EXHIBIT 10.12
Execution Copy
VERIDIAN CORPORATION
MASTER EQUITYHOLDERS AGREEMENT
Execution Copy
TABLE OF CONTENTS
1. EFFECTIVENESS; ENTIRE AGREEMENT; DEFINITIONS................................................................2
1.1 Effectiveness.........................................................................................2
1.2 Entire Agreement......................................................................................2
1.3 Definitions...........................................................................................3
2. RIGHTS OF FIRST OFFER.......................................................................................3
2.1 First Offer...........................................................................................3
2.2 Miscellaneous.........................................................................................6
2.3 Period................................................................................................8
3. "TAG ALONG" AND "DRAG ALONG" RIGHTS.........................................................................8
3.1 Tag Along.............................................................................................8
3.2 Drag Along...........................................................................................10
3.3 Miscellaneous........................................................................................11
3.4 Period...............................................................................................14
4. INITIAL INVESTOR TRANSFER RIGHTS...........................................................................14
4.1 Certain Permitted Transfers..........................................................................14
4.2 Period...............................................................................................15
5. MANAGEMENT EQUITYHOLDER TRANSFER RIGHTS....................................................................15
5.1 Transfers to Immediate Family and Certain Shareholders of Equity Interests...........................15
5.2 Transfer Upon Death..................................................................................15
5.3 Other Permitted Transfers............................................................................15
5.4 Period...............................................................................................15
6. CONSULTANT TRANSFER RIGHTS.................................................................................16
6.1 Permitted Transfers..................................................................................16
6.2 Period...............................................................................................16
7. WARRANT INVESTOR TRANSFER RIGHTS...........................................................................16
7.1 Certain Permitted Transfers..........................................................................16
7.2 Period...............................................................................................17
8. CERTAIN OTHER COVENANTS....................................................................................17
8.1 MCP Investor Standstill..............................................................................17
8.2 Transfer of Shares or Powers to Foreign Persons......................................................17
9. CERTAIN ISSUANCES AND TRANSFERS, ETC.......................................................................17
9.1 Transfers to Permitted Transferees...................................................................17
9.2 Other Transfers and Issuances........................................................................17
9.3 Subsequent Issuances.................................................................................18
10. REGISTRATION RIGHTS.....................................................................................18
10.1 Demand Registration Rights...........................................................................18
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10.2 Piggyback Registration...............................................................................22
10.3 Registration Procedures..............................................................................22
10.4 Additional Procedures in Connection with Underwritten Offerings......................................25
10.5 Shareholder Lockup Agreements in Connection with Public Offerings....................................27
10.6 Indemnification and Contribution.....................................................................27
10.7 Reports Under Securities Exchange Act................................................................30
10.8 Assignment of Registration Rights....................................................................31
10.9 Future Changes in Registration Requirements..........................................................31
11. REMEDIES................................................................................................31
12. LEGENDS.................................................................................................31
12.1 Restrictive Legends..................................................................................31
12.2 Securities Act Legends...............................................................................33
12.3 Stop Transfer Instruction............................................................................33
12.4 Termination of Certain Restrictions..................................................................33
13. AMENDMENT, TERMINATION, ETC.............................................................................33
13.1 Oral Modifications...................................................................................33
13.2 Written Modifications................................................................................33
13.3 Termination..........................................................................................34
14. DEFINITIONS.............................................................................................34
14.1 Certain Matters of Construction......................................................................34
14.2 Definitions..........................................................................................34
15. MISCELLANEOUS...........................................................................................43
15.1 Authority; Effect....................................................................................43
15.2 Notices..............................................................................................43
15.3 Binding Effect, etc..................................................................................44
15.4 Exercise of Rights and Remedies......................................................................44
15.5 Descriptive Headings.................................................................................44
15.6 Counterparts.........................................................................................44
15.7 Severability.........................................................................................45
15.8 Register.............................................................................................45
15.9 Certain Shareholders.................................................................................45
16. GOVERNING LAW, ETC......................................................................................45
16.1 Governing Law........................................................................................45
16.2 Consent to Jurisdiction..............................................................................45
16.3 WAIVER OF JURY TRIAL.................................................................................46
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VERIDIAN CORPORATION
MASTER EQUITYHOLDERS AGREEMENT
This Master Equityholders Agreement (the "Agreement") is made
effective as of September 9, 2000 by and among:
(a) Veridian Corporation, a Delaware corporation (the
"Company");
(b) each of Monitor Clipper Equity Partners, L.P., a
Delaware limited partnership ("MCEP"), and Monitor
Clipper Equity Partners (Foreign), L.P., a Delaware
limited partnership ("MCEP(F)"; collectively with
MCEP, the "MCP Investors");
(c) each of CIBC WG Argosy Merchant Fund 2, L.L.C.
("CIBC"), Co-Investment Merchant Fund 3, LLC
("Merchant") and the Texas Growth Fund II - 1998
Trust ("TGF"; collectively with the MCP Investors,
CIBC and Merchant, the "Initial Investors");
(d) each of the Persons (as hereinafter defined)
executing this Agreement and identified as a
"Management Equityholder" on such Person's
signature page hereto, including, but not limited
to, Argotyche, L.P., a Delaware limited
partnership, Santaeus, L.P., a Delaware limited
partnership, and Xxxxx X. Xxxxxxxxx (collectively,
the "Management Equityholders");
(e) each of Monitor Company Group Limited Partnership,
a Delaware limited partnership which is the
successor-in-interest to Monitor Company, Inc.
("TMC"), and Monitor Consulting, L.P., a Delaware
limited partnership ("MCLP"; collectively with TMC,
the "Consultants");
(f) each of First Union Investors, Inc. ("First
Union"), with respect to its 1999 Warrants, The
Northwestern Mutual Life Insurance Company
("Northwestern"), with respect to its 1999
Warrants, A.G. Investment Advisory Services, Inc.
("AG Investment"), with respect to its 1999
Warrants, Merit Life Insurance Co. ("Merit"), and
Lincoln National Life Insurance Company
("Lincoln"); collectively with First Union,
Northwestern, AG Investment and Merit, the "1999
Warrant Investors"); and
(g) each of Northwestern, with respect to its 2000
Warrants, X.X. Xxxxxxx Mezzanine Fund, L.P. ("JHW
Mezzanine"), X.X. Xxxxxxx Market Value Fund, L.P.
("JHW Market"), First Union, with respect to its
2000 Warrants, A.G. Investment, with respect to
its 2000 Warrants, American General Life and
Accident Insurance Company ("AG Life"), and
Magnetite Asset Investors L.L.C. ("Magnetite";
collectively with Northwestern, JHW Mezzanine, JHW
Market, First Union, AG Investment, and AG Life,
the "2000 Warrant Investors"; the 1999 Warrant
Investors and the 2000 Warrant Investors,
collectively, the "Warrant
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Investors"; and the Initial Investors, the
Management Equityholders, the Consultants and the
Warrant Investors, collectively, the
"Shareholders").
RECITALS
1. In connection with the issuance to the Initial Investors and
the Consultants of an aggregate of 5,502,500 shares of the Company's Class A
Common Stock, par value $.0001 per share (the "Class A Common Stock"), the
Company, the Initial Investors, the Consultants and certain of the Management
Equityholders entered into a Shareholders Agreement dated as of September 7,
1999 (the "Shareholders Agreement"), and the Company, the Initial Investors
and the Consultants entered into the Registration Rights Agreement dated as of
September 7, 1999 (the "Investor Rights Agreement") among the Company, the
Initial Investors and the Consultants.
2. In connection with the purchase by certain of the 1999
Warrant Investors of 40,000 shares of the Company's Senior Redeemable
Exchangeable Preferred Stock, $1,000 liquidation preference per share (the
"Preferred Stock") and warrants (the "1999 Warrants") to acquire an aggregate
of 589,414 shares of the Company's Class B Common Stock, par value $.0001 per
share (the "Class B Common Stock"; collectively with the Class A Common Stock,
the "Common Stock"), the Company, the 1999 Warrant Investors and the Initial
Investors entered into the Common Stock Registration Rights and Stockholders
Agreement dated as of September 7, 1999 (the "1999 Warrant Rights Agreement").
3. On September 14, 2000, the 2000 Warrant Investors purchased
warrants (the "2000 Warrants") to acquire an aggregate of 613,451 shares of
Class B Common Stock from the Company and, in connection therewith, (i) the
Company and the 2000 Warrant Investors entered into the Common Stock
Registration Rights and Stockholders Agreement dated as of September 14, 2000
(the "2000 Warrant Rights Agreement" and, together with the 1999 Warrant
Rights Agreement, the "Warrant Rights Agreements"), and (ii) the Company
agreed to enter into this Agreement.
4. The parties believe that it is in the best interests of the
Company and the Shareholders to supersede the Shareholders Agreement, the
Investor Rights Agreement, and the Warrant Rights Agreements with a single
agreement setting forth the respective rights of the Company and the
Shareholders as set forth in this Agreement.
AGREEMENT
Therefore, the parties hereto hereby agree as follows:
1. EFFECTIVENESS; ENTIRE AGREEMENT; DEFINITIONS
1.1 Effectiveness. This Agreement shall become effective upon
execution hereof by the Company, each MCP Investor, the Majority Initial
Investors, the Majority Management Equityholders, the Majority 1999 Warrant
Investors and each of the 2000 Warrant Investors.
1.2 Entire Agreement. This Agreement constitutes the entire
understanding of the parties with respect to the subject matter hereof and
supersedes any and all prior understandings
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and agreements, whether written or oral, with respect to such subject matter,
including without limitation:
(a) the Shareholders Agreement, which is hereby
terminated and replaced with the terms hereof by
agreement of the Company, the Majority Investors
(as defined in the Shareholders Agreement) and the
Majority Existing Equityholders (as defined in the
Shareholders Agreement), each being party hereto,
pursuant to Section 11.2 of the Shareholders
Agreement;
(b) the Investor Rights Agreement, which is hereby
terminated and replaced with the terms hereof by
agreement of the holders of a majority of the
Registrable Securities (as defined in the Investor
Rights Agreement), which majority is party hereto,
pursuant to Section 13 of the Investor Rights
Agreement;
(c) the 1999 Warrant Rights Agreement, which is hereby
terminated and replaced with the terms hereof by
agreement of the holders of a majority of the
outstanding Registrable Securities (as defined in
the 1999 Warrant Rights Agreement), which majority
is party hereto, and of the holders of a majority
of the shares of Common Stock (as defined in the
1999 Warrant Rights Agreement), which majority is
party hereto, pursuant to Section 6.2 of the 1999
Warrant Rights Agreement; and
(d) the 2000 Warrant Rights Agreement, which is hereby
terminated and replaced with the terms hereof by
agreement of the holders of a majority of the
outstanding Registrable Securities (as defined in
the 2000 Warrant Rights Agreement), which majority
is party hereto, pursuant to Section 6.2 of the
2000 Warrant Rights Agreement.
1.3 Definitions. Certain terms are used in this Agreement as
specifically defined herein. These definitions are set forth or referred to
in Section 14.
2. RIGHTS OF FIRST OFFER
2.1 First Offer. No holder of Shares (each such holder, a
"Prospective Selling Shareholder") shall Transfer any such Shares to any
Prospective Buyer except in the manner and on the terms set forth in this
Section 2.1 and in Sections 3 through 7 (as applicable). Any attempted
Transfer of Shares prohibited by this Section 2.1 or by Sections 3.1, 4, 5, 6,
or 7 shall be null and void, and the Company shall not in any way give effect
to any such impermissible Transfer.
2.1.1 Notice. A written notice (the "First Offer Notice")
shall be furnished by the Prospective Selling Shareholders to the Company and
to each other holder of Shares (the "First Offer Shareholders") at least 30
days prior to such Transfer; provided, however, that the First Offer Notice
may be furnished concurrently with the Tag Along Notice relating to the
proposed Transfer, and holders of Shares may, in accordance with Section 3.1,
elect to exercise
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the tag along rights granted therein with respect to the Transfer which is the
subject of such First Offer Notice. The First Offer Notice shall include:
(a) The principal terms of the proposed Transfer
insofar as it relates to the Common Stock,
including the number of Shares to be Transferred by
the Prospective Selling Shareholders, the expected
per Share purchase price, the name and address of
the Prospective Buyer, and the material
representations and warranties, covenants and
indemnities to be contained in the definitive
documentation relating to such Transfer; provided,
however, that in the event that the consideration
to be paid in exchange for such Shares contains
non-cash consideration, then such notice shall
specify the Fair Market Value of such non-cash
consideration; and
(b) An offer by the Prospective Selling Shareholders to
the Company and to the First Offer Shareholders to
sell to the Company and to the First Offer
Shareholders all (but not less than all) of the
number of Shares specified in the First Offer
Notice, on the same terms and conditions with
respect to each Share proposed to be Transferred
(subject to this Section 2.1.1 and Section 2.2.2)
as the Prospective Selling Shareholders shall
propose to Transfer to the Prospective Buyer;
provided, however, that in the event that the
consideration to be paid in exchange for such
Shares contains non-cash consideration, such offer
shall give the Company and the First Offer
Shareholders the option to pay, in lieu of
delivering such non-cash consideration, cash in the
amount of the Fair Market Value of such non-cash
consideration.
2.1.2 Exercise. Within 30 days after the effectiveness of
the First Offer Notice, the Company and each First Offer Shareholder (or their
respective assigns) desiring to accept the offer to purchase Shares proposed
to be Transferred in the proposed Transfer (each a "Participating First Offer
Buyer") shall send a written irrevocable acceptance (the "First Offer
Acceptance") to the Prospective Selling Shareholders specifying the number of
Shares which such Participating First Offer Buyer desires to purchase pursuant
to the First Offer Notice. If the Company does not so accept the Prospective
Selling Shareholders' offer to so purchase Shares, the Company shall be deemed
to have waived all of the Company's rights under this Section 2.1 with respect
to such Transfer, and each First Offer Shareholder who does not so accept the
Prospective Selling Shareholders' offer to so purchase Shares shall be deemed
to have waived all of such First Offer Shareholder's rights under this Section
2.1 with respect to such Transfer.
2.1.3 Undersubscribed Sale. Subject to compliance by the
Prospective Selling Shareholders with the provisions of Section 3.1, if the
aggregate number of Shares specified to be purchased in all First Offer
Acceptances shall be less than the aggregate number of Shares specified to be
Transferred in the First Offer Notice, the Prospective Selling Shareholders
shall thereafter be free to Transfer to the Prospective Buyer, at a per share
price no less than 95% of the per share price set forth in the First Offer
Notice and on other terms which are not more favorable, in any material
respect, to the Prospective Buyer than those set forth in the First Offer
Notice, without any further obligation to the Company or the First Offer
Shareholders, except as provided in Section 3.1. If, prior to consummation,
the terms of the proposed Transfer shall
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change with the result that the per share price to be paid in such proposed
Transfer shall be less than 95% of the per share price set forth in the First
Offer Notice or the other terms of such proposed Transfer shall be more
favorable, in any material respect, to the Prospective Buyer than those set
forth in the First Offer Notice, or if the identity of the Prospective Buyer
shall change, or if at the end of the 180th day following the date of the
effectiveness of the First Offer Notice, the Prospective Selling Shareholders
have not completed the proposed Transfer, the First Offer Notice shall be null
and void, and it shall be necessary for a separate First Offer Notice to be
furnished, and the terms and provisions of this Section 2.1 separately
complied with, in order to consummate such proposed Transfer pursuant to this
Section 2.1; provided, however, that in the case of such a separate First
Offer Notice, each applicable period to which reference is made in Sections
2.1.1 and 2.1.2 shall be the longer of (a) the remaining portion of the 30 day
period applicable to the original First Offer Notice distributed in connection
with such proposed Transfer or (b) ten business days.
