Exhibit 4.8
REGISTRATION RIGHTS AGREEMENT
among
ANTEON INTERNATIONAL CORPORATION
AZIMUTH TECHNOLOGIES, L.P.
AZIMUTH TECH. II LLC
XXXXXXXXX X. XXXXXX
XXXXXX X. XXXXX
XXXXXXX X. XXXXXXXX
XXXXXX X. XXXXXXX
THE XXXXXX FAMILY 1987 TRUST
XXXXXX X. XXXXXXXXX
XXXXXXX X. XXXXXXXXX
and
THE OTHER PARTIES NAMED HEREIN
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Dated: [ ], 2002
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TABLE OF CONTENTS
PAGE
1. Definitions.....................................................................................1
2. General; Securities Subject to this Agreement...................................................5
(a) Grant of Rights........................................................................5
(b) Registrable Securities.................................................................5
(c) Holders of Registrable Securities......................................................5
3. Demand Registration.............................................................................6
(a) Request for Demand Registration........................................................6
(b) Incidental or "Piggy-Back" Rights with Respect to a Demand Registration................7
(c) Effective Demand Registration..........................................................7
(d) Expenses...............................................................................7
(e) Underwriting Procedures................................................................7
(f) Selection of Underwriters..............................................................8
(g) Withdrawal.............................................................................8
4. Incidental or "Piggy-Back" Registration.........................................................8
(a) Request for Incidental Registration....................................................9
(b) Expenses...............................................................................9
(c) Initial Public Offering................................................................9
5. Form S-3 Registration..........................................................................10
(a) Request for a Form S-3 Registration. ................................................10
(b) Form S-3 Underwriting Procedures......................................................10
(c) Limitations on Form S-3 Registrations.................................................11
(d) Expenses..............................................................................11
(e) No Demand Registration................................................................11
6. Holdback Agreements............................................................................11
(a) Restrictions on Public Sale by Designated Holders.....................................11
(b) Restrictions on Public Sale by the Company............................................12
7. Registration Procedures........................................................................12
(a) Obligations of the Company............................................................12
(b) Seller Information....................................................................16
(c) Notice to Discontinue.................................................................16
(d) Registration Expenses.................................................................16
8. Indemnification; Contribution..................................................................17
(a) Indemnification by the Company........................................................17
(b) Indemnification by Designated Holders.................................................17
(c) Conduct of Indemnification Proceedings................................................18
(d) Contribution..........................................................................19
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9. Rule 144.......................................................................................19
10. Miscellaneous..................................................................................20
(a) Stock Splits, etc.....................................................................20
(b) No Inconsistent Agreements............................................................20
(c) Remedies..............................................................................20
(d) Amendments and Waivers................................................................20
(e) Notices...............................................................................21
(f) Successors and Assigns; Third Party Beneficiaries.....................................21
(g) Counterparts..........................................................................22
(h) Headings..............................................................................22
(I) GOVERNING LAW.........................................................................22
(j) Severability..........................................................................22
(k) Rules of Construction.................................................................22
(l) Entire Agreement......................................................................22
(m) Further Assurances....................................................................23
(n) Other Agreements......................................................................23
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REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated [ ], 2002, among
Anteon International Corporation, a Delaware corporation (the "Company"),
Azimuth Technologies, L.P., a Delaware limited partnership ("Azimuth"),
Azimuth Tech. II LLC, a Delaware limited liability company ("Azimuth Tech."),
Xxxxxxxxx X. Xxxxxx ("Xxxxxx" and, together with the Azimuth and Azimuth
Tech., the "CIC Stockholders"), Xxxxxx X. Xxxxx ("Kampf"), Xxxxxxx X.
Xxxxxxxx ("Xxxxxxxx"), Xxxxxx X. Xxxxxxx ("Xxxxxxx"), the Xxxxxx Family 1987
Trust ("Xxxxxx"), Xxxxxx X. Xxxxxxxxx ("Xxxxxxxxx"), Xxxxxxx X. Xxxxxxxxx
("Xxxxxxxxx" and, together with Kampf, Crenshaw, Xxxxxxx, Xxxxxx and
Xxxxxxxxx, the "Significant Holders"), Xxxxxx Xxxxxxxxxxx ("Xxxxxxxxxxx"),
Xxxxxx Xxxxxx ("Xxxxxx"), Xxxxxxx X. Xxxxxx ("Xxxxxx"), Xxxxx Xxxxxx
("Xxxxxx"), Xxxx X. Xxxxxxx ("Xxxxxxx"), Xxxx Xxxxxxxx ("Xxxxxxxx") and
Xxxxxx X. Xxxxxx ("Xxxxxx" and, together with Centracchio, Dawson, Decker,
Gurner, Xxxxxxx and Xxxxxxxx, the "Other Holders").
WHEREAS, the Company intends to consummate an Initial Public
Offering (as hereinafter defined);
WHEREAS, the parties hereto desire to provide for, among other
things, the grant of registration rights with respect to the Registrable
Securities (as hereinafter defined) in contemplation of such Initial Public
Offering.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein and for good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged, the parties hereto agree as
follows:
1. DEFINITIONS. As used in this Agreement, and unless the
context requires a different meaning, the following terms have the meanings
indicated:
"AFFILIATE" shall mean any Person who is an "affiliate" as
defined in Rule 12b-2 of the General Rules and Regulations under the Exchange
Act.
"AGREEMENT" means this
Registration Rights Agreement as the
same may be amended, supplemented or modified in accordance with the terms
hereof.
"APPROVED UNDERWRITER" has the meaning set forth in Section
3(f) of this Agreement.
"AZIMUTH" has the meaning set forth in the preamble to this
Agreement.
"AZIMUTH TECH." has the meaning set forth in the preamble to
this Agreement.
"BOARD OF DIRECTORS" means the Board of Directors of the
Company.
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"BUSINESS DAY" means any day other than a Saturday, Sunday or
other day on which commercial banks in the State of
New York are authorized or
required by law or executive order to close.
"XXXXXXXXXXX" has the meaning set forth in the preamble to
this Agreement.
"CIC STOCKHOLDERS" has the meaning set forth in the preamble
to this Agreement.
"CLOSING PRICE" means, with respect to the Registrable
Securities, as of the date of determination, (a) if the Registrable Securities
are listed on a national securities exchange, the closing price per share of a
Registrable Security on such date published in THE WALL STREET JOURNAL (NATIONAL
EDITION) or, if no such closing price on such date is published in THE WALL
STREET JOURNAL (NATIONAL EDITION), the average of the closing bid and asked
prices on such date, as officially reported on the principal national securities
exchange on which the Registrable Securities are then listed or admitted to
trading; or (b) if the Registrable Securities are not then listed or admitted to
trading on any national securities exchange but are designated as national
market system securities by the NASD, the last trading price per share of a
Registrable Security on such date; or (c) if there shall have been no trading on
such date or if the Registrable Securities are not designated as national market
system securities by the NASD, the average of the reported closing bid and asked
prices of the Registrable Securities on such date as shown by The Nasdaq Stock
Market, Inc. (or its successor) and reported by any member firm of The
New York
Stock Exchange, Inc. selected by the Company; or (d) if none of (a), (b) or (c)
is applicable, a market price per share determined in good faith by the Board of
Directors or, if such determination is not satisfactory to the Designated Holder
for whom such determination is being made, by a nationally recognized investment
banking firm selected by the Company and such Designated Holder, the expenses
for which shall be borne equally by the Company and such Designated Holder. If
trading is conducted on a continuous basis on any exchange, then the closing
price shall be at 4:00 P.M.
New York City time.
