EXHIBIT 10.4
AMENDED AND RESTATED
REGISTRATION AGREEMENT
THIS AMENDED AND RESTATED REGISTRATION AGREEMENT (this "AGREEMENT") is made
as of December 21, 1998, by and among Real Education, Inc., a Colorado
corporation (the "COMPANY"), each of the Series A Investors (the "SERIES A
INVESTORS") set forth in the Series A Agreement (as defined below), each of the
Series B Investors (the "SERIES B INVESTORS") set forth in the Series B
Agreement (as defined below) and each of the Series C Purchasers (the "SERIES C
PURCHASERS") set forth in the Series C Agreement (as defined below). In the
event less than all of the Series C Purchasers execute this Agreement as of the
date hereof, this Agreement shall be valid as to the parties who do execute this
Agreement as of the date hereof. The Series A Investors, the Series B
Investors, and the Series C Purchasers shall be collectively known as
"INVESTORS" hereinafter. This Agreement amends, restates and supersedes that
certain Registration Agreement by and between the Company and the Series A
Investors and Series B Investors dated as of February 2, 1998.
BACKGROUND
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A. Pursuant to a Unit Purchase Agreement by and among the Company and the
Series A Investors, dated as of June 11, 1997 (the "SERIES A AGREEMENT"), the
Series A Investors purchased an aggregate of 132,000 investment units ("UNITS"),
each Unit consisting of one share of Series A Convertible Preferred Stock, no
par value per share, of the Company (the "SERIES A PREFERRED"), and one Common
Stock Purchase Warrant ("WARRANT"). In addition, the Series B Investors
purchased 326,833 shares of Series B Convertible Preferred Stock, no par value
per share, of the Company (the "SERIES B PREFERRED"), pursuant to the Share
Purchase Agreement by and between the Company and the Series B Investors dated
as of February 2, 1998 (the " SERIES B AGREEMENT"). In addition, the Series C
Purchasers will purchase 430,540 shares of Series C Convertible Preferred Stock,
no par value per share, of the Company (the "SERIES C PREFERRED"), pursuant to
the Share Purchase Agreement by and between the Company and the Series C
Purchasers of even date herewith (the "SERIES C AGREEMENT"). The Series C
Purchasers' purchase of the Series C Preferred was on the condition that the
Company, the Series A investors and the Series B Investors agree to certain
terms and conditions related to the registration of securities of the Company,
as set forth in this Agreement.
B. All parties hereto are willing to enter into this Agreement so that
all registration rights covering Registrable Securities held by the Investors
will be identical.
C. The Series A Investors and Series B Investors have agreed to release
whatever registration rights they now have in exchange for the rights afforded
by this Agreement.
AGREEMENT
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NOW, THEREFORE, in consideration of the foregoing Background, which is by
this reference expressly incorporated herein, the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties to this Agreement hereby agree as
follows:
Page 1 - Registration Agreement
1. Definitions.
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"COMMON STOCK" has the meaning assigned to it in the Amended and Restated
Shareholders Agreement among the Company and its Shareholders of even date
herewith
"PERSON" means an individual, a partnership, a corporation, an association, a
joint stock company, a trust, a joint venture, a limited liability company, an
unincorporated organization or a governmental entity or any department, agency
or political subdivision thereof.
"REGISTRABLE SECURITIES" means (i) any Series A Preferred or Common Stock issued
upon the conversion of any Series A Preferred issued pursuant to the Series A
Agreement; (ii) any Common Stock issued upon exercise of any Warrant issued
pursuant to the Series A Agreement; (iii) any Series B Preferred or Common Stock
issued upon the conversion of any Series B Preferred issued pursuant to the
Series B Agreement; (iv) any Series C Preferred or Common Stock issued upon the
conversion of any Series C Preferred issued pursuant to the Series C Agreement;
and (v) any Common Stock issued or issuable with respect to the securities
referred to in clauses (i), (ii) (iii) (iv) and (v) by way of a 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 securities will cease to be Registrable Securities when they
have been distributed to the public pursuant to an offering registered under the
Securities Act of 1933, as amended (the "Securities Act") or sold to the public
through a broker, dealer or market maker in compliance with Rule 144 under the
Securities Act (or any similar rule then in force). For purposes of this
Agreement, a Person will be deemed to be a holder of Registrable Securities
whenever such Person has the right to acquire directly or indirectly such
Registrable Securities (upon conversion or exercise in connection with a
transfer of securities or otherwise, but disregarding any restrictions or
limitations upon the exercise of such right), whether or not such acquisition
has actually been effected.
