EXHIBIT 4.2
EXECUTION COPY
REGISTRATION RIGHTS AGREEMENT
BY AND AMONG
CMH HOLDINGS, INC.
AND
THE INVESTORS
AS DEFINED HEREIN
AND
THE FOUNDERS
AS DEFINED HEREIN
DATED AS OF MARCH 31, 2005
TABLE OF CONTENTS
Page
----
1. CERTAIN DEFINITIONS...............................................................2
2. DEMAND REGISTRATIONS..............................................................3
3. FORM S-3..........................................................................5
4. PIGGYBACK REGISTRATION............................................................5
5. REGISTRATION PROCEDURES...........................................................6
6. EXPENSES..........................................................................9
7. INDEMNIFICATION...................................................................9
8. COMPLIANCE WITH RULE 144.........................................................12
9. AMENDMENTS.......................................................................12
10. TRANSFERABILITY OF REGISTRATION RIGHTS...........................................12
11. RIGHTS WHICH MAY BE GRANTED TO SUBSEQUENT INVESTORS..............................12
12. DAMAGES..........................................................................12
13. MISCELLANEOUS....................................................................13
14. DISPUTE RESOLUTION...............................................................14
15. NO WAIVER........................................................................14
EXHIBITS
Exhibit A - Form of Joinder Agreement
i
REGISTRATION RIGHTS AGREEMENT
THIS
REGISTRATION RIGHTS AGREEMENT (the "Agreement") is dated as of March
31, 2005, by and among CMH Holdings, Inc., a Delaware corporation (together with
any successor thereto, "NEW HOLDINGS"), the persons designated as Investors on
the signature pages hereto and any assignees thereof (each, an "INVESTOR" and
collectively, the "INVESTORS"), and the persons or entities designated as
Founders on the signature pages hereto and any transferee thereof who executes
and delivers a joinder agreement in the form of EXHIBIT A hereto (each, a
"FOUNDER" and collectively, the "FOUNDERS").
WHEREAS, prior to the date hereof, certain Investors and Founders (the
"TMHC FOUNDERS") were the holders of capital stock of TMHC Holdings, Inc., a
Delaware corporation ("TMHC"), and certain Investors and Founders (the "XXXXXXX
Founders") were the holders of capital stock of Xxxxxxx Holdings, Inc., a
Delaware corporation ("XXXXXXX");
WHEREAS, on the date hereof, New Holdings, Xxxxxxx, TMHC, the Investors and
the Founders are entering into a certain Contribution and Share Exchange
Agreement (the "SHARE EXCHANGE AGREEMENT"), pursuant to which, among other
things, the Investors and the Founders are exchanging their shares of TMHC
capital stock and Xxxxxxx capital stock, as applicable, for shares of Common
Stock and Convertible Preferred Stock (each as defined below) of New Holdings;
WHEREAS, TMHC, the TMHC Founders and certain of the Investors are parties
to a certain
Registration Rights Agreement, dated as of May 24, 2004 (the "PRIOR
TMHC AGREEMENT"), and, in connection with the Share Exchange Agreement, the
parties thereto desire to terminate the Prior TMHC Agreement in its entirety and
enter into this Agreement for purposes of setting forth certain mutual
agreements and understandings among them;
WHEREAS, Xxxxxxx, the Xxxxxxx Founders and certain of the Investors are
parties to a certain
Registration Rights Agreement, dated as of August 2, 2004
(the "PRIOR XXXXXXX AGREEMENT"), and, in connection with the Share Exchange
Agreement, the parties thereto desire to terminate the Prior Xxxxxxx Agreement
in its entirety and enter into this Agreement for purposes of setting forth
certain mutual agreements and understandings among them; and
WHEREAS, it is a condition precedent to each of the parties' obligations
under the Share Exchange Agreement that this Agreement be executed by the
parties hereto, and the parties are willing to execute this Agreement and be
bound by the provisions hereof; and
WHEREAS, the parties hereto desire to agree upon certain terms regarding
their rights and obligations with respect to the securities of New Holdings, now
or hereafter outstanding and held by them.
NOW, THEREFORE, in consideration of the premises, as an inducement to the
Founders and the Investors to consummate the transactions contemplated by the
Share Exchange Agreement, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, New Holdings, the
Founders and the Investors hereby covenant and agree with each other as follows:
1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meanings:
"BOARD OF DIRECTORS" means the Board of Directors of New Holdings.
"COMMISSION" shall mean the United States Securities and Exchange
Commission, or any other federal agency at the time administering the Securities
Act and the Exchange Act.
"COMMON STOCK" shall mean, collectively, (a) the common stock, par
value $0.01 per share, of New Holdings, (b) the Class B common stock, par value
$0.01 per share, of New Holdings, and (c) any other common equity securities
issued by New Holdings, and, in each case, any other shares of stock issued or
issuable with respect thereto (whether by way of a stock dividend or stock split
or in exchange for or upon conversion of such shares or otherwise in connection
with a combination of shares, recapitalization, merger, consolidation or other
corporate reorganization).
"CONVERTIBLE PREFERRED STOCK" shall mean, collectively, (a) the Series
A convertible preferred stock, par value $0.01 per share, of New Holdings, and
(b) the Series B convertible preferred stock, par value $0.01 per share, of New
Holdings, and, in each case, any other shares of stock issued or issuable with
respect thereto (whether by way of a stock dividend or stock split or in
exchange for or upon conversion of such shares or otherwise in connection with a
combination of shares, recapitalization, merger, consolidation or other
corporate reorganization).
