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Exhibit 11
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REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of
December , 1996, is by and among ASDALE LIMITED (the "Holder"), and CROWN
NORTHCORP, INC., a Delaware corporation (the "Company").
WITNESSETH:
WHEREAS, the Holder desires to purchase from the Company certain
unregistered shares of the Common Stock on the date hereof; and
WHEREAS, the Company desires to encourage the Holder to purchase such
shares of the Common Stock by granting to the Holder certain registration rights
relating to such shares;
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINED TERMS. The following terms shall have the following
meanings:
"CERTIFICATE OF INCORPORATION" means the Certificate of Incorporation
of the Company, as amended and as in effect on the date hereof.
"COMMON STOCK" means the Common Stock, par value $.01 per share, of the
Company.
"COMMISSION" means the Securities and Exchange Commission or any
similar federal agency then having jurisdiction to enforce the Securities Act
and other federal securities laws.
"NASD" means the National Association of Securities Dealers, Inc. or
any successor corporation thereto.
"PERSON" means an individual or a corporation, partnership, trust,
incorporated or unincorporated association, joint venture, joint stock company,
government (or any agency or political subdivision thereof), or other entity of
any kind.
"REGISTRABLE SECURITIES," collectively, means (i) the Shares, (ii) any
shares of Common Stock hereafter distributed to the holders of the Registrable
Securities by the Company as a stock dividend or otherwise thereon, and (iii)
any equity securities of the Company convertible into, or exercisable or
exchangeable for, any of the shares of Common Stock identified in the foregoing
clauses (i) through (ii); provided, however, that any such securities shall
cease to be Registrable Securities when (i) such securities shall have been
registered under the Securities
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Act, the 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 pursuant to such effective registration statement, (ii)
such securities shall have been otherwise transferred, if new certificates or
other evidences of ownership for them not bearing a legend restricting further
transfer and not subject to any stop transfer order or other restrictions on
transfer shall have been delivered by the Company and subsequent disposition of
such securities shall not require registration or qualification of such
securities under the Securities Act or any state securities law then in force,
or (iii) such securities shall cease to be outstanding.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
successor federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect from time to time.
"SECURITIES EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended, or any successor federal statute, and the rule and regulations of the
Commission thereunder, all as the same shall be in effect from time to time.
"SHARES" means the shares of Common Stock purchased by the Holder from
the Company on the date hereof.
"STOCK" means all share, options, warrants, general or limited
partnership interests, participations, or other equivalents (regardless of how
designated) of or in a corporation, partnership, or equivalent entity, whether
voting or nonvoting, including, without limitation, common stock, preferred
stock, or any other "equity security" (as such term is defined in Rule 3a11-1 of
the General Rules and Regulations promulgated by the Commission under the
Securities Exchange Act.
"SUBSIDIARY," with respect to any Person, means (a) any corporation of
which an aggregate of more than 50% of the outstanding Stock having ordinary
voting power to elect a majority of the board of directors of such corporation
(irrespective of whether at such time Stock of any other class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time, directly, or indirectly, owned
legally or beneficially by such Person and/or one or more Subsidiaries of such
Person, and (b) any partnership in which such Person and (b) any partnership in
which such Person and/or one or more Subsidiaries of such Person shall have an
interest (whether in the form of voting or participation in profits or capital
contribution) of more than 50% or shall have any interest in a general partner
of any such partnership.
"VOTING STOCK" means capital stock of any class or classes of the
Company, including, without limitation, the Common Stock, the holders of which
are entitled to participate generally in the election of the members of the
Company's board of directors and any securities of the Company convertible into,
or exercisable or exchangeable for, any such capital stock of the Company;
provided, however, that "Voting Stock" shall not include any
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such capital stock or securities of the Company to the extent that (i) such
capital stock or securities shall have been registered under the Securities Act,
if the registration statement with respect to the sale of such capital stock or
securities shall have become effective under the Securities Act and such capital
stock or securities shall have been disposed of pursuant to such effective
registration statement, (ii) such capital stock or securities shall have been
distributed pursuant to Rule 144 (or any similar provision then in force) under
the Securities Act, (iii) such capital stock and securities shall have been
otherwise transferred, new certificates or other evidence of ownership for them
not bearing any legend restricting further transfer and not subject to any stop
transfer order or other restrictions on transfer shall been delivered by the
Company and subsequent disposition of such securities shall not require
registration or qualification of such securities under the Securities Act or any
securities laws then in force, or (iv) such capital stock or securities shall
have ceased to be outstanding.