"XXXXXXX" has the meaning set forth in the preamble to this
Agreement.
"COMMISSION" means the Securities and Exchange Commission or
any similar agency then having jurisdiction to enforce the Securities Act.
"COMMON STOCK" means (i) the Common Stock, par value $0.01 per
share, of the Company, (ii) any other common stock of the Company and (iii) any
other securities of the Company or any successor or assign of the Company into
which such stock described in clauses (i) and (ii) is reclassified or
reconstituted or into which such stock is converted or otherwise exchanged in
connection with a combination of shares, recapitalization, merger, sale of
assets, consolidation or other reorganization or otherwise.
"COMPANY" has the meaning set forth in the preamble to this
Agreement.
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"COMPANY UNDERWRITER" has the meaning set forth in Section
4(a) of this Agreement.
"XXXXXXXX" has the meaning set forth in the preamble to this
Agreement.
"XXXXXX" has the meaning set forth in the preamble to this
Agreement.
"XXXXXX" has the meaning set forth in the preamble to this
Agreement.
"DEMAND REGISTRATION" has the meaning set forth in Section
3(a) of this Agreement.
"DESIGNATED HOLDER" means each of the CIC Stockholders, the
Significant Holders and the Other Holders and any transferee of any of them
to whom Registrable Securities have been transferred in accordance with
Section 10(f) of this Agreement, other than a transferee to whom Registrable
Securities have been transferred pursuant to a Registration Statement under
the Securities Act or Rule 144 or Regulation S under the Securities Act (or
any successor rule thereto), PROVIDED, HOWEVER, that a Significant Holder
(except in the case of Xxxxxx and Xxxxxxxxx, taken together with the CIC
Stockholders) shall cease to be a Designated Holder if such Significant
Holder holds less than one percent (1%) of the outstanding shares of Common
Stock on a fully diluted basis.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder.
"XXXXXX" has the meaning set forth in the preamble to this
Agreement.
"GURNER" has the meaning set forth in the preamble to this
Agreement.
"XXXXXXX" has the meaning set forth in the preamble to this
Agreement.
"HOLDERS' COUNSEL" has the meaning set forth in Section
7(a)(i) of this Agreement.
"INCIDENTAL REGISTRATION" has the meaning set forth in
Section 4(a) of this Agreement.
"INDEMNIFIED PARTY" has the meaning set forth in Section 8(c)
of this Agreement.
"INDEMNIFYING PARTY" has the meaning set forth in Section 8(c)
of this Agreement.
"INITIAL PUBLIC OFFERING" means the initial public offering of
the shares of Common Stock of the Company pursuant to an effective Registration
Statement filed under the Securities Act.
"INITIATING HOLDERS" has the meaning set forth in Section 3(a)
of this Agreement.
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"INSPECTOR" has the meaning set forth in Section 7(a)(vii) of
this Agreement.
"IPO EFFECTIVENESS DATE" means the date upon which the Company
consummates the Initial Public Offering.
"XXXXXX" has the meaning set forth in the preamble to this
Agreement.
"XXXXXXXX" has the meaning set forth in the preamble to this
Agreement.
"KAMPF" has the meaning set forth in the preamble to this
Agreement.
"XXXXXXXXX" has the meaning set forth in the preamble to this
Agreement.
"LIABILITY" has the meaning set forth in Section 8(a) of this
Agreement.
"MARKET PRICE" means, on any date of determination, the
average of the daily Closing Price of the Registrable Securities for the
immediately preceding thirty (30) days on which the national securities
exchanges are open for trading; PROVIDED, HOWEVER, that if the Closing Price is
determined pursuant to clause (d) of the definition of Closing Price, the
"Market Price" means such Closing Price on the date of determination.
"XXXXXXXXX" has the meaning set forth in the preamble to this
Agreement.
"NASD" means the National Association of Securities Dealers,
Inc.
"OTHER HOLDERS" has the meaning set forth in the preamble to
this Agreement.
"PERMITTED ASSIGNEE" with respect to an individual, means (i)
such individual's parents, spouse, siblings, children (including stepchildren)
or grandchildren or the spouses thereof ("Family Members"), (ii) a trust,
corporation, partnership or limited liability company, all of the beneficial
interests of which shall be held by such individual or such individual's Family
Members or (iii) such individual's heirs, executors or administrators or a trust
under such individual's will.
"PERMITTED WITHDRAWAL" has the meaning set forth in Section
3(g) of this Agreement.
"PERSON" means any individual, firm, corporation, partnership,
limited liability company, trust, incorporated or unincorporated association,
joint venture, joint stock company, limited liability company, government (or an
agency or political subdivision thereof) or other entity of any kind, and shall
include any successor (by merger or otherwise) of such entity.
"RECORDS" has the meaning set forth in Section 7(a)(vii) of
this Agreement.
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"REGISTRABLE SECURITIES" means any and all shares of Common
Stock now or hereafter owned by the Designated Holders or issued or issuable
upon conversion of any convertible securities or exercise of any warrants or
options now or hereafter held by any of the Designated Holders.
"REGISTRATION EXPENSES" has the meaning set forth in Section
7(d) of this Agreement.
"REGISTRATION STATEMENT" means a Registration Statement filed
pursuant to the Securities Act.
"S-3 INITIATING HOLDERS" has the meaning set forth in Section
5(a) of this Agreement.
"S-3 REGISTRATION" has the meaning set forth in Section 5(a)
of this Agreement.
"XXXXXX" has the meaning set forth in the preamble to this
Agreement.
"SECURITIES ACT" means the Securities Act of 1933, as amended,
and the rules and regulations of the Commission promulgated thereunder.
"SIGNIFICANT HOLDERS" has the meaning set forth in the
preamble to this Agreement.
"VALID BUSINESS REASON" has the meaning set forth in Section
3(a) of this Agreement.
2. GENERAL; SECURITIES SUBJECT TO THIS AGREEMENT.
(a) GRANT OF RIGHTS. The Company hereby grants
registration rights to the Designated Holders upon the terms and conditions set
forth in this Agreement.
(b) REGISTRABLE SECURITIES. For the purposes of
this Agreement, Registrable Securities held by any Designated Holder will
cease to be Registrable Securities, when (i) a Registration Statement
covering such Registrable Securities has been declared effective under the
Securities Act by the Commission and such Registrable Securities have been
disposed of pursuant to such effective Registration Statement or (ii) the
entire amount of the Registrable Securities held by any Designated Holder (or
in the case of the CIC Stockholders, the CIC Stockholders taken as a whole
and in the case of Xxxxxx and Xxxxxxxxx, taken together with the CIC
Stockholders) may be sold in a single sale, in the opinion of counsel
satisfactory to the Company and the Designated Holder, each in their
reasonable judgment, without any limitation as to volume pursuant to Rule 144
(or any successor provision then in effect) under the Securities Act.
(c) HOLDERS OF REGISTRABLE SECURITIES. A Person is
deemed to be a holder of Registrable Securities whenever such Person owns of
record Registrable Securities, or holds an option to purchase, or a security
convertible into or exercisable or
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exchangeable for, Registrable Securities whether or not such acquisition or
conversion has actually been effected. If the Company receives conflicting
instructions, notices or elections from two or more Persons with respect to
the same Registrable Securities, the Company may act upon the basis of the
instructions, notice or election received from the registered owner of such
Registrable Securities. Registrable Securities issuable upon exercise of an
option or upon conversion of another security shall be deemed outstanding for
the purposes of this Agreement.