2.1.4 Fully-Subscribed Sale.
(a) If the aggregate number of Shares specified to be
purchased in all First Offer Acceptances shall
equal the aggregate number of Shares specified to
be Transferred in the First Offer Notice, such
Shares shall be allocated to each Participating
First Offer Buyer in accordance with the amount
specified by such Participating First Offer Buyer
in such Participating First Offer Buyer's First
Offer Acceptance.
(b) If the aggregate number of Shares specified to be
purchased in all First Offer Acceptances shall
exceed the aggregate number of Shares specified to
be Transferred in the First Offer Notice, such
Shares shall be allocated (a) if the Company is a
Participating First Offer Buyer, then first to the
Company, up to the amount specified by the Company
in its First Offer Acceptance, (b) then to each
Participating First Offer Buyer, pro rata based on
the aggregate number of Shares held by each such
Participating First Offer Buyer concurrently
receiving an allocation of Shares; provided,
however, that if, in the case of any such
Participating First Offer Buyer, such Participating
First Offer Buyer shall have been so allocated a
number of Shares equal to the number specified by
such Participating First Offer Buyer in such
Participating First Offer Buyer's First Offer
Acceptance, then such Participating First Offer
Buyer shall not be allocated any Shares in excess
of such number so specified, and any Shares
remaining unallocated shall be allocated among the
remaining Participating First Offer Buyers pro rata
based on the aggregate number of Shares held by
each such remaining Participating First Offer
Buyers, until all Shares specified to be sold in
the First Offer Notice have been so allocated.
2.1.5 Tag Along Rights in First Offer. In the event that
a Tag Along Offeror provides a Tag Along Offer to the Prospective Selling
Shareholders in accordance with Section 3.1.2 hereof, the Prospective Selling
Shareholders shall send a revised First Offer Notice to the Company and each
First Offer Shareholder which shall state the aggregate number of shares
desired to be transferred by the Prospective Selling Shareholders and the Tag
Along Offerors.
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Prior to the later to occur of (i) ten business days after receipt of such
revised First Offer Notice or (ii) 30 days after effectiveness of the original
First Offer Notice, the Company and each First Offer Shareholder desiring to
purchase such Shares may elect to do so by sending the notices required by,
and complying with Section 2.1.2; provided, however, that, for purposes of
Sections 2.1.1, 2.1.3 and 2.1.4, the Participating First Offer Buyers shall be
deemed to have accepted the offer to purchase all of the Shares specified in
the revised First Offer Notice if such offer has been so accepted with respect
to a number of Shares equal to not less than the number specified in the
original First Offer Notice without giving effect to the exercise of any tag
along rights by the Tag Along Offerors.
2.1.6 Excluded Transactions. Notwithstanding the
foregoing, no holder of Shares shall have any right of participation pursuant
to the provisions of this Section 2.1 or otherwise with respect to any
Transfer of Shares permitted by Sections 4.1.1, 4.1.3, 5.1, 5.2, 5.3.2, 5.3.3,
6.1.1, 6.1.3, 6.1.4, 7.1.1 or 7.1.3 or with respect to any Transfer pursuant
to Section 3.2.
2.2 Miscellaneous. The following provisions shall be applied to
any Sale to which Section 2.1 applies:
2.2.1 Further Assurances. Each Prospective Selling
Shareholder and each Participating First Offer Buyer, whether in his capacity
as a Prospective Selling Shareholder or Participating First Offer Buyer (as
applicable), Shareholder, officer or director of the Company, or otherwise,
shall take or cause to be taken all such actions as may be necessary or
reasonably desirable in order expeditiously to consummate each Transfer
pursuant to Section 2.1 (on the terms and conditions specified in the First
Offer Notice) and any related transactions, including, without limitation,
executing, acknowledging and delivering consents, assignments, waivers and
other documents or instruments; furnishing information and copies of
documents; filing applications, reports, returns, filings and other documents
or instruments with governmental authorities; and otherwise cooperating with
the Prospective Selling Shareholders and the Participating First Offer Buyers;
provided, however, that no Prospective Selling Shareholder shall be required
to make any representations, warranties, covenants or indemnities other than
with respect to such Prospective Selling Shareholder's authority to Transfer
its Shares, such Prospective Selling Shareholder's ownership of Shares, the
absence of contravention of agreements relating to such Shareholder and other
matters relating to such Shareholder; provided, further, that such Prospective
Selling Shareholder shall agree with each Participating First Offer Buyer and
any other Prospective Selling Shareholders, as a post-closing adjustment of
the purchase price paid to such Prospective Selling Shareholder, to return an
amount of the proceeds received by such Prospective Selling Shareholder equal
to the amount that such Prospective Selling Shareholder would have otherwise
paid in respect of such other representations, warranties, covenants and
indemnities as are made by other Prospective Selling Shareholders but are not
made by such Prospective Selling Shareholder. Except with respect to
individual representations, warranties, covenants, indemnities and other
agreements of Prospective Selling Shareholders of the type described above,
the aggregate amount of any liability hereunder shall not exceed the lesser of
(i) such Prospective Selling Shareholder's pro rata portion of any liability,
to be determined in accordance with such Prospective Selling Shareholder's
portion of the total number of Shares included in such sale or (ii) the
proceeds to such Prospective Selling Shareholder in connection with such sale.
Subject to the foregoing,
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each Prospective Selling Shareholder agrees to execute and deliver such
agreements as may be reasonably specified by the Participating First Offer
Buyer to which the other Prospective Selling Shareholders will also be a party
to the extent necessary to reflect the foregoing.
2.2.2 Treatment of Different Classes of Common Stock and
of Options.
(a) The relative amounts of consideration to be
received in respect of Shares in a Sale pursuant to
Section 2.1 shall be determined by the Board based
on the aggregate consideration to be paid in
respect of all such Shares being Transferred in
such Sale, the aggregate value of all of the equity
of the Company derived from such aggregate
consideration, and the relative amounts which would
be paid in respect of the Shares were such
aggregate value of all such equity to be paid out
in liquidation of the Company in accordance with
the terms of the Company's certificate of
incorporation as in effect from time to time (or,
if greater with respect to any Share, the amount
which would be received upon any conversion,
exercise or exchange of such Share for Shares of
Class B Common Stock in accordance with the terms
of such Share), all after giving effect to any
applicable changes in rates of conversion, exercise
or exchange, but shall not take into account any
differences in voting rights, rights to elect
directors or any other rights other than such
rights upon a liquidation of the Company or a
conversion, exercise or exchange of such Shares.
(b) If any Prospective Selling Shareholder shall
Transfer Options in any Transfer pursuant to
Section 2.1, such Prospective Selling Shareholder
shall receive in exchange for such Options
consideration equal to the amount (if greater than
zero) determined by multiplying (i) the purchase
price per share of Common Stock received by the
Prospective Selling Shareholders in such Transfer
less the exercise price per share of such Option by
(ii) the number of shares of Common Stock issuable
upon exercise of such Option (to the extent
exercisable at the time of such Transfer).
(c) Notwithstanding the fact that the only Shares to be
sold by Prospective Selling Shareholders may be
shares of one or more classes of Common Stock, each
holder of Shares of each class of Common Stock
shall be entitled to the benefits, and subject to
the obligations, of Sections 2.1 hereof with
respect to all Shares held by such holder as if all
Shares were of the same class of Common Stock,
subject only to possible differences in the
per-Share consideration to be paid in accordance
with Sections 2.2.2(a) and 2.2.2(b).
2.2.3 Expenses. All reasonable costs and expenses
incurred by any Participating First Offer Buyer or the Company in connection
with any proposed Transfer pursuant to this Section 2 (whether or not
consummated), including, without limitation, all attorneys fees and charges,
all accounting fees and charges and all finders, brokerage or investment
banking fees, charges or commissions, shall be paid by the Company.
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Notwithstanding the foregoing, the Company shall not be required to pay in
connection with any such proposed Transfer in excess of an aggregate of
$100,000 in respect of the fees and expenses of separate legal counsel or
other advisors retained by or on behalf of any and all of the Participating
First Offer Buyers in connection with any such proposed Sale. Such limit shall
be apportioned amongst all Participating First Offer Buyers pro rata in
accordance with the Shares proposed to be Transferred by each Participating
First Offer Buyer. Any such fees and expenses in excess of such limits shall
be borne by such Participating First Offer Buyers.
2.2.4 Closing. Unless the Prospective Selling
Shareholders and the Participating First Offer Buyers agree otherwise, any
closing of any purchase and sale of Shares pursuant to the exercise of rights
under this Section 2 shall take place at the offices of the Company at 11:00
a.m. local time on the date specified by the Participating First Offer Buyers,
which date shall be no later than 45 days after the date of the First Offer
Acceptance. At any such closing, each Participating First Offer Buyer shall
make payment to the Prospective Selling Shareholders of the purchase price
determined in accordance with the First Offer Notice for the number of Shares
being purchased by such Participating First Offer Buyer, and the Prospective
Selling Shareholders will deliver to the Participating First Offer Buyers the
certificates evidencing the Shares to be Transferred by the Prospective
Selling Shareholders, duly endorsed, or with stock (or equivalent) powers duly
endorsed, for transfer with signatures guaranteed with a "medallion"
guarantee, free and clear of any liens or encumbrances, with any stock (or
equivalent) transfer tax stamps affixed, against delivery of the applicable
consideration.
2.3 Period. The foregoing provisions of this Section 2 shall
expire upon the first closing of a Qualified Public Offering.
3. "TAG ALONG" AND "DRAG ALONG" RIGHTS
3.1 Tag Along. No holder of Shares (each such holder, a
"Prospective Selling Shareholder") shall Transfer any such Shares to any
Prospective Buyer, including a Participating First Offer Buyer pursuant to
Section 2 (any such Transfer is described herein as a "Sale" and the act of
engaging in such a Sale is referred to as to "Sell"), except in the manner and
on the terms set forth in Section 2 and this Section 3.1. Any attempted
Transfer of Shares not permitted by Section 2 or this Section 3.1 shall be
null and void, and the Company shall not in any way give effect to any such
impermissible Transfer.
3.1.1 Notice. A written notice (the "Tag Along Notice")
shall be furnished by the Prospective Selling Shareholders to each other
holder of Shares which is not an Affiliate of a Prospective Selling
Shareholder (the "Tag Along Offerors") at least 30 days prior to such
Transfer; provided, however, that the Tag Along Notice may be furnished
concurrently with the First Offer Notice relating to the proposed Transfer,
and holders of Shares may, in accordance with Section 2.1, exercise the rights
of first offer granted therein with respect to the Sale which is the subject
of such Tag Along Notice. The Tag Along Notice shall include:
(a) The principal terms of the proposed Sale insofar as
it relates to the Common Stock, including the
number of Shares to be purchased from the
Prospective Selling Shareholders, the percentage of
the total number of Shares held by such holder and
all Affiliates of such holder which such
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number of Shares constitutes (the "Tag Along Sale
Percentage"), the expected per Share purchase
price, the name and address of the Prospective
Buyer and the material representations and
warranties, covenants and indemnities to be
contained in the definitive documentation relating
to such Sale; and
(b) An invitation to each Tag Along Offeror to make an
offer to include in the proposed Sale to the
Prospective Buyer an additional number of Shares
(not in any event to exceed the Tag Along Sale
Percentage of the total number of Shares held by
such Tag Along Offeror) owned by such Tag Along
Offeror, on the same terms and conditions with
respect to each Share Sold (subject to Section
3.3.3), as the Prospective Selling Shareholders
shall Sell each of their Shares, provided that
neither any MCP Investor nor any Consultant shall
be entitled to be a Tag Along Offeror or a Tag
Along Seller with respect to any Warrants included
in the Sale to which a Tag Along Notice relates,
but shall be entitled to participate in such Sale
only to the extent it relates to Shares which are
not Warrants.
3.1.2 Exercise. Within 30 days after the effectiveness of
the Tag Along Notice, each Tag Along Offeror desiring to make an offer to
include Shares in the proposed Sale (each a "Participating Seller" and,
together with the Prospective Selling Shareholders, collectively, the "Tag
Along Sellers") shall send a written offer (the "Tag Along Offer") to the
Prospective Selling Shareholders specifying the number of Shares (not in any
event to exceed the Tag Along Sale Percentage of the total number of Shares
held by such Participating Seller) which such Participating Seller desires to
have included in the proposed Sale. Each Tag Along Offeror who does not so
accept the Prospective Selling Shareholders' invitation to make an offer to
include Shares in the proposed Sale shall be deemed to have waived all of such
Tag Along Offeror's rights with respect to such Sale, and the Tag Along
Sellers shall thereafter be free to Sell to the Prospective Buyer, at a per
share price no greater than 105% nor less than 95% of the per share price set
forth in the Tag Along Notice and on other terms which are not more favorable,
in any material respect, to the Tag Along Sellers than those set forth in the
Tag Along Notice, without any further obligation to such non-accepting Tag
Along Offerors.
3.1.3 Reduction of Shares Sold. The Prospective Selling
Shareholders shall attempt to obtain the inclusion in the proposed Sale of the
entire number of Shares which the Tag Along Sellers desire to have included in
the Sale (as evidenced in the case of the Prospective Selling Shareholders by
the Tag Along Notice and in the case of each Participating Seller by such
Participating Seller's Tag Along Offer). In the event the Prospective Selling
Shareholders shall be unable to obtain the inclusion of such entire number of
Shares in the proposed Sale (including without limitation by virtue of the
proviso to Section 2.1.5), the number of Shares to be sold in the proposed
Sale by each such Tag Along Seller shall be allocated to each Tag Along
Seller, pro rata based on the aggregate number of Shares held by each such Tag
Along Seller concurrently receiving an allocation of Shares; provided,
however, that if, in the case of any such Tag Along Seller, such Tag Along
Seller shall have been so allocated a number of Shares equal to the number
specified by such Tag Along Seller in such Tag Along Notice or Tag Along
Offer, as applicable, then such Tag Along Seller shall not be allocated any
Shares in excess of such
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number so specified, and any Shares remaining unallocated shall be allocated
among the remaining Tag Along Sellers pro rata based on the aggregate number
of Shares held by each such remaining Tag Along Seller, until all Shares
specified to be sold in the Tag Along Notice have been so allocated.
3.1.4 Irrevocable Offer. The offer of each Participating
Seller contained in his Tag Along Offer shall be irrevocable, and, to the
extent such offer is accepted, such Participating Seller shall be bound and
obligated to Sell in the proposed Sale on the same terms and conditions, with
respect to each Share Sold (subject to Section 3.3.3), as the Prospective
Selling Shareholders, up to such number of Shares as such Participating Seller
shall have specified in such Participating Seller's Tag Along Offer; provided,
however, that (a) if the principal terms of the proposed Sale change with the
result that the per share price shall be less than 95% of the per share price
set forth in the Tag Along Notice or the other terms shall be less favorable,
in any material respect, to the Tag Along Sellers than those set forth in the
Tag Along Notice, each Participating Seller shall be permitted to withdraw the
offer contained in his Tag Along Offer and shall be released from such
Participating Seller's obligations thereunder, and the Prospective Selling
Shareholders shall comply with the provisions of Section 2, and (b) if, at the
end of the 180th day following the date of the effectiveness of the Tag Along
Notice, the Prospective Selling Shareholders have not completed the proposed
Sale, each Participating Seller shall be released from such Participating
Seller's obligations under his Tag Along Offer, the Tag Along Notice shall be
null and void, and it shall be necessary for a separate Tag Along Notice to be
furnished, and the terms and provisions of this Section 3 separately complied
with, in order to consummate such proposed Sale pursuant to this Section 3,
unless the failure to complete such Sale resulted from any failure by any
Participating Seller to comply with the terms of this Section 3.
3.1.5 Additional Compliance. If, prior to consummation,
the terms of the proposed Sale shall change with the result that the per share
price to be paid in such proposed Sale shall be greater than 105% or less than
95% of the per share price set forth in the Tag Along Notice or the other
terms of such proposed Sale shall be more favorable, in any material respect,
to the Tag Along Sellers than those set forth in the Tag Along Notice, the Tag
Along Notice shall be null and void, and it shall be necessary for a separate
Tag Along Notice to be furnished, and the terms and provisions of this Section
3 separately complied with, in order to consummate such proposed Sale pursuant
to this Section 3, provided, however, that in the case of such a separate Tag
Along Notice, each applicable period to which reference is made in Sections
3.1.1 and 3.1.2 shall be the longer of (a) the remaining portion of the 30 day
period applicable to the first Tag Along Notice distributed in connection with
such proposed Sale or (b) ten business days, so long as the closing will occur
by the 180th day following the date of effectiveness of the Tag Along Notice.
3.1.6 Excluded Transactions. Notwithstanding the
foregoing, no holder of Shares shall have any right of participation pursuant
to the provisions of this Section 3.1. or otherwise with respect to any
Transfer of Shares permitted by Sections 3.2, 4.1.1, 4.1.3, 5.1, 5.2, 5.3.2,
5.3.3, 6.1.1, 6.1.3, 6.1.4, 7.1.1 or 7.1.3.
3.2 Drag Along. If the Board or the holders of more than 50% of
the Shares at any time outstanding (each a "Prospective Selling Shareholder")
approve an arm's length sale to an
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Independent Third Party (a "Drag Along Buyer") of (a) at least 80% (after
giving effect to the provisions of this Section 3.2) of the Shares at such
time outstanding (such percentage the "Drag Along Sale Percentage") or (b) at
least 80% of the assets of the Company, then each holder of Shares agrees, if
requested by the Company or the Prospective Selling Shareholders, as
appropriate, to sell the Drag Along Sale Percentage of such holder's Shares,
or otherwise vote such holder's Shares and take all other actions as may be
reasonably requested by the Company or the Prospective Selling Shareholders,
all in the manner and on the terms set forth in this Section 3.2 and in
Section 3.3.
3.2.1 Exercise. If the Company or one or more Prospective
Selling Shareholders elect to exercise its or their rights under this Section
3.2, a written notice (the "Drag Along Notice") shall be furnished by the
Company or the Prospective Selling Shareholders to each holder of Shares not
less than 10 days prior to the Sale. The Drag Along Notice shall set forth the
principal terms of the proposed Sale or asset sale, including, as applicable,
the manner in which such Shares or assets are to be Sold, the number of Shares
proposed to be acquired from the holders of Shares or to be acquired from the
Prospective Selling Shareholders (and in each such case, the Drag Along Sale
Percentage), the per share consideration to be received in the proposed Sale,
and the name and address of the Drag Along Buyer.
3.2.2 Sale. If the Company or the Prospective Selling
Shareholders consummate the proposed Sale to which reference is made in the
Drag Along Notice, each other holder of Shares (each a "Participating Seller",
and, together with the Prospective Selling Shareholders, collectively, the
"Drag Along Sellers") shall be bound and obligated to Sell the Drag Along Sale
Percentage of such holder's Shares in the proposed Sale on the same terms and
conditions, with respect to each Share Sold (subject to Section 3.3.3), as the
Prospective Selling Shareholders shall Sell each Share in the Sale. If at the
end of the 180th day following the date of the effectiveness of the Drag Along
Notice the Company or the Prospective Selling Shareholders have not completed
the proposed Sale, each Participating Seller shall be released from its
obligation under the Drag Along Notice, the Drag Along Notice shall be null
and void, and it shall be necessary for a separate Drag Along Notice to be
furnished and the terms and provisions of this Section 3.2 separately complied
with, in order to consummate such proposed Sale pursuant to this Section 3.2.
3.3 Miscellaneous. The following provisions shall be applied to
any Sale to which Section 3 applies:
3.3.1 Certain Legal Requirements. In the event the
consideration to be paid in exchange for Shares in a proposed Sale pursuant to
Section 3 includes any securities, and the receipt thereof by a Participating
Seller would require under applicable law (i) the registration or
qualification of such securities or of any person as a broker or dealer or
agent with respect to such securities or (ii) the provision to any Tag Along
Seller or Drag Along Seller of any information other than such information as
would be required under Regulation D in an offering made pursuant to
Regulation D solely to "accredited investors" as defined in Regulation D, the
Prospective Selling Shareholders shall be obligated only to use their
reasonable efforts to cause the requirements under Regulation D to be complied
with to the extent necessary to permit such Participating Seller to receive
such securities, it being understood and agreed that the Prospective Selling
Shareholders shall not be under any obligation to effect a registration of
such securities
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under the Securities Act or similar statutes. Notwithstanding any provisions
of this Section 3, if use of reasonable efforts does not result in the
requirements under Regulation D being complied with to the extent necessary to
permit such Participating Seller to receive such securities, the Prospective
Selling Shareholders shall cause to be paid to such Participating Seller in
lieu thereof, against surrender of the Shares (in accordance with Section
3.3.5) which would have otherwise been Sold by such Participating Seller to
the Prospective Buyer in the Sale, an amount in cash equal to the Fair Market
Value of such Shares as of the date of the issuance of securities in exchange
for Shares. The obligation of the Prospective Selling Shareholders to use
reasonable efforts to cause such requirements to have been complied with to
the extent necessary to permit a Participating Seller to receive such
securities shall be conditioned on such Participating Seller executing such
documents and instruments, and taking such other actions (including, without
limitation, if required by the Prospective Selling Shareholders, agreeing to
be represented during the course of such transaction by a "purchaser
representative" (as defined in Regulation D) in connection with evaluating the
merits and risks of the prospective investment and acknowledging that he was
so represented), as the Prospective Selling Shareholders shall reasonably
request in order to permit such requirements to be complied with. Unless the
Participating Seller in question shall have taken all actions reasonably
requested by the Prospective Selling Shareholders in order to comply with the
requirements under Regulation D, such Participating Seller shall not have the
right to require the payment of cash in lieu of securities under this Section
3.3.1.
3.3.2 Further Assurances. Each Participating Seller,
whether in his capacity as a Participating Seller, Shareholder, officer or
director of the Company, or otherwise, shall take or cause to be taken all
such actions as may be necessary or reasonably desirable in order
expeditiously to consummate each Sale pursuant to Section 3.1 or Section 3.2
and any related transactions, including, without limitation, executing,
acknowledging and delivering consents, assignments, waivers and other
documents or instruments; furnishing information and copies of documents;
filing applications, reports, returns, filings and other documents or
instruments with governmental authorities; and otherwise cooperating with the
Prospective Selling Shareholders and the Prospective Buyer; provided, however,
that no Participating Seller shall be required to make any representations,
warranties, covenants or indemnities other than with respect to such
Participating Seller's authority to Transfer such Shares, such Participating
Seller's ownership of Shares, the absence of contravention of agreements
relating to such Participating Seller and other matters relating to such
Participating Seller; provided, further, that such Participating Seller shall
agree with the Prospective Buyer, the Prospective Selling Shareholder and any
other Participating Sellers, as a post-closing adjustment of the purchase
price paid to such Participating Seller, to return an amount of the proceeds
received by such Participating Seller equal to the amount that such
Participating Seller would have otherwise paid in respect of such other
representations, warranties, covenants and indemnities as are made by a
Prospective Selling Shareholder but are not made by such Participating Seller.
Except with respect to individual representations, warranties, covenants,
indemnities and other agreements of Participating Sellers of the type
described above, the aggregate amount of any liability hereunder shall not
exceed the lesser of (i) such Participating Seller's pro rata portion of any
such liability, to be determined in accordance with such Participating
Seller's portion of the total number of Shares included in such Sale or (ii)
the proceeds to such Participating Seller in connection with such Sale.
Subject to the foregoing, each Participating Seller agrees to execute and
deliver such agreements as may
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be reasonably specified by the Prospective Selling Shareholder to which such
Prospective Selling Shareholder will also be a party to the extent necessary
to reflect the foregoing.
3.3.3 Treatment of Different Classes of Common Stock and of
Options.
(a) The relative amounts of consideration to be
received in respect of Shares in a Sale pursuant to
Section 3.1 or 3.2 shall be determined by the Board
based on the aggregate consideration to be paid in
respect of all such Shares being Transferred in
such Sale, the aggregate value of all of the equity
of the Company derived from such aggregate
consideration, and the relative amounts which would
be paid in respect of the Shares were such
aggregate value of all such equity to be paid out
in liquidation of the Company in accordance with
the terms of the Company's certificate of
incorporation as in effect from time to time (or,
if greater with respect to any Shares, the amount
which would be received upon any conversion,
exercise or exchange of such Share for Shares of
Class B Common Stock in accordance with the terms
of such Share), all after giving effect to any
applicable changes in rates of conversion, exercise
or exchange, but shall not take into account any
differences in voting rights, rights to elect
directors or any other rights other than such
rights upon a liquidation of the Company or a
conversion, exercise or exchange of such Share.
(b) If any Participating Seller shall Sell Options in
any Sale pursuant to Section 3.1, such
Participating Seller shall receive in exchange for
such Options consideration equal to the amount (if
greater than zero) determined by multiplying (i)
the purchase price per share of Common Stock
received by the holders of the Prospective Selling
Shareholders in such Sale less the exercise price
per share of such Option by (ii) the number of
shares of Common Stock issuable upon exercise of
such Option (to the extent exercisable at the time
of such Sale).
(c) Notwithstanding the fact that the only Shares to be
sold by Prospective Selling Shareholders may be
shares of one or more classes of Common Stock, each
holder of Shares of each class of Common Stock
shall be entitled to the benefits, and subject to
the obligations, of Sections 3.1 and 3.2 hereof
with respect to all Shares held by such holder as
if all Shares were of the same class of Common
Stock, subject only to possible differences in the
per-Share consideration to be paid in accordance
with Sections 3.3.3(a) and 3.3.3(b).
3.3.4 Expenses. All reasonable costs and expenses
incurred by any Tag Along Seller, Drag Along Seller or the Company in
connection with any proposed Sale pursuant to this Section 3 (whether or not
consummated), including, without limitation, all attorneys fees and charges,
all accounting fees and charges and all finders, brokerage or investment
banking fees, charges or commissions, shall be paid by the Company.
Notwithstanding the foregoing, the Company shall not be required to pay in
connection with any such proposed Sale in excess of an aggregate of $100,000
in respect of the fees and expenses of separate legal counsel or other
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advisors retained by or on behalf of any and all of the Participating Sellers
in connection with any such proposed Sale. Such limit shall be apportioned
amongst all Participating Sellers pro rata in accordance with the Shares
proposed to be Sold by each Participating Seller. Any such fees and expenses
in excess of such limits shall be borne by such Participating Sellers.
3.3.5 Closing. The closing of a Sale pursuant to Section
3.1 shall take place at such time and place as the Prospective Selling
Shareholders shall specify. At the closing of any Sale under this Section 3
(other than an asset sale pursuant to Section 3.2), each Participating Seller
shall deliver the certificates evidencing the Shares to be Sold by such
Participating Seller, duly endorsed, or with stock (or equivalent) powers duly
endorsed, for transfer with signature guaranteed with "medallion" guarantee,
free and clear of any liens or encumbrances, with any stock (or equivalent)
transfer tax stamps affixed, against delivery of the applicable consideration.
It is understood and agreed that no holder of Shares shall have any liability
to any other holder of Shares arising from, relating to or in connection with
any proposed Sale which has been the subject of a Tag Along Notice or Drag
Along Notice whether or not such proposed Sale is consummated.
3.4 Period. The foregoing provisions of this Section 3 shall
expire upon the first closing of a Qualified Public Offering.
4. INITIAL INVESTOR TRANSFER RIGHTS. No holder of Initial Investor
Shares shall Transfer any of such Shares to any other Person except as
permitted by this Section 4. Any attempted Transfer of Initial Investor Shares
not permitted by this Section 4 shall be null and void, and the Company shall
not in any way give effect to any such impermissible Transfer.
4.1 Certain Permitted Transfers. Notwithstanding the foregoing,
any holder of Initial Investor Shares may Transfer any or all Initial Investor
Shares held by such holder as set forth below:
4.1.1 Initial Investors. Subject to the provisions of
Section 9.1, any holder of Initial Investor Shares may Transfer any or all of
such Initial Investor Shares: (i) to an Affiliated Fund; or (ii) in a pro rata
Transfer to its members or partners. Any holder of Initial Investor Shares
that is a limited liability company or limited partnership whose members or
partners are comprised primarily of (i) Persons that are organized in
jurisdictions outside the United States and (ii) Persons formed for investment
purposes by entities organized in jurisdictions outside the United States may
Transfer to any Initial Investor or an Affiliated Fund who was Transferred
Initial Investor Shares under clause (i) of this Section 4.1.1 whose members
or partners are comprised primarily of Persons organized within the United
States.
4.1.2 First Offers, Tag Alongs and Drag Alongs. Any
holder of Initial Investor Shares may Transfer any or all of such Initial
Investor Shares in accordance with the provisions, terms and conditions of
Sections 2 and 3; provided, however, that no holder of Initial Investor Shares
may initiate a Transfer or Sale as a Prospective Selling Shareholder under
Sections 2 or 3 without the approval of the Board before the
Lock-Up/Standstill Termination Date.
4.1.3 Sales to Public. Any holder of Initial Investor
Shares may Transfer any or all of such Initial Investor Shares in a Public
Offering or, after the closing of the Initial Public
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Offering, pursuant to Rule 144. If the Company shall receive from any Initial
Investor actual notice of any Transfer of Initial Investor Shares pursuant to
Rule 144, the Company shall notify each other Shareholder of the receipt of
such notice.
4.2 Period. The foregoing provisions of this Section 4 shall
expire upon the first closing of a Qualified Public Offering.
5. MANAGEMENT EQUITYHOLDER TRANSFER RIGHTS. No holder of Management
Equityholder Shares shall Transfer any of such Shares to any other Person
except as permitted by this Section 5. Any attempted Transfer of Management
Equityholder Shares not permitted by this Section 5 shall be null and void,
and the Company shall not in any way give effect to any such impermissible
Transfer.
5.1 Transfers to Immediate Family and Certain Shareholders of
Equity Interests. Subject to the provisions of Section 8.2 and Section 9.1,
any holder of Management Equityholder Shares which is a natural person may
Transfer any or all of his Management Equityholder Shares to a Member of the
Immediate Family of such holder, and any holder of Management Equityholder
Shares which is not a natural person may Transfer any or all of such holder's
Management Equityholder Shares to a stockholder, member, partner or other
holder of any equity interest in such holder.
5.2 Transfer Upon Death. Subject to the provisions of Section
9.1, upon the death of any holder of Management Equityholder Shares, the
Management Equityholder Shares held by such holder may be distributed by will
or other instrument taking effect at death or by applicable laws of descent
and distribution to such holder's estate, executors, administrators and
personal representatives, and then to such holder's heirs, legatees or
distributees, whether or not such recipients are Members of the Immediate
Family of such holder.
5.3 Other Permitted Transfers. Notwithstanding the foregoing,
any holder of Management Equityholder Shares may Transfer any or all
Management Equityholder Shares held by such holder as set forth below:
5.3.1 First Offers, Tag Alongs and Drag Alongs. Any
holder of Management Equityholder Shares may Transfer any or all of such
Management Equityholder Shares in accordance with the provisions, terms and
conditions of Sections 2 and 3.
5.3.2 Sales to Public. Any holder of Management
Equityholder Shares may Transfer any or all of such Management Equityholder
Shares in a Public Offering or, after the closing of the Initial Public
Offering, pursuant to Rule 144.
5.3.3 Plan Transactions and Employee Stock Repurchases.
Any holder of Management Equityholder Shares may Transfer any or all of his or
her Management Equityholder Shares to the Company in accordance with the terms
of the Company's employee benefit plans or other agreements relating to the
Company's right to repurchase the shares of employees as in effect on the date
of this Agreement.
5.4 Period. The foregoing provisions of this Section 5 shall
expire upon the closing of a Qualified Public Offering.
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6. CONSULTANT TRANSFER RIGHTS. No holder of Consultant Shares shall
Transfer any such Shares to any Person except in the manner and on the terms
set forth in this Section 6. Any attempted Transfer of Consultant Shares not
permitted by this Section 6 shall be null and void, and the Company shall not
in any way give effect to any such impermissible Transfer.
6.1 Permitted Transfers. Notwithstanding the foregoing, any
holder of Consultant Shares may Transfer any or all Consultant Shares held by
such holder as set forth below:
6.1.1 Investors. Any holder of Consultant Shares may
Transfer any or all of such Consultant Shares to any (i) Affiliate (other than
the Company); or (ii) in a pro rata Transfer to its equity holders.
6.1.2 First Offers, Tag Alongs and Drag Alongs. Any
holder of Consultant Shares may Transfer any or all of such Consultant Shares
in accordance with the provisions, terms and conditions of Sections 2 and 3;
provided, however, that no holder of Consultant Shares may initiate a Transfer
or Sale as a Prospective Selling Shareholder under Sections 2 or 3 without the
approval of the Board before the Lock-Up/Standstill Termination Date.
6.1.3 Sales to Public. Any holder of Consultant Shares
may Transfer any or all of such Consultant Shares in a Public Offering or,
after the closing of the Initial Public Offering, pursuant to Rule 144.
6.1.4 Consultants. Subject to the provisions of Section
9.1, any holder of Consultant Shares may Transfer any or all of such
Consultant Shares to TMC or MCLP.
6.2 Period. The foregoing provisions of this Section 6 shall
expire on the closing of a Qualified Public Offering.
7. WARRANT INVESTOR TRANSFER RIGHTS. No holder of Warrant Shares shall
Transfer any of such Shares to any other Person except as permitted by this
Section 7. Any attempted Transfer of Warrant Shares not permitted by this
Section 7 shall be null and void, and the Company shall not in any way give
effect to any such impermissible Transfer.
7.1 Certain Permitted Transfers. Notwithstanding the foregoing,
any holder of Warrant Shares may Transfer any or all Warrant Shares held by
such holder as set forth below:
7.1.1 Certain Affiliates. Subject to the provisions of
Section 9.1, any holder of Warrant Shares may Transfer any or all of such
Warrant Shares: (i) to an Affiliated Fund; (ii) in a pro rata Transfer to its
members or partners or (iii) to an Affiliate. Any holder of Warrant Shares
that is a limited liability company or limited partnership whose members or
partners are comprised primarily of (i) Persons that are organized in
jurisdictions outside the United States and (ii) Persons formed for investment
purposes by entities organized in jurisdictions outside the United States may
Transfer to any Warrant Investor or an Affiliated Fund who was Transferred
Warrant Shares under clause (i) of this Section 7.1.1 whose members or
partners are comprised primarily of Persons organized within the United
States.
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7.1.2 First Offers, Tag Alongs and Drag Alongs. Any
holder of Warrant Shares may Transfer any or all of such Warrant Shares in
accordance with the provisions, terms and conditions of Sections 2 and 3.
7.1.3 Sales to Public. Any holder of Warrant Shares may
Transfer any or all of such Warrant Shares in a Public Offering or, after the
closing of the Initial Public Offering, pursuant to Rule 144.
7.2 Period. The foregoing provisions of this Section 7 shall
expire upon the first closing of a Qualified Public Offering.
8. CERTAIN OTHER COVENANTS.
8.1 MCP Investor Standstill. Until the Lock-Up/Standstill
Termination Date, no MCP Investor, and no Affiliate of a MCP Investor, shall,
without the prior consent of the Board, purchase any Common Stock if and to
the extent that, immediately after giving effect to such purchase, the
aggregate number of shares of Common Stock collectively owned by the MCP
Investors and their Affiliates would exceed 45% of the aggregate number of
shares of Common Stock then outstanding; provided, however, that the foregoing
shall not preclude the MCP Investors from exercising their rights to acquire
Shares under Section 2 or Section 3 hereof or pursuant to the exercise of any
preemptive rights.
8.2 Transfer of Shares or Powers to Foreign Persons. Until the
Initial Public Offering, no Transfer of Shares, or proxies or powers of
attorney granting the authority to vote the Shares, shall be made or granted
by any Shareholder to a Person, other than an immediate Affiliate of such
Shareholder, that is not a "U.S. Person" as defined in Appendix C of the
National Industrial Security Program Operating Manual; provided, however, that
the foregoing shall not apply to any indirect interest in a Share which is
held directly by an Initial Investor or a Warrant Investor.
9. CERTAIN ISSUANCES AND TRANSFERS, ETC.
9.1 Transfers to Permitted Transferees. Each holder of Shares
agrees that no Transfer of any such Shares to any Permitted Transferee shall
be effective unless such Permitted Transferee has delivered to the Company a
written acknowledgment and agreement in form and substance reasonably
satisfactory to the Company that such Shares to be received by such Permitted
Transferee shall remain MCP Shares, Initial Investor Shares, Consultant
Shares, Management Equityholder Shares or Warrant Shares hereunder, as the
case may be, and shall continue to be subject to all of the provisions of this
Agreement and that such Permitted Transferee shall be bound by and a party to
this Agreement as the holder of Initial Investor Shares, Consultant Shares,
Management Equityholder Shares or Warrant Shares, as the case may be,
hereunder; provided, however, that no Transfer by any party to a Permitted
Transferee shall relieve such party of any of its obligations hereunder.
9.2 Other Transfers and Issuances. Notwithstanding any other
provision of this Agreement, Shares transferred pursuant to Section 2.1, 3.1
or 3.2 (other than Shares transferred by a Shareholder to another Shareholder
which is also its Affiliate) or in a Public Offering or to the public under
Rule 144 shall be conclusively deemed thereafter not to be Shares under this
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Agreement and not to be subject to any of the provisions hereof or entitled to
the benefit of any of the provisions hereof, unless such Shares are
subsequently acquired by a Shareholder, in which case the Shares shall
continue to be subject to the provisions hereof.
9.3 Subsequent Issuances. The Company shall require, with the
written consent of the Majority MCP Investors, that all Persons to which
shares of Common Stock are issued by the Company after the date hereof to
become parties hereto having rights and obligations substantially similar to
those of the Initial Investors.
10. REGISTRATION RIGHTS.
10.1 Demand Registration Rights. The Initial Investors, the
Consultants and the Warrant Investors (each a "Demand Registrant") may
request, by written notice to the Company, that the Company effect the
registration under the Securities Act of Registrable Securities on the terms
and conditions set forth in this Section 10.1 (each a "Demand Registration").
If the Company receives a request for a Demand Registration pursuant to this
Section 10.1, the Company may either (A) proceed with such Demand Registration
pursuant to the provisions of this Section 10.1 or (B) proceed with a
registered primary Public Offering, in which case the Demand Registrants will
have the rights set forth in Section 10.2 and such Public Offering will not
constitute a Demand Registration pursuant to this Section 10.1.
10.1.1 By Initial Investors and Consultants. At any time
after the date (the "First Demand Date") which is the earlier of (a) September
7, 2004, or (b) six months after a Qualified Public Offering, the Majority MCP
Investors may request a Demand Registration of such of the then outstanding
Registrable Securities held by the MCP Investors and Consultants as a group as
the Majority MCP Investors may specify in such request. Any such request will
also specify the intended method of disposition thereof. In no event shall the
Company be required to register Registrable Securities pursuant to this
Section 10.1.1 more than a maximum of two separate occasions.
10.1.2 By 1999 Warrant Investors. At any time after the
First Demand Date, 1999 Warrant Investors owning, individually or in the
aggregate, at least 37.5% of the 1999 Warrant Shares may request a Demand
Registration of such of their 1999 Warrant Shares that are Registrable
Securities as such 1999 Warrant Investors may specify in such request. Any
such request will also specify the intended method of disposition thereof. In
no event shall the Company be required to register Registrable Securities
pursuant to this Section 10.1.2 on more than one separate occasion.
10.1.3 By 2000 Warrant Investors. At any time after the
First Demand Date, the Majority 2000 Warrant Investors may request a Demand
Registration of such of their 2000 Warrant Shares that are Registrable
Securities as such 2000 Warrant Investors may specify in such request. Any
such request will also specify the intended method of disposition thereof. In
no event shall the Company be required to register Registrable Securities
pursuant to this Section 10.1.3 on more than one separate occasion.
10.1.4 Participation by Other Demand Registrants. Within
10 days after receipt of a notice of a Demand Registration pursuant to Section
10.1.1, 10.1.2 or 10.1.3, the Company
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will give written notice of such requested registration to all other holders
of Registrable Securities. The Company will then use its best efforts
expeditiously to effect the registration under the Securities Act of the
Registrable Securities which the Company has been requested to register by the
Demand Registrants, and all other Registrable Securities which the Company has
been requested to register by other holders by notice delivered to the Company
within 20 days after the giving of such notice by the Company. Subject to
Sections 10.1.7 and 10.4.1, such participation by other Demand Registrants
shall constitute a Demand Registration pursuant to Section 10.1.1, 10.1.2 or
10.1.3, as applicable.
10.1.5 Registration on Form S-3. At any time within five
years after the Company becomes eligible to file a Registration Statement on
Form S-3, any holder of Registrable Securities may request the Company to
effect the registration on Form S-3 pursuant to Rule 415 of such number of
Registrable Securities held by such holder having a market value of not less
than $1,000,000 as shall be specified in the request. Any such request will
also specify the intended method of disposition thereof. Promptly after
receipt of such notice, the Company will give written notice of such requested
registration to all other holders of Registrable Securities. The Company will
then use its best efforts expeditiously to effect the registration under the
Securities Act of the Registrable Securities which the Company has been
requested to register by such Demand Registrants, and all other Registrable
Securities which the Company has been requested to register by other holders
by notice delivered to the Company within 20 days after the giving of such
notice by the Company.
10.1.6 Postponement. The Company may postpone for a period
of up to 60 days the filing or the effectiveness of any registration requested
pursuant to this Section 10.1 if the Board of Directors of the Company in good
faith determines that such registration is likely to have a material adverse
effect on any plan, proposal or agreement by the Company with respect to any
financing, acquisition, recapitalization, reorganization or other material
transaction; provided, however, that the Company may not exercise such right
of postponement more frequently than one time in any 12-month period; and
provided, further, that the Company shall promptly provide written notice of
any such postponement to each holder of Registrable Securities.
10.1.7 Payment of Expenses. The Company shall pay all
Registration Expenses in connection with all registrations effected pursuant
to this Section 10.1. However, the Company shall not be required to pay for
any expenses of such registration proceeding if the registration request is
withdrawn at any time at the request of the Majority Participating
Shareholders (in which case all participating Shareholders shall bear such
expenses). Notwithstanding the foregoing, if the participating Shareholders
have learned of a change in the condition, business, or prospects of the
Company or in the condition of the financial markets from that known to the
initiating Demand Registrants at the time of their request and such change
could be expected to have an adverse effect on the proposed offering in the
good faith judgment of the Majority Participating Shareholders, then the
Shareholders shall not be required to pay any of such expenses in the case of
a registration requested pursuant to this Section 10.1 and any Demand
Registration right that was exercised pursuant to Section 10.1.1, 10.1.2, or
10.1.3 in connection therewith shall not be forfeited.
10.1.8 Repurchase Election.
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(a) Notwithstanding the foregoing provisions of
Sections 10.1.2 and 10.1.3, the Company shall not
be obligated to effect a Demand Registration
pursuant to such Sections if the Company elects to
make an offer to repurchase (a "Purchase Offer")
all of the Registrable Securities requested to be
registered by Demand Registrants making the initial
request pursuant to such Sections and all other
holders of Warrant Shares joining in such request
(a "Purchase Election") by mailing notice of such
Purchase Offer to all such holders on a date (the
"Purchase Election Date") not more than 45 days
after the receipt of any request for a Demand
Registration under Sections 10.1.2 or 10.1.3 and
indicating in such Purchase Offer that the
Registrable Securities will be purchased at a price
in cash per Share equal to the Fair Market Value of
each share of Class B Common Stock (in the case of
a Warrant, at the Fair Market Value of each share
of Class B Common Stock issuable upon exercise of
such Warrant less that portion of the exercise
price allocable to such share of Class B Common
Stock).
(b) Notice of a Purchase Offer shall be mailed by the
Company (or caused to be mailed by the Company),
not less than 30 days nor more than 60 days before
the Purchase Offer Payment Date, to each holder of
Warrant Shares at its last registered address. The
Purchase Offer shall remain open from the time of
mailing for at least 20 Business Days and until
5:00 p.m. New York City time on the Business Day
next preceding the Purchase Offer Payment Date. The
notice, which shall govern the terms of the
Purchase Offer, shall include such disclosures as
are required by law and shall state:
(i) that the Purchase Offer is being made
pursuant to this Section 10.1.8 and that
all Warrant Shares constituting
Registrable Securities tendered for
repurchase will be accepted for payment;
(ii) the purchase price calculated as set forth
above and the payment date which shall be
not less than 30 days nor more than 60
days after the notice of the Purchase
Election is mailed to the participating
holders of Warrant Shares (the "Purchase
Offer Payment Date");
(iii) that any Warrant Shares constituting
Registrable Securities accepted for
payment pursuant to the Purchase Offer
shall cease to be outstanding after the
Purchase Offer Payment Date unless the
Company defaults in making payment
therefor of the purchase price;
(iv) that holders electing to have Warrant
Shares constituting Registrable Securities
purchased pursuant to a Purchase Offer
will be required to surrender such Warrant
Shares constituting Registrable
Securities, together with a completed
letter of transmittal, to the Company (or
its agent as designated by the
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Company in such notice) at the address
specified in the notice no later than 5:00
p.m. New York City time on the business
day prior to the Purchase Offer Payment
Date;
(v) that participating holders will be
entitled to withdraw their election if the
Company (or such designated agent)
receives, not later than 5:00 p.m. New
York City time on the business day prior
to the Purchase Offer Payment Date, a
telegram, telex, facsimile transmission or
letter setting forth the name of the
holder, the number and type of Warrant
Shares constituting Registrable Securities
delivered for purchase and a statement
that such holder is withdrawing its
election to have such Registrable
Securities purchased and promptly
thereafter the Company (or such designated
agent) shall redeliver the withdrawn
Warrant Shares constituting Registrable
Securities to the holder;
(vi) that a holder electing not to tender such
holder's Warrant Shares constituting
Registrable Securities for purchase
pursuant to such Purchase Offer by 5:00
p.m. New York City time on the business
day prior to the Purchase Offer Payment
Date will have no continuing right to
require the Company to repurchase such
holder's Warrant Shares constituting
Registrable Securities; and
(vii) that holders whose Warrant Shares
constituting Registrable Securities are
tendered for purchase in part only will be
issued new certificates representing the
number of the unpurchased Warrant Shares
constituting Registrable Securities
surrendered.
On the Purchase Offer Payment Date, the Company
shall (i) accept for payment Warrant Shares
constituting Registrable Securities or portions
thereof tendered pursuant to the Purchase Offer,
(ii) promptly deliver to the holders so accepted
payment of the purchase price therefor and (iii)
issue and mail or deliver to such Shareholders new
certificates representing the number and type of
Warrant Shares constituting Registrable Securities
equal to the unpurchased portion of the Warrant
Shares constituting Registrable Securities
surrendered. Upon payment to the holders for all
Warrant Shares constituting Registrable Securities
tendered pursuant to a Purchase Offer, or if
holders did not tender Warrant Shares constituting
Registrable Securities, the Company shall be deemed
to have effected the Demand Registration. The
Company shall comply, to the extent applicable,
with the requirements of Sections 13 and 14 of the
Exchange Act, and any other securities laws or
regulations in connection with the repurchase of
Warrant Shares constituting Registrable Securities
pursuant to a Purchase Offer. To the extent that
the provisions of any securities laws or
regulations conflict with the provisions of this
Section 10.1.8, the Company shall comply with the
applicable securities laws and regulations and
shall not be deemed to have breached its
obligations under
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this Section 10.1.8 by virtue thereof. The Company
may assign its rights under this Section 10.1.8 to
the holders of the Class A Common Stock; provided
that the offer to repurchase all Registrable
Securities complies substantially with this Section
10.1.8.
10.1.9 No Inconsistent Agreements. The Company has not
entered into nor will the Company on or after the date of this Agreement enter
into any agreement which is inconsistent with the rights granted to the
holders of Registrable Securities pursuant to Section 10 or otherwise
conflicts with the provisions of Section 10.
10.2 Piggyback Registration.
10.2.1 Piggyback Rights. If the Company at any time
proposes to register any of its equity securities under the Securities Act,
for its own account or for the account of any holder of its securities, on a
form which would permit registration of Registrable Securities for sale to the
public under the Securities Act, or proposes to register any equity securities
in a so-called "unallocated" or "universal" shelf registration statement, the
Company will each such time give notice to all holders of Registrable
Securities of its intention to do so. Such notice shall describe such
securities and specify the form, manner and other relevant aspects of such
proposed registration. Any such holder may by written response delivered to
the Company within 20 days after the giving of any such notice request that
all or a specified part of the Registrable Securities held by such holder be
included in such registration. Such response shall also specify the intended
method of disposition of such Registrable Securities. The Company thereupon
will use its best efforts as a part of its filing of such form to effect the
registration under the Securities Act of all Registrable Securities which the
Company has been so requested to register by the holders of Registrable
Securities, to the extent required to permit the disposition (in accordance
with the intended methods thereof as aforesaid) of the Registrable Securities
so to be registered. The Company shall be under no obligation to complete any
offering of its securities it proposes to make and shall incur no liability to
any holder for its failure to do so. No registration of Registrable Securities
effected under this Section 10.2 shall relieve the Company of any of its
obligations to effect registrations of Registrable Securities pursuant to
Section 10.1 hereof.
10.2.2 Excluded Transactions. The Company shall not be
obligated to effect any registration of Registrable Securities under this
Section 10.2 incidental to the registration of any of its securities in
connection with mergers, acquisitions, exchange offers, dividend reinvestment
plans or stock option or other employee benefit plan, if such registration is
on Form X-0, Xxxx X-0 or any similar form.
10.2.3 Payment of Expenses. The Company hereby agrees to
pay all Registration Expenses in connection with each registration of
Registrable Securities requested pursuant to this Section 10.2.
10.3 Registration Procedures. If and whenever the Company is
required to use its best efforts to effect the registration of any Registrable
Securities under the Securities Act as provided in Sections 10.1 or 10.2, the
Company will as expeditiously as reasonably possible:
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10.3.1 Registration Statement. Prepare and (in the case of
a registration pursuant to Section 10.1 hereof, promptly and in any event
within 60 days after the end of the period within which requests for
registration may be delivered to the Company) file with the Commission a
registration statement with respect to such Registrable Securities and use its
best efforts to cause such registration statement to become effective. Each
such registration made under Section 10.1.1, 10.1.2 or 10.1.3 shall be made on
Form S-1, or such other Form as may be consented to by the Majority
Participating Shareholders. Such registration statement shall be for an
offering to be made on a continuous or delayed basis (a so-called "shelf
registration statement") if the Company is eligible for the use thereof and
the Majority Participating Shareholders have requested a shelf registration
statement.
10.3.2 Amendments and Supplements to Registration
Statement. 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 and to comply with the provisions of the Securities Act with respect
to the disposition of all Registrable Securities and other securities, if any,
covered by such registration statement until the later of (i) such time as all
of such Registrable Securities have been disposed of in accordance with the
intended methods of disposition by the seller or sellers thereof set forth in
such registration statement (but in no event for a period of more than 180
days after such registration statement becomes effective) or (ii) the
expiration of the time when a prospectus relating to such registration is
required to be delivered under the Securities Act.
10.3.3 Cooperation. Use its best efforts to cooperate with
the seller(s) in the disposition of the Common Stock covered by such
registration statement, including without limitation in the case of an
underwritten offering pursuant to Section 10.1 causing key executives of the
Company and its subsidiaries to participate under the direction of the
managing underwriter in a "road show" scheduled by such managing underwriter
in such locations and of such duration as in the judgment of such managing
underwriter are appropriate for such underwritten offering.
10.3.4 Furnishing of Copies of Registration Statements and
Other Documents. Furnish to each seller of such Registrable Securities such
number of conformed copies of such registration statement and of each such
amendment and supplement thereto (in each case including all exhibits, except
that the Company shall not be obligated to furnish any such seller with more
than two copies of such exhibits other than incorporated documents), such
number of copies of the prospectus included in such registration statement
(including each preliminary prospectus and any summary prospectus), each in
conformity with the requirements of the Securities Act, such documents
incorporated by reference in such registration statement or prospectus and
such other documents as such seller may reasonably request in order to
facilitate the disposition of its Registrable Securities covered by such
registration statement.
10.3.5 State Securities Laws. Use its best efforts to
register or qualify such Registrable Securities under such securities or blue
sky laws of such jurisdictions as the sellers shall reasonably request, and do
any and all other acts and things which may be necessary or advisable to
enable each seller to consummate the disposition in such jurisdictions of its
Registrable Securities covered by such registration statement; provided,
however, that the Company shall not be obligated to file any general consent
to service of process or to qualify as a
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foreign corporation or subject the Company to taxation in any jurisdiction in
which it is not so qualified.
10.3.6 Opinion of Counsel; Comfort Letter. Use its best
efforts to obtain all legal opinions, auditors' consents and comfort letters
and experts cooperation as may be required, including furnishing to each
seller of such Registrable Securities a signed counterpart, addressed or
confirmed to such seller, of (i) an opinion of counsel for the Company and
(ii) a "cold comfort" letter signed by the independent public accountants who
have certified the Company's financial statements included in such
registration statement, covering substantially the same matters as are
customarily covered in opinions of issuer's counsel and in accountants'
letters delivered to underwriters in underwritten public offerings of
securities.
10.3.7 Notice of Prospectus Defects. Immediately notify
each seller of Registrable Securities covered by such registration statement,
at any time when a prospectus relating thereto is required to be delivered
under the Securities Act, of the happening of any event as a result of which
the prospectus included in such 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
not misleading in the light of the circumstances then existing, and at the
request of any such seller prepare and furnish to such seller 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 such
Registrable Securities, such prospectus shall not include an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading in the
light of the circumstances then existing.
10.3.8 General Compliance with Federal Securities Laws;
Section 11(a) Earnings Statement. Otherwise use its best efforts to comply
with the Securities Act, the Exchange Act and any other applicable rules and
regulations of the Commission, and make available to its securities holders,
as soon as reasonably practicable, an earnings statement covering the period
of at least 12 months after the effective date of such registration statement,
which earnings statement shall satisfy Section 11(a) of the Securities Act and
any applicable regulations thereunder, including Rule 158.
10.3.9 Exchange Listing. Use its best efforts to list such
Registrable Securities on each securities exchange on which any equity
security of the Company is then listed, if such securities are not already so
listed or, if the Company does not have a class of equity securities listed on
a national securities exchange, apply for qualification and use its best
efforts to qualify the Registrable Securities being registered for inclusion
on the Nasdaq National Market System.
10.3.10 Transfer Agent. Provide a transfer agent and
registrar for all such Registrable Securities not later than the effective
date of such registration statement.
10.3.11 Company Lockup. In the case of an underwritten
offering under Section 10.1 hereof, refrain, without the consent of the
managing underwriter, for a period from 7 days before the effective date of
the registration statement until 180 days after such effective date, from
directly or indirectly selling, offering to sell, granting any option for the
sale of, or
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otherwise disposing of any common equity or securities convertible into common
equity other than pursuant to Company employee equity plans.
10.3.12 Participation by Selling Shareholders. In
connection with the preparation and filing of each registration statement
registering Registrable Securities under the Securities Act, and before filing
any such registration statement or any other document in connection therewith,
give the participating Shareholders and their underwriters, if any, and their
respective counsel and accountants, the opportunity to participate in the
preparation of such registration statement, each prospectus included therein
or filed with the Commission, each amendment thereof or supplement thereto and
any related underwriting agreement or other document to be filed, and give
each of the aforementioned Persons such access to its books and records and
such opportunities to discuss the business of the Company with its officers
and the independent public accountants who have certified its financial
statements as shall be necessary, in the opinion of such Shareholders,
underwriters, counsel or accountants, to conduct a reasonable investigation
within the meaning of the Securities Act. The Company may require each seller
of Registrable Securities as to which any registration is being effected to
furnish the Company such information regarding such seller and the
distribution of such securities as the Company may from time to time
reasonably request in writing and which shall be required by the Securities
Act (or similar state laws) or by the Commission in connection therewith.
10.3.13 Information Regarding Shareholders. If any such
registration or comparable statement refers to any Shareholder by name or
otherwise as the holder of any securities of the Company then such Shareholder
shall have the right to require (i) the insertion therein of language, in form
and substance satisfactory to such Shareholder, to the effect that the holding
by such Shareholder of such securities is not to be construed as a
recommendation by such holder of the investment quality of the Company's
securities covered thereby and that such holding does not imply that such
Shareholder will assist in meeting any future financial requirements of the
Company, or (ii) in the event that such reference to such Shareholder by name
or otherwise is not required by the Securities Act or any similar federal
statute then in force, the deletion of the reference to such Shareholder.
10.3.14 Conversion only Upon Consummation of Offering. No
Shareholder shall be required by this Agreement to convert, exercise or
exchange any Registrable Security into or for Common Stock except at the
applicable closing or closings of an underwritten registered offering and
except upon the sale of such Registrable Security in the case of other
registered offerings or pursuant to Rule 144.
10.4 Additional Procedures in Connection with Underwritten
Offerings.
10.4.1 Demand Registrations. In the case of a registration
pursuant to Section 10.1 hereof, whenever the Majority Participating
Shareholders shall request that such registration shall be effected pursuant
to an underwritten offering, such registration shall be so effected, and only
securities which are to be distributed by the underwriters designated by such
Majority Participating Shareholders may be included in such registration. If
requested by such underwriters, the Company and each participating seller will
enter into an underwriting agreement with such underwriters for such offering
containing such representations and warranties by the Company and such other
terms and provisions as are customarily contained in
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underwriting agreements with respect to secondary distributions, including,
without limitation, indemnity and contribution. In each such registration
pursuant to Section 10.1, each Shareholder agrees that without the consent of
the managing underwriter, for a period from 7 days prior to the effective date
of the registration statement until 180 days after such effective date, such
Shareholder will not directly or indirectly sell, offer to sell, grant any
option for the sale of, or otherwise dispose of any common equity or
securities convertible into common equity except (i) for Registrable
Securities sold in such registered offering and (ii) transfers to Affiliates
and partners and stockholders of such Shareholder, each of whom shall have
furnished to the Company and the managing underwriter their written consent to
be bound by this Agreement including this Section 10.4.1; provided, however,
that the prohibitions hereunder shall not apply to shares of Common Stock or
other securities convertible into Common Stock (other than shares that are
restricted securities within the meaning of the Securities Act) purchased by
such Shareholder in the open market following the consummation of a Public
Offering. If the managing underwriter advises the Demand Registrants that the
number of shares to be included in a registration pursuant to Section 10.1
hereof should be limited due to market conditions or otherwise, (i) all shares
that are not Registrable Securities (other than those sought to be registered
by the Company) shall be excluded first, (ii) thereafter, if additional shares
must be excluded from such registration, shares sought to be registered by the
Company shall be excluded from such registration and; (iii) thereafter, if
additional shares must be excluded from such registration, all holders of
Registrable Securities held by Shareholders shall share pro rata in the number
of shares of Registrable Securities to be excluded from such registration
pursuant to this clause (iii), such sharing to be based on the respective
numbers of shares requested to be registered by such holders. In the event
that the Demand Registrants are unable to include all of the Registrable
Securities such Demand Registrants originally requested be included in a
registration statement pursuant to Section 10.1 hereof, the right to a demand
registration pursuant to Section 10.1 shall not be forfeited.
10.4.2 Piggyback Registrations Pursuant to Section 10.2;
Cutbacks. In connection with the exercise of any registration rights granted
to holders of Registrable Securities pursuant to Section 10.2 hereof, if the
registration is to be effected by means of an underwritten offering of Common
Stock on a firm commitment basis, the Company may condition participation in
such registration by such holders upon inclusion of the Registrable Securities
being so registered in such underwriting. In addition, such holders may
request that such Registrable Securities be included in any underwritten
offering of Common Stock (whether or not on a firm commitment basis). If the
managing underwriter for the offering shall advise the Company in writing that
the total amount of securities, including Registrable Securities, requested by
shareholders to be included in such offering exceeds the amount of securities
to be sold other than by the Company that can be successfully offered, then
the Company shall be required to include in the offering only that number of
such securities, including Registrable Securities, which the managing
underwriter believes will not jeopardize the success of the offering. In such
case, the securities so included shall be reduced as follows: (a) all shares
that are not Registrable Securities (other than those sought to be registered
by the Company or the Persons, if any, who triggered the registration by
exercising a right to demand such registration), shall be excluded from the
offering to the extent limitation on the number of shares included in the
underwriting is required, (b) if further limitation on the number of shares to
be included in the underwriting is required, the number of Registrable
Securities held by the Shareholders that may be included in the underwriting
shall be reduced pro rata among such selling Shareholders
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in accordance with the number of Registrable Securities requested by such
Shareholders to be registered, (c) if further limitation on the number of
shares to be included in the underwriting is required, shares sought by the
Company to be included in the offering shall be excluded from the offering to
the extent limitation on the number of shares included in the offering is
required, and (d) if further limitation on the number of shares to be included
in the underwriting is required, the shares held by the Persons who triggered
the registration by exercising a right to demand such registration shall be
excluded from the offering pro rata in accordance with the number of shares
requested by such Persons to be registered (or in such other proportions as
such Persons may have agreed).
10.4.3 Sellers Party to Underwriting Agreement. The
holders of Registrable Securities to be distributed in any underwritten
offering shall be parties to the underwriting agreement entered into by the
Company in connection therewith, and the representations and warranties by,
and the other agreements on the part of, the Company to and for the benefit of
the underwriters shall also be made to and for the benefit of such holders of
Registrable Securities.
10.5 Shareholder Lockup Agreements in Connection with Public
Offerings. Each Shareholder agrees that without the consent of the managing
underwriter it will not, for a period of 180 days following the effective date
of the registration statement for an Initial Public Offering directly or
indirectly sell, offer to sell, grant any option for the sale of, or otherwise
dispose of any common equity or securities convertible into common equity,
except (i) for the Registrable Securities sold pursuant to such registration
statement, and (ii) transfers to Affiliates, partners and stockholders of such
Shareholder (each of whom shall have furnished to the Company and the managing
underwriter their written consent to be bound by this Agreement, including
this Section 10.5), provided that the officers, directors and all holders of
more than 1% of the shares of Common Stock (calculated for the purpose as if
all securities convertible into or exercisable for Common Stock, directly or
indirectly, are so converted or exercised) of the Company enter such lockup
agreements for the same period and on the same terms. Each Shareholder
additionally agrees that for a period beginning seven days immediately
preceding the effective date of any registration statement filed by the
Company under the Securities Act and relating to a Public Offering which is
not the Initial Public Offering and ending on the earlier of (i) 180 days
after the effective date of such registration statement and (ii) the end of
the shortest period applicable to any affiliate of the Company who is a
selling shareholder pursuant to such registration statement or who is
otherwise subject to a lockup obligation with respect to such Public Offering,
such Shareholder shall refrain from directly or indirectly selling any Common
Stock except pursuant to such registration statement. Notwithstanding the
foregoing, the prohibitions hereunder shall not apply to shares of Common
Stock or other securities convertible into Common Stock (other than shares
that are restricted securities within the meaning of the Securities Act)
purchased by such Shareholder in the open market following the consummation of
a Public Offering.
10.6 Indemnification and Contribution.
10.6.1 Indemnities of the Company. The Company will, and
hereby does, indemnify and hold harmless each Shareholder and each seller of
Registrable Securities, their respective partners, members, stockholders,
directors, officers, employees and agents, and each other Person, if any, who
controls any such holder or seller or their respective partners, members,
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stockholders, directors, officers, employees and agents within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act (each such
Person being referred to herein as a "Covered Person"), against any losses,
claims, damages or liabilities, joint or several, to which such Covered Person
may be or become subject under the Securities Act, the Exchange Act, any other
securities or other law of any jurisdiction, common law or otherwise, insofar
as such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained or incorporated by
reference in any registration statement under the Securities Act, any
preliminary prospectus or final prospectus included therein, or any related
summary prospectus, or any amendment or supplement thereto, or any document
incorporated by reference therein, or (ii) any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, and will reimburse such Covered
Person for any legal or any other expenses incurred by it in connection with
investigating or defending any such loss, claim, damage, liability, action or
proceeding; provided, however, that the Company shall not be liable to any
Covered Person in any such case for any such loss, claim, damage, liability,
action or proceeding (i) to the extent that it arises out of or is based upon
an untrue statement or alleged untrue statement or omission or alleged
omission made in such registration statement, any such preliminary prospectus,
final prospectus, summary prospectus, amendment or supplement or incorporated
document, in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such Covered Person expressly for
inclusion therein or (ii) in the case of a sale directly by a Shareholder of
Registrable Securities (including a sale of such Registrable Securities
through any underwriter retained by such Shareholder engaging in a
distribution solely on behalf of such Shareholder), such untrue statement or
alleged untrue statement or omission or alleged omission was contained in a
preliminary prospectus and corrected in a final or amended prospectus, and
such Shareholder failed to deliver a copy of the final or amended prospectus
at or prior to the confirmation of the sale of the Registrable Securities to
the person asserting any such loss, claim, damage or liability in any case in
which such delivery is required by the Securities Act. The indemnities of the
Company contained in this Section 10.6 shall remain in full force and effect
regardless of any investigation made by or on behalf of such Covered Person
and shall survive any transfer of Registrable Securities.
10.6.2 Indemnities to the Company. In the event of any
registration of Registrable Securities pursuant to Section 10.1 or 10.2, each
selling Shareholder will, and hereby does, indemnify and hold harmless (in the
same manner and to the same extent as set forth in Section 10.6.1 hereof) the
Company, each director of the Company, each officer of the Company who shall
sign such registration statement and each other Person (other than such
seller), if any, who controls the Company within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act, with respect to any
statement in or omission from such registration statement, any preliminary
prospectus or final prospectus included therein, or any amendment or
supplement thereto, or any document incorporated therein, if such statement or
omission was made in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such seller expressly for
inclusion therein, provided that the Shareholder shall not be liable to the
Company in any case in which such untrue statement or alleged untrue statement
or omission or alleged omission was contained in a preliminary prospectus and
corrected in a final or amended prospectus, and the Company failed to deliver
a copy of the final or amended prospectus at or prior to the confirmation of
the sale of the securities to the person asserting any
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such loss, claim, damage or liability in any case in which such delivery is
required by the Securities Act. Such indemnity shall remain in full force and
effect regardless of any investigation made by or on behalf of the Company or
any such director, officer or controlling Person and shall survive any
transfer of Registrable Securities.
10.6.3 Indemnification Procedures. Promptly after receipt
by an indemnified party of notice of the commencement of any action or
proceeding involving a claim of the type referred to in the foregoing
provisions of this Section 10.6, such indemnified party will, if a claim in
respect thereof is to be made against any indemnifying party, give written
notice to each such indemnifying party of the commencement of such action;
provided, however, that the failure of any indemnified party to give notice to
such indemnifying party as provided herein shall not relieve such indemnifying
party of its obligations under the foregoing provisions of this Section 10.6,
except and solely to the extent that such indemnifying party is actually
prejudiced by such failure to give notice. In case any such action is brought
against an indemnified party, each indemnifying party will be entitled to
participate in and to assume the defense thereof, jointly with any other
indemnifying party similarly notified, to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to such an
indemnifying party), and after notice from an indemnifying party to such
indemnified party of its election so to assume the defense thereof, such
indemnifying party will not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
defense thereof; provided, however, that (i) if the indemnified party
reasonably determines that there may be a conflict between the positions of
such indemnifying party and the indemnified party in conducting the defense of
such action or that there may be defenses available to such indemnified party
different from or in addition to those available to such indemnifying party,
then counsel for the indemnified party shall conduct the defense to the extent
reasonably determined by such counsel to be necessary to protect the interests
of the indemnified party and such indemnifying party shall employ separate
counsel for its own defense, (ii) in any event, the indemnified party shall be
entitled to have counsel chosen by such indemnified party participate in, but
not conduct, the defense and (iii) the indemnifying party shall bear the legal
expenses incurred in connection with the conduct of, and the participation in,
the defense as referred to in clauses (i) and (ii) above. If, within a
reasonable time after receipt of the notice, such indemnifying party shall not
have elected to assume the defense of the action, such indemnifying party
shall be responsible for any legal or other expenses incurred by such
indemnified party in connection with the defense of the action, suit,
investigation, inquiry or proceeding. No indemnifying party will consent to
entry of any judgment or enter into any settlement which does not include as
an unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect to such claim or
litigation.
10.6.4 Contribution. If the indemnification provided for
in Sections 10.6.1 or 10.6.2 hereof is unavailable to a party that would have
been an indemnified party under any such Section in respect of any losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
referred to therein, then each party that would have been an indemnifying
party thereunder shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions or proceedings in
respect thereof) in such proportion as is appropriate to reflect the relative
fault of such indemnifying party on the one hand and such indemnified party on
the other
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in connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions or proceedings in respect thereof).
The relative fault shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by such indemnifying party or such indemnified party and the parties'
relative intent, knowledge, access to information and opportunity to correct
or prevent such statement or omission. The parties agree that it would not be
just and equitable if contribution pursuant to this Section 10.6 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
preceding sentence. The amount paid or payable by a contributing party as a
result of the losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) referred to above in this Section 10.6 shall
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
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.
10.6.5 Limitation on Liability of Shareholders of
Registrable Securities. The liability of each Shareholder in respect of any
indemnification or contribution obligation of such holder arising under this
Section 10.6 shall not in any event exceed an amount equal to the net proceeds
to such Shareholder (after deduction of all underwriters' discounts and
commissions and all other expenses paid by such Shareholder in connection with
the registration in question) from the disposition of the Registrable
Securities disposed of by such Shareholder pursuant to such registration.
10.7 Reports Under Securities Exchange Act. With a view to making
available to the Shareholders the benefits of Rule 144 and any other rule or
regulation of the Commission that may at any time permit a Shareholder to sell
securities of the Company to the public without registration, and with a view
to making it possible for Shareholders to register the Registrable Securities
or pursuant to a registration on Form S-3, the Company agrees to:
(a) use its best efforts to make and keep public
information available, as those terms are
understood and defined in Rule 144, at all times
commencing 91 days after the effective date of the
registration statement for its Initial Public
Offering;
(b) take such action, including the voluntary
registration of its Common Stock under Section 12
of the Exchange Act, as any Shareholder may
reasonably request such action to be taken as soon
as practicable (but not later than 120 days) after
the end of the fiscal year in which the
registration statement for the Initial Public
Offering is declared effective;
(c) use its best efforts to file with the Commission in
a timely manner all reports and other documents
required of the Company under the Securities Act
and the Exchange Act; and
(d) furnish to any Shareholder forthwith upon request
(1) a written statement by the Company as to its
compliance with the reporting requirements of
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Rule 144 (at any time more than 90 days after the
effective date of the registration statement for
the Initial Public Offering), the Securities Act
and the Exchange Act (at any time after it has
become subject to such reporting requirements), or
as to its qualification as a registrant whose
securities may be resold pursuant to Form S-3 (at
any time after it so qualifies), (2) a copy of the
most recent annual or quarterly report of the
Company and such other reports and documents so
filed by the Company, and (3) such other
information as may be reasonably requested in
availing any Shareholder of any rule or regulation
of the Commission which permits the selling of any
such securities without registration or pursuant to
such form.
10.8 Assignment of Registration Rights. The rights to cause the
Company to register Registrable Securities pursuant to Sections 10.1 and 10.2
may be assigned by any Shareholder to a transferee of such Registrable
Securities. Any transferee to whom rights under this Agreement are transferred
shall (i) as a condition to such transfer, deliver to the Company a written
instrument by which such transferee agrees to be bound by the obligations
imposed upon Shareholders under this Agreement to the same extent as if such
transferee were a Shareholder under this Agreement and (ii) be deemed to be a
Shareholder hereunder.
10.9 Future Changes in Registration Requirements. In the event
that the registration requirements under the Securities Act are amended or
eliminated to accommodate a "Company registration" or similar approach, this
Agreement shall be deemed amended to the extent necessary to reflect such
changes and the intent of the parties hereto with respect to the benefits and
obligations of the parties, and in such connection, the Company shall use
reasonable efforts to provide Shareholders of Registrable Securities
equivalent benefits to those provided under this Agreement.
11. REMEDIES. The Company and each holder of Shares shall have all
remedies available at law, in equity or otherwise in the event of any breach
or violation of this Agreement or any default hereunder by the Company or any
holder of Shares. The parties acknowledge and agree that in the event of any
breach of this Agreement, in addition to any other remedies which may be
available, each of the parties hereto shall be entitled to specific
performance of the obligations of the other parties hereto and, in addition,
to such other equitable remedies (including, without limitation, preliminary
or temporary relief) as may be appropriate in the circumstances.
12. LEGENDS
12.1 Restrictive Legends. Each certificate representing Shares
shall have the following legend endorsed conspicuously thereupon:
The sale, encumbrance or other disposition of the shares of stock
evidenced by this certificate, are subject to the provisions of a
Master Equityholders Agreement to which the issuer and certain of its
shareholders are party, a copy of which may be inspected at the
principal office of the issuer or obtained from the issuer without
charge.
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Each certificate representing MCP Shares shall also have the
following legend endorsed conspicuously thereupon:
The shares of stock represented by this certificate were originally
issued to, or issued with respect to shares originally issued to, an
MCP Investor (as such term is used in such Master Equityholders
Agreement).
Each certificate representing Initial Investor Shares shall also have
the following legend endorsed conspicuously thereupon:
The shares of stock represented by this certificate were originally
issued to, or issued with respect to shares originally issued to, an
Initial Investor (as such term is used in such Master Equityholders
Agreement).
Each certificate representing Management Equityholder Shares shall
also have the following legend endorsed conspicuously thereupon:
The shares of stock represented by this certificate were originally
issued to, or issued with respect to shares originally issued to, an
Management Equityholder (as such term is used in such Master
Equityholders Agreement).
Each certificate representing Consultant Shares shall also have the
following legend endorsed conspicuously thereupon:
The shares of stock represented by this certificate were originally
issued to, or issued with respect to shares originally issued to, a
Consultant (as such term is used in such Master Equityholders
Agreement).
Each certificate representing 1999 Warrant Shares shall also have the
following legend endorsed conspicuously thereupon:
The shares of stock represented by this certificate were originally
issued to, or issued with respect to shares originally issued to, a
1999 Warrant Investor (as such term is used in such Master
Equityholders Agreement).
Each certificate representing 2000 Warrant Shares shall also have the
following legend endorsed conspicuously thereupon:
The shares of stock represented by this certificate were originally
issued to, or issued with respect to shares originally issued to, a
2000 Warrant Investor (as such term is used in such Master
Equityholders Agreement).
Any person who acquires Shares which are not subject to all or part of the
terms of this Agreement shall have the right to have such legend (or the
applicable portion thereof) removed from certificates representing such
Shares. References in a legend on an existing certificate to the Shareholders
Agreement or to the 1999 Warrant Rights Agreement shall be deemed to be
references to this Agreement. References in a legend to an Investor shall be
deemed to be references to an Initial Investor.
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12.2 Securities Act Legends. Each certificate representing
Shares shall have a legend in substantially the following form endorsed
conspicuously thereupon:
The securities represented by this certificate were issued in a
private placement, without registration under the Securities Act of
1933, as amended (the "Act"), and may not be sold, assigned, pledged
or otherwise transferred in the absence of an effective registration
under the Act covering the transfer or an exemption therefrom under
said Act.
12.3 Stop Transfer Instruction. The Company will instruct any
transfer agent not to register the Transfer of any Shares until the conditions
specified in the foregoing legends are satisfied.
12.4 Termination of Certain Restrictions. The restrictions
imposed by this Section 12.4 upon the transferability of Shares shall cease
and terminate as to any particular Shares (i) when, in the opinion of Xxxxxxx
& Xxxxx L.L.P., Ropes & Xxxx, or other counsel reasonably acceptable to the
Company (which, in the case of any Warrant Shares, may include Xxxxxxx and
Xxxxxx and internal counsel to the holder of such Warrant Shares), such
restrictions are no longer required in order to assure compliance with the
Securities Act or (ii) when such Shares have been effectively registered under
the Securities Act or transferred pursuant to Rule 144. Wherever (i) such
restrictions shall cease and terminate as to any Shares or (ii) such Shares
shall be transferable under paragraph (k) of Rule 144, the holder thereof
shall be entitled to receive from the Company, without expense, new
certificates not bearing the appropriate legends set forth in Section 12.2.
13. AMENDMENT, TERMINATION, ETC.
13.1 Oral Modifications. This Agreement may not be orally
amended, modified, extended or terminated, nor shall any oral waiver of any of
its terms be effective.
13.2 Written Modifications. This Agreement may be amended,
modified, extended or terminated, and the provisions may be waived, only by an
agreement in writing signed by the Company, the Majority MCP Investors and the
Majority Non-MCP Holders; provided, however, that:
(a) the consent of the Majority Consultants shall be
required for any amendment, modification,
extension, termination or waiver which has a
material adverse effect on the rights of the
holders of Consultant Shares that is
disproportionate to the effect of such amendment,
modification, extension, termination or waiver on
any other holder of Shares,
(b) the consent of the Majority 1999 Warrant Investors
shall be required for any amendment, modification,
extension, termination or waiver which has a
material adverse effect on the rights of the
holders of 1999 Warrant Shares, and
(c) the consent of the Majority 2000 Warrant Investors
shall be required for any amendment, modification,
extension, termination or waiver which has
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a material adverse effect on the rights of the
holders of 2000 Warrant Shares.
(d) the consent of CIBC, Merchant and TGF shall be
required for any amendment, modification, extension,
termination or waiver which has a material adverse
effect on the rights of such holders that is
disproportionate to the effect of such amendment,
modification, extension, termination or waiver on any
other holder of Shares.
Each such amendment, modification, extension, termination and waiver
shall be binding upon each party hereto and each holder of Shares
subject hereto. In addition, each party hereto and each holder of
Shares subject hereto may waive any right hereunder by an instrument
in writing signed by such party or holder.
13.3 Termination. No termination under this Agreement shall
relieve any Person of liability for breach prior to termination.