2. Demand Registration Rights of the Investors.
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A. Requests for Registration. At any time following the closing date of
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the Company's initial public offering of its Common Stock (the "IPO CLOSING")
the holders of at least thirty percent (30%) of the Registrable Securities may
request up to two registrations under the Securities Act of 1933, as amended
from time to time (the "SECURITIES ACT"), of all or part of their Registrable
Securities on Form S-1 or any similar long-form registration ("LONG-FORM
REGISTRATIONS"). Each request for an Investor Demand Registration, including
Short Form Registrations, (both as defined below) shall specify the approximate
number of Registrable Securities requested to be registered and the anticipated
per share price range for such offering. Within ten days after receipt of any
such request, the Company will give written notice of such requested
registration to all other holders of Registrable Securities and will include in
such registration all Registrable Securities with respect to which the Company
has received written requests for inclusion therein within 20 days after the
receipt of the Company's notice. The holders of the Registrable Securities may
also request Short-Form Registrations, as defined in Section 2.B below. All
registrations requested pursuant to Sections 2.A and 2.B are referred to herein
as "INVESTOR DEMAND REGISTRATIONS".
B. Short-Form Registrations. At any time after the IPO Closing, the
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holders of the Registrable Securities may request registration of all or part of
their Registrable Securities on Form S-3, or any similar short-form registration
then available to the Company, provided that
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the anticipated aggregate offering price of the Registrable Securities to the
public for any such registration exceeds $500,000 ("SHORT-FORM REGISTRATIONS").
Investor Demand Registrations will be Short-Form Registrations whenever the
Company is permitted to use any applicable short form. Once the Company has
become subject to the reporting requirements of the Securities Exchange Act of
1934, as amended, (the "EXCHANGE ACT"), the Company will use its best efforts to
make Short-Form Registrations available for the sale of Registrable Securities.
C. Restrictions on Investor Demand Registrations. The Company will not be
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obligated to effect any Investor Demand Registration under this Section 2 within
60 days prior to or 180 days following the effective date of any registration
under the Securities Act pertaining to securities of the Company.
D. Selection of Underwriters. The holders of sixty-six and two-thirds
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percent (66-2/3%) ("TWO-THIRDS") of the Registrable Securities included in any
Investor Demand Registration under this Section 2 will have the right to select
the investment banker(s) and manager(s) to administer the offering, if such
offering is underwritten, subject to the approval of the Company, which approval
will not be unreasonably withheld.
E. Demand Registration Expenses. The Registration Expenses (as defined
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herein) of the holders of Registrable Securities in all Investor Demand
Registrations will be paid by the Company in accordance with Section 6 hereof.
F. Registration Delay. Anything in this Section 2 to the contrary
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notwithstanding, the Company may not defer or delay Investor Demand
Registrations under this Section 2 for more than two 60-day periods in any 12-
month period. The Company may engage in such delays only where its Board of
Directors has determined, in its good faith judgment, that such Investor Demand
Registration would be seriously detrimental to the Company and its shareholders.
If the Company makes such a determination of detriment warranting a delay in
Investor Demand Registration, prior written notice thereof shall be duly
provided to the holders of the Registrable Securities.
3. Piggyback Registrations.
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A. Right to Piggyback. Whenever the Company proposes to register any of
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its Common Stock under the Securities Act (other than pursuant to a Investor
Demand Registration) and the registration form to be used may be used for the
registration of Registrable Securities (a "PIGGYBACK REGISTRATION"), the Company
will give prompt written notice to all holders of Registrable Securities of its
intention to effect such a registration and will include in such registration
all Registrable Securities with respect to which the Company has received
written requests for inclusion therein within 20 days after the receipt of the
Company's notice. These rights to Piggyback Registration expire on the fifth
anniversary of the IPO Closing.
B. Piggyback Expenses. The Registration Expenses of the holders of
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Registrable Securities in all Piggyback Registrations will be paid by the
Company in accordance with Section 6 hereof.
C. Priority on Primary Registrations. If a Piggyback Registration is an
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underwritten primary registration on behalf of the Company, and the managing
underwriters advise the
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Company in writing that in their opinion the number of securities requested to
be included in such registration exceeds the number which can be sold in such
offering without adversely affecting the marketability of the offering, the
Company will include in such registration (i) first, the securities the Company
proposes to sell on its own behalf, and, if additional shares can be sold in the
opinion of the managing underwriters, (ii) second, the Registrable Securities
requested to be included in such registration, pro rata among the holders of
such Registrable Securities on the basis of the number of shares of Registrable
Securities owned by each such holder, calculated as if such shares had been
converted at such time to Common Stock, and (iii) third, other securities
requested to be included in such registration.
D. Priority on Secondary Registrations. If a Piggyback Registration is an
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underwritten secondary registration on behalf of holders of the Company's
securities (other than an Investor Demand Registration), and the managing
underwriters advise the Company in writing that in their opinion the number of
securities requested to be included in such registration exceeds the number
which can be sold in such offering without adversely affecting the marketability
of the offering, the Company will include in such registration (i) first, the
Registrable Securities requested to be included in such registration, pro rata
among the holders of such securities on the basis of the number of shares owned
by each such holder, calculated as if such shares had been converted at such
time to Common Stock, and (ii) second, other securities requested or permitted
to be included in such registration.
E. Other Registrations. If the Company has previously filed a
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registration statement with respect to Registrable Securities pursuant to
Sections 2 or 3, and if such previous registration has not been withdrawn or
abandoned, the Company will not file or cause to be effected any other
registration of any of its equity securities or securities convertible or
exchangeable into or exercisable for its equity securities under the Securities
Act (except on Form S-8 or any successor form), whether on its own behalf or at
the request of any holder or holders of such securities, until a period of at
least 90 days has elapsed from the effective date of such previous registration.
4. Holdback Agreements.
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A. Each holder of Registrable Securities agrees not to effect any public
sale or distribution (including sales pursuant to Rule 144) of equity securities
of the Company, or any securities convertible into or exchangeable or
exercisable for such securities, during the seven days prior to and during the
90-day period beginning on the effective date of any underwritten Investor
Demand Registration or any underwritten Piggyback Registration in which any
Registrable Securities are included (except as part of such underwritten
registration), unless the underwriters managing the registered public offering
otherwise agree. Notwithstanding the provisions of the prior sentence, if the
underwritten registration is the Company's initial public offering, then the
applicable periods under this Section 4.A shall be 180 rather than 90 days.
B. The Company agrees (i) not to effect any public sale or distribution
of its equity securities, or any securities convertible into or exchangeable or
exercisable for such securities, during the seven days prior to and during the
90-day period beginning on the effective date of any underwritten Investor
Demand Registration or any underwritten Piggyback Registration (except as part
of such underwritten registration or pursuant to registrations on Form S-8 or
any successor form), unless the underwriters managing the registered public
offering otherwise agree, and (ii) to cause each holder of its equity securities
(or any securities convertible into or exchangeable or exercisable for such
equity securities) purchased from the
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Company at any time after the date of this Agreement (other than in a registered
public offering) to agree not to effect any public sale or distribution
(including sales pursuant to Rule 144) of any such securities during such period
(except as part of such underwritten registration, if otherwise permitted),
unless the underwriters managing the registered public offering otherwise agree.
Notwithstanding the provisions of the prior sentence, if the underwritten
registration is the Company's initial public offering, then the applicable
periods under this Section 4.B shall be 180 rather than 90 days.
5. Registration Procedures. Whenever the holders of Registrable
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Securities have requested that any Registrable Securities be registered pursuant
to this Agreement, the Company will use its best efforts to effect the
registration and the sale of such Registrable Securities in accordance with the
intended method of disposition thereof, and pursuant thereto the Company will as
expeditiously as possible:
A. prepare and file with the Securities and Exchange Commission a
registration statement with respect to such Registrable Securities and use its
best efforts to cause such registration statement to become effective (provided
that before filing a registration statement or prospectus or any amendments or
supplements thereto, the Company will furnish to the counsel selected by the
holders of Two-Thirds of the Registrable Securities covered by such registration
statement copies of all such documents proposed to be filed, which documents
will be subject to the review and comments of such counsel);
B. prepare and file with the Securities and Exchange Commission such
amendments and supplements to such registration statement and the prospectus
used in connection therewith as may be necessary to keep such registration
statement effective for a period of not less than 180 days and comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement during such period in
accordance with the intended methods of disposition by the sellers thereof set
forth in such registration statement;
C. furnish to each seller of Registrable Securities such number of copies
of such registration statement, each amendment and supplement thereto, the
prospectus included in such registration statement (including each preliminary
prospectus) and such other documents as such seller may reasonably request in
order to facilitate the disposition of the Registrable Securities owned by such
seller;
D. use its best efforts to register or qualify such Registrable
Securities under such other securities or blue sky laws of such jurisdictions as
any seller reasonably requests and do any and all other acts and things which
may be reasonably necessary or advisable to enable such seller to consummate the
disposition in such jurisdictions of the Registrable Securities owned by such
seller (provided that the Company will not be required to (i) qualify generally
to do business in any jurisdiction where it would not otherwise be required to
qualify but for this Section, (ii) subject itself to taxation in any such
jurisdiction or (iii) consent to general service of process in any such
jurisdiction);
E. notify each seller of such Registrable Securities, 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 contains an untrue statement of a material fact