SECTION 2. REGISTRATION RIGHTS.
(a) INCIDENTAL REGISTRATION. If the Company at any time proposes to
file on its behalf and/or on behalf of any of its security holders (the
"registering security holders") a Registration Statement under the Securities
Act on any form (other than a Registration Statement on Form S-4 or S-8 or any
related small business form or any successor form for securities to be offered
in a transaction of the type referred to in Rule 145 under the Securities Act or
to employees of the Company pursuant to any employee benefit plan, respectively)
for the general registration of securities to be sold for cash with respect to
its Common Stock or any other class of equity security of the Company, it will
give written notice to all holders of Registrable Securities at least 45 days
before the initial filing with the Commission of such Registration Statement,
which notice shall set forth the intended method of disposition of the
securities proposed to be registered by the Company. The notice shall offer to
include in such filing the aggregate number of shares of Registrable Securities
as such holder may request.
Each holder of any Registrable Securities desiring to have Registrable
Securities registered under this Section 2(a) shall advise the Company in
writing within 10 days after the date of such receipt of such offer from the
Company, setting forth the amount of such Registrable Securities for which
registration is requested. The Company shall thereupon include in such filing
the number of shares of Registrable Securities for which registration is so
requested, subject to the next sentence, and shall use its reasonable commercial
efforts to effect registration under the Securities Act of such shares. If the
managing underwriter of a proposed public offering shall advise the Company in
writing that, in its opinion, the distribution of the Registrable Securities
requested to be included in the registration concurrently with the securities
being registered by the Company or such registering security holder would
materially and adversely affect the distribution of such securities by the
Company or such registering security holder, then all selling security holders
(other than the Company) shall reduce the amount of securities each intended to
distribute through such offering on a pro rata basis (such event is hereinafter
referred to as a "Reduction Event").
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Notwithstanding any provision of this Agreement to the contrary, the
Holder shall include shares of Registrable Securities in any registration of
Stock hereunder on a maximum of two occasions.
(b) REGISTRATION PROCEDURES. If the Company is required by the
provisions of Section 2(a) to use its reasonable commercial efforts to effect
the registration of any of its securities under the Securities Act, the Company
will, as expeditiously as possible:
(i) prepare and file with the Commission a Registration
Statement with respect to such securities and use its best efforts to cause such
Registration Statement to become and remain effective for a period of time
required for the disposition of such securities by the holders thereof, but not
to exceed 180 days;
(ii) prepare and file with the Commission such amendments and
supplements to such Registration Statement and the prospectus used in connection
therewith as may be necessary to keep such Registration Statement effective and
to comply with the provisions of the Securities Act with respect to the sale or
other disposition of any securities covered by such Registration Statement until
the earlier of such time as all of such securities have been disposed of in a
public offering or the expiration of 180 days;
(iii) furnish to such selling security holders such number of
copies of a summary prospectus or other prospectus, including a preliminary
prospectus, in conformity with the requirements of the Securities Act, and such
other documents, as such selling security holders may reasonably request;
(iv) use its reasonable commercial efforts to register or
qualify the securities covered by such Registration Statement under such other
securities or blue sky laws of such jurisdictions within the United States and
Puerto Rico as each holder of such securities shall request (provided, however,
that the Company shall not be obligated to qualify as a foreign corporation to
do business under the laws of any jurisdiction in which it is not then qualified
or to file any general consent to service of process), and do such other
reasonable acts and things as may be required of it to enable such holder to
consummate the disposition in such jurisdiction of the Securities covered by
such Registration Statement;
(v) enter into customary agreements (including an underwriting
agreement in customary form) and take such other actions as are reasonably
required in order to expedite or facilitate the disposition of such Registrable
Securities; and
(vi) otherwise use its reasonable commercial efforts to comply
with all applicable rules and regulations of the Commission, and make available
to its security holders, as soon as reasonably practicable, but not less than 18
months after the effective date of the Registration Statement, an earnings
statement covering the period of at least 12 months beginning with the first
full month after the effective date of such Registration Statement,
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which earnings statements shall satisfy the provisions of Section 11(a) of the
Securities Act.
It shall be a condition precedent to the obligation of the Company to
take any action pursuant to this Section 2 in respect of the securities which
are to be registered at the request of any holder of Registrable Securities that
such holder shall furnish to the Company such information regarding the
securities held by such holder and the intended method of disposition thereof as
the Company shall reasonably request and as shall be required under the
Securities Act in connection with the action taken by the Company and that such
holder shall execute such agreements, instruments, and other documents in
connection with such registration (including, without limitation, an escrow
agreement relating to such securities) as the Company may reasonably request.
SECTION 3. REGISTRATION EXPENSES. All expenses incurred in complying
with Section 2 of this Agreement, including, without limitation, all
registration and filing fees (including all expenses incident to filing with the
NASD), printing expenses, fees and disbursements of counsel for the Company,
expense of any special audits incident to or required by such registration, time
charges of Company personnel, and expenses of complying with the securities or
blue sky laws of any jurisdictions pursuant to Section 2(b), shall be paid by
the Company, except that
(a) all such expenses in connection with any amendment or supplement to
the Registration Statement or prospectus filed more than 120 days after the
effective date of such Registration Statement because any holder of Registrable
Securities has not effected the disposition of the securities requested to be
registered shall be paid by such holder;
(b) the Company shall not be liable for any fees, discounts, or
commissions to any underwriter in respect of the securities sold by such holder
of Registrable Securities; and
(c) the Company shall not be liable for any fees or expenses of counsel
to selling security holders.
SECTION 4. INDEMNIFICATION AND CONTRIBUTION. (a) In the event of any
registration of any Registrable Securities under the Securities Act pursuant to
this Agreement, the Company shall indemnify and hold harmless the holder of such
Registrable Securities, such holder's partners, their respective directors and
officers, and each other Person (including each underwriter) who participated in
the offering of such Registrable Securities and each other Person, if any, who
controls such holder or such participating person within the meaning of the
Securities Act, against any losses, claims, damages, or liabilities, joint or
several, to which such holder or any such director or officer or participating
person or controlling person may become subject under the Securities Act or any
other statute or at common law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereof) arise out of or are based upon (i)
any alleged untrue statement of any material fact contained, on the effective
date thereof, in any Registration Statement under which such securities were
registered under the
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Securities Act, any preliminary prospectus or final prospectus contained
therein, or any amendment or supplement thereto, or (ii) any alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and shall reimburse such holder or such
director, officer, or participating person or controlling person for any legal
or any other expenses reasonably incurred by such Person in connection with
investigating or defending any such loss, claim, damage, or liability; provided,
however, that the Company shall not be liable in any such case to the extent
that any such loss, claim, damage, or liability arises out of or is based upon
any alleged untrue statement or alleged omission made (x) in such Registration
Statement, preliminary prospectus, prospectus, or amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by such holder or underwriter specifically for use therein, or (y) in
such Registration Statement, preliminary prospectus, or amendment or supplement
but corrected in such final prospectus if such final prospectus was not
delivered to the Person alleging such loss, claim, damage, or liability. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of such holder or such director, officer, or participating
person or controlling Person, and shall survive the transfer of such securities
by such holder.
(b) Each holder of any Registrable Securities, by acceptance thereof,
agrees to indemnify and hold harmless the Company, its directors and officers,
and each other Person, if any, who controls the Company within the meaning of
the Securities Act against any losses, claims, damages, or liabilities, joint or
several, to which the Company or any such director or officer or any such Person
may become subject under the Securities Act or any other statute or at common
law, insofar as such losses, claims, damages, or liabilities (or actions in
respect thereof) arise out of or are based upon information in writing provided
to the Company by such holder of such Registrable Securities specifically for
use in the following documents and contained, on the effective date thereof, in
any Registration Statement under which securities were registered under the
Securities Act at the request of such holder, any preliminary prospectus or
final prospectus contained therein, or any amendment or supplement thereto.
(c) If the indemnification provided for in this Section 4 from the
indemnifying party is unavailable to an indemnified party hereunder in respect
of any losses, claims, damages, liabilities, or expenses referred to therein,
then the indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, liabilities, or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and the indemnified parties in connection with the actions which resulted
in such losses, claims, damages, liabilities, or expenses, as well as any other
relevant equitable considerations. The relative fault of such indemnifying party
and indemnified parties shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact, has
been made by, or relates to information supplied by, such indemnifying party or
indemnified parties, as well as the parties' relative intent, knowledge, access
to information and opportunity to correct or
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prevent such action. The amount paid or payable by a party as a result of the
losses, claims, damages, liabilities, and expenses referred to above shall be
deemed to include any legal or other fees or expenses reasonably incurred by
such party in connection with any investigation or proceeding.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 4(c) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
No Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not also guilty of such fraudulent misrepresentation.
SECTION 5. CERTAIN LIMITATIONS ON REGISTRATION RIGHTS. Notwithstanding
the other provisions of this Agreement, the Company shall not be obligated to
register the Registerable Securities of any holder if, in the opinion of Powell,
Goldstein, Xxxxxx & Xxxxxx or such other counsel to the Company reasonably
satisfactory to the holder and its counsel (or, if the holder has engaged an
investment banking firm, to such investment banking firm and its counsel), the
sale or other disposition of such holder's Registrable Securities, in the manner
proposed by such holder (or by such investment banking firm), may be effected
without registering such Registrable Securities under the Securities Act.
SECTION 6. MISCELLANEOUS
(a) AMENDMENTS AND WAIVERS. Except as otherwise provided herein, the
provisions of this Agreement may not be amended, modified, or supplemented, and
waivers or consents to departure from the provisions thereof may not be given,
without the prior written consent of the parties hereto.
(b) NOTICES. Any notice, demand, request, consent, approval,
declaration, or other communication hereunder to be made pursuant to the
provisions of this Agreement, shall be sufficiently given or made if in writing
and either delivered in person with receipt acknowledged or sent by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:
(i) If to the Holder:
Asdale Limited
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(ii) If to the Company:
Crown NorthCorp, Inc.
0000 Xxxxxx Xxxx
Xxxxxxxx, Xxxx 00000
Attn: Xxxxxxx X. Xxxxx
Secretary
(iv) If to any holder of Registrable Securities other than the Holder,
at its last known address appearing on the books of the Company maintained for
such purpose, or at such other address as may be substituted by notice given as
herein provided. The giving of any notice required hereunder may be waived in
writing by the party entitled to receive such notice. Every notice, demand,
request, consent, approval, declaration, delivery, or other communication
hereunder shall be deemed to have been duly given or served on the date on which
personally delivered, with receipt acknowledged, or three (3) business days
after the same shall have been deposited in the United States mail.
(c) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of and be binding upon the successors and permitted assigns of each of the
parties hereto. This Agreement may be assigned by the Company to any successor
to the Company without the consent of the Holder. This Agreement may not
otherwise be assigned by the Company without the prior written consent of the
Holder, which consent shall not be unreasonably delayed or withheld. This
Agreement may not be assigned by the Holder without the prior written consent of
the Company, which consent may be granted or withheld in the Company's sole
discretion.
(d) HEADINGS. The headings in this Agreement are for convenience of
reference only, and shall not limit or otherwise affect the meaning thereof.
(e) GOVERNING LAW. This Agreement shall be governed by the laws of the
State of Delaware, without regard to the provisions thereof relating to conflict
of laws.
(f) SEVERABILITY. Whenever possible, each provision of this Agreement
shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
(g) ENTIRE AGREEMENT. This Agreement represents the complete agreement
and understanding of the parties in respect of the subject matter contained
herein and therein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to the subject matter hereof.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
ASDALE LIMITED
By:________/s/__________________
Name: Xxxxxx X.X. Xxxxxxx
Title: Attorney-in-fact
CROWN NORTHCORP, INC.
By:_________/s/_________________
Name: Xxxxxxx X. Xxxxx
Title: Secretary
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