14. DEFINITIONS. For purposes of this Agreement:
14.1 Certain Matters of Construction. In addition to the definitions
referred to or set forth below in this Section 14:
(a) The words "hereof", "herein", "hereunder" and words
of similar import shall refer to this Agreement as
a whole and not to any particular Section or
provision of this Agreement, references to a
Section are, unless otherwise specified, to a
Section of this Agreement, and reference to a
particular Section of this Agreement shall include
all subsections thereof;
(b) Definitions shall be equally applicable to both the
singular and plural forms of the terms defined;
(c) The masculine, feminine and neuter genders shall
each include the other; and
(d) Whenever an allocation is to be made "pro rata"
based on the number of Shares, it shall mean that
such allocation shall be made pro rata based on the
number of Equivalent Shares of Class B Common Stock
represented by the Shares in question.
14.2 Definitions. The following terms shall have the following
meanings:
14.2.1. "10% Owner" shall have the meaning set forth in the
definition of Independent Third Party.
14.2.2. "1999 Warrant Investors" shall have the meaning set
forth in the Preamble.
14.2.3. "1999 Warrant Rights Agreement" shall have the
meaning set forth in the Recitals.
14.2.4. "1999 Warrant Shares" shall mean (i) all shares of
Common Stock originally issued to or issued with respect to shares
originally issued to a 1999 Warrant Investor, whenever issued,
including, without limitation, all shares of Common Stock issued
pursuant to the exercise of any Options or Convertible
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Securities originally issued to or issued with respect to shares
originally issued to a 1999 Warrant Investor, whenever issued, and
(ii) all Options and Convertible Securities originally issued to or
issued with respect to shares originally issued to a 1999 Warrant
Investor, whenever issued (treating such Options and Convertible
Securities as a number of Shares equal to the number of Equivalent
Shares represented by such Options and Convertible Securities).
14.2.5. "1999 Warrants" shall have the meaning set forth in
the Recitals.
14.2.6. "2000 Warrant Investors" shall have the meaning set
forth in the Preamble.
14.2.7. "2000 Warrant Rights Agreement" shall have the
meaning set forth in the Recitals.
14.2.8. "2000 Warrant Shares" shall mean (i) all shares of
Common Stock originally issued to, or issued with respect to shares
originally issued to a 2000 Warrant Investor, whenever issued,
including, without limitation, all shares of Common Stock issued
pursuant to the exercise of any Options or Convertible Securities
originally issued to or issued with respect to shares originally
issued to a 2000 Warrant Investor, whenever issued, and (ii) all
Options and Convertible Securities originally issued to or issued
with respect to shares originally issued to a 2000 Warrant Investor,
whenever issued (treating such Options and Convertible Securities as
a number of Shares equal to the number of Equivalent Shares
represented by such Options and Convertible Securities).
14.2.9. "2000 Warrants" shall have the meaning set forth in
the Recitals.
14.2.10. "Affiliate" shall mean, with respect to any
specified Person, any other Person which directly or indirectly
through one or more intermediaries controls, or is controlled by, or
is under common control with, such specified Person (for the purposes
of this definition, "control" (including, with correlative meanings,
the terms "controlling," "controlled by" and "under common control
with"), as used with respect to any Person, means the possession,
directly or indirectly, of the power to direct or cause the direction
of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise).
14.2.11. "Affiliated Fund" shall mean each Person under
common control with any Shareholder which is a private investment
fund.
14.2.12. "AG Investment" shall have the meaning set forth in
the Preamble.
14.2.13. "AG Life" shall have the meaning set forth in the
Preamble.
14.2.14. "Agreement" shall have the meaning set forth in the
Preamble.
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14.2.15. "Board" shall mean the board of directors of the
Company.
14.2.16. "CIBC" shall have the meaning set forth in the
Preamble.
14.2.17. "Class A Common Stock" shall have the meaning set
forth in the Recitals.
14.2.18. "Class B Common Stock" shall have the meaning set
forth in the Recitals.
14.2.19. "Commission" shall mean the Securities and Exchange
Commission.
14.2.20. "Common Stock" shall have the meaning set forth in
the Recitals.
14.2.21. "Company" shall have the meaning set forth in the
Preamble.
14.2.22. "Consultant" shall have the meaning set forth in
the Preamble.
14.2.23. "Consultant Shares" shall mean (i) all shares of
Common Stock originally issued to, or issued with respect to shares
originally issued to a Consultant, whenever issued, including,
without limitation, all shares of Common Stock issued pursuant to the
exercise of any Options or Convertible Securities originally issued
to, or issued with respect to shares originally issued to a
Consultant, whenever issued, and (ii) all Options and Convertible
Securities originally issued to, or issued with respect to shares
originally issued to a Consultant, whenever issued (treating such
Options and Convertible Securities as a number of Shares equal to the
number of Equivalent Shares represented by such Options and
Convertible Securities).
14.2.24. "Convertible Securities" shall mean any evidence of
indebtedness, shares of stock (other than Common Stock) or other
securities directly or indirectly convertible into or exchangeable or
exercisable for shares of Common Stock and, with respect to the Class
B Common Stock, shall include without limitation the Class A Common
Stock.
14.2.25. "Demand Registrant" shall have the meaning set
forth in Section 10.1.
14.2.26. "Demand Registration" shall have the meaning set
forth in Section 10.1.
14.2.27. "Drag Along Buyer" shall have the meaning set forth
in Section 3.2.
14.2.28. "Drag Along Notice" shall have the meaning set
forth in Section 3.2.1.
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14.2.29. "Drag Along Sale Percentage" shall have the meaning
set forth in Section 3.2.
14.2.30. "Drag Along Seller" shall have the meaning set
forth in Section 3.2.2.
14.2.31. "Equivalent Shares" shall mean as to any
outstanding shares of Common Stock, such number of shares of Common
Stock, and as to any outstanding Options or Convertible Securities,
the maximum number of shares of Common Stock for which or into which
such Options or Convertible Securities may at the time be exercised
or converted.
14.2.32. "Exchange Act" shall mean the Securities Exchange
Act of 1934, as in effect from time to time.
14.2.33. "Fair Market Value" shall mean, as of any date, (a)
if the non-cash consideration consists of securities that are either
listed on the New York Stock Exchange or quoted on the Nasdaq
National Market System, then the fair market value of each such
security shall be the average of the last reported sales prices of
such class of security for the ten consecutive trading days ending on
the most recent trading day prior to the date of the First Offer
Notice (or, if such sales prices are not readily available, the
average closing "bid" prices for the ten consecutive trading days
ending on the trading day prior to the date of the First Offer
Notice); or, (b) in all other cases (including for purposes of
Section 10.1.8, the fair market value shall mean the value of any
securities determined (without any discount for lack of liquidity,
restriction on transfer, the amount of Common Stock proposed to be
sold or the fact that the shares of Common Stock held by any
Shareholder of such security may represent a minority interest in a
private company) by a nationally recognized investment banking firm
selected by the Company for the determination of such value and which
firm is reasonably acceptable to, (i) in the case of Section 10.1.8,
the Demand Registrants to which Section 10.1.8 applies that hold a
majority of the applicable Warrant Shares constituting Registrable
Securities and (ii) in all cases, the Majority Initial Investors.
14.2.34. "First Demand Date" shall have the meaning set
forth in Section 3.1.1.
14.2.35. "First Offer Acceptance" shall have the meaning set
forth in Section 2.1.2.
14.2.36. "First Offer Notice" shall have the meaning set
forth in Section 2.1.1.
14.2.37. "First Offer Shareholders" shall have the meaning
set forth in Section 2.1.1.
14.2.38. "First Union" shall have the meaning set forth in
the Preamble.
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14.2.39. "Independent Third Party" shall mean any Person
who, immediately prior to the contemplated transaction, (i) does not
own in excess of 10% of the Company's Shares on a fully-diluted basis
(a "10% Owner"), (ii) is not controlling, controlled by or under
common control with any such 10% Owner, (iii) is not the spouse or
descendent (by birth or adoption) of any such 10% Owner or a trust
for the benefit of such 10% Owner and/or such other Persons and (iv)
is neither a portfolio company of any such 10% Owner nor a subsidiary
of any portfolio company of any such 10% Owner.
14.2.40. "Initial Investor Shares" shall mean (i) all shares
of Common Stock originally issued to, or issued with respect to
shares originally issued to an Initial Investor, whenever issued,
including, without limitation, all shares of Common Stock issued
pursuant to the exercise of any Options or Convertible Securities
originally issued to, or issued with respect to shares originally
issued to an Initial Investor, whenever issued, and (ii) all Options
and Convertible Securities originally issued to, or issued with
respect to shares originally issued to an Initial Investor, whenever
issued (treating such Options and Convertible Securities as a number
of Shares equal to the number of Equivalent Shares represented by
such Options and Convertible Securities).
14.2.41. "Initial Investors" shall have the meaning set
forth in the Preamble.
14.2.42. "Initial Public Offering" means the first Public
Offering.
14.2.43. "Investor Rights Agreement" shall have the meaning
set forth in the Recitals.
14.2.44. "JHW Market" shall have the meaning set forth in
the Preamble.
14.2.45. "JHW Mezzanine" shall have the meaning set forth in
the Preamble.
14.2.46. "Lincoln" shall have the meaning set forth in the
Preamble.
14.2.47. "Lock-Up/Standstill Termination Date" shall mean
the date which is the earliest of (i) the date of the first Liquidity
Event (as such term is defined in the Certificate of Incorporation of
the Company, as in effect on the date hereof), (y) the date of the
closing of the Initial Public Offering or (z) September 7, 2001.
14.2.48. "Magnetite" shall have the meaning set forth in the
Preamble.
14.2.49. "Majority Consultants" shall mean, as of any date,
the holders of a majority of the Consultant Shares outstanding on
such date.
14.2.50. "Majority Initial Investors" shall mean, as of any
date, the holders of a majority of the Initial Investor Shares
outstanding on such date.
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14.2.51. "Majority Management Equityholders" shall mean, as of
any date, the holders of a majority of the Management Equityholder
Shares outstanding on such date.
14.2.52. "Majority MCP Investors" shall mean, as of any
date, the holders of a majority of the MCP Shares outstanding on such
date.
14.2.53. "Majority Non-MCP Holders" shall mean, as of any
date, the holders of a majority of the Shares which are not MCP
Shares outstanding on such date.
14.2.54. "Majority Non-MCP Investors" shall mean, as of any
date, the holders of a majority of the Initial Investor Shares which
are not MCP Shares outstanding on such date.
14.2.55. "Majority Participating Shareholders" shall mean,
the holders of a majority of the Shares being registered pursuant to
a particular Demand Registration.
14.2.56. "Majority 1999 Warrant Investors" shall mean, as of
any date, the holders of a majority of the 1999 Warrant Shares
outstanding on such date.
14.2.57. "Majority 2000 Warrant Investors" shall mean, as of
any date, the holders of a majority of the 2000 Warrant Shares
outstanding on such date.
14.2.58. "Management Equityholder Shares" shall mean (i) all
shares of Common Stock originally issued to, or issued with respect
to shares originally issued to a Management Equityholder, whenever
issued, including, without limitation, all shares of Common Stock
issued pursuant to the exercise of any Options or Convertible
Securities originally issued to, or issued with respect to shares
originally issued to a Management Equityholder, whenever issued, and
(ii) all Options and Convertible Securities originally issued to, or
issued with respect to shares originally issued to a Management
Equityholder, whenever issued (treating such Options and Convertible
Securities as a number of Shares equal to the number of Equivalent
Shares represented by such Options and Convertible Securities).
14.2.59. "Management Equityholders" shall have the meaning
set forth in the Preamble.
14.2.60. "MCEP" shall have the meaning set forth in the
Preamble.
14.2.61. "MCEP(F)" shall have the meaning set forth in the
Preamble.
14.2.62. "MCLP" shall have the meaning set forth in the
Preamble.
14.2.63. "MCP Investors" shall have the meaning set forth in
the Preamble.
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14.2.64. "MCP Shares" shall mean (i) all shares of Common
Stock originally issued to, or issued with respect to shares
originally issued to an MCP Investor, whenever issued, including,
without limitation, all shares of Common Stock issued pursuant to the
exercise of any Options or Convertible Securities originally issued
to, or issued with respect to shares originally issued to an MCP
Investor, whenever issued, and (ii) all Options and Convertible
Securities originally issued to, or issued with respect to shares
originally issued to an MCP Investor, whenever issued (treating such
Options and Convertible Securities as a number of Shares equal to the
number of Equivalent Shares represented by such Options and
Convertible Securities).
14.2.65. "Members of the Immediate Family" shall mean, with
respect to any individual, each spouse or child of such individual,
each trust created solely for the benefit of one or more of the
aforementioned Persons and each custodian or guardian of any property
of one or more of the aforementioned Persons in his capacity as such
custodian or guardian.
14.2.66. "Merchant" shall have the meaning set forth in the
Preamble.
14.2.67. "Merit" shall have the meaning set forth in the
Preamble.
14.2.68. "Northwestern" shall have the meaning set forth in
the Preamble.
14.2.69. "Options" shall mean any options or warrants to
subscribe for, purchase or otherwise acquire either Common Stock or
Convertible Securities and shall include without limitation the 1999
Warrants and the 2000 Warrants.
14.2.70. "Participating First Offer Buyer" shall have the
meaning set forth in Section 2.1.2.
14.2.71. "Participating Seller" shall have the meaning set
forth in Sections 3.1.2 and 3.2.2.
14.2.72. "Permitted Transferee" shall mean (i) as to each
Initial Investor Share, a Transferee of such Initial Investor Share
resulting from a Transfer described in Section 4.1.1, (ii) as to each
Management Equityholder Share, a Transferee of such Management
Equityholder Share in compliance with Section 5.1 or 5.2, (iii) as to
each Consultant Share, a Transferee of such Consultant Share in
compliance with Section 6.1.4. and (iv) as to each Warrant Share, a
Transferee of such Warrant Share in compliance with Section 7.1.1.
14.2.73. "Person" shall mean any individual, partnership,
corporation, limited liability company, company, association, trust,
joint venture, unincorporated organization, entity or division, or
any government, governmental department or agency or political
subdivision thereof.
14.2.74. "Preferred Stock" shall have the meaning set forth
in the Recitals.
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14.2.75. "Prospective Buyer" shall mean any Person.
14.2.76. "Prospective Selling Shareholder" shall have the
meaning set forth in Sections 2.1 and 3.1.
14.2.77. "Public Offering" shall mean a public offering and
sale of Common Stock for cash pursuant to an effective registration
statement under the Securities Act.
14.2.78. "Purchase Election" shall have the meaning set
forth in Section 10.1.8.
14.2.79. "Purchase Election Date" shall have the meaning set
forth in Section 10.1.8.
14.2.80. "Purchase Offer" shall have the meaning set forth
in Section 10.1.8.
14.2.81. "Purchase Offer Payment Date" shall have the
meaning set forth in Section 10.1.8.
14.2.82. "Qualified Public Offering" shall mean a Public
Offering, other than any Public Offering or sale pursuant to a
registration statement on Form S-8 or comparable form, in which the
aggregate price to the public of all such Common Stock sold in such
offering shall exceed $100,000,000.
14.2.83. "Registrable Securities" shall mean (i) all shares
of Common Stock issued or issuable to any Shareholder, (ii) all
shares of Common Stock issuable, directly or indirectly, upon
exercise of any Option or conversion of any Convertible Security
issued or issuable to any Shareholder, and (iii) all shares of Common
Stock directly or indirectly issued or issuable with respect to the
securities referred to in clauses (i) or (ii) above by way of stock
dividend or stock split or in connection with a combination of
shares, recapitalization, merger, consolidation or other
reorganization. As to any particular Registrable Securities, such
shares shall cease to be Registrable Securities when (a) 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 with such
registration statement, (b) such securities shall have been
distributed to the public pursuant to Rule 144 (or any successor
provision) under the Securities Act, (c) subject to the provisions of
Section 12, such securities shall have been otherwise transferred,
new certificates for them not bearing a legend restricting further
transfer shall have been delivered by the Company and subsequent
disposition of them shall not require registration of their offer and
sale under the Securities Act and such securities may be distributed
without volume limitation or other restrictions on transfer under
Rule 144 (including without application of paragraphs (c), (e) (f)
and (h) of Rule 144), or (d) such securities shall have ceased to be
outstanding.
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14.2.84. "Registration Expenses" shall mean all expenses
incident to performance of or compliance with Sections 10.1, 10.2 and
10.3 hereof by the Company, including without limitation all
registration and filing fees, all listing fees, all fees and expenses
of complying with securities or blue sky laws, all printing and
document preparation expenses, all messenger and delivery expenses,
the fees and disbursements of counsel for the Company and of its
independent public accountants, including the expenses of any special
audits required by or incident to such performance and compliance,
and the fees and disbursements (up to $100,000 with respect to each
registration) of one counsel (such counsel to be acceptable to the
holders of a majority of the Registrable Securities being registered)
for the Shareholders on whose behalf Registrable Securities are being
registered, but excluding underwriting discounts and commissions and
applicable transfer taxes, if any, which shall be borne by the
sellers of the Registrable Securities in all cases.
14.2.85. "Regulation D" shall mean Regulation D under the
Securities Act.
14.2.86. "Rule 144" shall mean Rule 144 under the Securities
Act.
14.2.87. "Sale" shall have the meaning set forth in Section
3.1.
14.2.88. "Securities Act" shall mean the Securities Act of
1933, as in effect from time to time.
14.2.89. "Shares" shall mean all Initial Investor Shares,
Consultant Shares, Management Equityholder Shares and Warrant Shares,
provided, however, that the Preferred Stock and all other securities
of the Company which are not directly or indirectly convertible into,
or exercisable or exchangeable for, shares of Class B Common Stock or
other common equity securities, shall not constitute Shares for
purposes of this Agreement.
14.2.90. "Shareholders" shall have the meaning set forth in
the Preamble.
14.2.91. "Shareholders Agreement" shall have the meaning set
forth in the Recitals.
14.2.92. "Tag Along Notice" shall have the meaning set forth
in Section 3.1.1.
14.2.93. "Tag Along Offer" shall have the meaning set forth
in Section 3.1.2.
14.2.94. "Tag Along Offerors" shall have the meaning set
forth in Section 3.1.1.
14.2.95. "Tag Along Sale Percentage" shall have the meaning
set forth in Section 3.1.1.
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14.2.96. "Tag Along Sellers" shall have the meaning set
forth in Section 3.1.2.
14.2.97. "TGF" shall have the meaning set forth in the
Preamble.
14.2.98. "TMC" shall have the meaning set forth in the
Preamble.
14.2.99. "Transfer" shall mean any sale, pledge,
hypothecation, assignment, encumbrance or other transfer or
disposition of any Shares to any other Person, whether directly,
indirectly, voluntarily, involuntarily, by operation of law, pursuant
to judicial process or otherwise.
14.2.100. "Warrant Investors" shall have the meaning set
forth in the Preamble.
14.2.101. "Warrant Shares" shall mean all 0000 Xxxxxxx
Shares and all 2000 Warrant Shares.
15. MISCELLANEOUS.
15.1 Authority; Effect. Each party hereto represents and warrants
to and agrees with each other party that the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby have
been duly authorized on behalf of such party and do not violate any agreement
or other instrument applicable to such party or by which its assets are bound.
This Agreement does not, and shall not be construed to, give rise to the
creation of a partnership among any of the parties hereto, or to constitute
any of such parties members of a joint venture or other association.
15.2 Notices. Any notices and other communications required or
permitted in this Agreement shall be effective if in writing and (a) delivered
personally or (b) sent (i) by Federal Express, DHL or UPS or (ii) by
registered or certified mail, postage prepaid, in each case, addressed as
follows:
If to the Company, to it at:
0000 X. Xxxxx Xx.
Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Chief Executive Officer
with a copy to:
Xxxxxxx & Xxxxx L.L.P.
Chase Tower
000 Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention: Xxxxx X. Xxxxx, Esq.
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If to MCEP, MCEP(F) or the Consultants, to them at:
c/o Monitor Clipper Partners, Inc.
Two Xxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxxxx 00000
with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxxxx X. Xxxxx, Esq.
If to any other Shareholder, to such Shareholder at the address set
forth in the stock record book of the Company.
Notice to the holder of record of any shares of capital stock shall
be deemed to be notice to the holder of such shares for all purposes hereof.
Unless otherwise specified herein, such notices or other
communications shall be deemed effective (a) on the date received, if
personally delivered, (b) two business days after being sent by Federal
Express, DHL or UPS and (c) three business days, if sent by registered or
certified mail. Each of the parties hereto shall be entitled to specify a
different address by giving notice as aforesaid to each of the other parties
hereto.
15.3 Binding Effect, etc. This Agreement constitutes the entire
agreement of the parties with respect to its subject matter, supersedes all
prior or contemporaneous oral or written agreements or discussions with
respect to such subject matter (except for any written employment agreement
and any written agreement relating to any Acquisition, with respect to which
the terms of this Agreement shall be in addition to, and not in substitution
or replacement of, such other agreement), and shall be binding upon and inure
to the benefit of the parties hereto and their respective heirs,
representatives, successors and assigns.
15.4 Exercise of Rights and Remedies. No delay of or omission in
the exercise of any right, power or remedy accruing to any party as a result
of any breach or default by any other party under this Agreement shall impair
any such right, power or remedy, nor shall it be construed as a waiver of or
acquiescence in any such breach or default, or of any similar breach or
default occurring later; nor shall any such delay, omission nor waiver of any
single breach or default be deemed a waiver of any other breach or default
occurring before or after that waiver.
15.5 Descriptive Headings. The descriptive headings of this
Agreement are for convenience of reference only, are not to be considered a
part hereof and shall not be construed to define or limit any of the terms or
provisions hereof.
15.6 Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, but all of which
taken together shall constitute one instrument.
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15.7 Severability. In the event that any provision hereof would,
under applicable law, be invalid or unenforceable in any respect, such
provision shall be construed by modifying or limiting it so as to be valid and
enforceable to the maximum extent compatible with, and possible under,
applicable law. The provisions hereof are severable, and in the event any
provision hereof should be held invalid or unenforceable in any respect, it
shall not invalidate, render unenforceable or otherwise affect any other
provision hereof.
15.8 Register. The Company shall maintain a register listing each
holder of Shares and shall promptly make available such register to any holder
of Shares upon request.
15.9 Certain Shareholders. Xxxxx X. Xxxxxxxxx and Santaeus, L.P.,
each a limited partner in Argotyche, L.P., each agrees that its partnership
interest therein shall be deemed to be Management Equityholder Shares
hereunder and that, in all cases where it is necessary to calculate the number
of shares held by a Shareholder, such Shareholder shall be deemed to hold that
number of shares of Class B Common Stock equal to the percentage interest of
such Shareholder in Argotyche, L.P. multiplied by the number of shares of
Class B Common Stock held by Argotyche L.P., provided that neither such
Shareholder shall have rights under Section 3.1 hereof to sell his or its
partnership interests as a Tag Along Offeror.
16. GOVERNING LAW, ETC.
16.1 Governing Law. This Agreement shall be governed by and
construed in accordance with the domestic substantive laws of the State of
Delaware without giving effect to any choice or conflict of laws provision or
rule that would cause the application of the domestic substantive laws of any
other jurisdiction.
16.2 Consent to Jurisdiction. Each party to this Agreement, by
its execution hereof, (a) hereby irrevocably submits to the jurisdiction of
the state courts of the State of Delaware or the United States District Court
for the District of Delaware for the purpose of any action, claim, cause of
action or suit (in contract, tort or otherwise), inquiry, proceeding or
investigation arising out of or based upon this Agreement or relating to the
subject matter hereof, (b) hereby waives to the extent not prohibited by
applicable law, and agrees not to assert, and agrees not to allow any of its
subsidiaries to assert, by way of motion, as a defense or otherwise, in any
such action, any claim that it is not subject personally to the jurisdiction
of the above-named courts, that its property is exempt or immune from
attachment or execution, that any such proceeding brought in one of the
above-named courts is improper, or that this Agreement or the subject matter
hereof or thereof may not be enforced in or by such court and (c) hereby
agrees not to commence or maintain any action, claim, cause of action or suit
(in contract, tort or otherwise), inquiry, proceeding or investigation arising
out of or based upon this Agreement or relating to the subject matter hereof
or thereof other than before one of the above-named courts nor to make any
motion or take any other action seeking or intending to cause the transfer or
removal of any such action, claim, cause of action or suit (in contract, tort
or otherwise), inquiry, proceeding or investigation to any court other than
one of the above-named courts whether on the grounds of inconvenient forum or
otherwise. Notwithstanding the foregoing, to the extent that any party hereto
is or becomes a party in any litigation in connection with which it may assert
indemnification rights set forth in this agreement, the court in which such
litigation is being heard shall be deemed to be included in clause (a) above.
Each party hereto hereby consents to service of process in any such
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proceeding in any manner permitted by Delaware law, and agrees that service of
process by registered or certified mail, return receipt requested, at its
address specified pursuant to Section 15.2 hereof is reasonably calculated to
give actual notice.
16.3 WAIVER OF JURY TRIAL. TO THE EXTENT NOT PROHIBITED BY
APPLICABLE LAW WHICH CANNOT BE WAIVED, EACH PARTY HERETO HEREBY WAIVES AND
COVENANTS THAT IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR
OTHERWISE) ANY RIGHT TO TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE OR
ACTION, CLAIM, CAUSE OF ACTION OR SUIT (IN CONTRACT, TORT OR OTHERWISE),
INQUIRY, PROCEEDING OR INVESTIGATION ARISING OUT OF OR BASED UPON THIS
AGREEMENT OR THE SUBJECT MATTER HEREOF OR IN ANY WAY CONNECTED WITH OR RELATED
OR INCIDENTAL TO THE TRANSACTIONS CONTEMPLATED HEREBY, IN EACH CASE WHETHER
NOW EXISTING OR HEREAFTER ARISING. EACH PARTY HERETO ACKNOWLEDGES THAT IT HAS
BEEN INFORMED BY THE OTHER PARTIES HERETO THAT THIS SECTION 16.3 CONSTITUTES A
MATERIAL INDUCEMENT UPON WHICH THEY ARE RELYING AND WILL RELY IN ENTERING INTO
THIS AGREEMENT. ANY PARTY HERETO MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF
THIS SECTION 16.3 WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF EACH
SUCH PARTY TO THE WAIVER OF ITS RIGHT TO TRIAL BY JURY.
SIGNATURE PAGES TO FOLLOW
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EXHIBIT 10.12
Execution Copy
IN WITNESS WHEREOF, each of the undersigned has duly executed this
Agreement (or caused this Agreement to be executed on its behalf by its
officer or representative thereunto duly authorized) under seal as of the date
first above written.
THE COMPANY: VERIDIAN CORPORATION
By: /s/ XXXXX X. XXXXX
---------------------------------------
Name: Xxxxx X. Xxxxx
---------------------------------------
Title: Senior Vice President & CEO
---------------------------------------
MONITOR: MONITOR CLIPPER EQUITY PARTNERS, L.P.
MONITOR CLIPPER EQUITY PARTNERS (FOREIGN), L.P.
Each By: MONITOR CLIPPER PARTNERS, L.P.,
its general partner
By MCP GP, INC.,
its general partner
By: /s/ XXXXX X. XXXXXXXXX
__________________________
Xxxxx X. Xxxxxxxxx
Authorized Signatory
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INITIAL INVESTORS:
CIBC WG ARGOSY MERCHANT FUND 2, L.L.C.
By: /s/ XXXXXX X. FLYER
---------------------------------------
Name: Xxxxxx X. Flyer
---------------------------------------
Title: Executive Director
---------------------------------------
THE BOARD OF TRUSTEES OF THE TEXAS GROWTH FUND
II, as Trustee for the Texas Growth Fund II -
1998 Trust
By: TGF II MANAGEMENT, L.P., as
Executive Director
By: TGF MANAGEMENT CORP.,
as general partner
By: /s/ XXXXXXX X. XXXXXXX
________________________________
Xxxxxxx X. Xxxxxxx
Executive Vice President
CO-INVESTMENT MERCHANT FUND 3, LLC
By: /s/ XXXXXX X. FLYER
---------------------------------------
Name: Xxxxxx X. Flyer
---------------------------------------
Title: Attorney-in-Fact
---------------------------------------
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MANAGEMENT EQUITYHOLDERS: ARGOTYCHE, L.P.
By: Santaeus, L.P.
Its General Partner
By: The Antaeusian Group, Inc.,
Its General Partner
By: /s/ XXXXX X. XXXXXXXXX
________________________________
Xxxxx X. Xxxxxxxxx
President
SANTAEUS, L.P.
By: The Antaeusian Group, Inc.,
Its General Partner
By: /s/ XXXXX X. XXXXXXXXX
________________________________
Xxxxx X. Xxxxxxxxx
President
/s/ XXXXX X. XXXXXXXXX
-----------------------------------
Xxxxx X. Xxxxxxxxx
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CONSULTANTS: MONITOR CONSULTING, L.P.
By: MONITOR G.P., INC.,
its general partner
By: /s/ XXXX XXXXXX
---------------------------------------
Name: Xxxx Xxxxxx
---------------------------------------
Title: Managing Director
---------------------------------------
MONITOR COMPANY GROUP LIMITED PARTNERSHIP
successor-in-interest to Monitor Company, Inc.
By: Monitor Company Group, G.P., L.L.C.,
its General Partner
By: /s/ XXXX XXXXXX
---------------------------------------
Name: Xxxx Xxxxxx
---------------------------------------
Title: Vice Chairman
---------------------------------------
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WARRANT INVESTORS: FIRST UNION INVESTORS, INC.
By: /s/ XXXXX X. XXXXXX
---------------------------------------
Name: Xxxxx X. Xxxxxx
---------------------------------------
Title: Senior Vice President
---------------------------------------
THE NORTHWESTERN MUTUAL
LIFE INSURANCE COMPANY
By: /s/ XXXXXXX X. XXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Its Authorized Representative
---------------------------------------
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY
By: Delaware Lincoln Investment Advisors,
a series of Delaware Management Business
Trust, Attorney-in-Fact
By: /s/ R. XXXXXX XXXXX
---------------------------------------
Name: R. Xxxxxx Xxxxx
---------------------------------------
Title: Vice President
---------------------------------------
X.X. XXXXXXX MEZZANINE FUND, L.P.
By: Xxxxxxx X.X., LLC,
General Partner
By: /s/ XXXXXX X. XXXXXXXXX
------------------------------
Name: Xxxxxx X. Xxxxxxxxx
------------------------------
Title: Managing Director
------------------------------
X.X. XXXXXXX MARKET VALUE FUND, L.P.
By: Whitney Market Value GP, LLC,
General Partner
By: /s/ XXXXXXX X. XXXXXXXX
------------------------------
Name: Xxxxxxx X. Xxxxxxxx
------------------------------
Title: Managing Director
------------------------------
A. G. INVESTMENT ADVISORY SERVICES, INC.
By: /s/ XXXXXXX X. XXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Vice President
---------------------------------------
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AMERICAN GENERAL LIFE AND ACCIDENT
INSURANCE COMPANY
By: /s/ XXXXXXX X. XXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Vice President
---------------------------------------
MAGNETITE ASSET INVESTORS L.L.C.
By: Blackrock Financial Management, Inc.
As Managing Member
By: /s/ XXXXXX X. XXXXXXX
------------------------------
Name: Xxxxxx X. Xxxxxxx
------------------------------
Title: Managing Director
------------------------------
MERIT LIFE INSURANCE CO.
By: /s/ XXXXXXX X. XXXXXX
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
---------------------------------------
Title: Vice President
---------------------------------------
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