or omits any fact necessary to make the statements therein not misleading, and,
at the request of any such seller, the Company will prepare a supplement
Page 5 - Registration Agreement
or amendment to such prospectus so that, as thereafter delivered to the
purchasers of such Registrable Securities, such prospectus will not contain an
untrue statement of a material fact or omit to state any fact necessary to make
the statements therein not misleading;
F. cause all such Registrable Securities to be listed on each securities
exchange on which similar securities issued by the Company are then listed and,
if not so listed, to be listed on The Nasdaq Stock Market ("NASDAQ") and, if
listed on Nasdaq, use its best efforts to secure designation of all such
Registrable Securities covered by such registration statement as a Nasdaq
National Market security within the meaning of Rule 11Aa2-l promulgated pursuant
to the Exchange Act or, failing that, to secure Nasdaq authorization for such
Registrable Securities and, without limiting the generality of the foregoing, to
arrange for at least two market makers to register as such with Nasdaq with
respect to such Registrable Securities;
G. provide a transfer agent and registrar for all such Registrable
Securities not later than the effective date of such registration statement;
H. enter into such customary agreements (including underwriting
agreements in customary form) and take all such other actions as the holders of
Two-Thirds of the Registrable Securities being sold or the underwriters, if any,
reasonably request in order to expedite or facilitate the disposition of such
Registrable Securities (including, without limitation, effecting a stock split
or a combination of shares);
I. make available for inspection by any seller of Registrable Securities,
any underwriter participating in any disposition pursuant to such registration
statement and any attorney, accountant or other agent retained by any such
seller or underwriter, all financial and other records, pertinent corporate
documents and properties of the Company, and cause the Company's officers,
directors, employees and independent accountants to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant or
agent in connection with such registration statement; provided that upon the
reasonable request of the Company, any Person to whom any proprietary
information is made available shall agree to maintain the confidentiality of
such proprietary information, except if disclosure is required by judicial
decree or applicable law or such proprietary information otherwise becomes
publicly available;
J. otherwise use its best efforts to comply with all applicable rules and
regulations of the Securities and Exchange Commission, and make available to its
security holders, as soon as reasonably practicable, an earnings statement
covering the period of at least twelve months beginning with the first day of
the Company's first full calendar quarter after the effective date of the
registration statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder;
K. permit any holder of Registrable Securities, which holder might be
deemed to be an underwriter or a controlling Person of the Company, (i) to
review and comment on the registration or comparable statement to be filed with
the Securities and Exchange Commission, and all preliminary versions thereof,
(ii) to require the insertion therein of material, furnished to the Company in
writing, which in the reasonable judgment of such holder and its counsel should
be included therein in order to reduce the risk that such holder may be deemed
to be an underwriter or a controlling Person of the Company, or to reduce the
risk and potential liability associated therewith in the event that such holder
is deemed to be an underwriter or
Page 6 - Registration Agreement
controlling Person of the Company (including, without limitation, that the
holding by such holder 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 holder
will assist in meeting any future financial requirements of the Company),
provided that such material does not contain a material misstatement or omission
and (iii) in the event that reference to such holder by name or otherwise is not
required by the Securities Act or any similar Federal statute then in force, the
deletion of any reference to such holder (provided that such holder shall
furnish to the Company an opinion of counsel to such effect, which opinion shall
be reasonably satisfactory to the Company);
L. use its best efforts to cause such Registrable Securities covered by
such registration statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the sellers
thereof to consummate the disposition of such Registrable Securities;
M. in any underwritten offering obtain a "cold comfort" letter and
updates thereof from the Company's independent public accountants in customary
form and covering such matters of the type customarily covered by cold comfort
letters as the holders of a majority of the Registrable Securities being sold
reasonably request (provided that such Registrable Securities constitute at
least 10% of the securities covered by such registration statement); and
N. in the event of the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any common stock included in such registration statement for sale in any
jurisdiction, the Company will use its best efforts promptly to obtain the
withdrawal of such order.
O. make such representations and warranties to the holders of Registrable
Securities and the underwriters, if any, in form, substance, and scope as are
customarily made by issuers to underwriters in underwritten offerings in
customary form and consistent with then-current market practice;
P. obtain opinions of counsel to the Company which counsel and opinions
(in form, scope, and substance) shall be reasonably satisfactory to the managing
underwriters, if any, addressed to the underwriters, if any, in customary form
covering the matters customarily covered in opinions requested in primary
underwritten offerings and such other matters as may be reasonably requested by
such underwriters;
Q. of an underwriting agreement is entered into, cause the same to set
forth in full the indemnification provisions and procedures substantially to the
effect set forth in Section 7 hereof with respect to all parties to be
indemnified pursuant to said Section; and
R. deliver such documents and certificates as may be reasonably requested
by the holders of at least 50% of Registrable Securities being sold or the
managing underwriters, if any, to evidence compliance with Section E above and
with any customary conditions contained in the underwriting agreement or other
agreement entered into by the Company.
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6. Registration Expense.
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A. All expenses incident to the Company's performance of or compliance
with this Agreement, including without limitation all registration and filing
fees, fees and expenses of compliance with securities or blue sky laws, printing
expenses, messenger and delivery expenses, and fees and disbursements of counsel
for the Company and all independent certified public accountants, underwriters
(excluding discounts and commissions) and other Persons retained by the Company
(all such expenses being herein called "REGISTRATION EXPENSES"), will be borne
by the Company. Registration Expenses shall also include the Company's internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expense of
any annual audit or quarterly review, the expense of any liability insurance and
the expenses and fees for listing the securities to be registered on each
securities exchange on which similar securities issued by the Company are then
listed or on Nasdaq.
B. In connection with each Investor Demand Registration and each
Piggyback Registration, the Company will reimburse the holders of the
Registrable Securities covered by such registration for the reasonable fees and
disbursements of one counsel chosen by the holders of Two-Thirds of the
Registrable Securities covered by such registration.
C. Each holder of securities included in any registration hereunder will
pay any underwriting discounts and commissions incurred upon the sale of such
securities.
7. Indemnification.
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A. The Company agrees to indemnify and hold harmless, to the extent
permitted by law, each holder of Registrable Securities, its officers,
directors, employees and agents and each Person who controls such holder (within
the meaning of the Securities Act) against all losses, claims, damages,
liabilities and expenses arising out of or based upon any untrue or alleged
untrue statement of material fact contained in any registration statement,
prospectus or preliminary prospectus or any amendment thereof or supplement
thereto or any omission or alleged omission of a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as the same are caused by or contained in any information
furnished in writing to the Company by such holder expressly for use therein or
by such holder's failure to deliver a copy of the registration statement or
prospectus or any amendments or supplements thereto after the Company has
furnished such holder with a sufficient number of copies of the same. In
connection with an underwritten offering, the Company will indemnify such
underwriters, their officers and directors and each Person who controls such
underwriters (within the meaning of the Securities Act) to the same extent as
provided above with respect to the indemnification of the holders of Registrable
Securities.
B. In connection with any registration statement in which a holder of
Registrable Securities is participating, each such holder will furnish to the
Company in writing such information and affidavits as the Company reasonably
requests for use in connection with any such registration statement or
prospectus and, to the extent permitted by law, will indemnify and hold harmless
the Company, its directors, officers, employees and agents and each Person who
controls the Company (within the meaning of the Securities Act) against all
losses, claims, damages, liabilities and expenses arising out of or based upon
any untrue or alleged untrue statement of material fact contained in any
registration statement, prospectus or preliminary prospectus or any amendment
thereof or supplement thereto or any omission or
Page 8 - Registration Agreement
alleged omission of a material fact required to be stated therein or necessary
to make the statements therein not misleading, but only to the extent that such
untrue statement or omission is contained in any information or affidavit so
furnished in writing by such holder and is not cured in a timely manner;
provided that the obligation to indemnify will be individual to each holder and
will be limited to the amount of proceeds received by such holder from the sale
of Registrable Securities pursuant to such registration statement.
C. Any Person entitled to indemnification hereunder will (i) give prompt
written notice to the indemnifying party of any claim with respect to which it
seeks indemnification and (ii) unless in the reasonable judgment of such
indemnified party a conflict of interest between such indemnified and
indemnifying parties exists with respect to such claim, permit such indemnifying
party to assume the defense of such claim with counsel reasonably satisfactory
to the indemnified party. If such defense is assumed, the indemnifying party
will not be subject to any liability for any settlement made by the indemnified
party without its consent (but such consent will not be unreasonably withheld).
An indemnifying party who is not entitled to, or elects not to, assume the
defense of a claim will not be obligated to pay the fees and expenses of more
than one counsel for all parties indemnified by such indemnifying party with
respect to such claim, unless in the reasonable judgment of legal counsel to any
indemnified party a conflict of interest exists between such indemnified party
and any other of such indemnified parties with respect to such claim.
D. The indemnification provided for under this Agreement will remain in
full force and effect regardless of any investigation made by or on behalf of
the indemnified party or any officer, director or controlling Person of such
indemnified party and will survive the transfer of securities. The Company also
agrees to make such provisions, as are reasonably requested by any indemnified
party, for contribution to such party in the event the Company's indemnification
is unavailable for any reason.
8. Participation in Underwritten Registrations. No Person may participate
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in any registration hereunder which is underwritten unless such Person (a)
agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Person or Persons entitled hereunder
to approve such arrangements and (b) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents
required under the terms of such underwriting arrangements; provided that no
holder of Registrable Securities included in any underwritten registration shall
be required to make any representations or warranties to the Company or the
underwriters other than representations and warranties regarding such holder and
such holder's intended method of distribution.
9. Miscellaneous.
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A. No Inconsistent Agreements. From and after the date hereof the Company
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shall not enter into any agreement granting any holder or prospective holder of
any securities of the Company registration rights with respect to such
securities unless such new registration rights are subordinate to, or otherwise
do not adversely affect the rights of the holders granted hereunder. The Company
represents and warrants that the rights granted to the holders hereunder do not
in any way conflict with and are not inconsistent with the rights granted to the
holders of the Company's securities under any agreement in effect on the date
hereof.
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B. Adjustments Affecting Registrable Securities. The Company will not
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take any action, or permit any change to occur, with respect to its securities
which would adversely affect the ability of the holders of Registrable
Securities to include such Registrable Securities in a registration undertaken
pursuant to this Agreement or which would adversely affect the marketability of
such Registrable Securities in any such registration (including, without
limitation, effecting a stock split or a combination of shares).
C. Remedies, Enforcement, Governing Law, Venue.
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(1) Any Person having rights under any provision of this Agreement will be
entitled to enforce such rights specifically to recover damages caused by reason
of any breach of any provision of this Agreement and to exercise all other
rights granted by law. The parties hereto agree and acknowledge that (i) money
damages may not be an adequate remedy for any breach of the provisions of this
Agreement; and (ii) any party may in its sole discretion apply to any court of
law or equity of competent jurisdiction (without posting any bond or other
security) for specific performance and for other injunctive relief in order to
enforce or prevent violation of the provisions of this Agreement; and (iii) each
party hereby waives the defense in any action for specific performance that a
remedy at law would be adequate.
(2) All questions concerning the relative rights of the Company and its
shareholders and the construction, validity and interpretation of this Agreement
and the exhibits and schedules hereto shall be governed by and construed in
accordance with the domestic laws of the State of Colorado, without giving
effect to any choice of law or conflict of law provision or rule (whether of the
State of Colorado or any other jurisdiction) that would cause the application of
the laws of any jurisdiction other than the State of Colorado.
(3) In the event of any claim, dispute and controversy of any nature
between or among the Investors and the Company arising out of or in connection
with this Agreement, or the negotiation, execution, delivery, performance,
nonperformance or breach thereof (collectively, a "Dispute"), the Investors and
the Company shall consult and negotiate with each other in good faith and
otherwise use their respective commercially reasonable efforts to settle such
Dispute within a 45-day period after the Dispute first arises. If the Dispute
is not resolved or settled within such 45-day period then, upon written notice
by either party to the other, the Dispute shall be resolved by binding
arbitration in Denver, Colorado in accordance with Title 9 of the U.S. Code
(United States Arbitration Act) and the Commercial Arbitration Rules of the
American Arbitration Association ("AAA"), as they may be amended from time to
time and as modified by this Agreement or decision of a majority of the
arbitrators. The arbitration shall be conducted in Denver, Colorado. The
Investors and the Company intend that arbitration be the sole remedy available
as to matters arbitrable hereunder. An arbitration award rendered by the
arbitrators shall be final and binding on the Investors and the Company and may
be filed with any court having jurisdiction over the Investors or the Company,
as the case may be, or their property as a basis of declaratory or other
judgment and of the issuance of execution.
(4) Unless otherwise agreed, any party requesting arbitration hereunder
shall do so within 15 days after the expiration of 45-day negotiation period
referenced in Section 9.C.3, and failure by either party to request arbitration
within such period shall thereafter bar such Dispute in any forum whatsoever.
When a party timely requests arbitration hereunder, the Dispute shall be
resolved by a panel of three neutral arbitrators to be selected as follows: the
party requesting the arbitration shall, incident to giving the notice of
arbitration, also notify the
Page 10 - Registration Agreement
other party of the name of an arbitrator selected from a list of qualified
persons supplied by the AAA, and the other party shall, within 20 days after
receipt of such notice, notify the party requesting arbitration of the name of
an arbitrator it has selected from such list. The two arbitrators shall, within
20 days after notification of the identity of the second arbitrator, choose a
third arbitrator.
(5) The Commercial Arbitration Rules of the AAA and decisions by a
majority of the arbitration panel shall determine the rules governing
admissibility of evidence and the rules of procedure and discovery. The action
of a majority of the arbitration panel shall govern all actions by the panel,
and the arbitrators shall render their decision promptly but in no event more
than 60 days after the conclusion of submission of evidence. The arbitration
award shall be in writing and shall specify factual and legal basis for the
award. Either party may make application to the arbitration panel seeking
injunctive relief to maintain the status quo until such time as the arbitration
award is rendered or the Dispute is otherwise resolved. The arbitration panel
shall have the authority to award any remedy or relief that a court of the State
of Colorado could order or grant, including specific performance of any
obligation created under the Agreement, issuance of an injunction or money
damages, but excluding punitive, incidental or consequential damages.
(6) Each party shall pay the fees and expenses of the arbitrator selected
by it and one-half of the reasonable fees and expenses of the third arbitrator.
All other fees and expenses of each party incurred in connection with the
arbitration shall be paid as determined by the arbitrators.
(7) The parties agree that they will not seek from the arbitrator any
claim under this Agreement any award or judgment for punitive damages (or any
other amount awarded for the purpose of imposing a penalty), and that if any
such award or judgment is granted, the parties agree not to seek to satisfy such
award or judgment.
D. Amendments and Waivers. Except as otherwise provided herein, the
----------------------
provisions of this Agreement may be amended or waived only upon the prior
written consent of the Company and holders of Two-Thirds of the Registrable
Securities then outstanding. The Series A Investors and Series B Investors, by
executing this Amended and Restated Agreement, shall consent to the amendment of
the Amended and Restated Registration Agreement as originally executed on
February 2, 1998 to add the Series C Purchasers as parties to this Agreement,
with the rights set forth herein. This Amended and Restated Agreement shall
become effective as to the Company and the Investors when executed by the
Company and by holders of Two-Thirds of the Registrable Securities.
E. Successors and Assigns. All covenants and agreements in this Agreement
----------------------
by or on behalf of any of the parties hereto will bind and inure to the benefit
of the respective successors and assigns of the parties hereto whether so
expressed or not. In addition, whether or not any express assignment has been
made, the provisions of this Agreement which are for the benefit of purchasers
or holders of Registrable Securities are also for the benefit of, and
enforceable by, any subsequent holder of Registrable Securities.
F. Severability. Whenever possible, each provision of this Agreement
------------
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be prohibited by or
invalid under applicable law, such
Page 11 - Registration Agreement
provision will be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of this Agreement.
G. Counterparts. This Agreement may be executed in separate counterparts,
------------
any one of which need not contain the signatures of more than one party, but all
such counterparts taken together will constitute one and the same agreement.
H. Descriptive Headings; Interpretation. The descriptive headings of this
-------------------------------------
Agreement are inserted for convenience only and do not constitute a part of this
Agreement. The use of the word "including" in this Agreement shall be by way of
example rather than by limitation.
I. Notices. All notices, demands or other communications to be given or
-------
delivered under or by reason of the provisions of this Agreement shall be in
writing and shall be deemed to have been given when delivered personally to the
recipient, sent to the recipient by reputable express courier service (charges
prepaid) or mailed to the recipient by certified or registered mail, return
receipt requested and postage prepaid. Unless otherwise indicated below, such
notices, demands and other communications will be sent to each Investor at the
address listed on the signature page(s) to this Agreement and to the Company at
the addresses indicated below:
Xxxxxx X. Xxxxxxx
CEO & President
Real Education, Inc.
00000X X. Xxxxxx Xxxxxx
Xxxxxx, XX 00000
With a copy to:
Xxxxxx X. Xxxxxxx
Xxxxxx & Xxxxxxx XXX
Xxxxxxxx Xxxxx Xxxxxxxx, Xxxxx 0000
000 00/xx/ Xxxxxx
Xxxxxx, XX 00000-0000
and to:
MediaOne Interactive Services
0000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
ATTN: VP Business Development
and
MediaOne Interactive Services
0000 XXX Xxxxxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
ATTN: Xxxx Xxxxxxxx
Page 12 - Registration Agreement
with a copy to:
Xxxx X. Xxxxxxxxxx
Xxxxx & Xxxxxxx L.L.P.
One Xxxxx Center
0000 Xxxxxxxxxxx Xxxxxx.
Xxxxxx, Xxxxxxxx 00000
or to such other address or to the attention of such other Person as the
recipient party has specified by prior written notice to the sending party.
[the remainder of this page is intentionally blank]
Page 13-Registration Agreement
[Signature Page to Amended and Restated Registration Agreement]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
REAL EDUCATION, INC.
/s/ Xxxxxx X. Xxxxxxx
-----------------------------------------
Xxxxxx X. Xxxxxxx, President and CEO
XXXXXXXXXXX/XXXXXX INFORMATION PARTNERS I, L.P
By: Xxxxxxxxxxx/Xxxxxx Information Partners L.L.C., as General Partner
/s/ Oakleigh Xxxxxx
------------------------------------
Oakleigh Xxxxxx, Co-President
MEDIAONE INTERACTIVE SERVICES, INC.
/s/ Xxxxxx Xxxxxx
-----------------------------------------
Xxxxxx Xxxxxx, President
VSI HOLDINGS, INC.
/s/ Xxxxx X. Xxxxx
-----------------------------------------
Xxxxx X. Xxxxx, Executive Vice President
/s/ Xxxxxx X. Xxxxxxx /s/ Xxxx X. Xxxxxxx
----------------------------------------- ----------------------------
Xxxxxx X. Xxxxxxx Xxxx X. Xxxxxxx
/s/ Xxxxxxxx X. Xxxxxx /s/ Xxxxx X. Xxxxxx
----------------------------------------- ----------------------------
Xxxxxxxx X. Xxxxxx Xxxxx X. Xxxxxx
Signature Page-Amended and Restated Registration Agreement
/s/ Xxxxx X. Xxxxxxx /s/ Xxxxxxx Xxxxx
--------------------------------- ----------------------------
Xxxxx X. Xxxxxxx Xxxxxxx Xxxxx
/s/ Xxxxx Xxxx
--------------------------------- ----------------------------
Xxxxx Xxxx Xxxx Xxxxx
/s/ Xxxxxx Xxxxxx /s/ Xxxxxx X. Xxxxxxx
--------------------------------- ____________________________
Xxxxxx Xxxxxx Xxxxxx X. Xxxxxxx
By: Xxxx X. Xxxxxxx, Attorney-in-Fact
/s/ Xxxxxxx X. Xxxxxxx /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------- ----------------------------
Xxxxxxx X. Xxxxxxx Xxxxx X. Xxxxxxxxxx
NEW WORLD EQUITIES, INC. /s/ Xxxxxxx X. XxXxxxx
----------------------------
Xxxxxxx X. XxXxxxx
By: /s/ Xxxxxxxxxxx X. Xxxxxxxx /s/ Xxxxxx X. Xxxxxx
------------------------------ ----------------------------
Its: Senior Mnagement Director Xxxxxx X. Xxxxxx and
---------------------------- Xxxxxxx X. Xxxxxx, JTWROS
/s/ Xxxx X. Xxxxxx /s/ Xxx X. Xxxxxx
--------------------------------- ----------------------------
Xxxx X. Xxxxxx Xxx X. Xxxxxx
/s/ Xxxxx X. Xxxxxx /s/ Xxxxxxx X. Xxxxxx
--------------------------------- ----------------------------
Xxxxx X. Xxxxxx Xxxxxxx X. Xxxxxx
/s/ Xxxxxxx X. Xxxxxx /s/ Xxxx X. Xxxxxxxxx
--------------------------------- ----------------------------
Xxxxxxx X. Xxxxxx Xxxx X. Xxxxxxxxx
Signature Page-Amended and Restated Registration Agreement
McD VENTURE CAPITAL FUND, L.P.
By: /s/ Xxxxxxxx Xxxxxxx
----------------------------------
Its: Assistant Treasurer
---------------------------------
/s/ Xxxxxxx X. Xxxxxx
--------------------------------
Xxxxxxx X. Xxxxxx
XxXxxxxx & Company Securities, Inc. /s/ Xxxxx X. Xxxxxxx
--------------------------------
AS CUSTODIAN FOR XXXXXXX X. XXXXXXX XXX Xxxxx X. Xxxxxxx
By: Xxxx Xxxx, Attorney-in-Fact
By: W.E Xxxxxxx
----------------------------------
Its: Managing Director /s/ Xxx X. Xxxxxxxxxx
--------------------------------- --------------------------------
Xxx X. Xxxxxxxxxx
XXXXXXXX & CO. SECURITIES, INC.
By: /s/ Xxxxxxxx Xxxxxxx
----------------------------------
Its: Chief Financial Officer
---------------------------------
SILVER FAMILY TRUST U/D/T
/s/ Xxxxxx X. Silver
-------------------------------------
Xxxxxx X. Silver, Trustee
/s/ Xxxxxxxx X. Silver
-------------------------------------
Xxxxxxxx X. Silver, Trustee
Signature Page-Amended and Restated Registration Agreement
[Signature Pages to Real Education, Inc. Series C Preferred Resignation
Agreement]
/s/ Xxxxxxx Xxxxxx
------------------------------------------
/s/ Xxxxx Xxxxxx
------------------------------------------
Xxxxxxx Xxxxxx & Xxxxx Xxxxxx, JTWROS
/s/ Xxxxx X. Xxxxxxx
------------------------------------------
Xxxxx X. Xxxxxxx
/s/ Xxx Xxxxxxxx
------------------------------------------
Xxx Xxxxxxxx
H & K PARTNERS V
/s/ Xxxxxxx Xxxxxx
------------------------------------------
Xxxxxxx Xxxxxx
N.T. XXXXXXX CO. -- Profit Sharing Trust
/s/ Xxxx X. Xxxxxxx, Xx. Trust Administrator
------------------------------------------
Xxxxxx Xxxxx Xxxxxxx, Vice President
Signature Page to Registration Agreement