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended from time to time, or any similar successor federal statute, and the
rules and regulations of the Commission thereunder, all as the same shall be in
effect at the time.
"MAJORITY INTEREST" shall mean Investors and Founders holding not less
than a majority of the outstanding Registrable Securities (on an as converted
basis) held by all Investors and Founders.
"OPTIONS" shall mean options to purchase Common Stock issued by New
Holdings, including, but not limited to, options issued under New Holdings' 2005
Stock Option and Grant Plan (including options received subsequent to the date
of this Agreement), together with any shares or other securities issued or
issuable with respect thereto (whether by way of a stock dividend or stock split
or in exchange for or in replacement of such Options or otherwise in connection
with a combination of shares, recapitalization, merger, consolidation or other
corporation reorganization).
"PERSON" shall mean any individual, corporation, joint venture, trust,
unincorporated organization, limited liability company, partnership, government
and any agency or political subdivision thereof.
"REGISTRABLE SECURITIES" shall mean (i) any shares of Common Stock
(including Class B Common Stock) held by the Investors or Founders, or subject
to acquisition: (A) by any Founder upon exercise of the Options owned by such
Founder or (B) by any Investor upon
2
conversion of the Convertible Preferred Stock (it being understood that for
purposes of this Agreement, a Founder or Investor will be deemed to be a holder
of Registrable Securities whenever such Founder or Investor has the right to
then acquire or obtain from New Holdings any Registrable Securities, whether or
not such acquisition has actually been effected), and (ii) any other securities
issued and issuable with respect to any such shares described in clause (i)
above by way of a stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization; PROVIDED, HOWEVER, that if a Founder owns Options or an Investor
owns Convertible Preferred Stock, the Founder or Investor may exercise its
registration rights hereunder by exercising the Options for, or by converting
the shares of Convertible Preferred Stock into, the shares of Common Stock to be
sold under the relevant registration statement as of the closing of the relevant
offering and shall not be required to cause such Options to be exercised for
Common Stock or such Convertible Preferred Stock to be converted to Common
Stock, unless and until such closing occurs, it being understood that New
Holdings shall at the request of the relevant Founder or Investor effect the
reconversion of Common Stock, acquired upon exercise of the Options or
conversion of Convertible Preferred Stock, to Options or Convertible Preferred
Stock, as applicable, if such an exercise or conversion occurs, notwithstanding
the foregoing, and the relevant offering does not close; and PROVIDED, FURTHER,
that any Common Stock that is sold in a registered sale pursuant to an effective
registration statement under the Securities Act or pursuant to Rule 144
thereunder shall not be deemed to be Registrable Securities, and that any Common
Stock that may be sold (as confirmed by an unqualified opinion of counsel to New
Holdings) without restriction as to volume or otherwise pursuant to Rule 144(k)
under the Securities Act shall not be deemed to be Registrable Securities.
"REGISTRATION EXPENSES" shall mean the expenses so described in
Section 6 hereof.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended
from time to time, or any similar successor federal statute, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect at
the time.
2. DEMAND REGISTRATIONS.
(a) At any time after the initial public offering of New Holdings'
Common Stock pursuant to an effective registration under the Securities Act (the
"IPO"), a Majority Interest may request that New Holdings register under the
Securities Act all or any portion of the Registrable Securities held by such
Majority Interest; PROVIDED that all such requests shall be made in writing and
shall state the number of shares of Registrable Securities to be disposed of and
the intended method of disposition of such shares; and PROVIDED, FURTHER, that
such registration shall not become effective prior to the six month anniversary
of the effectiveness of New Holdings' IPO. Upon receipt of such request, New
Holdings shall promptly deliver notice of such request to all holders of
Registrable Securities, if any, who shall then have thirty (30) days to notify
New Holdings in writing of their desire to be included in such registration. If
the request for registration contemplates an underwritten public offering, New
Holdings shall state such in the written notice and in such event the right of
any holder of Registrable Securities to participate in such registration shall
be conditioned upon their participation in such underwritten public offering and
the inclusion of their Registrable Securities in the underwritten public
3
offering to the extent provided herein. New Holdings will use its best efforts
to expeditiously effect the registration of all Registrable Securities whose
holders request participation in such registration under the Securities Act and
to qualify such Registrable Securities for sale under any state blue sky law;
provided, however, that New Holdings shall not be required to effect
registration pursuant to a request under this Section 2 more than three (3)
times for the holders of the Registrable Securities as a group. Notwithstanding
anything to the contrary contained herein, no request may be made under this
Section 2 within ninety (90) days after the effective date of a registration
statement filed by New Holdings covering a firm commitment underwritten public
offering in which the holders of Registrable Securities shall have been entitled
to join pursuant to this Section 2 or Section 4 hereof and in which there shall
have been effectively registered all shares of Registrable Securities as to
which registration shall have been so requested. New Holdings may postpone the
filing or the effectiveness of any registration statement pursuant to this
Section 2 for a reasonable time period, provided that such postponements shall
not exceed ninety (90) days in the aggregate during any twelve (12) month
period, if (i) New Holdings has been advised by legal counsel that such filing
or effectiveness would require disclosure of a material financing, acquisition
or other corporate transaction, and the Board of Directors of New Holdings
determines in good faith that such disclosure is not in the best interests of
New Holdings and its stockholders, or (ii) the Board of Directors of New
Holdings determines in good faith that there is a valid business purpose or
reason for delaying filing or effectiveness. A registration will not count as a
requested registration under this Section 2(a) until the registration statement
relating to such registration has been declared effective by the Commission at
the request of the initiating Majority Interest; provided, however, that if a
Majority Interest shall request, in writing, that New Holdings withdraw a
registration statement which has been filed under this Section 2(a) but not yet
been declared effective, a Majority Interest may thereafter request New Holdings
to reinstate such registration statement, if permitted under the Securities Act,
or to file another registration statement, in accordance with the procedures set
forth herein.
