EXHIBIT 10.2
STOCKHOLDERS AGREEMENT
of
XXXXX ADVISORS, INC.
(A Delaware Corporation)
Effective as of January 22, 1999
STOCKHOLDERS AGREEMENT, dated as of January 22, 1999, by and among
XXXXX ADVISORS, INC., a Delaware corporation (the "Company"), THE ASHTON
TECHNOLOGY GROUP, INC., a Delaware corporation ("Ashton"), XXXXX XXXXX, an
individual ("Xxxxx"), XXXX X. XXXX, an individual ("Xxxx"), XXXXXXXXX XXXXX, an
individual ("Xxxxx", and together with Xxxxx and Xxxx, the "Xxxxx Principals"),
XXXXXXX X. XXXXXXXXXXX, an individual ("Rittereiser"), K. XXXX X. XXXXXXX, an
individual ("Gothner"), and XXXXXX X. XXXXX, an individual ("Bacci").
RECITALS:
As of the date of this Agreement, the Company is entering into an
Exchange Agreement (the "Exchange Agreement") with the other parties hereto.
After giving effect to the transactions contemplated by the Exchange
Agreement, the Company is authorized by its Restated Certificate of
Incorporation (the "Certificate of Incorporation") to issue (i) 60,000 shares of
its Common Stock, par value $.0001 per share, of which no shares are
outstanding, (ii) 29,940,000 shares of its Class A Common Stock, par value
$.0001 per share (the "Common Stock"), of which 3,003 are outstanding, (iii)
2,990,000 shares of its preferred stock, par value $.01 per share, of which no
shares are outstanding, and (iv) 10,000 shares of its Series A Convertible
Voting Preferred Stock, par value $.01 per share, of which 4,905 shares are
outstanding.
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The parties wish to (i) provide for the voting of the Shares (as
defined herein), certain rights and obligations relating to the transfer of
Shares and certain other arrangements concerning the governance of the Company
and related business matters, and (ii) provide registration rights with respect
to certain shares of Common Stock, all as set forth herein.
In consideration of the foregoing recitals and of the mutual
agreements contained herein, the parties agree as follows:
1. Construction.
1.1 Definitions. As used herein the following terms shall have the
following meanings:
Affiliate: with respect to a specified Person, an officer or
director of such Person, or a Person who, directly or indirectly through one or
more intermediaries, owns, Controls, is owned or Controlled by, or is under
common ownership or Control with, the Person specified.
Agreement: this Stockholders Agreement, dated as of the date hereof,
as amended from time to time.
Appraiser: the meaning set forth in Section 6.3.
Ashton Executives: together, Rittereiser, Gothner, Bacci and any
other person who, after the date of this Agreement,
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purchases shares of Common Stock pursuant to Section 6.3 of the Exchange
Agreement.
Ashton Executive Shares: all shares of Common Stock owned now or in
the future by the Ashton Executives and their Permitted Transferees, and any
Common Stock issued with respect to such Common Stock by way of a stock dividend
or stock split or in connection with a combination of shares, recapitalization,
merger, consolidation or other reorganization.
Ashton Shares: all shares of Common Stock owned now or in the future
by Ashton, the Ashton Executives and their Permitted Transferees, the shares of
Common Stock issued upon conversion of the Preferred Stock and any Common Stock
issued with respect to such Common Stock by way of a stock dividend or stock
split or in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization.
ATG Shares: all shares of Common Stock owned now or in the future by
Ashton and its Permitted Transferees, the shares of Common Stock issued upon
conversion of the Preferred Stock and any Common Stock issued with respect to
such Common Stock by way of a stock dividend or stock split or in connection
with a combination of shares, recapitalization, merger, consolidation or other
reorganization.
Board: the Board of Directors of the Company.
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Certificate of Incorporation: the meaning set forth in the Recitals.
Common Stock: the meaning set forth in the Recitals.
Company: the meaning set forth in the introductory paragraph.
Control: (including, with correlative meaning, the terms "Controlled
by" and "under common Control with"), as used with respect to any Person, means
the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
Disability: an individual's inability, due to physical or mental
incapacity or impairment, to fully perform the tasks usually encountered in such
individual's employment with the Company for at least 90 consecutive days, or
for a period shorter than 90 consecutive days as determined by the Board after
consultation with a medical expert.
for cause: with respect to any Stockholder who has an employment
agreement with the Company, as set forth in such employment agreement;
otherwise, any of the following: (i) the willful failure or refusal, after
notice thereof, to perform specific directives of the Board, Chief Executive
Officer or President of the Company, when such directives are consistent
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with the scope and nature of the employee's duties and responsibilities; (ii)
willful dishonesty of the employee affecting the Company; (iii) chronic
alcoholism or drug abuse; (iv) the employee's conviction for committing a felony
or any crime involving moral turpitude or fraud; (iv) engagement in negligence
or conduct injurious to the Company or its affiliates; or (v) substantial and
repeated failure of the employee to adequately perform the employee's duties and
responsibilities to the Company, continuing after notice thereof.
Xxxxx Shares: all shares of Common Stock owned now or in the future
by the Xxxxx Principals and their Permitted Transferees, the shares of Common
Stock issued upon exercise of the Xxxxx Principals Options (as defined in the
Exchange Agreement) and any Common Stock issued with respect to such Common
Stock by way of a stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization.
IPO: an initial underwritten public offering pursuant to an
effective registration statement under the Securities Act covering the offer and
sale of Common Stock to the public.
Nominee: the meaning set forth in Section 2.1.
Note: a subordinated promissory note of the Company with the
following terms: (i) a maturity date four years after the Note Issue Date (but
which may be prepaid at any time without
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penalty); (ii) principal and interest payments to commence on the first
anniversary of the Note Issue Date; (iii) principal and interest payable in
annual installments comprising 25% of the original principal amount of the Note
plus interest accrued on the unpaid principal amount of the Note to the date of
such payment; (iv) interest to accrue on all unpaid principal from the date of
the Note at a rate equal to the lowest rate that would not cause the recognition
of imputed or deemed interest pursuant to the Internal Revenue Code of 1986, as
amended, and the rules and regulations thereunder; and (v) payment subordinated
to the payment of all other indebtedness of the Company except Notes (all of
which shall rank pari passu).
Note Issue Date: the date of issuance by the Company of any Note.
Permitted Transferee: the issue, spouse or family trust of a
Stockholder to whom Shares are transferred by such Stockholder (i) by will or
the laws of descent or distribution or (ii) by gift without consideration of any
kind.
Person: an individual, firm, corporation, trust, joint venture,
partnership, limited liability company, association, unincorporated organization
or other entity or any governmental body or subdivision, agency, commission or
authority thereof.
Preferred Stock: the Series A Convertible Voting Preferred Stock,
par value $.01 per share, of the Company.
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Securities Act: the Securities Act of 1933, as amended.
Shares: outstanding shares of Common Stock and Preferred Stock,
including, without limitation, any shares of Common Stock or other securities
resulting from the exercise of stock options, a conversion, split-up,
combination, recapitalization, dividend or exchange.
Stockholder: Each Person (other than the Company) who shall be a
party to this Agreement whether in connection with the execution and delivery
hereof as of the date hereof, as a purchaser of any shares of Common Stock
pursuant to Section 6.3 of the Exchange Agreement, as a transferee of Shares who
becomes bound by the provisions hereof pursuant to Section 6 of this Agreement
or otherwise, so long as such Person shall beneficially own any Shares.
Subsidiary: as to any Person, a corporation, limited liability
company or other entity of which shares or other rights or securities having
voting power to elect a majority of the board of directors or other governing
body are at the time owned, directly or indirectly, through one or more
intermediaries, by such Person.
Termination Date: the earlier to occur of (i) the date that is two
years following the date hereof and (ii) the consummation of the IPO.
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Transfer: the meaning set forth in Section 5.1.
1.2 Interpretation. When the context in which words are used in this
Agreement indicates that such is the intent, singular words include the plural
and vice versa and masculine words include the feminine and the neuter and vice
versa. References herein to Sections are to the appropriate sections of this
Agreement unless otherwise expressly so stated. The words "herein", "hereof" and
"hereunder" and other words of similar import refer to this Agreement as a whole
and not to any particular Section or other subdivision.
1.3 Headings. The headings or captions included in this Agreement
are inserted for convenience of reference only and shall not be construed to
define or limit the scope, extent or intent of this Agreement or any of its
provisions.
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2. Board of Directors.
2.1 Voting for Directors. Initially, the Board shall consist of the
following six directors: Xxxxx and Rittereiser as Class III Directors, Xxxx and
Gothner as Class II Directors, and Xxxxx and Bacci as Class I Directors. For so
long as the IPO shall not have occurred, such number of directors shall not be
increased or decreased. Each Stockholder shall vote all Shares now or hereafter
owned by him or her, at any regular or special meeting of stockholders called
for the purpose, for, or otherwise consent to, the election to the Board of the
individuals nominated in accordance with Section 2.2 (the "Nominees").
2.2 Nominees. (a) For so long as the IPO shall not have occurred,
Nominees for election to the Board shall be selected as follows:
(i) Xxxxx shall be entitled to designate one Nominee which shall
initially be Xxxxx; provided, however, that if such designated
Nominee is a Person other than Xxxxx, then such designee shall not
be eligible to be elected to the Board unless such designee is
approved by a majority of the other directors of the Company;
provided, further, that if Xxxxx shall cease to be an executive
officer of the Company, the right to designate one Nominee pursuant
to this paragraph (i) shall be vested in Xxxx and Xxxxx; and
provided, further, that if both Xxxx and Xxxxx shall cease to be
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executive officers of the Company, the right to designate one
Nominee pursuant to this paragraph (i) shall be vested in the Board.
(ii) Xxxx shall be entitled to designate one Nominee which shall
initially be Xxxx; provided, however, that if such designated
Nominee is a Person other than Xxxx, then such designee shall not be
eligible to be elected to the Board unless such designee is approved
by a majority of the other directors of the Company; provided,
further, that if Xxxx shall cease to be an executive officer of the
Company, the right to designate one Nominee pursuant to this
paragraph (ii) shall be vested in Xxxxx (for so long as Xxxxx is an
executive officer of the Company), subject to the approval of Ashton
which shall not be unreasonably withheld; and provided, further,
that if Xxxxx shall cease to be an executive officer of the Company,
the right to designate one Nominee pursuant to this paragraph (ii)
shall be vested in the Board.
(iii) Xxxxx shall be entitled to designate one Nominee which shall
initially be Xxxxx; provided, however, that if such designated
Nominee is a Person other than Xxxxx, then such designee shall not
be eligible to be elected to the Board unless such designee is
approved by a majority of the other directors of the Company;
provided, further, that if Xxxxx shall cease to be an
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executive officer of the Company, the right to designate one Nominee
pursuant to this paragraph (iii) shall be vested in Xxxxx (for so
long as Xxxxx is an executive officer of the Company), subject to
the approval of Ashton which shall not be unreasonably withheld; and
provided, further, that if Xxxxx shall cease to be an executive
officer of the Company, the right to designate one Nominee pursuant
to this paragraph (iii) shall be vested in the Board.
(iv) Ashton shall be entitled to designate three Nominees which
shall initially be Rittereiser, Gothner and Bacci; provided,
however, that if Ashton and the Ashton Executives shall together own
less than 5% of the outstanding Shares, then the Board shall be
entitled to remove from the Board any Nominees then serving as a
director pursuant to this paragraph (iv), and the right to designate
three Nominees pursuant to this paragraph (iv) shall be vested in
the Board.
(b) From and after such time as the IPO shall have been consummated,
subject to the approval of Ashton, which approval shall not be unreasonably
withheld, two additional independent Nominees who are not employees of the
Company, Stockholders or Permitted Transferees of Stockholders shall be
designated by Xxxxx; provided, however, that following the election of such two
independent Nominees to the Board, the
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voting requirements of this Section 2 shall terminate and have no further force
or effect.
2.3 Substitution. If any Nominee designated as provided in Section
2.2 shall be unable or unwilling to serve on the Board or shall resign
therefrom, the Person or Persons who designated such Nominee shall be entitled
to designate a replacement (provided that such Person or Persons are then
entitled to designate a Nominee pursuant to the provision of Section 2.2 that
governed the designation of the original Nominee), and the Person designated as
a replacement shall then be a Nominee for the purposes of this Agreement.
2.4 Removal. Each Stockholder agrees that if, at any time, such
Stockholder is then entitled to vote for the removal of directors of the Company
(other than any vote to remove a director for cause), then such Stockholder will
not vote any of his or her Shares in favor of the removal of (i) any director
who shall have been designated or nominated by the Board unless the Board
consents to such removal or (ii) any director who shall have been designated or
nominated by a Stockholder unless such removal shall have been consented to in
writing by the Stockholder making such designation or nomination.
3. Voting of Ashton Executives Shares. From the date hereof until
the Termination Date, each Ashton Executive shall cause the shares of Common
Stock owned by such Ashton Executive to be voted at any meeting of the
stockholders of the Company or
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in any consent in lieu of such a meeting for and/or against any proposal in the
same proportion as all other Shares are voted at such meeting or consent in lieu
of meeting, as the case may be.