3. DEMAND REGISTRATION.
(a) REQUEST FOR DEMAND REGISTRATION. Each of the CIC
Stockholders, acting through Azimuth or its written designee (each, an
"Initiating Holder"), may make a written request to the Company to register, and
the Company shall register, under the Securities Act (other than pursuant to a
Registration Statement on Form S-4 or S-8 or any successor thereto) (a "Demand
Registration"), the number of Registrable Securities stated in such request;
PROVIDED, HOWEVER, that the Company shall not be obligated to effect (x) more
than five such Demand Registrations requested by the CIC Stockholders, (y) a
Demand Registration if the Initiating Holders, together with the Designated
Holders (other than the Initiating Holders) which have requested to register
securities in such registration pursuant to Section 3(b), propose to sell their
Registrable Securities at an aggregate price (calculated based upon the Market
Price of the Registrable Securities on the date of filing of the Registration
Statement with respect to such Registrable Securities) to the public of less
than $5,000,000 and (z) any such Demand Registration commencing prior to 180
days after the IPO Effectiveness Date. For purposes of the preceding sentence,
two or more Registration Statements filed in response to one demand shall be
counted as one Demand Registration. If the Board of Directors, in its good faith
judgment, determines that any registration of Registrable Securities should not
be made or continued because it would materially interfere with any material
financing, acquisition, corporate reorganization or merger or other material
transaction involving the Company (a "Valid Business Reason"), the Company may
(x) postpone filing a Registration Statement relating to a Demand Registration
until such Valid Business Reason no longer exists, but in no event for more than
forty-five (45) days and (y) in case a Registration Statement has been filed
relating to a Demand Registration, the Company, upon the approval of a majority
of the Board of Directors, may cause such Registration Statement to be withdrawn
and its effectiveness terminated or may postpone amending or supplementing such
Registration Statement (in which case, if the Valid Business Reason no longer
exists or if more than forty-five (45) days have passed since such withdrawal or
postponement, the Initiating Holders may request a new Demand Registration). The
Company shall give written notice of its determination to postpone or withdraw a
Registration Statement and of the fact that the Valid Business Reason for such
postponement or withdrawal no longer exists, in each case, promptly after the
occurrence thereof. Notwithstanding anything to the contrary contained herein,
the Company may not postpone or withdraw a filing under this Section 3(a) more
than once in any six (6) month period. Each request for a Demand Registration by
the Initiating Holders shall state the amount of the Registrable Securities
proposed to be sold and the intended method of disposition thereof.
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(b) INCIDENTAL OR "PIGGY-BACK" RIGHTS WITH RESPECT
TO A DEMAND REGISTRATION. Each of the Designated Holders (other than
Initiating Holders which have requested a registration under Section 3(a))
may offer its Registrable Securities under any Demand Registration pursuant
to this Section 3. Within five (5) days after the receipt of a request for a
Demand Registration from an Initiating Holder, the Company shall (i) give
written notice thereof to all of the Designated Holders (other than
Initiating Holders which have requested a registration under Section 3(a))
and (ii) subject to Section 3(e), include in such registration all of the
Registrable Securities held by such Designated Holders from whom the Company
has received a written request for inclusion therein within ten (10) days of
the receipt by such Designated Holders of such written notice referred to in
clause (i) above. Each such request by such Designated Holder shall specify
the number of Registrable Securities proposed to be registered. The failure
of any Designated Holder to respond within such 10-day period referred to in
clause (ii) above shall be deemed to be a waiver of such Designated Holder's
rights under this Section 3(b) with respect to such Demand Registration. Any
Designated Holder may waive its rights under this Section 3(b) prior to the
expiration of such 10-day period by giving written notice to the Company,
with a copy to the Initiating Holders.
(c) EFFECTIVE DEMAND REGISTRATION. The Company
shall use its commercially reasonable efforts to cause any such Demand
Registration to become and remain effective not later than sixty (60) days
after it receives a request under Section 3(a) hereof. A registration shall
not constitute a Demand Registration until it has become effective and
remains continuously effective for the lesser of (i) the period during which
all Registrable Securities registered in the Demand Registration are sold or
(ii) 120 days; PROVIDED, HOWEVER, that a registration shall not constitute a
Demand Registration if (x) after such Demand Registration has become
effective, such registration or the related offer, sale or distribution of
Registrable Securities thereunder is interfered with by any stop order,
injunction or other order or requirement of the Commission or other
governmental agency or court for any reason not attributable to the
Initiating Holders or the Designated Holders participating in such Demand
Registration and such interference is not thereafter eliminated or (y) the
conditions specified in the underwriting agreement, if any, entered into in
connection with such Demand Registration are not satisfied or waived, other
than by reason of a failure by the Initiating Holders or the Designated
Holders participating in such Demand Registration.
(d) EXPENSES. The Company shall pay all
Registration Expenses in connection with a Demand Registration, whether or
not such Demand Registration becomes effective.
(e) UNDERWRITING PROCEDURES. If the Company or the
Initiating Holders so elect, the Company shall use its commercially
reasonable efforts to cause such Demand Registration to be in the form of a
firm commitment underwritten offering and the managing underwriter or
underwriters selected for such offering shall be the Approved Underwriter
selected in accordance with Section 3(f). In connection with any Demand
Registration under this Section 3 involving an underwritten offering, none of
the Registrable Securities held by any Designated Holder making a request for
inclusion of such Registrable Securities pursuant to Section 3(b) hereof
shall be included in such
8
underwritten offering unless such Designated Holder accepts the terms of the
offering as agreed upon by the Company, the Initiating Holders and the
Approved Underwriter, and then only in such quantity as set forth below. If
the Approved Underwriter advises the Company that the aggregate amount of
such Registrable Securities requested to be included in such offering is
sufficiently large to have a material adverse effect on the success of such
offering, then the Company shall include in such registration, to the extent
of the amount that the Approved Underwriter believes may be sold without
causing such material adverse effect, FIRST, such number of Registrable
Securities of the Initiating Holders and any Designated Holder participating
in the offering pursuant to the terms of Section 3(b), which Registrable
Securities shall be allocated pro rata among such Initiating Holders and
Designated Holders, based on the number of Registrable Securities held by
each such Initiating Holder or Designated Holder, as the case may be, SECOND,
upon the written consent of the holders of at least a majority of the
Registrable Securities participating in the offering, any other securities of
the Company requested by holders thereof to be included in such registration,
which such securities shall be allocated pro rata among such stockholders,
based on the number of the Company's securities held by each such
stockholder, and THIRD, securities offered by the Company for its own account.
(f) SELECTION OF UNDERWRITERS. If any Demand
Registration or S-3 Registration, as the case may be, of Registrable
Securities is in the form of an underwritten offering, the Company shall
select and obtain an investment banking firm of national reputation to act as
the managing underwriter of the offering (the "Approved Underwriter");
PROVIDED, HOWEVER, that the Approved Underwriter shall, in any case, also be
approved by the Initiating Holders or S-3 Initiating Holders, as the case may
be, such approval not to be unreasonably withheld.
(g) WITHDRAWAL. An Initiating Holder shall be
entitled to withdraw or revoke a request for a Demand Registration without
the prior written consent of the Company if (i) as a result of facts or
circumstances arising after the date on which such request was made relating
to the Company or to market conditions, such Initiating Holder reasonably
determines that participation in such registration would have a material
adverse effect on such Initiating Holder or (ii) if the Closing Price
declines by more than [ ] percent ([ ]%) from the date the Initiating Holder
or Holders requested such Demand Registration (a "Permitted Withdrawal"). An
Initiating Holder shall also be entitled to withdraw or revoke a request for
a Demand Registration, notwithstanding that such withdrawal or revocation
does not constitute a Permitted Withdrawal; PROVIDED, THAT, in such case,
such withdrawal or revocation shall nevertheless be deemed to constitute an
effective Demand Registration for purposes of Section 3(a) unless, (i) the
Initiating Holder receives the prior written consent of the Company to such
withdrawal or (ii) the Initiating Holder pays all fees and expenses incurred
by the Company in connection with such withdrawn registration. Any withdrawal
of or revocation of a request for any Demand Registration by an Initiating
Holder under this Section 3(g) shall constitute and effect an automatic
withdrawal by any Designated Holder participating in such Demand Registration
pursuant to the provisions of Section 3(b).