(b) If a registration requested pursuant to Section 2(a) involves an
underwritten public offering and the managing underwriter of such offering
determines in good faith that the number of securities sought to be offered
should be limited due to market conditions, then the number of securities to be
included in such underwritten public offering shall be reduced to a number
deemed satisfactory by such managing underwriter; provided, however, that the
shares to be excluded shall be determined in the following sequence: (i) first,
securities held by any Persons not having registration rights, (ii) second,
securities held by any Persons having contractual, incidental "piggy back"
registration rights to include such securities in the registration statement
pursuant to an agreement which is not this Agreement, (iii) third, shares sought
to be registered by New Holdings for its own account, and (iv) fourth,
Registrable Securities held by holders who requested such registration pursuant
to Section 2(a) or who joined such requested registration pursuant to Section
2(a), it being understood that no shares shall be registered for the account of
New Holdings or any stockholder other than the holders of Registrable Securities
unless all Registrable Securities for which holders thereof have requested
registration have been registered. If there is a reduction of the number of
Registrable Securities pursuant to clauses (i), (ii), or (iv), such reduction
shall be made on a pro rata basis (based upon the aggregate number of shares of
Common Stock or Registrable Securities held by the holders in each tranche and
subject to the priorities set forth in the preceding sentence).
4
(c) With respect to a request for registration pursuant to Section
2(a) which is for an underwritten public offering, the managing underwriter
shall be chosen by a Majority Interest of the Registrable Securities to be sold
in such offering, subject to New Holdings' consent, which consent shall not be
unreasonably withheld. New Holdings may not cause any other registration of
securities for sale for its own account (other than a registration effected
solely to implement an employee benefit plan or a transaction to which Rule 145
of the Securities Act is applicable) to become effective within one hundred
eighty (180) days following the effective date of any registration required
pursuant to this Section 2.
3. FORM S-3. New Holdings shall use its best efforts to qualify and
remain qualified to register securities on Form S-3 (or any comparable successor
form) under the Securities Act. For so long as New Holdings is qualified to
register securities on Form S-3 (or any comparable successor form), an Investor
or Investors or a Founder or Founders holding Registrable Securities anticipated
to have an aggregate sale price (net of underwriting discounts and commissions,
if any) in excess of $500,000 shall have the right, on one or more occasions, to
request registration on Form S-3 (or any comparable successor form) for the
Registrable Securities held by such requesting Investor or Investors or Founder
or Founders. Such requests shall be in writing and shall state the number of
shares of Registrable Securities to be disposed of and the intended method of
disposition of such shares by such Investor or Investors or Founder or Founders.
New Holdings shall give notice to all other Investors and Founders holding
Registrable Securities of the receipt of a request for registration pursuant to
this Section 3 and such Investors and Founders shall then have thirty (30) days
to notify New Holdings in writing of their desire to participate in the
registration. New Holdings shall use its best efforts to effect promptly the
registration of all shares on Form S-3 (or any comparable successor form) to the
extent requested by such Investors or Founders; PROVIDED, HOWEVER, that New
Holdings may postpone the filing or the effectiveness of any registration
statement pursuant to this Section 3 for a reasonable period of time, provided
that such postponements shall not exceed ninety (90) days in the aggregate
during any twelve (12) month period, if (i) New Holdings has been advised by
legal counsel that such filing or effectiveness would require disclosure of a
material financing, acquisition or other corporate transaction, and the Board of
Directors of New Holdings determines in good faith that such disclosure is not
in the best interests of New Holdings and its stockholders or (ii) the Board of
Directors determines in good faith that there is a valid business purpose or
reason for delaying filing or effectiveness.
4. PIGGYBACK REGISTRATION. If New Holdings shall propose to register any
of its Common Stock or securities convertible into or exchangeable or
exercisable for any of its Common Stock under the Securities Act for sale to the
public, whether in connection with a public offering of securities by New
Holdings (including, but not limited to, an IPO), a public offering of
securities by stockholders, or both (but not including pursuant to a demand
under Section 2 hereof which shall be handled as provided therein), and except
(i) with respect to registration statements on Forms X-0, X-0 or another form
not available for registering the Registrable Securities for sale to the public,
and (ii) in connection with a registration effected solely to implement an
employee benefit plan or a transaction to which Rule 145 or any other similar
rule of the Commission under the Securities Act is applicable), New Holdings
shall promptly give written notice at the applicable address of record to each
holder of Registrable Securities of its intention to do so. Upon the written
request of any of such holder, given within thirty (30) days after receipt by
such holder of such notice, New Holdings shall, subject to the
5
limits contained in this Section 4, use its best efforts to cause all such
Registrable Securities of said requesting holder to be registered under the
Securities Act and qualified for sale under any state blue sky law, all to the
extent required to permit such sale or other disposition of said Registrable
Securities. Notwithstanding the foregoing, if New Holdings is advised in writing
in good faith by any managing underwriter of New Holdings' securities being
offered in a public offering pursuant to such registration statement that the
amount to be sold by Persons other than New Holdings (collectively, "Selling
Stockholders") is greater than the amount which can be offered without adversely
affecting the offering, New Holdings may reduce the amount offered for the
accounts of Selling Stockholders (including Selling Stockholders holding
Registrable Securities) to a number deemed satisfactory by such managing
underwriter. In such event, the shares to be excluded shall be determined in the
following sequence: (A) first, securities held by any Persons not having
registration rights, (B) second, securities held by any Persons having
contractual, incidental "piggyback" registration rights to include such
securities in the registration statement pursuant to an agreement which is not
this Agreement, and (C) third, the Registrable Securities sought to be included
by the holders thereof requesting such registration pursuant to this Section 4.
If there is a reduction of the number of Registrable Securities pursuant to
clauses (A), (B) or (C), such reduction shall be made on a pro rata basis (based
upon the aggregate number of shares of Common Stock or Registrable Securities
held by the holders in each tranche and subject to the priorities set forth in
the preceding sentence).
5. REGISTRATION PROCEDURES. If and whenever New Holdings is required by
the provisions of this Agreement to use its best efforts to effect the
registration of any of its securities under the Securities Act, New Holdings
will, as expeditiously as possible:
(a) prepare and file with the Commission a registration statement on
the appropriate form under the Securities Act with respect to such securities,
which form shall comply as to form with the requirements of the applicable form
and include all financial statements required by the Commission to be filed
therewith, and use its best efforts to cause such registration statement to
become and remain effective until completion of the proposed offering;
(b) prepare and file with the Commission such amendments,
post-effective amendments, and supplements to such registration statement and
the prospectus used in connection therewith as may be necessary to keep such
registration statement effective as contemplated herein and to comply with the
provisions of the Securities Act with respect to the sale or other disposition
of all securities covered by such registration statement whenever the seller or
sellers of such securities shall desire to sell or otherwise dispose of the
same, but only to the extent provided in this Agreement;
(c) furnish to each selling holder and the underwriters, if any, such
number of copies of such registration statement, any amendments thereto, any
documents incorporated by reference therein, the prospectus, including a
preliminary prospectus, in conformity with the requirements of the Securities
Act, and such other documents as such selling holder may reasonably request in
order to facilitate the public sale or other disposition of the securities owned
by such selling holder;
6
(d) register or qualify the securities covered by such registration
statement under the securities or state "blue sky" laws of such jurisdictions as
each selling holder may request, and do any and all other acts and things which
may be necessary under such state securities or "blue sky" laws to enable such
selling holder to consummate the public sale or other disposition in such
jurisdictions of the securities owned by such selling holder; provided that New
Holdings shall not be required to register or qualify the securities in any
jurisdictions which require it to qualify to do business or subject itself to
general service of process therein;
(e) within a reasonable time before each filing of the registration
statement or prospectus or amendments or supplements thereto with the
Commission, furnish to counsel selected by the holders of Registrable Securities
copies of such documents proposed to be filed, which documents shall be subject
to the approval of such counsel, which approval shall not be unreasonably
withheld;
(f) immediately notify each selling holder of Registrable Securities,
such selling holders' counsel and any underwriter and (if requested by any such
Person) confirm such notice in writing, of the happening of any event which
makes any statement made in the registration statement or related prospectus
untrue, or which requires the making of any changes in such registration
statement or prospectus so that they will not contain any 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 not misleading; and thereafter,
prepare and file with the Commission and furnish a supplement or amendment to
such prospectus so that, as thereafter deliverable to the purchasers of such
Registrable Securities, such prospectus will not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein not misleading;
(g) use its best efforts to prevent the issuance of any order
suspending the effectiveness of a registration statement, and if one is issued
immediately notify each selling holder of Registrable Securities of the receipt
of such notice and use its reasonable best efforts to obtain the withdrawal of
any order suspending the effectiveness of a registration statement at the
earliest possible moment;
(h) if requested by the managing underwriter or underwriters (if
any), any selling holder, or such selling holder's counsel, promptly incorporate
in a prospectus supplement or post-effective amendment such information as such
Person requests to be included therein with respect to the selling holder or the
securities being sold, including, without limitation, with respect to the
securities being sold by such selling holder to such underwriter or
underwriters, the purchase price being paid therefor by such underwriter or
underwriters and with respect to any other terms of an underwritten offering of
the securities to be sold in such offering, and promptly make all required
filings of such prospectus supplement or post-effective amendment;
(i) make available to each selling holder, any underwriter
participating in any disposition pursuant to a registration statement, and any
attorney, accountant or other agent or representative retained by any such
selling holder or underwriter (collectively, the "Inspectors"), all financial
and other records, pertinent corporate documents and properties of New Holdings
(collectively, the "Records"), as shall be reasonably necessary to enable them
to exercise their due diligence responsibility, and cause New Holdings'
officers, directors and employees to
7
supply all information requested by any such Inspector in connection with such
registration statement subject, in each case, to such confidentiality agreements
as New Holdings shall reasonably request;
(j) enter into any reasonable underwriting agreement required by the
proposed managing underwriter or underwriter(s) for the selling holders, if any,
and use its best efforts to facilitate the public offering of the securities;
provided, however, that no selling holder shall be required to make any
representations or warranties other than with respect to its title to the
Registrable Securities and any written information provided by it to New
Holdings specifically for use in the registration statement, and if the proposed
managing underwriter or underwriter(s) require that representations or
warranties be made and that indemnification be provided, New Holdings shall make
all such representations and warranties and provide all such indemnities,
including, without limitation, in respect of New Holdings' business, operations
and financial information and the disclosures relating thereto in the
prospectus;
(k) request that each prospective selling holder be furnished a
signed counterpart, addressed to the prospective selling holder, of (i) an
opinion of counsel for New Holdings, dated the effective date of the
registration statement, and (ii) if and to the extent permitted by applicable
professional standards, a "comfort" letter signed by the independent public
accountants who have certified New Holdings' financial statements included in
the registration statement, covering substantially the same matters with respect
to the registration statement (and the prospectus included therein) and (in the
case of the accountants' letter) with respect to events subsequent to the date
of the financial statements, as are customarily covered (at the time of such
registration) in opinions of New Holdings' counsel and in accountants' letters
delivered to the underwriters in underwritten public offerings of securities;
(l) cause the securities covered by such registration statement to be
listed on the securities exchange or quoted on the quotation system on which the
similar securities issued by New Holdings are then listed or quoted (or, if the
Common Stock is not yet listed or quoted, then on such exchange or quotation
system as the selling holders of Registrable Securities and New Holdings shall
determine);
(m) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission and make generally available to its
stockholders, in each case as soon as practicable, but not later than thirty
(30) days after the close of the period covered thereby, an earnings statement
of New Holdings which will satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder (or any comparable successor provisions);
(n) from and after the date of New Holdings' IPO, comply with all
applicable requirements of the Xxxxxxxx-Xxxxx Act and all applicable listing
requirements, and in connection therewith establish and maintain a system of
adequate internal financial controls and a Board of Directors comprised of a
majority of independent directors which directors shall comprise the audit
committee and be members of the compensation and nominating and governance
committees;
8
(o) during the period when the prospectus is required to be delivered
under the Securities Act, promptly file all documents required to be filed with
the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act;
(p) appoint a transfer agent and registrar for all Registrable
Securities covered by a registration statement not later than the effective date
of such registration statement;
(q) in connection with an underwritten offering, to the extent
reasonably requested by the managing underwriter for the offering or the selling
holders, participate in and support customary efforts to sell the securities in
the offering, including, without limitation, participating in "road shows"; and
(r) otherwise cooperate with the underwriter(s), the Commission and
other regulatory agencies and take all reasonable actions and execute and
deliver or cause to be executed and delivered all documents reasonably necessary
to effect the registration of any securities under this Agreement.
6. EXPENSES. All expenses incurred by New Holdings and the holders of
Registrable Securities being registered in a registration provided for in
Sections 2, 3 and 4, including, without limitation, all registration and filing
fees, printing expenses, reasonable fees and disbursements of counsel for New
Holdings and one counsel for the Investors holding Registrable Securities and
who are participating in such registration as a group (selected by a majority in
interest of such Investors who participate in the registration) and one counsel
for each of the Xxxxxxx Founders and the TMHC Founders holding Registrable
Securities and who are participating in such registration as a group (selected
by a majority in interest of such Xxxxxxx Founders and TMHC Founders, as
applicable, who participate in such registration) (such fees and disbursements
for each of Investors' counsel, Xxxxxxx Founders' counsel and TMHC Founders'
counsel, in each case, not to exceed $10,000), underwriting expenses (other than
commissions or discounts), expenses of any audits incident to or required by any
such registration and expenses of complying with the securities or blue sky laws
of any jurisdictions (all of such expenses referred to as "Registration
Expenses"), shall be paid by New Holdings.
7. INDEMNIFICATION.
(a) Incident to any registration statement referred to in this
Agreement, and subject to applicable law, New Holdings shall indemnify and hold
harmless each underwriter (as defined in the Securities Act) and each holder of
Registrable Securities (including its partners (including partners of partners
and stockholders of any such partners), stockholders, members, trustees, and
directors, officers, employees and agents of any of them), and each person who
controls any of them within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act (a "Controlling Person") who offers or sells any
such Registrable Securities in connection with such registration statement, from
and against any and all losses, claims, expenses, damages or liabilities, joint
or several (including any investigation, legal and other expenses incurred in
connection with, and any amount paid in settlement of, any action, suit or
proceeding or any claim asserted), as the same are incurred to which they, or
any of them, may become subject under the Securities Act, the Exchange Act,
other federal or state statutory law or regulation, at common law, or otherwise,
insofar as such losses, claims, expenses, damages or
9
liabilities (or action in respect thereof) arise out of or are based upon (i)
any untrue statement or alleged untrue statement of any material fact contained,
on the effective date thereof, in any registration statement under which such
securities were registered under the Securities Act (including any preliminary
prospectus or final prospectus contained therein, or any amendment or supplement
thereto), (ii) any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or (iii) any violation by New Holdings of the Securities Act, any
state securities or "blue sky" laws or any rule or regulation thereunder in
connection with such registration. Except as otherwise provided in Section 7(d),
New Holdings shall reimburse each such indemnified party in connection with
investigating or defending any such liability as expenses in connection with the
same are incurred. New Holdings shall not be liable to any indemnified party,
however, in any such case to the extent that any such liability arises out of or
is based upon any untrue statement or alleged untrue statement or omission or
alleged omission made in such registration statement, preliminary or final
prospectus, or amendment or supplement thereto in reliance upon and in
conformity with information furnished in writing to New Holdings by such
indemnified party specifically for use therein, and New Holdings shall not be
required to indemnify any indemnified party against any liability arising from
any untrue or misleading statement or omission contained in any preliminary
prospectus if such deficiency is corrected in the final prospectus or for any
liability which arises out of the failure of any indemnified party to deliver a
prospectus as required by the Securities Act.
(b) Each holder selling Registrable Securities included in such
registration being effected shall, severally and not jointly, indemnify and hold
harmless each underwriter (as defined in the Securities Act), New Holdings
(including its directors, officers, employees and agents), and each other
selling holder (including its partners (including partners of partners and
stockholders of any such partners), stockholders, members, trustees and
directors, officers, employees and agents of any of them), and each person who
controls any of them within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, from and against any and all losses, claims,
damages, expenses and liabilities, joint or several, to which they, or any of
them, may become subject under the Securities Act, the Exchange Act or other
federal or state statutory law or regulation, at common law, or otherwise to the
same extent provided in Section 7(a) above, insofar as such liability (or
actions in respect thereof) arises out of or is based upon (i) any untrue
statement or alleged untrue statement of any material fact contained, on the
effective date thereof, in any registration statement under which securities
were registered under the Securities Act at the request of such selling holder,
any preliminary prospectus or final prospectus contained therein, or any
amendment or supplement thereto, or (ii) any omission or alleged omission by
such selling holder to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in the case
of both (i) and (ii) to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in such registration statement, preliminary or final prospectus, amendment or
supplement thereto in reliance upon and in conformity with information furnished
in writing to New Holdings by such selling holder specifically for use therein.
In no event, however, shall the liability of any selling holder for
indemnification under this Section 7 in its capacity as a seller of Registrable
Securities exceed the lesser of (A) that proportion of the total of such losses,
claims, damages, expenses or liabilities indemnified against equal to the
proportion of the total securities sold under such registration statement which
is being sold by such selling holder, or (B) the amount equal to the proceeds to
such selling
10
holder of the securities sold in any such registration. Further, no selling
holder shall be required to indemnify any Person against any liability arising
from any untrue or misleading statement or omission contained in any preliminary
prospectus if such deficiency is corrected in the final prospectus or for any
liability which arises out of the failure of any Person to deliver a prospectus
as required by the Securities Act.
(c) If the indemnification provided for in this Section 7 for any
reason is held by a court of competent jurisdiction to be unavailable to an
indemnified party in respect of any losses, claims, damages, expenses or
liabilities referred to therein, then each indemnifying party under this Section
7, in lieu of indemnifying such indemnified party thereunder, shall contribute
to the amount paid or payable by such indemnified party as a result of such
losses, claims, damages, expenses or liabilities (i) in such proportion as is
appropriate to reflect the relative benefits received by New Holdings, the
selling holders and the underwriters from the offering of the Registrable
Securities, or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect not
only the relative benefits referred to in clause (i) above but also the relative
fault of New Holdings, the selling holders and the underwriters in connection
with the statements or omissions which resulted in such losses, claims, damages,
expenses or liabilities, as well as any other relevant equitable considerations.
The relative benefits received by New Holdings, the selling holders and the
underwriters shall be deemed to be in the same respective proportions that the
net proceeds from the offering (before deducting expenses) received by New
Holdings and the selling holders, and the underwriting discount received by the
underwriters, in each case as set forth in the table on the cover page of the
applicable prospectus, bear to the aggregate public offering price of the
Registrable Securities. The relative fault of New Holdings, the selling holders
and the underwriters shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by New Holdings, the selling holders or the underwriters and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
(d) New Holdings, the selling holders and the underwriters agree that
it would not be just and equitable if contribution pursuant to this Section 7
were determined by pro rata or per capita allocation or by any other method of
allocation which does not take account of the equitable considerations referred
to in the immediately preceding paragraph. In no event, however, shall a selling
holder be required to contribute any amount under this Section 7(d) in excess of
the lesser of (A) that proportion of the total of such losses, claims, damages,
expenses or liabilities indemnified against equal to the proportion of the total
Registrable Securities sold under such registration statement which are being
sold by such selling holder, or (B) the proceeds received by such selling holder
from its sale of Registrable Securities under such registration statement. No
Person found 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 found guilty of such fraudulent misrepresentation.
(e) The indemnification and contribution provided for in this Section
7 will remain in full force and effect regardless of any investigation made by
or on behalf of the indemnified parties or any officer, director, employee,
agent or controlling person of the indemnified parties. The obligations under
this Section 7 shall survive the completion of any
11
offering of Registrable Securities in a registration statement and the
termination of this Agreement. No indemnifying party, in the defense of any such
claim or litigation, shall consent to the entry of any judgment or enter into
any settlement without the indemnified party's prior written consent unless the
sole relief provided is monetary damages that are paid in full by the
indemnifying party. Unless waived by the indemnified party, all judgments and
settlements must include as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified party of a release from all liability
to the claimant or plaintiff with respect to such claim or litigation.
8. COMPLIANCE WITH RULE 144. In the event that New Holdings (a) registers
a class of securities under Section 12 of the Exchange Act, or (b) shall
commence to file reports under Section 13 or 15(d) of the Exchange Act, New
Holdings will use its best efforts thereafter to file with the Commission such
information as is required under the Exchange Act for so long as there are
holders of Registrable Securities; and in such event, New Holdings shall use its
best efforts to take all action as may be required as a condition to the
availability of Rule 144 or Rule 144A under the Securities Act (or any
comparable successor rules). New Holdings shall furnish to any holder of
Registrable Securities upon request a written statement executed by New Holdings
as to the steps it has taken to comply with the current public information
requirement of Rule 144 or Rule 144A (or such comparable successor rules).
9. AMENDMENTS. The provisions of this Agreement may not be modified or
amended except in writing signed by New Holdings, a Majority Interest, the
Xxxxxxx Founders holding a majority of the Shares held by all Xxxxxxx Founders
and the TMHC Founders holding a majority of the Shares held by all TMHC
Founders; PROVIDED, HOWEVER, that any proposed modification or amendment that,
by its terms, could reasonably be expected to adversely affect the rights of any
Investor or Founder in a manner different from other Investors or Founders
hereunder shall require the prior written consent of such adversely affected
Investor or Founder.
10. TRANSFERABILITY OF REGISTRATION RIGHTS. The registration rights set
forth in this Agreement are transferable and assignable to any transferee of
Registrable Securities. Each subsequent holder of Registrable Securities must
consent in writing to be bound by the terms and conditions of this Agreement in
order to acquire the rights granted pursuant to this Agreement; provided that,
for the avoidance of doubt, each transferee of a Founder will acquire the rights
of a Founder and be treated as a "Founder" hereunder, and each transferee of an
Investor will acquire the rights of an Investor and be treated as an "Investor"
hereunder.
11. RIGHTS WHICH MAY BE GRANTED TO SUBSEQUENT INVESTORS. Other than
transferees as contemplated by Section 10, New Holdings shall not, without the
prior written consent of a Majority Interest, (a) allow purchasers of New
Holdings' securities to become a party to this Agreement, or (b) grant any other
registration rights to any third parties other than subordinate piggyback
registration rights.
12. DAMAGES. New Holdings recognizes and agrees that each holder of
Registrable Securities will not have an adequate remedy if New Holdings fails to
comply with the terms and provisions of this Agreement and that damages will not
be readily ascertainable, and New Holdings expressly agrees that, in the event
of such failure, it shall not oppose an application by any holder of Registrable
Securities or any other Person entitled to the benefits of this
12
Agreement requiring specific performance of any and all provisions hereof or
enjoining New Holdings from continuing to commit any such breach of this
Agreement.
13. MISCELLANEOUS.
(a) All notices, requests, demands and other communications provided
for hereunder shall be in writing and mailed (by first class registered or
certified mail, postage prepaid), telegraphed, sent by express overnight courier
service or electronic facsimile transmission (with a copy by mail), or delivered
to the applicable party at the addresses indicated below:
IF TO NEW HOLDINGS:
x/x XX Xxxxxxxxxx, Xxx.
Xxxx Xxxxxx Xxxxx, Xxxxx 0000
000 Xxxx Xxxxxx, Xxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxx
Telecopy No.: (000) 000-0000
IF TO THE INVESTORS:
TA Associates, Inc.
Xxxx Xxxxxx Xxxxx, Xxxxx 0000
000 Xxxx Xxxxxx, Xxxxxx, XX 00000
Attn: Xxxxx X. Xxxxxx
Telecopy No.: (000) 000-0000
TA Associates, Inc.
00 Xxxxxx Xxxx
Xxxxx Xxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxxxxx and Xxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
Madison Capital Funding LLC
00 Xxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxxxx Account Manager
Facsimile No.: 000-000-0000
Xxxxxx Family Holdings LLC
0000 Xxxx Xxxxxx
Xxx Xxxxxx, XX 00000
Facsimile No.: (000) 000-0000
13
IF TO ANY OTHER HOLDER OF REGISTRABLE SECURITIES:
At such Person's address for notice as set forth on the signature
pages hereto
or, as to each of the foregoing, at such other address as shall be designated by
such Person in a written notice to other parties complying as to delivery with
the terms of this subsection (a). All such notices, requests, demands and other
communications shall, when mailed, telegraphed or sent, respectively, be
effective (i) two days after being deposited in the mails or (ii) one day after
being delivered to the telegraph company, deposited with the express overnight
courier service or sent by electronic facsimile transmission, respectively,
addressed as aforesaid.
(b) This Agreement shall be governed by and construed in accordance
with the laws of the State of
New York, without giving effect to conflicts of
laws principles thereof.
(c) This Agreement may be executed in two or more counterparts, each
of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
(d) If any provision of this Agreement shall be held to be illegal,
invalid or unenforceable, such illegality, invalidity or unenforceability shall
attach only to such provision and shall not in any manner affect or render
illegal, invalid or unenforceable any other provision of this Agreement, and
this Agreement shall be carried out as if any such illegal, invalid or
unenforceable provision were not contained herein.
(e) This Agreement is intended by the parties as a final expression
of their agreement and intended to be complete and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject
matter contained herein. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter,
including, without limitation, the Prior Xxxxxxx Agreement and the Prior TMHC
Agreement, which agreements are hereby terminated.
14. DISPUTE RESOLUTION. All disputes, claims, or controversies arising out
of or relating to this Agreement, or any other agreement executed and delivered
pursuant to this Agreement, or the negotiation, validity or performance hereof
and thereof or the transactions contemplated hereby or thereby, that are not
resolved by mutual agreement shall be resolved in accordance with the provisions
set forth in Sections 5.7 and 5.8 of the Share Exchange Agreement.
15. NO WAIVER. No provision of this Agreement shall be construed to limit,
waive, amend or alter the terms and provisions of the Credit Agreement (the
"Credit Agreement"), dated as of August 2, 2004, among Xxxxxxx Services, Inc.
(formerly known as Xxxxxxx GRP, Inc.), a Delaware corporation and wholly-owned
subsidiary of Xxxxxxx (the "Company"), the Lenders (as defined therein) and
Madison Capital Funding LLC ("Madison") and the other Loan Documents (as defined
in the Credit Agreement) or any rights or remedies available to Madison and its
Affiliates thereunder. This restriction shall terminate only at such time as the
Company
14
and its Affiliates shall have paid in full any and all Obligations (as defined
in the Credit Agreement) pursuant to the terms of the Credit Agreement and the
other Loan Documents and no disputes remain outstanding between the Company and
Madison and its Affiliates with respect thereto.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
15
IN WITNESS WHEREOF, the parties hereto have caused this
Registration Rights
Agreement to be duly executed as of the date first set forth above.
HOLDINGS:
CMH HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President
FOUNDERS:
/s/ Xxxxxxxx Xxx Xxxxx
-----------------------------------------------
Xxxxxxxx Xxx Xxxxx
Address For Notice:
c/o The Murrayhilll Company
-----------------------------------------------
0000 Xxxxxxx Xxxxxx, Xxxxx 0000,
-----------------------------------------------
Xxxxxx, Xxxxxxxx 00000
-----------------------------------------------
/s/ Xxxxxx Xxxxx
-----------------------------------------------
Xxxxxx Xxxxx
Address For Notice:
c/o Braddock Financial Corporation
-----------------------------------------------
Xxxxx Center, 0000 00xx Xxxxxx, Xxxxx 000
-----------------------------------------------
Xxxxxx, XX 00000
-----------------------------------------------
Facsimile: (000) 000-0000
/s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------------
Xxxxxxx X. Xxxxxxx
Address For Notice:
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
/s/ Xxxxx Xxxxx
-----------------------------------------------
Xxxxx Xxxxx
Address For Notice:
00 Xxxxxxxxx XX
-----------------------------------------------
Basking Ridge, JN 07920
-----------------------------------------------
/s/ Xxxxx Xxxxxx
-----------------------------------------------
Xxxxx Xxxxxx
Address For Notice:
0 Xxxxx Xxxxxxx Xxxxx
-----------------------------------------------
Xxxx, XX 00000
-----------------------------------------------
-----------------------------------------------
BNS FAMILY IRREVOCABLE GRANTOR
TRUST
By: /s/ Xxxxxxxx Xxxxxxx
------------------------------------------
Name: Xxxxxxxx Xxxxxxx
Title: Authorized Person
Address For Notice:
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
XXXXXXX CHARITABLE REMAINDER
UNITRUST
By: /s/ Xxxxxxx X. Xxxxxxx
-------------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Authorized Person
Address For Notice:
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
INVESTORS:
TA IX L.P.
By: TA Associates IX LLC, its General Partner
By: TA Associates, Inc., its Manager
By:/s/ Xxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxx
Its: Managing Director
TA/ATLANTIC AND PACIFIC IV L.P.
By: TA Associates AP IV L.P., its General Partner
By: TA Associates, Inc., its General Partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxx
Its: Managing Director
TA STRATEGIC PARTNERS FUND A L.P.
By: TA Associates SPF L.P., its General Partner
By: TA Associates, Inc., its General Partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxx
Its: Managing Director
TA STRATEGIC PARTNERS FUND B L.P.
By: TA Associates SPF L.P., its General Partner
By: TA Associates, Inc., its General Partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxx
Its: Managing Director
TA INVESTORS II, L.P.
By: TA Associates, Inc., its General Partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxx
Its: Managing Director
TA SUBORDINATED DEBT FUND, L.P.
By: TA Associates SDF LLC, its General Partner
By: TA Associates, Inc., its Manager
By: /s/ Xxxxx X. Xxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxx
Its: Managing Director
MADISON CAPITAL FUNDING LLC
By: /s/ Xxxxx X. Xxxxxx
--------------------------------
Name: Xxxxx X. Xxxxxx
Its: Managing Director
XXXXXX FAMILY HOLDINGS LLC
By: /s/ Xxxxx Xxxxxx
--------------------------------
Name: Xxxxx Xxxxxx
Its:
