Xxxxxxxx,
Xxxxxxx Xxxxxx and Xxxxx X. Xxxxxx (collectively the "Principal Stockholders,"
and each individually a "Principal Stockholder").
WHEREAS, the parties to this Agreement are parties to a certain
Agreement and Plan of Merger (the "Merger Agreement") dated as of the date
hereof pursuant to which the parties thereto agreed to merge (the "Merger") the
Company's wholly-owned subsidiary, HWK Acquisition Corp. ("Acquisition Corp"),
with and into HireWorks, Inc., a Delaware corporation ("HireWorks") of which the
Principal Stockholders are the holders of all of the outstanding shares of
capital stock;
WHEREAS, as partial consideration for the Merger, the Principal
Stockholders will receive shares (the "Principal Stockholder Shares") of the
Company's common stock, par value $.01 per share ("Common Stock"), in accordance
with the terms of the Merger Agreement;
WHEREAS, the execution of this Agreement is an inducement and a
condition precedent to the merger of Acquisition Corp. with and into Hire Works
pursuant to the Merger Agreement.
NOW, THEREFORE, the Company and the Principal Stockholders, in
consideration of the premises and mutual covenants herein, intending to be
legally bound, hereby agree as follows:
ARTICLE I. REGISTRATION RIGHTS
SECTION 1.01. FORM S-3 SHELF REGISTRATION STATEMENT.
From and after the date hereof and until the termination of this
Agreement, the Company shall use its best efforts to continue to qualify at all
times for registration of secondary sales of Common Stock on Form S-3 or any
comparable successor form. The Principal Stockholders, individually or as a
group, shall have the right to request and have effected an aggregate of one (1)
registration of shares of Registrable Securities on Form S-3 or such successor
form for a public offering of shares of Registrable Securities on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933, as
amended (the "Securities Act"), PROVIDED, HOWEVER, that the aggregate proposed
offering price for such shares of Registrable Securities is not less than
$500,000 (such requests shall be in writing and shall state the number of shares
of Registrable Securities to be disposed of). Upon receipt of any such request,
the Company will use its best efforts to cause such of the Registrable
Securities as may be requested by any Principal Stockholders (including the
Principal
Stockholder or Principal Stockholders giving the initial notice of intent to
register hereunder) to be registered under the Securities Act subject to the
terms of this Agreement. The Company may postpone the filing of any registration
statement required hereunder for a reasonable period of time, not to exceed
ninety (90) days or such lesser period of time as may be permitted pursuant to
the last paragraph of this Section 1.01 (the "Postponement Period"), if the
Company has been advised by legal counsel that such filing would require the
disclosure of a material transaction or other factor and the Board of Directors
of the Company determines reasonably and in good faith that such disclosure
would have a material adverse effect on the Company. The Company shall give
notice to all Principal Stockholders of the receipt of a request for
registration pursuant to this Section 1.01 and such Principal Stockholders shall
have the right, by giving written notice to the Company within thirty (30)
business days after such notice referred to in the preceding sentence has been
given by the Company, to elect to have included in such registration statement
such of their Registrable Securities as each Principal Stockholder may request
in such notice of election. Subject to the foregoing, the Company will use its
best efforts to effect promptly the registration of all shares of Registrable
Securities on Form S-3 on a delayed or continuous basis pursuant to Rule 415
under the Securities Act or such successor form to the extent requested by the
Principal Stockholder or Principal Stockholders thereof. All expenses incurred
in connection with a registration requested pursuant to this Section 1.01,
including, without limitation, all registration, qualification, printing, and
accounting fees, fees and disbursements of counsel for the Company and up to
$5,000 in fees and disbursements of one counsel for the selling Principal
Stockholder or Principal Stockholders, shall be borne by the Company, except
that the Principal Stockholders shall bear underwriting commissions attributable
to their Registrable Securities being registered, transfer taxes on shares being
sold by such Principal Stockholders and, except as provided above, the fees and
disbursements of counsel for the selling Principal Stockholder or Principal
Stockholders holding Registrable Securities.
Notwithstanding the foregoing provisions of this Section 1.01, the
holders of Registrable Securities included in any registration statement will
not (until further notice) effect sales thereof after receipt of telegraphic or
written notice from the Company to suspend sales to permit the Company to
correct or update such registration statement or prospectus; the Company shall
correct or update such registration statement or prospectus as soon as possible
in the Company's good faith judgment and give the holders of Registrable
Securities included in such registration statement notice that they may resume
sales thereof, but in no circumstances shall the suspension exceed 90 days as
such lesser period of time as may be permitted pursuant to the last paragraph of
this Section 1.01 (the "Blackout Period"); and at the end of any period during
which the Company is obligated to keep any registration statement current and
effective, the holders of Registrable Securities included in such registration
statement shall discontinue sales of shares pursuant to such registration
statement upon notice from the Company of its intention to remove from
registration the shares covered by such registration statement which remain
unsold, and such holders shall notify the Company of the number of shares
registered which remain unsold promptly after receipt of such notice from the
Company. Notwithstanding the foregoing, the Company shall not be required to
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effect a registration under this Section 1.01 if, in the unqualified opinion of
counsel for the Company addressed to the Principal Stockholders, the Principal
Stockholders holding Registrable Securities may sell such Registrable Securities
in the manner proposed without registration under the Securities Act.
Notwithstanding any other provision of this Section 1.01, the
Postponement Period and the Blackout Period may not exceed ninety (90) days in
the aggregate.
SECTION 1.02. REGISTRABLE SECURITIES.
For the purposes of this Agreement, the term "Registrable Securities"
shall mean the Principal Stockholder Shares acquired by a Principal Stockholder
pursuant to the Merger Agreement and any shares of Common Stock issued or
issuable with respect to such Principal Stockholder Shares by way of a stock
dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganizations; PROVIDED,
HOWEVER, that as to any particular Registrable Securities, such securities shall
cease to be Registrable Securities: (i) 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 in accordance
therewith; (ii) when such securities are eligible for sale pursuant to Rule 144
(or any successor provisions thereto) under the Securities Act, notwithstanding
any volume limitations imposed by such Rule that may delay the sale of such
securities; and (iii) when they shall have otherwise been transferred and
subsequent disposition of them shall not require registration or qualification
under the Securities Act or any similar state law then in force.
SECTION 1.03. FURTHER OBLIGATIONS OF THE COMPANY AND THE PRINCIPAL
STOCKHOLDERS.
(a) Whenever the Company is required to register Registrable
Securities under Section 1.01, it agrees that it shall also do the following:
(i) Use its best efforts to diligently prepare and
file a registration statement with the Securities and Exchange
Commission (the "Commission") within forty-five (45) days after receipt
of a request for registration under Section 1.01 and to prepare and
file such amendments and supplements to said registration statement and
the prospectus used in connection therewith as may be necessary to
cause such registration statement to become effective and thereafter to
keep said registration statement effective and to comply with the
provisions of the Securities Act with respect to the sale of securities
covered by said registration statement until the earlier of (A) the
date which is twelve (12) months from the effective date of such
registration statement and (B) the date on which the Registrable
Securities covered by such registration statement may be sold by the
Principal Stockholders pursuant to Rule 144 (or any successor
provisions thereto) under the Securities Act, notwithstanding any
volume limitations imposed by such Rule that may delay the sale of such
securities;
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(ii) Furnish to each selling Principal Stockholder
such copies of each preliminary and final prospectus and such other
documents as such Principal Stockholder may reasonably request to
facilitate the public offering of its Principal Stockholder Shares;
(iii) Use its best efforts to register or qualify the
Principal Stockholder Shares covered by said registration statement
under the blue sky laws of such jurisdictions as any selling Principal
Stockholder may reasonably request, provided that the Company shall not
be required to register in any states which require it to qualify to do
business or subject itself to general service of process;
(iv) File any necessary listing applications or
amendments to the existing applications to cause the shares to be then
listed or quoted on the primary exchange or quotation system on which
the Common Stock is then listed or quoted;
(v) Promptly notify each Principal Stockholder
requesting registration of any request by the Commission for amendments
or supplements to the registration statement or the prospectus related
thereto or for additional information. In addition, the Company shall
promptly notify each such Principal Stockholder of the filing of the
registration statement, any prospectus supplement related thereto or
any post-effective amendment to the registration statement and the
effectiveness of any post-effective amendment; and
(vi) Promptly notify each Principal Stockholder
requesting registration, at any time when a prospectus relating to the
registration statement is required to be delivered under the Securities
Act, of the happening of any event as a result of which the prospectus
included in the registration statement, as then in effect, includes an
untrue statement of a material fact or omits 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. In such event, the Company shall prepare and furnish to
each such Principal Stockholder a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so
that, as thereafter delivered to the purchasers of 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.
(b) Whenever under the preceding sections of this Article I, a
Principal Stockholder desires to register Registrable Securities, such Principal
Stockholder agrees that it shall also do the following:
(i) Furnish to the Company such information
regarding such Principal Stockholder and the Registrable Securities to
be registered as the Company
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may reasonably request and as may be reasonably required in connection
with any such registration;
(ii) To the extent required by the Securities Act,
deliver or cause delivery of the prospectus contained in the
registration statement to any purchaser of the shares covered by the
registration statement from the Principal Stockholder; and
(iii) Notify the Company of any sale of Registrable
Shares by such Principal Stockholder.
SECTION 1.04. INDEMNIFICATION.
(a) Incident to any registration statement referred to in this
Article I, and subject to applicable law, the Company will indemnify each
Principal Stockholder holding Registrable Securities so registered, and each
person controlling any of them, against all claims, losses, damages and
liabilities, including legal and other expenses reasonably incurred in
investigating or defending against the same, arising out of any untrue statement
of a material fact contained therein, or any omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or arising out of any violation by the Company of the
Securities Act, any blue sky laws or any rule or regulation thereunder in
connection with such registration; PROVIDED, HOWEVER, that the Company shall not
have any such indemnification obligation with respect to each Principal
Stockholder, and each Principal Stockholder will indemnify the Company, its
directors and officers, the other STOCKHOLDERS and each person controlling,
controlled by or under common control with any of them, against any losses,
claims, damages, expenses or liabilities to which any of them may become subject
insofar as the same may have been caused by (a) an untrue statement or omission
based upon information furnished to the Company by such Principal Stockholder
expressly for use therein, or (b) any prospectus, to the extent that any such
loss, claim, damage or liability of such Principal Stockholder results from an
untrue statement of a material fact contained in, or the omission of a material
fact from, such prospectus which untrue statement or omission was corrected in a
later filed prospectus, if such Principal Stockholder sold shares to the person
alleging such loss, claim, damage or liability without sending or giving, at or
prior to the written confirmation of such sale, a copy of such later filed
prospectus.
Any Indemnified Party that proposes to assert the right to be
indemnified under this Section 1.04 will, promptly after receipt of notice of
commencement of any claim or action against such party in respect of which a
claim is to be made against an indemnifying party under this Section 1.04,
notify the indemnifying party of the commencement of such action, enclosing a
copy of all papers served, but the omission so to notify the indemnifying party
will not relieve the Company from any liability that the indemnifying party may
have to any Indemnified Party under the foregoing provisions of this Section
1.04 unless, and only to the extent that, such omission results in the
forfeiture of substantive rights or defenses by the
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indemnifying party. The Indemnified Party will have the right to retain its own
counsel in any such action and all fees, disbursements and other charges
incurred in the investigation, defense and/or settlement of such action shall be
advanced and reimbursed by the Company promptly as they are incurred; PROVIDED,
HOWEVER, that the Indemnified Party shall agree to repay any expenses so
advanced hereunder if it is ultimately determined by a court of competent
jurisdiction that the Indemnified Party to whom such expenses are advanced is
not entitled to be indemnified as a matter of law. The Company shall not settle
any action or claim for which indemnification is sought under this Section 1.04
without the prior written consent of the Indemnified Party, which consent shall
not be unreasonably withhold.
(b) If the indemnification provided for in Section 1.04(a)
above for any reason is held by a court of competent jurisdiction to be
unavailable to the party to be indemnified hereunder (an "Indemnified Party") in
respect of any claims, losses, damages or liabilities referred to therein, then
the indemnifying party, in lieu of indemnifying such Indemnified Party
thereunder, shall contribute to the amount paid or payable by such Indemnified
Party as a result of such claims, losses, damages or liabilities in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Principal Stockholders and the relative fault of the Company and
the Principal Stockholders in connection with the action or inaction which
resulted in such losses, claims, damages, expenses or liabilities, as well as
any other relevant equitable considerations. The relative fault of the Company
and the Principal Stockholders shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Principal Stockholders and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company and the Principal Stockholders agree that it would not be
just and equitable if contribution pursuant to this Section 1.04(b) were
determined by pro rata or per capita allocation or by any other method of
allocation which does not take account of the equitable considerations referred
to in the immediately preceding paragraph. In connection with the registration
of the Company's securities, in no event shall a Principal Stockholder be
required to contribute any amount under this Section 1.04(b) in excess of the
lesser of (i) that proportion of the total of such claims, losses, damages or
liabilities indemnified against equal to the proportion of the total securities
sold under such registration statement which is being sold by such Principal
Stockholder or (ii) the net proceeds received by such Principal Stockholder from
its sale of securities under such registration statement. No person found 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
found guilty of such fraudulent misrepresentation.
(c) The indemnification and contribution provided for in this
Section 1.04 will remain in full force and effect regardless of any
investigation made by or on behalf of Indemnified Parties or any officer,
director, employee, agent or controlling person of
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Indemnified Parties and shall survive the completion of any offering of
Registrable Securities pursuant to a registration statement under this Agreement
and shall survive the termination of this Agreement.
SECTION 1.05. RULE 144 REQUIREMENTS.
The Company will use its best efforts to file with the Commission such
information as the Commission may require under Section 13 of the Securities
Exchange Act of 1934, as amended, and the Company shall use its best efforts to
take all action as may be required as a condition to the availability of Rule
144 under the Securities Act (or any successor exemptive rule hereafter in
effect). The Company shall furnish to any Principal Stockholder upon request a
written statement executed by the Company as to the steps it has taken to comply
with the current public information requirement of Rule 144 or such successor
rule.
SECTION 1.06. TRANSFER OF REGISTRATION RIGHTS.
The registration rights of the Principal Stockholders under this
Article I may be transferred to any transferee of Registrable Securities (i) who
is a Principal Stockholder or (ii) who is a member of the transferor's immediate
family or a trust for which the transferor and/or a member or members of the
transferor's immediately family are the sole beneficiaries.
SECTION 1.07. MARKET STAND-OFF.
For as long as any Principal Stockholder owns at least 1% of the
Company's issued and outstanding shares of Common Stock, such Principal
Stockholder hereby agrees not to sell, transfer, hypothecate, or otherwise
dispose of any Common Stock held by him or her during the 180-day period
commencing immediately after the consummation of any underwritten public
offering by the Company. The Principal Stockholders acknowledge and agree that
the Company may issue "stop transfer" instructions to its transfer agent to
enforce this market stand-off provision.
ARTICLE II. MISCELLANEOUS PROVISIONS
SECTION 2.01. LEGEND ON SECURITIES.
The Principal Stockholders acknowledge and agree that the Principal
Stockholder Shares they acquired pursuant to the Merger Agreement will not be
registered under the Securities Act and may not be offered, sold, transferred,
hypothecated or otherwise assigned except pursuant to (a) a registration
statement with respect to such securities which is effective under the
Securities Act, or (b) an available exemption from registration under the
Securities Act.
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The Principal Stockholders acknowledge and agree that each certificate
evidencing Principal Stockholder Shares shall bear a legend in substantially the
form provided below (in addition to any required legend under applicable state
securities laws):
THE SHARES REPRESENTED HEREBY HAVE BEEN ACQUIRED BY THE HOLDER
NAMED HEREON FOR HIS OWN ACCOUNT FOR INVESTMENT; AND SUCH
SECURITIES MAY NOT BE PLEDGED, SOLD OR IN ANY OTHER WAY
TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES ACT OF
1933, AS IN EFFECT AT THAT TIME, OR AN OPINION OF COUNSEL
REASONABLY SATISFACTORY TO THE ISSUER THAT REGISTRATION IS NOT
REQUIRED UNDER SAID ACT.
SECTION 2.02. AMENDMENT AND WAIVER.
No failure or delay on the part of any party hereto in exercising any
right, power or remedy hereunder shall operate as a waiver thereof. The remedies
provided for herein are cumulative and are not exclusive of any remedies that
may be available to any party hereto at law or in equity or otherwise. This
Agreement may be amended with the prior written consent of the Company and
Principal Stockholders holding a majority in interest of the Registrable
Securities.
SECTION 2.03. NOTICES.
All notices and other communications provided for herein shall be in
writing and shall be deemed to have been duly given (a) if delivered personally
or (b) if sent by telex or telecopier, registered or certified mail (return
receipt requested) postage prepaid, or by courier guaranteeing next day
delivery, in each case to the party to whom it is directed at the following
addresses (or at such other address for any party as shall be specified by
notice given in accordance with the provisions hereof, provided that notices of
a change of address shall be effective only upon receipt thereof). Notices
delivered personally shall be effective on the day so delivered, notices sent by
registered or certified mail shall be effective three days after mailing,
notices sent by telex shall be effective when answered back, notices sent by
telecopier shall be effective when receipt is acknowledged, and notices sent by
courier guaranteeing next day delivery shall be effective on the earlier of the
second business day after timely delivery to the courier or the day of actual
delivery by the courier:
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(i) if to the Company, at the following address:
Webhire, Inc.
00 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Xxxxxxx, Procter & Xxxx XXX
Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxx X. Xxxx, III, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
(ii) if to a Principal Stockholder, at the following address:
Xxxxx X. Xxxxxxxx
000 Xxxxxxx Xxxx
Xxxxxxxxxxx, XX 00000
Tel: (000) 000-0000
Xxxxxxx Xxxxxx
00 Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Tel: (000) 000-0000
Xxxxx X. Xxxxxx
00 Xxxxxxx Xxxx
Xxxxxxx, XX 00000
Tel: (000) 000-0000
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with a copy to:
Xxxxxx, Gesmer & Xxxxxxxxx, LLP
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxx Xxxxxx, Esq.
Tel: (000) 000-0000
Fax: (000) 000-0000
SECTION 2.04. HEADINGS.
The Article and Section headings used or contained in this Agreement
are for convenience of the reference only and shall not affect the construction
of this Agreement.
SECTION 2.05. COUNTERPARTS.
This Agreement may be executed in one or more counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which together shall be deemed to constitute
one and the same agreement.
SECTION 2.06. SEVERABILITY.
In the event that any one or more of the provisions contained herein,
or the application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be in any way impaired thereby, it being
intended that all of the rights and privileges of the parties hereto shall be
enforceable to the fullest extent permitted by law.
SECTION 2.07. ENTIRE AGREEMENT.
This Agreement, together with the Merger Agreement and other agreements
contemplated hereby and thereby, is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein and therein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein and therein. This Agreement and the Merger Agreement and other agreements
contemplated hereby and thereby (including the exhibits hereto and thereto)
supersede all prior agreements and understandings between the parties with
respect to such subject matter.
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SECTION 2.08. TERM OF AGREEMENT.
This Agreement shall be effective as of the date first hereinabove set
forth and shall terminate upon the earliest of (i) the earlier of (A) the date
which is twelve (12) months from the effective date of a registration statement
filed pursuant to Section 1.01 hereof or (B) the date after which all of the
securities registered thereunder have been disposed of in accordance therewith;
(ii) the date after which the Principal Stockholder Shares are eligible for sale
pursuant to Rule 144 (or any successor provisions thereto) under the Securities
Act, notwithstanding any volume limitations imposed by such Rule that may delay
the sale of such Principal Stockholder Shares; and (iii) the date after which
all of the Principal Stockholder Shares have otherwise been transferred and
subsequent disposition of them shall not require registration or qualification
under the Securities Act or any similar state law then in force.
SECTION 2.09. LAW GOVERNING.
This Agreement shall be construed under and governed by the internal
laws of the Commonwealth or Massachusetts without regard to its conflict of laws
provision.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
WEBHIRE, INC.
By: /s/ XXXXXX X. XXXXX
--------------------------------------
Name: Xxxxxx X. Xxxxx
Title: President
PRINCIPAL STOCKHOLDERS:
/s/ XXXXX X. XXXXXXXX
------------------------------------------
Xxxxx X. Xxxxxxxx
/s/ XXXXXXX XXXXXX
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Xxxxxxx Xxxxxx
/s/ XXXXX X. XXXXXX
-------------------------------------------
Xxxxx X. Xxxxxx
