Exhibit 4.4
RESALE REGISTRATION RIGHTS AGREEMENT
BETWEEN
NETWORKS ASSOCIATES, INC.
AND
XXXXXX BROTHERS INC.
DATED AS OF AUGUST 17, 2001
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RESALE REGISTRATION RIGHTS AGREEMENT, dated as of August 17,
2001, between Networks Associates, Inc., a Delaware corporation (together with
any successor entity, herein referred to as the "COMPANY"), and Xxxxxx Brothers
Inc., as initial purchaser (the "INITIAL PURCHASER") under the Purchase
Agreement (as defined below).
Pursuant to the Purchase Agreement, dated as of August 13, 2001,
between the Company and the Initial Purchaser (the "PURCHASE AGREEMENT"), the
Initial Purchaser has agreed to purchase from the Company $300,000,000
($345,000,000 if the Initial Purchaser exercises its option in full) in
aggregate principal amount of 5.25% Convertible Subordinated Notes due 2006 (the
"SECURITIES"). The Securities initially may be convertible into fully paid,
nonassessable shares of common stock, par value $0.01 per share, of the Company
on the terms, and subject to the conditions, set forth in the Indenture (as
defined herein). To induce the Initial Purchaser to purchase the Securities, the
Company has agreed to provide the registration rights set forth in this
Agreement pursuant to Section 1 of the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions. As used in this Agreement, the following
capitalized terms shall have the following meanings:
"ADDITIONAL INTEREST": As defined in Section 3(a) hereof.
"ADDITIONAL INTEREST PAYMENT DATE": Each February 15 and August
15.
"AFFILIATE": The definition of "Affiliate" in the Indenture.
"AGREEMENT": This Resale Registration Rights Agreement, as
amended, modified or otherwise supplemented from time to time.
"BLUE SKY APPLICATION": As defined in Section 6(a) hereof.
"BUSINESS DAY": The definition of "Business Day" in the
Indenture.
"COMMISSION": Securities and Exchange Commission.
"COMMON STOCK": The definition of "Common Stock" in the
Indenture.
"COMPANY": As defined in the preamble hereto.
"EFFECTIVENESS PERIOD": As defined in Section 2(a)(iii) hereof.
"EFFECTIVENESS TARGET DATE": As defined in Section 2(a)(ii)
hereof.
"EXCHANGE ACT": Securities Exchange Act of 1934, as amended.
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"HOLDER": A Person who owns, beneficially or otherwise, Transfer
Restricted Securities.
"HOLDER QUESTIONNAIRE": As defined in Section 2(b) hereof.
"INDEMNIFIED HOLDER": As defined in Section 6(a) hereof.
"INDENTURE": The Indenture, dated as of August 17, 2001 between
the Company and State Street Bank and Trust Company of California, N.A.,
as trustee (the "TRUSTEE"), pursuant to which the Securities are to be
issued, as such Indenture is amended, modified or supplemented from time
to time in accordance with the terms thereof.
"INITIAL PURCHASER": As defined in the preamble hereto.
"MAJORITY OF HOLDERS": Holders holding over 50% of the aggregate
principal amount of Transfer Restricted Securities outstanding; provided,
however that in determining whether Transfer Restricted Securities are
outstanding, Transfer Restricted Securities held for the account of the
Company or of any of its Affiliates shall be disregarded; provided,
further that for purpose of this definition, a holder of shares of Common
Stock that constitute Transfer Restricted Securities when issued upon
conversion of the Securities shall be deemed to hold an aggregate
principal amount of Securities (in addition to the principal amount of
Securities held by such holder) equal to the quotient of (x) the number
of such shares of Common Stock received upon conversion of the Securities
and then held by such holder and (y) the conversion rate(s) in effect at
the time such Holder converted Securities into such shares of Common
Stock as determined in accordance with the Indenture.
"NASD": National Association of Securities Dealers, Inc.
"PERSON": An individual, partnership, corporation, company,
unincorporated organization, trust, joint venture or a government or
agency or political subdivision thereof.
"PURCHASE AGREEMENT": As defined in the preamble hereto.
"PROSPECTUS": The prospectus included in a Shelf Registration
Statement, as amended or supplemented by any prospectus supplement and by
all other amendments thereto, including post-effective amendments, and
all material incorporated by reference into such Prospectus.
"QUESTIONNAIRE DEADLINE": As defined in Section 2(b) hereof.
"RECORD HOLDER": With respect to any Additional Interest Payment
Date, each Person who is a Holder on the Register on the February 1 or
August 1 immediately preceding the relevant Additional Interest Payment
Date. In the case of a Holder of shares of Common Stock issued upon
conversion of the Securities, "Record Holder" shall mean each Person who
is a Holder of shares of Common Stock which constitute Transfer
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Restricted Securities on the February 1 or August 1 immediately preceding
the relevant Additional Interest Payment Date.
"REGISTER": The definition of "Register" in the Indenture.
"REGISTRAR": The definition of "Registrar" in the Indenture.
"REGISTRATION DEFAULT": As defined in Section 3(a) hereof.
"SALE NOTICE": As defined in Section 4(e) hereof.
"SECURITIES": As defined in the preamble hereto.
"SECURITIES ACT": Securities Act of 1933, as amended.
"SHELF FILING DEADLINE": As defined in Section 2(a)(i) hereof.
"SHELF REGISTRATION STATEMENT": As defined in Section 2(a)(i)
hereof.
"SUSPENSION NOTICE". As defined in Section 4(c) hereof.
"SUSPENSION PERIOD". As defined in Section 4(b)(i) hereof.
"TIA": Trust Indenture Act of 1939, as amended, the rules and
regulations of the Commission thereunder, in each case, as in effect on
the date the Indenture is qualified under the TIA.
"TRANSFER RESTRICTED SECURITIES": Each Security and each share of
Common Stock issued upon conversion of Securities for which a Holder has
submitted their Holder Questionnaire by the Questionnaire Deadline until
the earlier of:
(i) the date on which such Security or such share of
Common Stock issued upon conversion thereof has been effectively
registered under the Securities Act and disposed of in accordance
with the Shelf Registration Statement;
(ii) the date on which such Security or such share of
Common Stock issued upon conversion thereof is transferred in
compliance with Rule 144 under the Securities Act or may be sold
or transferred by a person who is not an affiliate of the Company
pursuant to Rule 144 under the Securities Act (or any other
similar provision then in force) without any volume or manner of
sale restrictions thereunder; or
(iii) the date on which such Security or such share of
Common Stock issued upon conversion ceases to be outstanding
(whether as a result of redemption, repurchase and cancellation,
conversion or otherwise).
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UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING: A
registration in which Transfer Restricted Securities are sold to an
underwriter for reoffering to the public pursuant to the Shelf
Registration Statement.
Unless the context otherwise requires, the singular includes the
plural, and words in the plural include the singular.
2. Shelf Registration
(a) The Company shall:
(i) not later than 90 days after the date hereof (the
"SHELF FILING DEADLINE"), cause to be filed a registration
statement pursuant to Rule 415 under the Securities Act (the
"SHELF REGISTRATION STATEMENT"), which Shelf Registration
Statement shall provide for resales of all Transfer Restricted
Securities held by Holders that have provided the information
required pursuant to the terms of Section 2(b) hereof;
(ii) use its reasonable efforts to cause the Shelf
Registration Statement to be declared effective by the Commission
not later than 180 days after the date hereof (the "EFFECTIVENESS
TARGET DATE"); and
(iii) use its reasonable efforts to keep the Shelf
Registration Statement continuously effective, supplemented and
amended as required by the provisions of Section 4(b) hereof (and
subject to the right of the Company to suspend the use of the
Shelf Registration Statement by delivery of a Suspension Notice
in accordance with Section 4(b)(i) hereof) to the extent
necessary to ensure that (A) it is available for resales by the
Holders of Transfer Restricted Securities entitled, subject to
Section 2(b), to the benefit of this Agreement and (B) conforms
with the requirements of this Agreement and the Securities Act
and the rules and regulations of the Commission promulgated
thereunder as announced from time to time, for a period (the
"EFFECTIVENESS PERIOD") until the earliest of:
(1) two years following the last date of
original issuance of any of the Securities; or
(2) the date when the Holders of Transfer
Restricted Securities are able to sell all such
Transfer Restricted Securities immediately without
restriction pursuant to the volume limitation
provisions of Rule 144 under the Securities Act;
and
(3) the date when all of the Transfer
Restricted Securities of those Holders that
complete and deliver in a timely manner the Holder
Questionnaire described below are registered under
the Shelf Registration Statement and disposed of in
accordance with the Shelf Registration Statement.
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(b) No Holder of Transfer Restricted Securities may include any
of its Transfer Restricted Securities in the Shelf Registration Statement
pursuant to this Agreement unless such Holder furnishes to the Company in
writing, prior to or on the 20th Business Day after the date of the Holder
Questionnaire (or, in the case of a Holder that is a transferee of Transfer
Restricted Securities, prior to or on the earlier of (i) the 20th business day
after the completion of such transfer to the transferee and (ii) 9:00 a.m., San
Francisco time, on the second Business Day before the effectiveness of the Shelf
Registration Statement) (the "QUESTIONNAIRE DEADLINE"), such information as the
Company may reasonably request for use in connection with the Shelf Registration
Statement or Prospectus or preliminary Prospectus included therein and in any
application to be filed with or under state securities laws (the form of which
request is attached as Appendix A to the offering memorandum dated August 13,
2001 regarding the sale of the Securities to the Initial Purchaser and is
referred to herein as the "HOLDER QUESTIONNAIRE"). In connection with all
requests for information from Holders of Transfer Restricted Securities with
respect to inclusion of Transfer Restricted Securities in the Shelf Registration
Statement, the Company shall notify such Holders of the requirements set forth
in the preceding sentence. The Company agrees and undertakes that (i) it shall
distribute a Holder Questionnaire no later than 20 Business Days prior to the
effectiveness of the Shelf Registration Statement to each Holder at the address
set forth on the Register of Securities maintained by the Registrar of the
Securities or the records of the transfer agent of the Common Stock at such
time, and (ii) upon the request of any Holder prior to 9:00 a.m., San Francisco
time, on the second Business Day before the effectiveness of the Shelf
Registration Statement, the Company shall distribute a Holder Questionnaire to
such Holder at the address set forth in such request. Holders that do not
complete the Holder Questionnaire and timely deliver it to the Company shall not
be named as selling securityholders in the Prospectus or preliminary Prospectus
included in the Shelf Registration Statement and therefore shall not be
permitted to sell any Transfer Restricted Securities pursuant to the Shelf
Registration Statement. Each Holder as to which the Shelf Registration Statement
is being effected agrees to furnish promptly to the Company all information
required to be disclosed in order to make information previously furnished to
the Company by such Holder not materially misleading.
NO HOLDER OF TRANSFER RESTRICTED SECURITIES SHALL BE ENTITLED TO
ADDITIONAL INTEREST PURSUANT TO SECTION 3 HEREOF UNLESS SUCH HOLDER SHALL HAVE
PROVIDED ALL SUCH REASONABLY REQUESTED INFORMATION PRIOR TO OR ON THE
QUESTIONNAIRE DEADLINE.
3. Additional Interest.
(a) If:
(i) the Shelf Registration Statement is not filed with the
Commission prior to or on the Shelf Filing Deadline;
(ii) the Shelf Registration Statement has not been
declared effective by the Commission prior to or on the
Effectiveness Target Date;
(iii) except as provided in Section 4(b)(i) hereof, the
Shelf Registration Statement is filed and declared effective but,
during the Effectiveness Period, shall thereafter cease to be
effective or fail to be usable for its intended purpose
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without being succeeded within five Business Days by a
post-effective amendment to the Shelf Registration Statement, a
supplement to the Prospectus or a report filed with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act that cures such failure and, in the case of a
post-effective amendment, is itself immediately declared
effective; or
(iv) (A) prior to or on the 45th or 60th day, as the case
may be, of any Suspension Period, such suspension has not been
terminated or (B) Suspension Periods exceed an aggregate of 90
days in any 360 day period,
(each such event referred to in foregoing clauses (i) through (iv), a
"REGISTRATION DEFAULT"), the Company hereby agrees to pay liquidated damages in
the form of additional interest ("ADDITIONAL INTEREST") with respect to the
Transfer Restricted Securities from and including the day following the
Registration Default to but excluding the earlier of (1) the day on which the
Registration Default has been cured and (2) the date the Shelf Registration
Statement is no longer required to be kept effective, accruing at a rate:
(A) in respect of the Securities, to each holder of
Securities, (x) with respect to the first 90-day period during
which a Registration Default shall have occurred and be
continuing, equal to 0.25% per annum of the principal amount of
the Securities, and (y) with respect to the period commencing on
the 91st day following the day the Registration Default shall
have occurred and be continuing, equal to 0.50% per annum of the
principal amount of the Securities; provided that in no event
shall Additional Interest accrue at a rate per year exceeding
0.50% of the principal amount of the Securities; and
(B) in respect of any shares of Common Stock, to each
holder of shares of Common Stock issued upon conversion of
Securities, (x) with respect to the first 90-day period in which
a Registration Default shall have occurred and be continuing,
equal to 0.25% per annum of the principal amount of the converted
Securities, and (y) with respect to the period commencing the
91st day following the day the Registration Default shall have
occurred and be continuing, equal to 0.50% per annum of the
principal amount of the converted Securities; provided that in no
event shall Additional Interest accrue at a rate per year
exceeding 0.50% of the principal amount of the converted
Securities.
(b) All accrued Additional Interest shall be paid in arrears to
Record Holders by the Company on each Additional Interest Payment Date in the
same manner as the payment of interest on the Securities. Upon the cure of all
Registration Defaults relating to any particular Security or share of Common
Stock, the accrual of Additional Interest with respect to such Security or share
of Common Stock will cease. The Company agrees to deliver all notices,
certificates and other documents contemplated by the Indenture in connection
with the payment of Additional Interest.
Notwithstanding any other provision of this Agreement, no
Additional Interest shall accrue as to any Transfer Restricted Security from and
after the earlier of the date such security is no longer a Transfer Restricted
Security and the expiration of the Effectiveness
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Period. All obligations of the Company set forth in this Section 3 that are
outstanding with respect to any Transfer Restricted Security at the time such
security ceases to be a Transfer Restricted Security shall survive until such
time as all such obligations with respect to such Transfer Restricted Security
shall have been satisfied in full.
The parties hereto agree that the Holders of Transfer Restricted
Securities will suffer damages, and that it would not be feasible to ascertain
the extent of such damages with precision, if a Registration Default were to
occur. The parties hereto further agree that the Additional Interest provided
for in this Section 3 constitutes a reasonable estimate of the damages that may
be incurred by Holders of Transfer Restricted Securities by reason of a
Registration Default. Therefore, the parties hereto agree that the sole damages
payable for a violation of the terms of this Agreement with respect to which
Additional Interest is expressly provided for (including any non-compliance with
a covenant that results, directly or indirectly, in a Registration Default)
shall be such Additional Interest.
4. Registration Procedures.
(a) In connection with the Shelf Registration Statement, the
Company shall comply with all the provisions of Section 4(b) hereof and shall
use its reasonable efforts to effect such registration to permit the sale of the
Transfer Restricted Securities, and pursuant thereto, shall prepare and file
with the Commission a Shelf Registration Statement relating to the registration
on any appropriate form under the Securities Act.
(b) In connection with the Shelf Registration Statement and any
Prospectus required by this Agreement to permit the sale or resale of Transfer
Restricted Securities, the Company shall:
(i) Subject to any notice by the Company in accordance
with this Section 4(b) of the existence of any fact or event of
the kind described in Section 4(b)(iii)(D) and the Company's
right to invoke a Suspension Period in the manner described in
this Section 4(b)(i), use its reasonable efforts to keep the
Shelf Registration Statement continuously effective during the
Effectiveness Period; upon the occurrence of any event that would
cause the Shelf Registration Statement or the Prospectus
contained therein (A) to contain a material misstatement or
omission or (B) not be effective and usable for resale of
Transfer Restricted Securities during the Effectiveness Period,
unless a Suspension Period is then in effect, the Company shall
file promptly an appropriate amendment to the Shelf Registration
Statement, a supplement to the Prospectus or a report filed with
the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act, in the case of clause (A), correcting any such
misstatement or omission, and, in the case of either clause (A)
or (B), use its reasonable efforts to cause such amendment to be
declared effective and the Shelf Registration Statement and the
related Prospectus to become usable for their intended purposes
as soon as practicable thereafter. Notwithstanding the foregoing,
the Company may suspend the effectiveness of the Shelf
Registration Statement by written notice to the Holders for a
period not to exceed an aggregate of 45 days in any 90-
9
day period or 90 days in any 360-day period (each such period, a
"SUSPENSION PERIOD") if:
(x) an event occurs and is continuing as a result
of which the Shelf Registration Statement, the Prospectus,
any amendment or supplement thereto, or any document
incorporated by reference therein would, in the Company's
judgment, contain 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; and
(y) the Company reasonably determines that the
disclosure of such event at such time would have a
material adverse effect on the Company and its
subsidiaries taken as a whole;
provided that, in the event the disclosure relates to a
previously undisclosed proposed or pending material business
transaction, the disclosure of which the Company determines in
good faith would be reasonably likely to impede the Company's
ability to consummate such transaction, the Company may extend
the 45-day Suspension Period from 45 days to 60 days. The Company
shall not be required to specify in the written notice to the
Holders the nature of the event giving rise to the Suspension
Period.
(ii) Prepare and file with the Commission such amendments
and post-effective amendments to the Shelf Registration Statement
as may be necessary to keep the Shelf Registration Statement
effective during the Effectiveness Period; cause the Prospectus
to be supplemented by any required Prospectus supplement, and as
so supplemented to be filed pursuant to Rule 424 (it being
understood that the Company shall not be required to file a
prospectus supplement pursuant to 424(b) with respect to any
Holder that failed to submit their Holder Questionnaire by the
Questionnaire Deadline) under the Securities Act, and to comply
fully with the applicable provisions of Rules 424 and 430A under
the Securities Act in a timely manner; and comply with the
provisions of the Securities Act with respect to the disposition
of all securities covered by the Shelf Registration Statement
during the applicable period in accordance with the intended
method or methods of distribution by the sellers thereof set
forth in the Shelf Registration Statement or supplement to the
Prospectus.
(iii) Advise in writing the underwriter(s), if any, and
the selling Holders promptly (in the case of Holders, at the
address set forth on the Register of Securities maintained by the
Registrar of the Securities or the records of the transfer agent
of the Common Stock at such time) of each of the following:
(A) when the Prospectus or any Prospectus
supplement or post-effective amendment has been filed,
and, with respect to the Shelf Registration Statement or
any post-effective amendment thereto, when the same has
become effective,
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(B) any request by the Commission for amendments
to the Shelf Registration Statement or amendments or
supplements to the Prospectus or for additional
information relating thereto,
(C) the issuance by the Commission of any stop
order suspending the effectiveness of the Shelf
Registration Statement under the Securities Act or of
the suspension by any state securities commission of the
qualification of the Transfer Restricted Securities for
offering or sale in any jurisdiction, or the initiation
of any proceeding for any of the preceding purposes, or
(D) the existence of any fact or the happening
of any event, during the Effectiveness Period (but not
as to the substance of any such fact or event), that
makes any statement of a material fact made in the Shelf
Registration Statement, the Prospectus, any amendment or
supplement thereto, or any document incorporated by
reference therein untrue, or that requires the making of
any additions to or changes in the Shelf Registration
Statement or the Prospectus in order to make the
statements therein not misleading (provided, however,
that no notice by the Company shall be required pursuant
to this clause (D) in the event that the Company either
promptly files a prospectus supplement to update the
Prospectus or a Form 8-K or other appropriate Exchange
Act report that is incorporated by reference into the
Shelf Registration Statement, which, in either case,
contains the requisite information with respect to such
material event that results in such Shelf Registration
Statement no longer containing any such untrue or
misleading statements).
If at any time the Commission shall issue any stop order
suspending the effectiveness of the Shelf Registration
Statement, or any state securities commission or other
regulatory authority shall issue an order suspending the
qualification or exemption from qualification of the Transfer
Restricted Securities under state securities or Blue Sky laws,
the Company shall use its reasonable efforts to promptly obtain
the withdrawal or lifting of such order and will provide to each
Holder (in the case of Holders, at the address set forth on the
Register of Securities maintained by the Registrar of the
Securities or the records of the transfer agent of the Common
Stock at such time) who is named in the Shelf Registration
Statement prompt notice of the withdrawal of any such order.
(iv) If requested by any selling Holders or the
underwriter(s), if any, incorporate in the Shelf Registration
Statement or Prospectus, pursuant to an amendment prior to
effectiveness if necessary, such information as such selling
Holders and underwriter(s), if any, may reasonably request to
have included therein, including, without limitation information
relating to the "Plan of Distribution" of the Transfer
Restricted Securities as specified by such Holder in such Holder
Questionnaire to be delivered prior to the Questionnaire
Deadline.
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(v) Furnish to each selling Holder (in the case of
Holders, at the address set forth in the Register of Securities
or the records of the transfer agent of the Common Stock at such
time) and each of the underwriter(s), if any, upon their
request, without charge, at least one copy of the Shelf
Registration Statement, as first filed with the Commission, and
of each amendment thereto (and any documents incorporated by
reference therein or exhibits thereto (or exhibits incorporated
in such exhibits by reference) as such Person may request).
(vi) Deliver to each selling Holder (in the case of
Holders, at the address set forth in the Register of Securities
or the records of the transfer agent of the Common Stock at such
time) and underwriter(s), if any, without charge, as many copies
of the Prospectus (including each preliminary prospectus) and
any amendment or supplement thereto as such Persons reasonably
may request; subject to any notice by the Company in accordance
with this Section 4(b) of the existence of any fact or event of
the kind described in Section 4(b)(iii) (D), the Company hereby
consents to the use of the Prospectus and any amendment or
supplement thereto by each of the selling Holders in connection
with the offering and the sale of the Transfer Restricted
Securities covered by the Prospectus or any amendment or
supplement thereto.
(vii) In connection with an Underwritten Offering, the
Company shall:
(A) upon request, furnish to each underwriter,
if any, in such substance and scope as they may
reasonably request and as are customarily made by
issuers to underwriters in primary underwritten
offerings for selling security holders, upon the date of
closing of any sale of Transfer Restricted Securities in
an Underwritten Registration:
(1) a certificate, dated the date of
such closing, signed by the Chief Financial
Officer of the Company confirming, as of the
date thereof, the matters customarily covered in
an officer's certificate to underwriters in
connection with underwritten offerings of
securities;
(2) opinions, each dated the date of
such closing, of counsel to the Company covering
such of the matters as are customarily covered
in legal opinions to underwriters in connection
with underwritten offerings of securities; and
(3) customary comfort letters, dated the
date of such closing, from the Company's
independent accountants (and from any other
accountants whose report is contained or
incorporated by reference in the Shelf
Registration Statement) in the customary form
and covering matters of the type customarily
covered in comfort letters to underwriters in
connection with underwritten offerings of
securities; and
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(B) deliver such other documents and
certificates as may be reasonably requested by such
parties to evidence compliance with clause (A) above and
with any customary conditions contained in the
underwriting agreement or other agreement entered into
by the selling Holders pursuant to this clause (x).
(viii) Before any public offering of Transfer Restricted
Securities, cooperate with the selling Holders, the
underwriter(s), if any, and their counsel in connection with the
registration and qualification of the Transfer Restricted
Securities under the securities or Blue Sky laws of such
jurisdictions in the United States as the selling Holders or
underwriter(s), if any, may reasonably request and do any and
all other acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Transfer Restricted
Securities covered by the Shelf Registration Statement;
provided, however, that the Company shall not be required (A) to
register or qualify as a foreign corporation or a dealer of
securities where it is not now so qualified or to take any
action that would subject it to the service of process in any
jurisdiction where it is not now so subject or (B) to subject
themselves to taxation in any such jurisdiction if they are not
now so subject.
(ix) Cooperate with the selling Holders and
underwriter(s), if any, to facilitate the timely preparation and
delivery of certificates representing Transfer Restricted
Securities to be sold and not bearing any restrictive legends
(unless required by applicable securities laws); and enable such
Transfer Restricted Securities to be in such denominations and
registered in such names as the Holders may request at least two
Business Days before any sale of Transfer Restricted Securities.
(xii) Use its reasonable efforts to cause the Transfer
Restricted Securities covered by the Shelf Registration
Statement to be registered with or approved by such other U.S.
governmental agencies or authorities as may be necessary to
enable the seller or sellers thereof to consummate the
disposition of such Transfer Restricted Securities.
(xiii) Subject to Section 4(b)(i) hereof, if any fact or
event contemplated by Section 4(b)(iii)(D) hereof shall exist or
have occurred, use its reasonable efforts to prepare a
supplement or post-effective amendment to the Shelf Registration
Statement or related Prospectus or any document incorporated
therein by reference or file any other required document so
that, as thereafter delivered to the purchasers of Transfer
Restricted Securities, the Prospectus will not contain an untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they
are made, not misleading; provided that the Company shall not be
required to comply with the foregoing obligations during any
Suspension Period of any period during which Additional Interest
is accruing.
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(xiv) Provide CUSIP numbers for all Transfer Restricted
Securities not later than the effective date of the Shelf
Registration Statement and provide the Trustee under the
Indenture with certificates for the Securities that are in a
form eligible for deposit with The Depository Trust Company.
(xv) Cooperate and assist in any filings required to be
made with the NASD and in the performance of any due diligence
investigation by any underwriter that is required to be retained
in accordance with the rules and regulations of the NASD.
(xvi) Otherwise use its reasonable efforts to comply
with all applicable rules and regulations of the Commission and
all reporting requirements under the rules and regulations of
the Exchange Act.
(xvii) Cause the Indenture to be qualified under the TIA
not later than the effective date of the Shelf Registration
Statement required by this Agreement, and, in connection
therewith, cooperate with the Trustee and the holders of
Securities to effect such changes to the Indenture as may be
required for such Indenture to be so qualified in accordance
with the terms of the TIA; and execute and use its reasonable
efforts to cause the Trustee thereunder to execute all documents
that may be required to effect such changes and all other forms
and documents required to be filed with the Commission to enable
such Indenture to be so qualified in a timely manner.
(xviii) Cause all Common Stock covered by the Shelf
Registration Statement to be listed or quoted, as the case may
be, on each securities exchange or automated quotation system on
which Common Stock is then listed or quoted.
(c) Each Holder agrees by acquisition of a Transfer Restricted
Security that, upon receipt of any notice (a "SUSPENSION NOTICE") from the
Company of the existence of any fact of the kind described in Section
4(b)(iii)(D) hereof, such Holder will, and will use its reasonable efforts to
cause any underwriter(s) in an Underwritten Offering to, forthwith discontinue
disposition of Transfer Restricted Securities pursuant to the Shelf Registration
Statement until:
(i) such Holder has received copies of the supplemented
or amended Prospectus contemplated by Section 4(b)(xiii) hereof;
or
(ii) such Holder is advised in writing by the Company
that the use of the Prospectus may be resumed, and has received
copies of any additional or supplemental filings that are
incorporated by reference in the Prospectus.
Each Holder agrees to keep the receipt of a Suspension Notice and its contents
confidential. If so directed by the Company, each Holder will deliver to the
Company (at the Company's expense) all copies, other than permanent file copies
then in such Holder's possession, of the Prospectus covering such Transfer
Restricted Securities that was current at the time of receipt of such notice of
suspension.
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(d) Each Holder who intends to be named as a selling Holder in
the Shelf Registration Statement shall furnish to the Company in writing, within
20 Business Days after the date of the Holder Questionnaire, such information
regarding such Holder and the proposed distribution by such Holder of its
Transfer Restricted Securities as the Company may reasonably request for use in
connection with the Shelf Registration Statement or Prospectus or preliminary
Prospectus included therein. Holders that do not complete the Holder
Questionnaire and deliver it to the Company shall not be named as selling
securityholders in the Prospectus or preliminary Prospectus included in the
Shelf Registration Statement and therefore shall not be permitted to sell any
Transfer Restricted Securities pursuant to the Shelf Registration Statement;
provided, however, that notwithstanding the foregoing, transferees of all or a
portion of a Holder's Transfer Restricted Securities who furnish the Company a
completed Holder Questionnaire on or prior to the earlier of (i) the 20th
business day after the completion of such transfer to the transferee and (ii)
9:00 a.m., San Francisco time, on the second Business Day before the
effectiveness of the Shelf Registration Statement shall be named as selling
securityholders in the Prospectus or preliminary Prospectus included in the
Shelf Registration Statement. Each Holder who intends to be named as a selling
Holder in the Shelf Registration Statement shall promptly furnish to the Company
in writing such other information as the Company may from time to time
reasonably request in writing.
(e) Upon the effectiveness of the Shelf Registration Statement,
each Holder shall notify the Company at least five Business Days prior to any
intended distribution of Transfer Restricted Securities pursuant to the Shelf
Registration Statement (a "SALE NOTICE"), which notice shall be effective for
five Business Days. Each Holder of Transfer Restricted Securities, by accepting
the same, agrees to hold any communication by the Company in response to a Sale
Notice in confidence. Upon receipt of a Sale Notice, the Company shall inform
each Holder in writing of the existence of a Suspension Period or otherwise, of
the kind of event described in Section 4(b)(iii)(D).
5. Registration Expenses.
All expenses incident to the Company's performance of or
compliance with this Agreement shall be borne by the Company regardless of
whether a Shelf Registration Statement becomes effective, including, without
limitation:
(i) all registration and filing fees and expenses
(including filings made with the NASD);
(ii) all fees and expenses of compliance with federal
securities and state Blue Sky or securities laws;
(iii) all expenses of printing (including printing of
Prospectuses and certificates for the Common Stock to be issued
upon conversion of the Securities) and the Company's expenses
for messenger and delivery services and telephone;
(iv) all fees and disbursements of counsel to the
Company;
15
(v) all application and filing fees in connection with
listing (or authorizing for quotation) the Common Stock on a
national securities exchange or automated quotation system
pursuant to the requirements hereof; and
(vi) all fees and disbursements of independent certified
public accountants of the Company.
The Company shall bear its internal expenses (including, without
limitation, all salaries and expenses of their officers and employees performing
legal, accounting or other duties), the expenses of any annual audit and the
fees and expenses of any Person, including special experts, retained by the
Company. Notwithstanding the foregoing, the Holders of the Transfer Restricted
Securities being registered shall pay all agency fees and commissions and
underwriting discounts and commissions attributable to the sale of such Transfer
Restricted Securities and the fees and disbursements of any counsel or other
advisors or experts retained by such Holders (severally and jointly), other than
the counsel and experts that represent the Company specifically referred to
above.
6. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Holder,
such Holder's officers, directors and employees and each person, if any, who
controls such Holder within the meaning of the Securities Act (each, an
"INDEMNIFIED HOLDER"), from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof (including, but not limited
to, any loss, claim, damage, liability or action relating to resales of the
Transfer Restricted Securities), to which such Indemnified Holder may become
subject, insofar as any such loss, claim, damage, liability or action arises out
of, or is based upon:
(i) any untrue statement or alleged untrue statement of
a material fact contained in (A) the Shelf Registration
Statement or Prospectus or any amendment or supplement thereto
or (B) any blue sky application or other document or any
amendment or supplement thereto prepared or executed by the
Company (or based upon written information furnished by or on
behalf of the Company expressly for use in such blue sky
application or other document or amendment on supplement) filed
in any jurisdiction specifically for the purpose of qualifying
any or all of the Transfer Restricted Securities under the
securities law of any state or other jurisdiction (such
application or document being hereinafter called a "BLUE SKY
APPLICATION"); or
(ii) the omission or alleged omission to state therein
any material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading,
and shall reimburse each Indemnified Holder promptly upon demand for any legal
or other expenses reasonably incurred by such Indemnified Holder in connection
with investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that the Company shall not be liable in any such case to the extent
that any such loss, claim, damage, liability or action arises out of, or is
based upon,
16
any untrue statement or alleged untrue statement or omission or alleged omission
made in the Shelf Registration Statement or Prospectus or amendment or
supplement thereto or Blue Sky Application in reliance upon and in conformity
with written information furnished to the Company by or on behalf of such Holder
(or its related Indemnified Holder) specifically for use therein; provided,
further, that the Company shall not be liable to any Indemnified Holder under
the indemnity agreement in this subsection (a) with respect to any preliminary
Prospectus to the extent that any such loss, claim, damage or liability of such
Indemnified Holder results from the fact that such Indemnified Holder sold
Transfer Restricted Securities to a Person as to whom it shall be established
that there was not sent or given, at or prior to the written confirmation of
such sale, a copy of the final Prospectus in any case where such delivery is
required by the Securities Act if the Company had previously furnished copies
thereof in sufficient quantities to such Indemnified Holder and the loss, claim,
damage or liability of such Indemnified Holder results from an untrue statement
or omission of a material fact contained in the preliminary Prospectus which was
(i) identified to such Indemnified Holder at or prior to the earlier of the
filing with the Commission or the furnishing to such Indemnified Holder of the
corrected Prospectus and (ii) corrected in the final Prospectus. The foregoing
indemnity agreement is in addition to any liability which the Company may
otherwise have to any Indemnified Holder.
(b) Each Holder, severally and not jointly, shall indemnify and
hold harmless the Company, its officers, directors and employees and each
person, if any, who controls the Company within the meaning of the Securities
Act, from and against any loss, claim, damage or liability, joint or several, or
any action in respect thereof, to which the Company or any such officer,
employee or controlling person may become subject, insofar as any such loss,
claim, damage or liability or action arises out of, or is based upon:
(i) any untrue statement or alleged untrue statement of
any material fact contained in the Shelf Registration Statement
or Prospectus or any amendment or supplement thereto or any Blue
Sky Application; or
(ii) the omission or the alleged omission to state
therein any material fact required to be stated therein or
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading,
but in each case only to the extent that such untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such Holder (or its related Indemnified Holder) specifically for use therein,
and shall reimburse the Company and any such officer, employee or controlling
person promptly upon demand for any legal or other expenses reasonably incurred
by the Company or any such officer, employee or controlling person in connection
with investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred. The foregoing
indemnity agreement is in addition to any liability which any Holder may
otherwise have to the Company and any such officer, employee or controlling
person.
(c) Promptly after receipt by an indemnified party under this
Section 6 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 6, notify the
17
indemnifying party in writing of the claim or the commencement of that action;
provided, however, that the failure to notify the indemnifying party shall not
relieve it from any liability which it may have under this Section 6 except to
the extent it has been materially prejudiced by such failure and, provided,
further, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have to an indemnified party otherwise than
under this Section 6. If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it wishes, jointly with any other similarly notified indemnifying party, to
assume the defense thereof with counsel satisfactory to the indemnified party.
After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying party
shall not be liable to the indemnified party under this Section 6 for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation; provided,
however, that the Holders shall have the right to employ a single counsel to
represent jointly a the Holders and their officers, employees and controlling
persons who may be subject to liability arising out of any claim in respect of
which indemnity may be sought by the Holders against the Company under this
Section 6 if the Holders seeking indemnification shall have been advised by
legal counsel that there may be one or more legal defenses available to such
Holders and their respective officers, employees and controlling persons that
are different from or additional to those available to the Company, and in that
event the fees and expenses of such separate counsel shall be paid by the
Company. No indemnifying party shall:
(i) without the prior written consent of the indemnified
parties (which consent shall not be unreasonably withheld)
settle or compromise or consent to the entry of any judgment
with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties
are actual or potential parties to such claim or action) unless
such settlement, compromise or consent includes an unconditional
release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding, or
(ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent
or if there be a final judgment for the plaintiff in any such
action, the indemnifying party agrees to indemnify and hold
harmless any indemnified party from and against any loss of
liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 6 shall
for any reason be unavailable or insufficient to hold harmless an indemnified
party under Section 6(a) or 6(b) in respect of any loss, claim, damage or
liability (or action in respect thereof) referred to therein, each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability (or action in respect thereof):
(i) in such proportion as is appropriate to reflect the
relative benefits received by the Company from the offering and
sale of the Transfer Restricted
18
Securities on the one hand and a Holder with respect to the sale
by such Holder of the Transfer Restricted Securities on the
other, or
(ii) if the allocation provided by clause (6)(d)(i) is
not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred
to in clause 6(d)(i) but also the relative fault of the Company
on the one hand and the Holders on the other in connection with
the statements or omissions or alleged statements or alleged
omissions that resulted in such loss, claim, damage or liability
(or action in respect thereof), as well as any other relevant
equitable considerations.
The relative benefits received by the Company on the one hand and a Holder on
the other with respect to such offering and such sale shall be deemed to be in
the same proportion as the total net proceeds from the offering of the
Securities purchased under the Purchase Agreement (before deducting expenses)
received by the Company, on the one hand, bear to the total proceeds received by
such Holder with respect to its sale of Transfer Restricted Securities on the
other. The relative fault of the parties shall be determined by reference to
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or the Holders on the other, the intent
of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
each Holder agree that it would not be just and equitable if the amount of
contribution pursuant to this Section 6(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the first sentence of this paragraph
(d). The amount paid or payable by an indemnified party as a result of the loss,
claim, damage or liability, or action in respect thereof, referred to above in
this Section 6 shall be deemed to include, for purposes of this Section 6, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending or preparing to defend any such
action or claim. Notwithstanding the provisions of this Section 6, no Holder
shall be required to contribute any amount in excess of the amount by which the
total price at which the Transfer Restricted Securities purchased by it were
resold exceeds the amount of any damages which such Holder has otherwise been
required to pay by reason of any untrue or alleged untrue statement or omission
or alleged omission. 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. The Holders' obligations to contribute as provided in this
Section 6(d) are several and not joint.
7. Rule 144A. In the event the Company is not subject to Section
13 or 15(d) of the Exchange Act, the Company hereby agrees with each Holder, for
so long as any Transfer Restricted Securities remain outstanding, to make
available to any Holder or beneficial owner of Transfer Restricted Securities in
connection with any sale thereof and any prospective purchaser of such Transfer
Restricted Securities from such Holder or beneficial owner, the information
required by Rule 144A(d)(4) under the Securities Act in order to permit resales
of such Transfer Restricted Securities pursuant to Rule 144A.
19
8. Underwritten Registrations. The Holders of Transfer Restricted
Securities covered by the Shelf Registration Statement who desire to do so may
sell such Transfer Restricted Securities in an Underwritten Offering if approved
by the Company in its sole discretion; provided, however that no such Holder may
participate in any Underwritten Registration hereunder unless such Holder:
(i) agrees to sell such Holder's Transfer Restricted
Securities on the basis provided in any underwriting
arrangements approved by the Persons entitled hereunder to
approve such arrangements; and
(ii) completes and executes all reasonable
questionnaires, powers of attorney, indemnities, underwriting
agreements, lock-up letters and other documents required under
the terms of such underwriting arrangements.
In any such Underwritten Offering, the investment banker or investment bankers
and manager or managers that will administer the offering will be selected by a
Majority of Holders whose Transfer Restricted Securities are included in such
offering; provided, that such investment bankers and managers must be reasonably
satisfactory to the Company. If requested by the underwriter(s), if any, the
Company agrees to make appropriate officers of the Company available to the
underwriters for meetings with prospective purchasers of the Transfer Restricted
Securities and prepare and present to potential investors customary "road show"
or marketing materials in a manner consistent with other new issuances of other
securities similar to the Transfer Restricted Securities.
9. Miscellaneous.
(a) Actions Affecting Transfer Restricted Securities. The Company
shall not, directly or indirectly, take any action with respect to the Transfer
Restricted Securities as a class that would adversely affect the ability of the
Holders of Transfer Restricted Securities to include such Transfer Restricted
Securities in a registration undertaken pursuant to this Agreement.
(b) No Inconsistent Agreements. The Company will not, on or after
the date of this Agreement, enter into any agreement with respect to its
securities that is inconsistent with the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof. In addition, the
Company shall not grant to any of its security holders (other than the Holders
of Transfer Restricted Securities in such capacity) the right to include any of
its securities in the Shelf Registration Statement provided for in this
Agreement other than the Transfer Restricted Securities. The Company has not
previously entered into any agreement (which has not expired or been terminated)
granting any registration rights with respect to its securities to any Person
which rights conflict with the provisions hereof.
(c) Amendments and Waivers. This Agreement may not be amended,
modified or supplemented, and waivers or consents to or departures from the
provisions hereof may not be given, unless the Company has obtained the written
consent of a Majority of Holders.
(d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified,
20
return receipt requested), telex, facsimile transmission, or air courier
guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the
records of the Registrar under the Indenture or the transfer
agent of the Common Stock, as the case may be; and
(ii) if to the Company:
Networks Associates, Inc.
0000 Xxxxxxx Xxxxxx
Xxxxx Xxxxx, Xxxxxxxxxx 00000
Attention:Xxxx Xxxxxxx,
Executive Vice President
and General Counsel
Fax: (000) 000-0000
Tel: (000) 000-0000;
with a copy to:
Networks Associates Inc.
00000 Xxxxxx Xxxx
Xxxxxx, Xxxxx 00000
Attention: Xxxx Xxxxxxx
Executive Vice President
And General Counsel
Fax: (000) 000-0000
Tel: (000) 000-0000;
with a copy to:
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
All such notices and communications shall be deemed to have been
duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt acknowledged, if transmitted by
facsimile; and on the next Business Day, if timely delivered to an air courier
guaranteeing overnight delivery.
(e) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders of Transfer Restricted
21
Securities; provided, however, that (i) this Agreement shall not inure to the
benefit of or be binding upon a successor or assign of a Holder unless and to
the extent such successor or assign acquired Transfer Restricted Securities from
such Holder and (ii) nothing contained herein shall be deemed to permit any
assignment, transfer or other disposition of Transfer Restricted Securities in
violation of the terms of the Purchase Agreement or the Indenture. If any
transferee of any Holder shall acquire Transfer Restricted Securities, in any
manner, whether by operation of law or otherwise, such Transfer Restricted
Securities shall be held subject to all of the terms of this Agreement, and by
taking and holding such Transfer Restricted Securities such person shall be
conclusively deemed to have agreed to be bound by and to perform all of the
terms and provisions of this Agreement.
(f) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(g) Securities Held by the Company or Their Affiliates. Whenever
the consent or approval of Holders of a specified percentage of Transfer
Restricted Securities is required hereunder, Transfer Restricted Securities held
by the Company or its "affiliates" (as such term is defined in Rule 405 under
the Securities Act) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage.
(h) Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
(j) Severability. If any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
(k) Entire Agreement. This Agreement is intended by the parties
as a final expression of their agreement and intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein with respect to the registration rights granted by the Company with
respect to the Transfer Restricted Securities. This Agreement supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first written above.
NETWORKS ASSOCIATES, INC.
By /s/ Xxxx X. Xxxxxxx
---------------------------------------
Name Xxxx X. Xxxxxxx
Title: EVP and General Counsel
XXXXXX BROTHERS INC.
By /s/ Xxxxx McLanire
---------------------------------------
Authorized Representative