4. INCIDENTAL OR "PIGGY-BACK" REGISTRATION.
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(a) REQUEST FOR INCIDENTAL REGISTRATION. If the
Company proposes to file a Registration Statement under the Securities Act
with respect to an offering by the Company for its own account (other than a
Registration Statement on Form S-4 or S-8 or any successor thereto) or for
the account of any stockholder of the Company other than the Designated
Holders (pursuant to this Agreement), then the Company shall give written
notice of such proposed filing to each of the Designated Holders at least
twenty (20) days before the anticipated filing date, and such notice shall
describe the proposed registration and distribution and offer such Designated
Holders the opportunity to register the number of Registrable Securities as
each such Designated Holder may request (an "Incidental Registration"). The
Company shall use its commercially reasonable efforts (within twenty (20)
days of the notice provided for in the preceding sentence) to cause the
managing underwriter or underwriters in the case of a proposed underwritten
offering (the "Company Underwriter") to permit each of the Designated Holders
who has requested in writing to participate in the Incidental Registration
pursuant to this Section 4(a) to include its Registrable Securities in such
offering on the same terms and conditions as the securities of the Company or
the account of such other stockholder, as the case may be, included therein.
In connection with any Incidental Registration under this Section 4(a)
involving an underwritten offering, the Company shall not be required to
include any Registrable Securities in such underwritten offering unless the
Designated Holders thereof accept the terms of the underwritten offering as
agreed upon between the Company, such other stockholders, if any, and the
Company Underwriter, and then only in such quantity as set forth below. If
the Company Underwriter determines that the registration of all or part of
the securities that have been requested to be included would materially
adversely affect the success of such offering, then the Company shall be
required to include in such Incidental Registration, to the extent of the
amount that the Company Underwriter believes may be sold without causing such
material adverse effect, FIRST, all of the securities to be offered for the
account of the Company, SECOND, securities of the Company requested by the
Designated Holders to be included in such offering, which such securities
shall be allocated pro rata among such Designated Holders participating in
the offering based on the number of the Company's securities held by each
such Designated Holder and THIRD, any other securities of the Company
requested by stockholders to be included in such offering, which such
securities shall be allocated pro rata among the stockholders participating
in the offering based on the number of the Company's securities held by each
such stockholder. The holders of a majority of the Registrable Securities may
waive any right to participate in an Incidental Registration under this
Section 4(a) in respect of any registration on behalf of all holders of
Registrable Securities.
(b) EXPENSES. The Company shall bear all
Registration Expenses in connection with any Incidental Registration pursuant
to this Section 4, whether or not such Incidental Registration becomes
effective.
(c) INITIAL PUBLIC OFFERING. The parties hereto agree
and acknowledge that the sale of Common Stock by any Designated Holder in the
Initial Public Offering shall be deemed an exercise of such Designated Holder's
Incidental Registration Rights. In addition, the parties hereto agree and
acknowledge that following the sale of any Common Stock by any Other Holder in
the Initial Public Offering, such
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Other Holder shall have no rights or obligations (including those set forth
in Section 6 hereof) for any registration of securities under this Agreement.
5. FORM S-3 REGISTRATION.
(a) REQUEST FOR A FORM S-3 REGISTRATION. Upon the
Company becoming eligible for use of Form S-3 (or any successor form thereto)
under the Securities Act in connection with a public offering of its
securities, in the event that the Company shall receive from one or more of
the CIC Stockholders, acting through Azimuth or its written designee (the
"S-3 Initiating Holders"), a written request that the Company register, under
the Securities Act on Form S-3 (or any successor form then in effect) (an
"S-3 Registration"), all or a portion of the Registrable Securities owned by
such S-3 Initiating Holders, the Company shall give written notice of such
request to all of the Designated Holders (other than S-3 Initiating Holders
which have requested an S-3 Registration under this Section 5(a)) at least
twenty (20) days before the anticipated filing date of such Form S-3, and
such notice shall describe the proposed registration and offer such
Designated Holders the opportunity to register the number of Registrable
Securities as each such Designated Holder may request in writing to the
Company, given within ten (10) days after their receipt from the Company of
the written notice of such registration. Each request for an S-3 Registration
by the S-3 Initiating Holders shall state the amount of the Registrable
Securities proposed to be sold and the intended method of disposition
thereof. With respect to each S-3 Registration, the Company shall, subject to
Section 5(b), (i) include in such offering the Registrable Securities of the
S-3 Initiating Holders and the Designated Holders (who have requested in
writing to participate in such registration on the same terms and conditions
as the Registrable Securities of the S-3 Initiating Holders included therein)
and (ii) use its commercially reasonable efforts to cause such registration
pursuant to this Section 5(a) to become and remain effective as soon as
practicable.
(b) FORM S-3 UNDERWRITING PROCEDURES. If the S-3
Initiating Holders so elect, the Company shall use its commercially
reasonable efforts to cause such S-3 Registration pursuant to this Section 5
to be in the form of a firm commitment underwritten offering and the managing
underwriter or underwriters selected for such offering shall be the Approved
Underwriter selected in accordance with Section 3(f). In connection with any
S-3 Registration under Section 5(a) involving an underwritten offering, the
Company shall not be required to include any Registrable Securities in such
underwritten offering unless the Designated Holders thereof accept the terms
of the underwritten offering as agreed upon between the Company, the Approved
Underwriter and the S-3 Initiating Holders, and then only in such quantity as
set forth below. If the Approved Underwriter believes that the registration
of all or part of the Registrable Securities which the S-3 Initiating Holders
and the other Designated Holders have requested to be included would
materially adversely affect the success of such public offering, then the
Company shall be required to include in the underwritten offering, to the
extent of the amount that the Approved Underwriter believes may be sold
without causing such material adverse effect, FIRST, such number of
Registrable Securities of the S-3 Initiating Holders and any Designated
Holder participating in the offering pursuant to the terms of Section 5(a)
hereof, which such Registrable Securities shall be allocated pro
11
rata among such S-3 Initiating Holders and Designated Holders, based on the
number of Registrable Securities held by each such S-3 Initiating Holder or
Designated Holder, as the case may be, SECOND, any other securities of the
Company requested by holders thereof to be included in such registration,
which such securities shall be allocated pro rata among such stockholders,
based on the number of the Company's securities held by each such
stockholder, and THIRD, securities offered by the Company for its own account.