4. Forfeiture of Shares by Ashton Executives. Notwithstanding the
provisions of Section 6 of this Agreement, if any Ashton Executive is no longer
employed (as a direct employee or as a consultant) by Ashton or any of its
Subsidiaries (including the Company) on or after the date hereof and prior to
the Termination Date, then such Ashton Executive shall forfeit his Shares to the
Company and the Company shall have the right and obligation to purchase from
such Ashton Executive (including any Permitted Transferees of such Ashton
Executive) or his or her estate, and such Ashton Executive (including any
Permitted Transferees of such Ashton Executive) or his or her estate shall have
the right and obligation to sell to the Company, all of the Shares owned by such
Ashton Executive (and such Ashton Executive's Permitted Transferees) promptly
after such event at a purchase price equal to the purchase price paid by such
Ashton Executive for such Shares.
5. Restrictions on Transferability of Shares.
5.1 Certain Definitions. For the purposes of this Section 5
"Transfer", as to any Shares, means any transfer, sale, exchange, assignment,
the creation of any option or right to purchase, security interest or other
encumbrance, and any other disposition of any kind, whether voluntary or
involuntary,
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affecting title to, possession of or voting rights in respect of such Shares, or
any interest therein.
5.2 Restriction on Transfer. Except as required hereunder, until the
consummation of the IPO, no Stockholder may Transfer or permit the Transfer of
any of his or her Shares to any Person except (i) with the prior approval of the
Board or (ii) to a Permitted Transferee who shall have been approved by the
Board, but, in each case, only if such transferee shall agree to be bound by the
terms and conditions of this Agreement, including, without limitation, the
obligations to sell Shares set forth in Section 6. The Company shall not
Transfer on its books any certificates evidencing Shares or certificates in lieu
thereof unless the related provisions of this Agreement shall have been complied
with. Any purported Transfer in violation of this Agreement shall be void.
5.3 Legends. Each certificate evidencing Shares now or hereafter
registered in the name of any Stockholder shall be endorsed with a legend
substantially as follows:
The shares evidenced by this certificate are subject to the
restrictions contained in a Stockholders Agreement, effective as of
January __, 1999, among the Company and certain stockholders of the
Company, a copy of which is on file in the offices of the Company
and will be furnished to the holder of this certificate upon
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written request and without charge. Ownership, voting and transfer
of such shares are subject to the terms of such Agreement. The
holder of this certificate, by acceptance hereof, agrees to be bound
by all the terms of such Agreement, as the same is in effect from
time to time. No vote, sale, assignment, encumbrance, pledge,
transfer or other hypothecation or disposition of such shares shall
be made except in compliance with such Agreement.
60 Mandatory Purchase on Death, Disability, or Termination of
Employment.
6.1 Death or Disability. Subject to the provisions of Section 4 of
this Agreement, in the event of the death or Disability of a Stockholder prior
to the IPO, the Company shall have the right and obligation to purchase from
such Stockholder (including any Permitted Transferees of such Stockholder) or
his or her estate, and such Stockholder (including any Permitted Transferees of
such Stockholder) or his or her estate shall have the right and obligation to
sell to the Company, all of the Shares held by such Stockholder (and such
Stockholder's Permitted Transferees) at the time of such event at a purchase
price equal to the Share Value (as defined in Section 6.3) of such Shares. The
purchase price for the Shares to be purchased shall be paid, at the option of
the Company in its sole discretion, in cash or by delivery of cash (equal to at
least 20% of the purchase price)
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and a Note in principal amount equal to the balance of such purchase price,
against receipt by the Company of all duly executed instruments and documents
necessary to transfer all right, title and interest of the sellers in the Shares
to the Company, free and clear of all liens, claims and encumbrances. Except as
provided in the next sentence, the closing of such purchase and sale shall take
place within 10 business days of the event giving rise to such purchase and
sale, except that in the event of an appraisal as contemplated by the first
sentence of Section 6.3, such closing shall take place within 10 business days
after the issuance of the report of the Appraiser. Notwithstanding the previous
sentence, if the event giving rise to the purchase and sale is the death of the
Stockholder, then the closing of such purchase and sale shall take place as
promptly as practicable (including, if possible, within the periods specified in
the previous sentence), but in no event more than five business days after the
appointment of the legal representative of the deceased Stockholder.
6.2 Termination of Employment. Subject to the provisions of Section
4 of this Agreement, in the event that, prior to the IPO, any Stockholder's
employment with Ashton and/or its Subsidiaries (including the Company) is (i)
terminated by Ashton and/or its Subsidiaries for cause, or (ii) voluntarily
terminated by a Stockholder other than as a result of such Stockholder's death
or Disability, then the Company shall have the right and obligation to purchase
from the Stockholder (including any Permitted Transferees of such Stockholder),
and
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such Stockholder (including any Permitted Transferees of such Stockholder) shall
have the right and obligation to sell to the Company, all of the Shares held by
such Stockholder (and such Stockholder's Permitted Transferees) promptly after
such event. The purchase price for such Shares shall be determined as follows:
(i) if such Stockholder voluntarily terminates his employment with the Company
other than because of a Disability, then the purchase price shall be the Share
Value for such Shares, provided, that, in determining the Share Value, the
Appraiser (as defined in Section 6.3) shall take into account the diminution in
value of the Company resulting from the termination of employment of such
Stockholder; or (ii) if the employment of such Stockholder is terminated by the
Company for cause, then the purchase price shall be for an amount equal to the
lesser of (X) the Share Value for such Shares or (Y) the purchase price paid by
such Stockholder for such Shares. The purchase price for the Shares to be so
purchased shall be paid, at the option of the Company in its sole discretion, in
cash or by delivery at the closing of cash (equal to at least 20% of the
purchase price) and a Note in principal amount equal to the balance of such
purchase price, against receipt by the Company of all duly executed instruments
and documents necessary to transfer all right, title and interest of the sellers
in the Shares to the Company, free and clear of all liens, claims and
encumbrances. The closing of such purchase and sale shall take place within 10
business days of the event giving rise to such purchase and sale, except that in
the event of an appraisal as contemplated by the first sentence of Section 6.3,
such closing shall take place within 10
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business days after the issuance of the report of the Appraiser.
6.3 Determination of Share Value. Subject to the provisions set
forth below, for purposes of this Agreement, "Share Value" shall be determined
by an appraisal of the Shares made by an independent accountant or investment
banking professional selected by the Board who shall be knowledgeable in valuing
the capital stock of companies engaged in businesses similar to the business
engaged in by the Company (the "Appraiser"); provided, however, that if such an
appraisal shall have been issued at any time during the preceding 12 months,
then, unless the Board elects to make a new appraisal of the Shares, the Share
Value shall be as set forth in such appraisal and no new appraisal shall be
required. Notwithstanding the preceding sentences, the Board may order an
appraisal of the Shares to determine Share Value at any time if the Board
believes that there has been, since the date of the last determination of Share
Value, a material adverse change in the business, operations, assets or
liabilities, employee relationships, customer relationships, results of
operations, prospects or the condition (financial or otherwise) of the Company.
The fees and disbursements of the Appraiser shall be paid by the Company. Within
30 days after being retained by the Company, the Appraiser shall issue a report
setting forth the value of the Shares and a reasonably detailed explanation of
the methods used to determine such value.
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6.4 Voting of Shares. Notwithstanding anything to the contrary
contained in this Agreement, in the event of a Stockholder's death, Disability
or termination of employment with the Company (for any reason), such Stockholder
and such Stockholder's Permitted Transferees, if any, shall be required to vote
all Shares held by such Stockholder and such Permitted Transferees (including,
without limitation, abstaining from voting) as directed by the Board.
70 Registration Rights.
7.1 Registration of the Xxxxx Shares in the IPO. (a) Holders of the
Xxxxx Shares have the right to request that such Xxxxx Shares be registered in
the registration statement (other than a registration statement on Form X-0, X-0
or similar form) (the "IPO Registration Statement") that the Company files with
the Securities and Exchange Commission (the "Commission") for the purpose of
effecting the IPO; provided, however, that the maximum number of Xxxxx Shares to
be included in the IPO Registration Statement shall equal 10% of the total
number of shares of Common Stock offered in the IPO (exclusive of any
overallotment). The inclusion of such Xxxxx Shares in the IPO Registration
Statement is subject to any restrictions, cutbacks, lockups or other conditions
imposed by the managing underwriter of the Company's IPO (the "Underwriter")
which the Underwriter determines in its sole discretion are necessary to effect
the IPO.
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(b) If the Underwriter informs the Company in writing that in the
Underwriter's opinion the total number of shares of the Common Stock which the
Company, the holders of the Xxxxx Shares and any other holders of shares of the
Common Stock entitled to participate in the IPO Registration Statement request
to include in the IPO Registration Statement is an amount which would adversely
affect the success of the IPO including, without limitation, the price at which
the Common Stock can be offered, then the Company will be required to include in
the IPO Registration Statement only the amount of shares of Common Stock which
it is so advised by the Underwriter. In such event, the shares shall be included
on the IPO Registration Statement pursuant to the following priority: first, the
shares of the Common Stock to be sold for the account of the Company (including
any shares to be sold pursuant to any overallotment); second, the Xxxxx Shares;
and third, the shares of Common Stock to be sold for the account of such holders
who in the future may be granted incidental registration rights in the IPO
Registration Statement. In the event that the Underwriter determines that some,
but less than all, of the Xxxxx Shares requested for inclusion can be included
in the IPO Registration Statement, then a pro rata amount of the Xxxxx Shares
requested by each holder shall be included in the IPO Registration Statement
(subject to the rights of the Company to include all of its shares in the IPO
Registration Statement as provided above). The Underwriter may determine in its
sole discretion that none of the Xxxxx Shares should be included in the IPO
Registration Statement.
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(c) Other than pursuant to Section 7.3, the Xxxxx Principals shall
not have any additional registration rights with respect to the Xxxxx Shares if
all or any portion of the Xxxxx Shares are cutback or not otherwise permitted to
be included in the IPO Registration Statement in accordance with this Agreement.
(d) If requested by the Underwriter, each holder of the Xxxxx Shares
participating in the IPO Registration Statement will enter into an underwriting
agreement with the Underwriter and the Company. Each holder of the Xxxxx Shares
will be required to make such representations and warranties to, and agreements
with, the Company and the Underwriter as are customarily contained in an
underwriting agreement of this type including, without limitation,
representations, warranties and agreements, including indemnities, regarding the
holders of the Xxxxx Shares, the Xxxxx Shares and the holders' of the Xxxxx
Shares intended method of distribution and any other representations required by
law.
(e) Each holder of the Xxxxx Shares hereby agrees that it/he will
not sell or otherwise dispose of any of the Xxxxx Shares during the period
beginning seven days prior to the effective date of the IPO Registration
Statement and ending 180 days after the effective date of the IPO Registration
Statement; provided, however, this Section 7.1(e) shall not apply to any of the
Xxxxx Shares which are included in the IPO Registration Statement.
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(f) The Company shall notify each holder of the Xxxxx Shares
appearing on the Company's records as a record holder of the Xxxxx Shares as of
the date 10 business days prior to the filing of the preliminary IPO
Registration Statement with the Commission of their right to request
registration of their Xxxxx Shares in the IPO Registration Statement pursuant to
the terms and conditions of this Agreement within 10 business days prior to the
filing of such preliminary IPO Registration Statement. In order to exercise its
registration rights under this Section 7.1, holders of the Xxxxx Shares must
notify the Company in writing of its request to include its Xxxxx Shares in the
IPO Registration Statement within 10 business days after the Company has
delivered such notice.
7.2 Registration Rights of the Ashton Shares. (a) Commencing 180
days following the consummation of the IPO, holders of the Ashton Shares shall
have the right to require the Company (subject to (x) the shares of the Common
Stock to be sold for the account of such holders who in the future may be
granted demand registration rights expressly senior to those of the holders of
the Ashton Shares and (y) the conditions set forth in Section 7.4) on four
separate occasions, to exercise its reasonable best efforts to (i) cause a
registration statement (each, a "Demand Registration Statement") to be declared
effective for the public sale under the Securities Act of the Ashton Shares, and
(ii) maintain the effectiveness of each such Demand Registration Statement for
at least 180 days.
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(b) The Company shall include in each Demand Registration Statement
at least 25% of the total number of Ashton Shares outstanding as of the date of
this Agreement; provided, however, if market conditions allow, the Board may by
written resolution permit more than 25% of the total number of such shares to be
included in a Demand Registration Statement.
(c) Unless Ashton and each Ashton Executive otherwise unanimously
agree in writing:
(i) the first Demand Registration Statement shall contain (A) at
least 50% of the Ashton Executive Shares, if so requested, and (B) a number of
ATG Shares which, when added to the Ashton Executive Shares equals at least 25%
of the total number of Ashton Shares outstanding as of the date of this
Agreement;
(ii) the second Demand Registration Statement shall contain (A) the
remaining Ashton Executive Shares, if so requested, and (B) a number of ATG
Shares which, when added to the remaining Ashton Executive Shares, equals at
least 25% of the total number of Ashton Shares outstanding as of the date of
this Agreement;
(iii) the third Demand Registration Statement shall contain a number
of ATG Shares equal to at least 25% of the total number of Ashton Shares
outstanding as of the date of this Agreement; and
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(iv) the fourth Demand Registration Statement shall contain all
remaining ATG Shares.
Unless otherwise unanimously agreed to in writing by each Ashton Executive, the
number of Ashton Executive Shares to be included in a Demand Registration
Statement for the account of each Ashton Executive shall be proportionate to the
total number of Ashton Executive Shares outstanding.
(d) The first demand registration right granted hereunder may be
exercised no earlier than 180 days after the consummation of the IPO, and each
successive demand registration right may be exercised no earlier than one year
after the effective date of the preceding Demand Registration Statement.
(e) Ashton and the Ashton Executives shall be entitled to use an
underwriter to effect the offering of the Ashton Shares pursuant to the Demand
Registration Statements. Ashton shall select the underwriters, if any, to use in
connection therewith, subject to the approval of the Board, which shall not be
unreasonably withheld. Ashton shall be entitled to select the form of the Demand
Registration Statement for the Company to use in connection with the offering of
the Ashton Shares.
(f) Xxxxx, Xxxx and Xxxxx agree not to sell any shares of Common
Stock for their respective accounts for a period beginning seven days prior to
the effective date of each Demand
24
Registration Statement and ending on the earlier of (i) 180 days after each such
effective date, or (ii) the date that all shares included in the Demand
Registration Statement are sold.
(g) In order for the registration rights set forth in this Section
7.2 to be exercised, a written request with the signatures of holders of at
least 67% of the Ashton Shares then outstanding must be delivered to the
Company. Upon the Company's receipt of such written request, which must include
the intended method of distribution of the Ashton Shares to be sold pursuant to
such registration statement, the Company within 20 business days shall give
notice of the exercise of this registration right to each holder (the
"Non-Participating Ashton Holders") of the Ashton Shares (other than those
included in such request) appearing on the Company's records as a record holder
of Ashton Shares as of the date the Company receives such request. In order to
exercise registration rights under this Section 7.2, each Non-Participating
Xxxxxx Xxxxxx must notify the Company in writing of its/his intention to be
included in the registration request within 10 business days after the Company
has delivered such notice.
7.3 Piggyback Registration. If, after one year following the
consummation of the IPO, the Company proposes to register Common Stock under the
Securities Act (otherwise than (i) in connection with the registration of
securities issuable pursuant to an employee stock option, stock purchase or
similar plan, (ii) pursuant to a merger, exchange offer or a transaction
25
of the type specified in Rule 145(a) under the Securities Act, or (iii) in
connection with the first Demand Registration Statement requested by the holders
of the Ashton Shares pursuant to Section 7.2), the Company shall give each
holder of Ashton Shares and Xxxxx Shares notice of such proposed registration at
least 30 days prior to the filing of a registration statement. At the written
request of any such holder within 15 days after the receipt of the notice from
the Company, any such request stating the number of Ashton Shares or Xxxxx
Shares that such holder wishes to sell or distribute publicly under the
registration statement proposed to be filed by the Company, the Company shall
use its reasonable best efforts to register under the Securities Act the sale of
such Ashton Shares and/or Xxxxx Shares (which, in the aggregate, shall not
exceed 25% of the shares being registered), and to cause such registration
statement (the "Piggyback Registration") to become and remain effective for 180
days; provided, however, that the holders of the Xxxxx Shares shall not have the
right to include any such Xxxxx Shares in the first Demand Registration
Statement requested by the holders of the Ashton Shares pursuant to Section 7.2;
and provided, further, that the holders of the Ashton Shares shall not have the
right to include any such Ashton Shares in the first registration statement
filed by the Company following the IPO which does not involve an underwritten
offering of the securities so being registered. The Company may at any time
withdraw or cease proceeding with the Piggyback Registration if it shall at the
same time withdraw or cease proceeding with the registration of all the
securities originally proposed to be registered.
26
If the Piggyback Registration involves an underwritten offering of
the securities so being registered 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, then the shares to be included in the registration and underwriting
shall be allocated (i) if the Piggyback Registration is also a Demand
Registration Statement (other than the first Demand Registration Statement)
initiated by the holders of the Ashton Shares pursuant to Section 7.2, first, to
the minimum number of Ashton Shares required to be included in such Demand
Registration Statement pursuant to Section 7.2(c), second, to the Company for
shares being sold for its own account, and third, in the ratio of one Ashton
Share for every Xxxxx Share requested by the holders thereof to be included in
such registration statement, or (ii) if the Piggyback Registration is not also a
Demand Registration Statement, first, to the Company for shares being sold for
its own account, second, to shares of Common Stock to be sold for the account of
such holders who in the future may be granted registration rights expressly
senior to those of the holders of the Ashton Shares and the Xxxxx Shares
hereunder, and third, in the ratio of one Ashton Share for every Xxxxx Share
requested by the holders thereof to be included in such registration statement.
7.4 General Registration Rights Provisions. The following
provisions, unless otherwise stated, shall be
27
applicable to any registration to be effected pursuant to the rights exercised
under Section 7.1, 7.2 or 7.3 hereof.
(a) The holders whose Ashton Shares or Xxxxx Shares are to be
included in any registration statement as provided in Section 7.1 or 7.2 (the
"Sellers") agree to furnish the Company with such information regarding the
Sellers and the distribution of the Ashton Shares or Xxxxx Shares, as the case
may be, as the Company shall from time to time reasonably request in writing and
as shall be required by applicable federal or state law or the Commission in
connection therewith.
(b) Following the effective date of the applicable registration
statement, the Company shall upon the request of any Seller supply a reasonable
number of prospectuses meeting the requirements of the Securities Act as shall
be requested by such Seller to permit such Seller to make a public offering of
the securities of such Seller included therein.
(c) The Company shall use reasonable efforts (i) to qualify the
securities included in an applicable registration statement for sale in such
states as the Sellers shall reasonably designate, provided that no such
qualification shall be required in any jurisdiction where, as a result thereof,
the Company would be subject to service of general process or to taxation as a
foreign corporation doing business in such jurisdiction to which it is not then
subject and (ii) to qualify such offering with the National Association of
Securities Dealers, Inc., if applicable.
28
(d) The Company's obligations under Section 7.2 to exercise
reasonable best efforts to cause a registration statement to be declared
effective by the Commission for the public sale of Ashton Shares under the
Securities Act are limited to the following:
(i) The Company will prepare and file with the Commission the
form of registration statement selected by Ashton pursuant to Section 7.2(e) to
effect such registration and thereafter use reasonable best efforts in good
faith to cause such registration statement to become effective; provided,
however, that the Company may discontinue any registration of securities or
suspend the effectiveness of any registration statement in accordance with
Section 7.4(i); and
(ii) The Company will prepare and file with the Commission
such amendments and supplements to the applicable registration statement and the
prospectus used in connection therewith as may be necessary to keep such
registration statement effective and to comply with the provisions of the
Securities Act with respect to the disposition of all Ashton Shares covered by
such registration statement for 180 days or such earlier time as all of such
Ashton Shares included in such registration statement have been disposed of in
accordance with the intended methods of disposition by the Sellers set forth in
such registration statement; provided, however, that the Company may discontinue
any registration of securities or suspend the effectiveness of any registration
statement in accordance with Section 7.4(i).
29
(e) The Company shall indemnify and hold harmless each Seller and
each underwriter (if applicable), within the meaning of the Securities Act, who
may purchase from or sell for any Seller any Xxxxx Shares or Ashton Shares, as
the case may be, from and against any and all loss, liability, claim, damage and
expense whatsoever (including, but not limited to, any and all expenses
reasonably incurred in investigating, preparing or defending against any
litigation, commenced or threatened, or any claim whatsoever) arising out of any
untrue statement or alleged untrue statement of a material fact contained in the
applicable registration statement or any prospectus included therein required to
be filed or furnished by reason of this Section 7 or any amendment or supplement
thereto, or caused by any omission or alleged omission to state therein a
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, except insofar as such loss, liability, claim, damage or expense is
caused by any such untrue statement or alleged untrue statement or omission or
alleged omission based upon written information furnished to the Company by a
Seller or underwriter expressly for use therein. This indemnification shall
include each person, if any, who controls a Seller or underwriter within the
meaning of the Securities Act; provided, however, that the indemnity agreement
set forth in this Section 7 with respect to any registration statement or
prospectus which shall be subsequently amended prior to the written confirmation
of the sale of any Ashton Shares or Xxxxx Shares, as the case may
30
be, pursuant thereto, shall not inure to the benefit of any Seller or
underwriter from whom the person asserting any such loss, liability, claim,
damage or expense purchased the Ashton Shares or Xxxxx Shares, as the case may
be, which are the subject thereof (or to the benefit of any person controlling
such Seller or underwriter), if such Seller or underwriter failed to send or
give a copy of the prospectus as so amended to such person at or prior to the
written confirmation of the sale of such Ashton Shares or Xxxxx Shares, as the
case may be, and if the amended prospectus did not contain any untrue statement
or alleged untrue statement or omission or alleged omission giving rise to such
loss, liability, claim, damage or expense.
(f) Each Seller and underwriter (if applicable) shall at the same
time indemnify the Company, its directors, its executive officers, each officer
signing the applicable registration statement and each person who controls the
Company, within the meaning of the Securities Act, from and against any and all
loss, liability, claim, damage and expense whatsoever (including, but not
limited to, any and all expenses reasonably incurred in investigating, preparing
or defending against any litigation, commenced or threatened, or any claim
whatsoever) arising out of any untrue statement of a material fact contained in
the applicable registration statement or any prospectus included therein
required to be filed or furnished by reason of this Section 7 or any amendment
or supplement thereto, or caused by any omission or alleged omission to state
therein a material fact to be stated therein or necessary to make the statements
31
therein, in light of the circumstances under which they were made, not
misleading, insofar as such loss, liability, claim, damage or expense is caused
by any untrue statement or alleged untrue statement or omission or alleged
omission based upon written information furnished to the Company by any such
Seller or underwriter expressly for use therein.
(g) If for any reason the foregoing indemnity is unavailable under
either Section 7.4(e) or 7.4(f), then the indemnifying party shall contribute to
the amount paid or payable by the indemnified party as a result of such losses,
liabilities, claims, damages or expenses (i) in such proportion as is
appropriate to reflect the relative benefits received by the indemnifying party
on the one hand and the indemnified party on the other, or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law or
provides a lesser sum to the indemnified party than is appropriate to reflect
not only the relative benefits received by the indemnifying party on the one
hand and the indemnified party on the other but also the relative fault of the
indemnifying party and the indemnified party as well as any other relevant
equitable considerations, then in such proportion as is appropriate to reflect
the relative fault of the indemnifying party and the indemnified party as well
as any other equitable considerations. Notwithstanding the foregoing, neither
party shall be required to contribute any amount in excess of the amount the
indemnifying party would have been required to pay to an indemnified party if
the indemnity under this Section 7.4(e) or 7.4(f) was available. No person
guilty of fraudulent
32
misrepresentation (within the meaning of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation.
(h) In their applicable request for registration of their Ashton
Shares or Xxxxx Shares, the Sellers must inform the Company of their intended
method of distribution of the Ashton Shares or Xxxxx Shares, as the case may be.
In the event that Ashton and/or the Ashton Executives request pursuant to
Section 7.2 an underwritten offering of the Ashton Shares, each Seller selling
Ashton Shares pursuant to such underwritten offering hereby agrees to enter into
an underwriting agreement with the underwriter and the Company whereby such
Seller will be required to make such representations and warranties to, and
agreements with, the Company and the underwriter as are customarily contained in
an underwriting agreement of this type, including without limitation,
representations, warranties and agreements, including indemnities, regarding the
Sellers, the Ashton Shares and the Seller's intended method of distribution and
any other representations required by law.
(i) Subject to the next sentence of this paragraph, the Company
shall be entitled to postpone, for a reasonable period of time, the filing or
effectiveness of, or suspend the rights of any Sellers to make sales pursuant
to, any registration statement otherwise required to be prepared, filed and kept
effective by it under this Section 7; provided, however, that the duration of
such postponement or suspension may not exceed the
33
earlier to occur of (A) 15 business days after the cessation of the
circumstances described in the next sentence of this paragraph on which such
postponement or suspension is based or (B) 180 days after the date of the
determination of the Board referred to in the next sentence, or if the Company
is filing a registration statement under the Securities Act for the purpose of
raising capital, 180 days after the effective date of such registration
statement. Such postponement or suspension may only be effected if the Board
determines in good faith that the filing or effectiveness of, or sales pursuant
to, the applicable registration statement would materially impede, delay or
interfere with any financing, offer or sale of securities, acquisition,
corporate reorganization or other significant transaction involving the Company
or any of its affiliates (whether or not planned, proposed or authorized prior
to an exercise of registration rights hereunder or any other registration rights
agreement) or require disclosure of material information which the Company has a
bona fide business purpose for preserving as confidential. If (i) the Company
shall postpone the filing or effectiveness of a Demand Registration Statement or
suspend the rights of Sellers to make sales thereunder, (ii) a Demand
Registration Statement does not continue in effect for at least 180 days or
until the sale of all Ashton Shares included thereunder, or (iii) a Demand
Registration Statement is interfered with by a stop order, injunction or other
order or requirement of the SEC or other governmental agency or court for any
reason not the fault of Ashton or the Ashton Executives, the Company shall as
promptly as practicable notify
34
any participating Sellers of such determination, and the holders of the Ashton
Shares shall have the right, upon the affirmative vote of such holders holding
not less than 51% of the Ashton Shares to be included in such registration
statement which are not sold, to withdraw the request for registration by giving
written notice to the Company within 10 business days after receipt of such
notice. Any registration right as to which the withdrawal election referred to
in the preceding sentence has been effected shall not be counted for purposes of
the registration rights which Ashton and the Ashton Executives have been granted
pursuant to Section 7.2.
(j) The registration rights set forth in Section 7.1 and 7.2 shall
terminate with respect to any holder of Ashton Shares and/or Xxxxx Shares at
such time as the Company receives a written opinion (the "Rule 144 Opinion")
from counsel to the Company that all of the Ashton Shares and/or Xxxxx Shares
owned by such holder will be eligible to be sold pursuant to Rule 144
promulgated under the Securities Act ("Rule 144") by the end of the calendar
quarter in which it receives such Rule 144 Opinion.
(k) The Company shall pay all expenses incurred in complying with
Section 7.1 and 7.2 including, without limitation, all registration and filing
fees, printing expenses, expenses of complying with securities or blue sky laws
(including fees and disbursements of counsel for the Company and counsel for any
underwriters of such offerings, but excluding fees and disbursements of counsel
representing the Sellers), all fees and
35
disbursements of counsel for the Company and accountants' fees and expenses
incident to the applicable registration statement; provided, however, that the
Sellers shall pay for all underwriting fees and commissions, all fees and
disbursements of counsel for any Seller and any transfer and similar taxes to be
incurred by any Seller (collectively, the "Selling Expenses"). Unless the
Sellers otherwise unanimously agree in writing, the Sellers shall bear the
Selling Expenses in direct proportion to the number of Ashton Shares or Xxxxx
Shares, as the case may be, that they are seeking to register.
80 Amendments to Employment Agreements.
8.1 Section 5 and Section 6 of the Employment Agreement between the
Company and Xxxxx, dated as of May 15, 1997, are hereby deleted.
8.2 Section 5 and Section 6 of the Employment Agreement between the
Company and Xxxx, dated as of May 15, 1997, are hereby deleted.
8.3 Section 5 and Section 6 of the Employment Agreement between the
Company and Xxxxx, dated as of May 15, 1997, are hereby deleted.
90 Representations and Warranties by the Company. the Company hereby
represents and warrants to the Stockholders as follows:
36
(a) the Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware.
(b) the Company has the full right, power and authority to enter
into this Agreement and to carry out the transactions contemplated hereby. The
execution and delivery of this Agreement by the Company and the consummation by
the Company of the transactions contemplated hereby have been duly authorized by
all requisite action on the part of the Company. This Agreement has been duly
executed and delivered by the Company and is a legal, valid and binding
obligation of the Company, enforceable in accordance with its terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws and general principles of equity.
(c) There is no material claim, and no legal action, suit,
arbitration, governmental investigation or other legal or administrative
proceeding pending or threatened against, or relating to the Company or any of
its respective material properties or businesses, which would if adversely
determined prevent or impede the consummation of, or have a material adverse
effect on, any of the transactions contemplated by this Agreement nor is there
any basis known to the Company for any such action, investigation or proceeding.
37
100 Term and Termination.
10.1 Term. This Agreement is effective as of the date hereof and,
unless earlier terminated, shall continue in force until the dissolution or
liquidation of the Company.
10.2 Effect of Termination. Termination of this Agreement shall not
affect or impair any rights or obligations that arise prior to or at the time of
the termination of this Agreement, or which may arise by reason of an event
causing the termination of this Agreement, and all such rights and obligations,
including the rights and obligations under any provision of this Agreement,
which by their terms are to survive termination, shall also survive. The rights
and remedies provided in this Agreement and in such other agreements shall be
cumulative and not exclusive and shall be in addition to any other rights and
remedies which the Stockholders may have under this Agreement or otherwise.
110 Miscellaneous.
11.1 Entire Agreement. This Agreement supersedes all prior oral and
written agreements between the parties with respect to the subject matter
hereof, and this Agreement and the other documents and agreements between the
parties which are referred to herein or executed contemporaneously herewith set
forth the entire agreement among the parties with respect to the transactions
contemplated hereby.
38
11.2 Amendment. Any term of this Agreement may be amended and the
observance of any such term may be waived (either generally or in a particular
instance and either retroactively or prospectively) only with the written
consent of (i) the Board and (ii) Stockholders holding at least 67% of the
outstanding Shares held by Stockholders and their Permitted Transferees (after
notice to all Stockholders of the proposal to adopt such amendment). Anything in
this Section 11.2 to the contrary notwithstanding, (i) none of the terms of this
Agreement may be amended in a manner that would adversely affect the rights
hereunder of the Xxxxx Principals under Sections 2 and 7 without their prior
written consent and (ii) none of the terms of this Agreement may be amended in a
manner that would adversely affect the rights hereunder of the Ashton Executives
and Ashton under Sections 2 and 7 without their prior written consent, as the
case may be. Any amendment so adopted shall become effective upon the giving of
notice of such adoption to all of the Stockholders. Each Stockholder shall be
bound by any amendment or waiver adopted in accordance with this Section 11.2,
whether or not such Stockholder shall have consented thereto.
11.3 Binding Effect. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective heirs and permitted
successors and assigns. Except as otherwise expressly provided herein, neither
this Agreement nor any rights or obligations hereunder shall be assignable or
otherwise transferable by any party, voluntarily or by operation
39
of law, without the prior written consent of the other parties hereto, and any
assignment or transfer without such consent shall be null and void.
11.4 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original and all of which
taken together shall constitute a single agreement.
11.5 Governing Law. This Agreement is made under and shall be
governed by and construed in accordance with the laws of the State of Delaware
(without regard to the conflict of laws principles thereof).
11.6 Further Assurances. Each party shall, at any time and from time
to time after the date hereof, do, execute, acknowledge and deliver, or cause to
be done, executed, acknowledged and delivered, all such further acts, deeds,
assignments, transfers, conveyances, powers of attorney, receipts,
acknowledgments, acceptances and assurances as may be reasonably required to
procure for any party, his, her or its successors and assigns, the benefits
intended to be conferred upon such party under this Agreement.
11.7 Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by reason of any rule of law
or public policy, all other conditions and provisions of this Agreement shall
nevertheless
40
remain in full force and effect so long as the economic or legal substance of
the transactions or agreements of the parties contemplated hereby are not
affected in any manner materially adverse to any party. Upon the determination
that any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in a mutually acceptable manner.
11.8 Negotiation and Arbitration. (a) The parties shall attempt in
good faith to resolve any dispute arising out of or relating to this Agreement
promptly by negotiation. If a matter in dispute has not been resolved within 60
days of a party's request for negotiation, any of the parties to the dispute may
initiate arbitration as provided hereinafter. Any dispute arising out of or
relating to this Agreement or the breach, termination or validity thereof,
including, without limitation, the determination of the scope or applicability
of this agreement to arbitrate, which has not been resolved by negotiation
within 60 days after a party's request for negotiation shall be settled by
arbitration before a panel of three arbitrators in the State of Massachusetts.
The arbitration shall be governed by the Federal Arbitration Act and
administered by the American Arbitration Association under its Commercial
Arbitration Rules, provided that persons eligible to be selected as arbitrators
shall be limited to persons who are either (i) retired judges of the state or
Federal courts in New York or Massachusetts or (ii) attorneys-at-law who have
engaged in the
41
private practice of law in the Borough of Manhattan or the city of Boston for at
least 10 years concentrating either in general commercial litigation or general
corporate and commercial matters. To assure the parties that disputes and
controversies subject to arbitration will be resolved expeditiously, the
arbitration hearing shall occur within 60 days after the arbitration is
initiated and any discovery prior to the arbitration hearing shall be limited
(including no more than two depositions per party). The arbitrators shall not
have authority to award punitive or exemplary damages. Each of the parties
shall, subject to the award of the arbitrators, pay an equal share of the
arbitrators' fees. The arbitrators shall have the power to award recovery of all
costs (including attorneys' fees, administrative fees, arbitrators' fees and
court costs) to the prevailing party. Judgment upon the award rendered may be
entered in any court having jurisdiction.
(b) No provision of, nor the exercise of any rights under, this
Section 11.8 shall limit the right of any party to request and obtain from a
court of competent jurisdiction before, during or after the pendency of any
arbitration, provisional or ancillary remedies and relief including, but not
limited to, the remedies provided for in Section 11.9. The institution and
maintenance of an action or judicial proceeding for, or pursuit of, provisional
or ancillary remedies shall not constitute a waiver of the right of any party,
even if it is the plaintiff, to submit the dispute to arbitration if such party
would otherwise have such right. Each of the parties hereby, for purposes of
42
this provision, submits unconditionally to the non-exclusive jurisdiction of the
state and federal courts located in the State of New York, Borough of Manhattan,
waives objection to the venue of any proceeding in any such court or that any
such court provides an inconvenient forum and consents to the service of process
upon it in connection with any proceeding instituted under this Section 11.8 in
the same manner as provided for the giving of notice hereunder.
11.9 Equitable Relief. Since a party may sustain irreparable harm in
the event there is a breach of any of the covenants contained in this Agreement,
in addition to any other rights or remedies which a party may have under this
Agreement or otherwise (including the rights to require negotiation and
arbitration in accordance with Section 11.8), a party shall be entitled to
obtain specific performance or injunctive relief against any other party in any
court of competent jurisdiction for the purposes of restraining the other party
from any actual or threatened breach of any of such covenants or to compel such
other party to perform any of such covenants, without the necessity of proving
irreparable injury or the inadequacy of remedies at law or posting bond or other
security.
11.10 Notices. Any and all notices, requests, demands, consents and
other communications required or permitted under this Agreement shall be in
writing, signed by or on behalf of the party by which given, and shall be
considered to have been duly given when (i) delivered by hand, (ii) sent by
telecopier
43
(with receipt confirmed), provided that a copy is mailed (on the same date) by
first class mail, postage prepaid, or (iii) received by the addressee, if sent
by Express Mail, Federal Express or other reputable express delivery service
(receipt requested), or by first class certified or registered mail, return
receipt requested, postage prepaid, in each case to the appropriate addresses
and telecopier numbers set forth below (or to such other addresses and
telecopier numbers as a party may from time to time designate as to itself by
notice similarly given to the other parties in accordance herewith). A notice of
change of address shall not be deemed given until received by the addressee.
Notice shall be given:
(1) to the Company at:
Xxxxx Advisors, Inc.
00 Xxxxxx Xxxx, Xxxxx 00
Xxxxxxx, XX 00000
Attn: President
Telecopier: (000) 000-0000
(2) to Ashton at:
The Ashton Technology Group, Inc.
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxxxx, XX 00000
Attn: President
Telecopier: (000) 000-0000
(3) to the Ashton Executives at:
c/o The Ashton Technology Group, Inc.
0000 Xxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxxxx, XX 00000
Attn: President
Telecopier: (000) 000-0000
44
(4) to the Xxxxx Principals at:
c/x Xxxxx Advisors, Inc.
00 Xxxxxx Xxxx, Xxxxx 00
Xxxxxxx, XX 00000
Attn: President
Telecopier: (000) 000-0000
11.11 Additional Stockholders. Notwithstanding anything to the
contrary contained herein, in connection with the issuance of Common Stock to an
employee of Ashton pursuant to Section 6.3 of the Exchange Agreement, the
parties agree to permit such person to become a party to this Agreement and
succeed to all of the rights and obligations of a "Stockholder" and "Ashton
Executive" under this Agreement by obtaining an executed counterpart signature
page to this Agreement, and, upon such execution, such person shall for all
purposes be a "Stockholder" and "Ashton Executive" party to this Agreement.
45
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed, and the Stockholders have executed this Agreement, as of the date
first above written.
XXXXX ADVISORS, INC.
By: /s/ Xxxxx Xxxxx
----------------------------------------------
Name: Xxxxx Xxxxx
Title: CEO
THE ASHTON TECHNOLOGY GROUP, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxxxx
----------------------------------------------
Name: Xxxxxxx X. Xxxxxxxxxxx
Title: President & CEO
/s/ Xxxxx Xxxxx
--------------------------------------------------
XXXXX XXXXX
/s/ Xxxx X. Xxxx
--------------------------------------------------
XXXX X. XXXX
/s/ Xxxxxxxxx X. Xxxxx
--------------------------------------------------
XXXXXXXXX XXXXX
/s/ Xxxxxxx X. Xxxxxxxxxxx
--------------------------------------------------
XXXXXXX X. XXXXXXXXXXX
46
/s/ K. Xxxx X. Xxxxxxx
--------------------------------------------------
K. XXXX X. XXXXXXX
/s/ Xxxxxx X. Xxxxx
--------------------------------------------------
XXXXXX X. XXXXX
47
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed, and the Stockholders have executed this Agreement, as of the date
first above written.
/s/ Xxxxxxx Xxxxxxxx
--------------------------------------------------
XXXXXXX XXXXXXXX
/s/ Xxxx Xxxxx
--------------------------------------------------
Xxxx Xxxxx
/s/ Xxxxxxx Xxxxxx
--------------------------------------------------
Xxxxxxx Xxxxxx
/s/ Xxxx Xxxxxxxx
--------------------------------------------------
Xxxx Xxxxxxxx
48