(c) LIMITATIONS ON FORM S-3 REGISTRATIONS. If the
Board of Directors has a Valid Business Reason, the Company may (x) postpone
filing a Registration Statement relating to a S-3 Registration until such
Valid Business Reason no longer exists, but in no event for more than
forty-five (45) days following the request and (y) in case a Registration
Statement has been filed relating to a S-3 Registration, the Company, upon
the approval of a majority of the Board of Directors, may cause such
Registration Statement to be withdrawn and its effectiveness terminated or
may postpone amending or supplementing such Registration Statement (in which
case, if the Valid Business Reason no longer exists or if more than
forty-five (45) days have passed since such withdrawal or postponement, the
S-3 Initiating Holder may request the prompt amendment or supplement of such
Registration Statement or a new S-3 Registration). The Company shall give
written notice of its determination to postpone or withdraw a Registration
Statement and of the fact that the Valid Business Reason for such
postponement or withdrawal no longer exists, in each case, promptly after the
occurrence thereof. Notwithstanding anything to the contrary contained
herein, the Company may not postpone or withdraw a filing, under either this
Section or Section 3(a), due to a Valid Business Reason more than once in any
six (6) month period. In addition, the Company shall not be required to
effect any registration pursuant to Section 5(a), (i) within ninety (90) days
after the effective date of any other Registration Statement of the Company
(other than a Registration Statement on Form S-4 or S-8 or any successor
thereto), (ii) if Form S-3 is not available for such offering by the S-3
Initiating Holders or (iii) if the S-3 Initiating Holders, together with the
Designated Holders (other than S-3 Initiating Holders which have requested an
S-3 Registration under Section 5(a)) registering Registrable Securities in
such registration, propose to sell their Registrable Securities at an
aggregate price (calculated based upon the Market Price of the Registrable
Securities on the date of filing of the Form S-3 with respect to such
Registrable Securities) to the public of less than $5,000,000.
(d) EXPENSES. The Company shall bear all
Registration Expenses in connection with any S-3 Registration pursuant to
this Section 5, whether or not such S-3 Registration become effective.
(e) NO DEMAND REGISTRATION. No registration
requested by any Designated Holder pursuant to this Section 5 shall be deemed
a Demand Registration pursuant to Section 3.
6. HOLDBACK AGREEMENTS.
(a) RESTRICTIONS ON PUBLIC SALE BY DESIGNATED
HOLDERS. To the extent (i) requested (A) by the Company, the Initiating
Holders or the S-3 Initiating
12
Holders, as the case may be, in the case of a non-underwritten public
offering and (B) by the Approved Underwriter or the Company Underwriter, as
the case may be, in the case of an underwritten public offering and (ii) all
of the Company's executive officers, directors and holders in excess of ten
percent (10%) of its outstanding capital stock execute agreements identical
to those referred to in this Section 6(a), each Designated Holder agrees (x)
not to effect any public sale or distribution of any Registrable Securities
or of any securities convertible into or exchangeable or exercisable for such
Registrable Securities, including a sale pursuant to Rule 144 under the
Securities Act, or offer to sell, contract to sell (including without
limitation any short sale), grant any option to purchase or enter into any
hedging or similar transaction with the same economic effect as a sale any
Registrable Securities and (y) not to make any request for a Demand
Registration or S-3 Registration under this Agreement, during the period
beginning on the fifteenth (15th) day prior to the expected effective date
(as determined by the Company, which shall notify the Designated Holders of
such date in writing) of such Registration Statement and ending on the
ninetieth (90th) day following the actual effective date of such Registration
Statement, or such other period, if any, mutually agreed upon by such
Designated Holder and the requesting party (except as part of such
registration). In connection with the Initial Public Offering, in lieu of the
foregoing provisions of this Section 6(a), each Designated Holder shall
comply with the terms of its lock-up agreement entered into in connection
with the Initial Public Offering.
(b) RESTRICTIONS ON PUBLIC SALE BY THE COMPANY.
Unless the Company shall have received the prior written consent of the CIC
Stockholders, the Company agrees not to effect any public sale or
distribution of any of its securities, or any securities convertible into or
exchangeable or exercisable for such securities (except pursuant to
registrations on Form S-4 or S-8 or any successor thereto), during the period
beginning on the fifteenth (15th) day prior to the expected effective date
(as determined by the Company) of any Registration Statement in which the
Designated Holders of Registrable Securities are participating and ending on
the earlier of (i) the date on which all Registrable Securities registered on
such Registration Statement are sold and (ii) 90 days after the actual
effective date of such Registration Statement (except as part of such
registration).
7. REGISTRATION PROCEDURES.
(a) OBLIGATIONS OF THE COMPANY. Whenever
registration of Registrable Securities has been requested pursuant to Section
3, Section 4 or Section 5 of this Agreement, the Company shall use its
commercially reasonable efforts to effect the registration and sale of such
Registrable Securities in accordance with the intended method of distribution
thereof as quickly as practicable, and in connection with any such request,
the Company shall, as expeditiously as possible:
(i) prepare and file with the Commission
(as promptly as practicable, but in any event not later than sixty (60) days
after receipt of a request to file a Registration Statement with respect to
Registrable Securities) a Registration Statement on any form for which the
Company then qualifies or which counsel for the Company shall deem
appropriate and which form shall be available for the sale of such
13
Registrable Securities in accordance with the intended method of distribution
thereof, and cause such Registration Statement to become effective; PROVIDED,
HOWEVER, that (x) before filing a Registration Statement or prospectus or any
amendments or supplements thereto, the Company shall provide counsel selected
by the Designated Holders holding a majority of the Registrable Securities
being registered in such registration ("Holders' Counsel") and any other
Inspector (as hereinafter defined) with an opportunity to review and comment
on such Registration Statement and each prospectus included therein (and each
amendment or supplement thereto) to be filed with the Commission, subject to
such documents being under the Company's control, and (y) the Company shall
notify the Holders' Counsel and each seller of Registrable Securities of any
stop order issued or threatened by the Commission and take all reasonable
actions required to prevent the entry of such stop order or to remove it if
entered;
(ii) prepare and file with the Commission
such 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 the lesser of (x) 120 days (except in
the case of a registration filed pursuant to Rule 415 of the Securities Act
or any successor rule or regulation) and (y) such shorter period which will
terminate when all Registrable Securities covered by such Registration
Statement have been sold, and comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by such
Registration Statement during such period in accordance with the intended
methods of disposition by the sellers thereof set forth in such Registration
Statement;
(iii) furnish to each seller of
Registrable Securities such number of copies of such Registration Statement,
each amendment and supplement thereto (in each case including all exhibits
thereto), and the prospectus included in such Registration Statement
(including each preliminary prospectus) and any prospectus filed under Rule
424 under the Securities Act as each such seller may reasonably request in
order to facilitate the disposition of the Registrable Securities owned by
such seller;
(iv) register or qualify such Registrable
Securities under such other securities or "blue sky" laws of such
jurisdictions as any seller of Registrable Securities may reasonably request,
and to continue such qualification in effect in such jurisdiction for as long
as permissible pursuant to the laws of such jurisdiction, or for as long as
any such seller requests or until all of such Registrable Securities are
sold, whichever is shortest, and do any and all other acts and things which
may be reasonably necessary or advisable to enable any such seller to
consummate the disposition in such jurisdictions of the Registrable
Securities owned by such seller; PROVIDED, HOWEVER, that the Company shall
not be required to (x) qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for this Section
7(a)(iv), (y) subject itself to taxation in any such jurisdiction or (z)
consent to general service of process in any such jurisdiction;
(v) notify each seller of Registrable
Securities at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, upon discovery that, or upon the
happening of any event as a result
14
of which, the prospectus included in such Registration Statement contains 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 and the
Company shall promptly prepare a supplement or amendment to such prospectus
and furnish to each seller of Registrable Securities a reasonable number of
copies of such supplement to or an amendment of such prospectus as may be
necessary so that, after delivery to the purchasers of such Registrable
Securities, such prospectus shall not contain an untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(vi) enter into and perform customary
agreements (including an underwriting agreement in customary form with the
Approved Underwriter or Company Underwriter, if any, selected as provided in
Section 3, Section 4 or Section 5, as the case may be) and take such other
actions as are reasonably required in order to expedite or facilitate the
disposition of such Registrable Securities, including causing its officers to
participate in "road shows" and other information meetings organized by the
Approved Underwriter or Company Underwriter;
(vii) make available at reasonable times
for inspection by any seller of Registrable Securities, any managing
underwriter participating in any disposition of such Registrable Securities
pursuant to a Registration Statement, Holders' Counsel and any attorney or
accountant retained by any such seller or any managing underwriter (each, an
"Inspector" and collectively, the "Inspectors"), all financial and other
records, pertinent corporate documents and properties of the Company and its
subsidiaries (collectively, the "Records") as shall be reasonably necessary
to enable them to exercise their due diligence responsibility, and cause the
Company's and its subsidiaries' officers, directors and employees, and the
independent public accountants of the Company, to supply all information
reasonably requested by any such Inspector in connection with such
Registration Statement. Records that the Company determines, in good faith,
to be confidential and which it notifies the Inspectors are confidential
shall not be disclosed by the Inspectors (and the Inspectors shall confirm
their agreement in writing in advance to the Company if the Company shall so
request) unless (x) the disclosure of such Records is necessary, in the
Company's judgment, to avoid or correct a misstatement or omission in the
Registration Statement, (y) the release of such Records is ordered pursuant
to a subpoena or other order from a court of competent jurisdiction after
exhaustion of all appeals therefrom or (z) the information in such Records
was known to the Inspectors on a non-confidential basis prior to its
disclosure by the Company or has been made generally available to the public.
Each seller of Registrable Securities agrees that it shall, upon learning
that disclosure of such Records is sought in a court of competent
jurisdiction, give notice to the Company and allow the Company, at the
Company's expense, to undertake appropriate action to prevent disclosure of
the Records deemed confidential;
(viii) if such sale is pursuant to an
underwritten offering, obtain "cold comfort" letters dated the effective date
of the Registration Statement and the date of the closing under the
underwriting agreement from the Company's
15
independent public accountants in customary form and covering such matters of
the type customarily covered by "cold comfort" letters as the managing
underwriter reasonably requests;
(ix) furnish, at the request of any
seller of Registrable Securities on the date such securities are delivered to
the underwriters for sale pursuant to such registration or, if such
securities are not being sold through underwriters, on the date the
Registration Statement with respect to such securities becomes effective, an
opinion, dated such date, of counsel representing the Company for the
purposes of such registration, addressed to the underwriters, if any, and to
the seller making such request, covering such legal matters with respect to
the registration in respect of which such opinion is being given as the
underwriters, if any, and such seller may reasonably request and are
customarily included in such opinions;
(x) comply with all applicable rules and
regulations of the Commission, and make available to its security holders, as
soon as reasonably practicable but no later than fifteen (15) months after
the effective date of the Registration Statement, an earnings statement
covering a period of twelve (12) months beginning after the effective date of
the Registration Statement, in a manner which satisfies the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder;
(xi) cause all such Registrable
Securities to be listed on each securities exchange on which similar
securities issued by the Company are then listed, PROVIDED that the
applicable listing requirements are satisfied;
(xii) cooperate with each seller of
Registrable Securities and each underwriter participating in the disposition
of such Registrable Securities and their respective counsel in connection
with any filings required to be made with the NASD;
(xiii) use its commercially reasonable
efforts to cause the Registrable Securities covered by such Registration
Statement to be registered with or approved by such other governmental
agencies or authorities as may be reasonably necessary by virtue of the
business and operations of the Company to enable the seller or sellers of
Registrable Securities to consummate the disposition of such Registrable
Securities;
(xiv) keep each seller of Registrable
Securities advised as to all material developments of any registration under
Sections 3, 4 or 5 hereunder;
(xv) provide officers' certificates and
other customary closing documents; and
(xvi) take all other steps reasonably
necessary to effect the registration of the Registrable Securities
contemplated hereby and reasonably cooperate with the holders of such
Registrable Securities to facilitate the disposition of such Registrable
Securities pursuant thereto.
16
(b) SELLER INFORMATION. The Company may require each seller
of Registrable Securities as to which any registration is being effected to
furnish, and such seller shall furnish, to the Company such information
required to be included in such Registration Statement by applicable
securities laws or otherwise necessary or desirable in connection with the
disposition of such Registrable Securities as the Company may from time to
time reasonably request in writing. If any seller of Registrable Securities
fails to provide such information required to be included in such
Registration Statement by applicable securities laws or otherwise necessary
or desirable in connection with the disposition of such Registrable
Securities in a timely manner after written request therefor, the Company may
exclude such seller's Registrable Securities from a registration under
Sections 3, 4 or 5 hereof.
(c) NOTICE TO DISCONTINUE. Each Designated Holder agrees
that, upon receipt of any notice from the Company of the happening of any
event of the kind described in Section 7(a)(v), such Designated Holder shall
forthwith discontinue disposition of Registrable Securities pursuant to the
Registration Statement covering such Registrable Securities until such
Designated Holder's receipt of the copies of the supplemented or amended
prospectus contemplated by Section 7(a)(v) and, if so directed by the
Company, such Designated Holder shall deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Designated Holder's possession, of the prospectus covering such Registrable
Securities which is current at the time of receipt of such notice. If the
Company shall give any such notice, the Company shall extend the period
during which such Registration Statement shall be maintained effective
pursuant to this Agreement (including, without limitation, the period
referred to in Section 7(a)(ii)) by the number of days during the period from
and including the date of the giving of such notice pursuant to Section
7(a)(v) to and including the date when sellers of such Registrable Securities
under such Registration Statement shall have received the copies of the
supplemented or amended prospectus contemplated by and meeting the
requirements of Section 7(a)(v).
(d) REGISTRATION EXPENSES. The Company shall pay all
expenses arising from or incident to its performance of, or compliance with,
this Agreement, including, without limitation, (i) Commission, stock exchange
and NASD registration and filing fees, (ii) all fees and expenses incurred in
complying with State securities or "blue sky" laws (including reasonable
fees, charges and disbursements of counsel to any underwriter incurred in
connection with "blue sky" qualifications of the Registrable Securities as
may be set forth in any underwriting agreement), (iii) all printing,
messenger and delivery expenses, (iv) the fees, charges and expenses of
counsel to the Company and of its independent public accountants and any
other accounting fees, charges and expenses incurred by the Company
(including, without limitation, any expenses arising from any "cold comfort"
letters or any special audits incident to or required by any registration or
qualification) and the legal fees, charges and expenses of one law firm
designated by the holders of a majority of the Registrable Securities
participating in any registration incurred by the Designated Holders in any
registration pursuant to this Agreement and (v) any liability insurance or
other premiums for insurance obtained in connection with any Demand
Registration or piggy-back registration thereon, Incidental Registration or
S-3 Registration pursuant to the terms of
17
this Agreement, regardless of whether such Registration Statement is declared
effective. All of the expenses described in the preceding sentence of this
Section 7(d) are referred to herein as "Registration Expenses." The
Designated Holders of Registrable Securities sold pursuant to a Registration
Statement shall bear the expense of any broker's commission or underwriter's
discount or commission relating to registration and sale of such Designated
Holders' Registrable Securities and shall, other than as set forth in clause
(iv) above, bear the fees and expenses of their own counsel.
8. INDEMNIFICATION; CONTRIBUTION.
(a) INDEMNIFICATION BY THE COMPANY. The Company
agrees to indemnify and hold harmless each Designated Holder, its partners,
directors, officers, affiliates, members, employees and each Person who
controls (within the meaning of Section 15 of the Securities Act) such
Designated Holder from and against any and all losses, claims, damages,
liabilities and expenses (including, but not limited to, reasonable costs and
expenses of legal counsel or otherwise arising from any investigation, action
or proceeding, whether commenced or threatened, in respect to any of the
foregoing) (each, a "Liability" and collectively, "Liabilities"), arising out
of or based upon any untrue, or allegedly untrue, statement of a material
fact contained in any Registration Statement, prospectus or preliminary
prospectus or notification or offering circular (as amended or supplemented
if the Company shall have furnished any amendments or supplements thereto) or
arising out of or based upon any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein not misleading under the circumstances such statements
were made, except insofar as such Liability arises out of or is based upon
any untrue statement or alleged untrue statement or omission or alleged
omission contained in such Registration Statement, preliminary prospectus or
final prospectus in reliance and in conformity with information concerning
such Designated Holder furnished in writing to the Company by such Designated
Holder expressly for use therein, including, without limitation, the
information furnished to the Company pursuant to Section 8(b). The Company
shall also provide customary indemnities to any underwriters of the
Registrable Securities, their officers, directors and employees and each
Person who controls such underwriters (within the meaning of Section 15 of
the Securities Act) to the same extent as provided above with respect to the
indemnification of the Designated Holders of Registrable Securities.
(b) INDEMNIFICATION BY DESIGNATED HOLDERS. In
connection with any Registration Statement in which a Designated Holder is
participating pursuant to Section 3, Section 4 or Section 5 hereof, each such
Designated Holder shall promptly furnish to the Company in writing such
information with respect to such Designated Holder as the Company may
reasonably request or as may be required by law for use in connection with
any such Registration Statement or prospectus and all information required to
be disclosed in order to make the information previously furnished to the
Company by such Designated Holder not materially misleading or necessary to
cause such Registration Statement not to omit a material fact with respect to
such Designated Holder necessary in order to make the statements therein not
misleading. Each Designated Holder agrees severally to indemnify and hold
harmless the Company, the other Designated Holders who participate in the
Registration Statement, any underwriter
18
retained by the Company and each Person who controls the Company, the other
Designated Holders who participate in the Registration Statement or such
underwriter (within the meaning of Section 15 of the Securities Act) to the
same extent as the foregoing indemnity from the Company to the Designated
Holders (including indemnification of their respective partners, directors,
officers, members and employees), but only to the extent that Liabilities
arise out of or are based upon a statement or alleged statement or an
omission or alleged omission that was made in reliance upon and in conformity
with information with respect to such Designated Holder furnished in writing
to the Company by such Designated Holder expressly for use in such
Registration Statement or prospectus, including, without limitation, the
information furnished to the Company pursuant to this Section 8(b); PROVIDED,
HOWEVER, that the total amount to be indemnified by such Designated Holder
pursuant to this Section 8(b) shall be limited to the net proceeds received
by such Designated Holder in the offering to which the Registration Statement
or prospectus relates.
(c) CONDUCT OF INDEMNIFICATION PROCEEDINGS. Any
Person entitled to indemnification or contribution hereunder (the
"Indemnified Party") agrees to give prompt written notice to the indemnifying
party (the "Indemnifying Party") after the receipt by the Indemnified Party
of any written notice of the commencement of any action, suit, proceeding or
investigation or threat thereof made in writing for which the Indemnified
Party intends to claim indemnification or contribution pursuant to this
Agreement; PROVIDED, HOWEVER, that the failure so to notify the Indemnifying
Party shall not relieve the Indemnifying Party of any Liability that it may
have to the Indemnified Party hereunder (except to the extent that the
Indemnifying Party is materially prejudiced or otherwise forfeits substantive
rights or defenses by reason of such failure). If notice of commencement of
any such action is given to the Indemnifying Party as above provided, the
Indemnifying Party shall be entitled to participate in and, to the extent it
may wish, jointly with any other Indemnifying Party similarly notified, to
assume the defense of such action at its own expense, with counsel chosen by
it and reasonably satisfactory to such Indemnified Party. Each Indemnified
Party shall have the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of such counsel
shall be paid by the Indemnified Party unless (i) the Indemnifying Party
agrees to pay the same, (ii) the Indemnifying Party fails to assume the
defense of such action with counsel reasonably satisfactory to the
Indemnified Party or (iii) the named parties to any such action (including
any impleaded parties) include both the Indemnifying Party and the
Indemnified Party and such parties have been advised by such counsel that
either (x) representation of such Indemnified Party and the Indemnifying
Party by the same counsel would be inappropriate under applicable standards
of professional conduct or (y) there may be one or more legal defenses
available to the Indemnified Party which are different from or additional to
those available to the Indemnifying Party. In any of such cases, the
Indemnifying Party shall not have the right to assume the defense of such
action on behalf of such Indemnified Party, it being understood, however,
that the Indemnifying Party shall not be liable for the reasonable fees and
expenses of more than one separate firm of attorneys (in addition to any
local counsel) for all Indemnified Parties and all such expenses shall be
reimbursed as incurred. No Indemnifying Party shall be liable for any
settlement entered into without its written consent, which consent shall not
be unreasonably withheld. No
19
Indemnifying Party shall, without the consent of such Indemnified Party,
effect any settlement of any pending or threatened proceeding in respect of
which such Indemnified Party is a party and indemnity has been sought
hereunder by such Indemnified Party, unless such settlement includes an
unconditional release of such Indemnified Party from all liability for claims
that are the subject matter of such proceeding. Notwithstanding the
foregoing, 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 8, 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) business 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 or contested
the reasonableness of such fees and expenses prior to the date of such
settlement.
(d) CONTRIBUTION. If the indemnification provided
for in this Section 8 from the Indemnifying Party is unavailable to an
Indemnified Party hereunder or insufficient to hold harmless an Indemnified
Party in respect of any Liabilities referred to herein, then each
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a
result of such Liabilities in such proportion as is appropriate to reflect
the relative fault of the Indemnifying Party and Indemnified Party in
connection with the actions which resulted in such Liabilities, as well as
any other relevant equitable considerations. The relative fault of such
Indemnifying Party and Indemnified Party shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission
to state a material fact, has been made by, or relates to information
supplied by, such Indemnifying Party or Indemnified Party, and the parties'
relative intent, knowledge, access to information and opportunity to correct
or prevent such action. The amount paid or payable by a party as a result of
the Liabilities referred to above shall be deemed to include, subject to the
limitations set forth in Sections 8(a), 8(b) and 8(c), any legal or other
fees, charges or expenses reasonably incurred by such party in connection
with any investigation or proceeding; provided that the total amount to be
contributed by any Designated Holder shall be limited to the net proceeds
received by such Designated Holder in the offering.
The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 8(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 in the immediately
preceding paragraph. 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.
9. RULE 144. The Company covenants that from and after the IPO
Effectiveness Date it shall (a) file any reports required to be filed by it
under the Exchange Act and (b) take such further action as each Designated
Holder may reasonably request (including providing any information necessary to
comply with Rule 144 under the
20
Securities Act), all to the extent required from time to time to enable such
Designated Holder to sell Registrable Securities without registration under
the Securities Act within the limitation of the exemptions provided by (i)
Rule 144 under the Securities Act, as such rule may be amended from time to
time, or Regulation S under the Securities Act or (ii) any similar rules or
regulations hereafter adopted by the Commission. The Company shall, upon the
request of any Designated Holder, deliver to such Designated Holder a written
statement as to whether it has complied with such requirements.
10. MISCELLANEOUS.
(a) STOCK SPLITS, ETC. The provisions of this
Agreement shall be appropriately adjusted for any stock dividends, splits,
reverse splits, combinations, recapitalizations and the like occurring after
the date hereof. To the extent the issuer of any Registrable Securities is a
successor or assign (whether by merger, consolidation, sale of assets or
otherwise) of the Company, the Company shall cause such successor or assign
to enter into a new
registration rights agreement with the Designated Holders
on terms substantially similar to those in this Agreement as a condition of
any such transaction.
(b) NO INCONSISTENT AGREEMENTS. The Company hereby
represents and warrants that it has not previously entered into any agreement
granting registration rights to any Person with respect to any securities of
the Company. The Company shall not enter into any agreement with respect to
its securities that is inconsistent with the rights granted to the Designated
Holders in this Agreement or grant any additional registration rights to any
Person or with respect to any securities that are not Registrable Securities
that provides for the priority in registration of such securities over the
Registrable Securities held by the Designated Holders or which rights are
otherwise inconsistent with the rights granted in this Agreement.
(c) REMEDIES. The Designated Holders, in addition
to being entitled to exercise all rights granted by law, including recovery
of damages, shall be entitled to specific performance of their rights under
this Agreement. The Company agrees that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by it of
the provisions of this Agreement and hereby agrees to waive in any action for
specific performance the defense that a remedy at law would be adequate.
(d) AMENDMENTS AND WAIVERS. Except as otherwise
provided herein, the provisions of this Agreement may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given unless consented to in writing by the
Company and Designated Holders holding more than 50% of the Registrable
Securities; PROVIDED, HOWEVER, that no amendment, modification, supplement,
waiver or consent to depart from the provisions hereof shall be effective if
such amendment, modification, supplement, waiver or consent to depart from
the provisions hereof materially and adversely affects the substantive rights
or obligations of one Designated Holder, or group of Designated Holders,
without a similar and proportionate effect on the substantive rights or
obligations of all Designated Holders,
21
unless each such disproportionately affected Designated Holder consents in
writing thereto.
(e) NOTICES. All notices, demands and other
communications provided for or permitted hereunder shall be made in writing
and shall be made by registered or certified first-class mail, return receipt
requested, telecopier, courier service or personal delivery:
(i) if to the Company:
Anteon International Corporation
0000 Xxxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, Xxxxxxxx 00000-0000
Telecopy: (000) 000-0000
Attention: General Counsel
(ii) if to the CIC Stockholders:
c/o Xxxxxx-Xxxxxx Capital, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attention: Xxxxxxxxx X. Xxxxxx
(iii) if to any other party to this
Agreement, to the address of such party as
set forth in the books and records of the
Company.
All such notices, demands and other communications shall be
deemed to have been duly given when delivered by hand, if personally
delivered; when delivered by courier, if delivered by commercial courier
service; five (5) Business Days after being deposited in the mail, postage
prepaid, if mailed; and when receipt is mechanically acknowledged, if
telecopied. Any party may by notice given in accordance with this Section
10(e) designate another address or Person for receipt of notices hereunder.
(f) SUCCESSORS AND ASSIGNS; THIRD PARTY
BENEFICIARIES. This Agreement shall inure to the benefit of and be binding
upon the successors and permitted assigns of the parties hereto as
hereinafter provided. The Demand Registration rights, incidental registration
rights and the S-3 Registration rights and the other rights of the CIC
Stockholders hereunder may be (i) with respect to any Registrable Security
that is transferred to an Affiliate of the CIC Stockholders (or if any of the
CIC Stockholders is a partnership, limited liability company or corporation,
to any such partner, member or stockholder thereof), transferred to such
Affiliate (or such partner, member or stockholder) and (ii) with respect to
any Registrable Security that is transferred in all cases to a non-Affiliate
of the CIC Stockholders, transferred only if the transferee receives in one
transaction or series of related transactions Registrable Securities
representing at least ten percent (10%) of the Common Stock outstanding on
the date of
22
such transaction (or the first transaction in a series of transactions). The
incidental or "piggy-back" registration rights of the Significant Holders
contained in Sections 3, 4 and 5 hereof and the other rights of the
Significant Holders hereunder may be (i) with respect to any Registrable
Security that is transferred by a Significant Holder to an Affiliate or
Permitted Assignee of such Significant Holder, transferred to such Affiliate
or such Permitted Assignee and (ii) with respect to any Registrable Security
that is transferred in all cases to a non-Affiliate of the Significant
Holders, transferred only if the transferee receives in one transaction or
series of related transactions Registrable Securities representing at least
one percent (1%) of the Common Stock outstanding on the date of such
transaction (or the first transaction in a series of transactions). All of
the obligations of the Company hereunder shall survive any such transfer.
Except as provided in Section 8, no Person other than the parties hereto and
their successors and permitted assigns is intended to be a beneficiary of
this Agreement.
(g) COUNTERPARTS. This Agreement may be executed
in any number of 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 taken together shall constitute one and the same
agreement.
(h) HEADINGS. The headings in this Agreement are
for convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(I) GOVERNING LAW. THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW
YORK, WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAW THEREOF.
(j) SEVERABILITY. If any one or more of the
provisions contained herein, or the application thereof in any circumstance,
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 hereof shall not be in any way
impaired.
(k) RULES OF CONSTRUCTION. Unless the context
otherwise requires, references to sections or subsections refer to sections
or subsections of this Agreement.
(l) ENTIRE AGREEMENT. This Agreement 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. There are
no restrictions, promises, representations, warranties or undertakings, other
than those set forth or referred to herein. This Agreement supersedes all
prior agreements and understandings among the parties with respect to such
subject matter.
23
(m) FURTHER ASSURANCES. Each of the parties shall
execute such documents and perform such further acts as may be reasonably
required or desirable to carry out or to perform the provisions of this
Agreement.
(n) OTHER AGREEMENTS. Nothing contained in this
Agreement shall be deemed to be a waiver of, or release from, any obligations
any party hereto may have under, or any restrictions on the transfer of
Registrable Securities or other securities of the Company imposed by, any
other agreement.
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the undersigned have executed, or have
caused to be executed, this
Registration Rights Agreement on the date first
written above.
ANTEON INTERNATIONAL CORPORATION
By: _____________________________________
Name:
Title:
AZIMUTH TECHNOLOGIES, L.P.
By: GEORGICA (AZIMUTH TECHNOLOGIES),
L.P., its general partner
By: GEORGICA (AZIMUTH TECHNOLOGIES),
INC., its general partner
By: _____________________________________
Name: Xxxxxxxxx X. Xxxxxx
Title: President
AZIMUTH TECH. II LLC
By: GEORGICA (AZIMUTH TECHNOLOGIES),
L.P., its managing member
By: GEORGICA (AZIMUTH TECHNOLOGIES),
INC., its general partner
By: _____________________________________
Name: Xxxxxxxxx X. Xxxxxx
Title: President
___________________________________
Xxxxxxxxx X. Xxxxxx
___________________________________
Xxxxxx X. Xxxxx
___________________________________
Xxxxxxx X. Xxxxxxxx
___________________________________
Xxxxxx X. Xxxxxxx
___________________________________
Xxxxxx X. Xxxxxxxxx
___________________________________
Xxxxxxx X. Xxxxxxxxx
___________________________________
Xxxxxx Xxxxxxxxxxx
___________________________________
Xxxxxx Xxxxxx
___________________________________
Xxxxxxx X. Xxxxxx
___________________________________
Xxxxx Xxxxxx
___________________________________
Xxxx X. Xxxxxxx
___________________________________
Xxxx Xxxxxxxx
___________________________________
Xxxxxx X. Xxxxxx
THE XXXXXX FAMILY 1987 TRUST
By:________________________________
Name:
Title:
