REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into as of , 1996, by and between LARSCOM INCORPORATED, a
Delaware corporation (the "Company"), and XXXX XXXXXXX INC., a Delaware
corporation ("AJI").
WHEREAS, this Agreement is made in connection with the registration
under the Securities Act for sale to the public by AJI of shares of Class A
Common Stock of the Company pursuant to a registration statement on Form S-1 and
any amendments thereto originally filed with the SEC on , 1996 (File
No. 333- ) (the "Initial Public Offering");
WHEREAS, prior to the Initial Public Offering, AJI owned 100% of the
issued and outstanding shares of Common Stock of the Company and upon
consummation of the Initial Public Offering, assuming no exercise of the
Overallotment Option, AJI will own approximately % of the outstanding Common
Stock; and
WHEREAS, the Company and AJI desire to enter into this Agreement
pursuant to which AJI, or any Affiliate of AJI that may acquire shares of Common
Stock of the Company from AJI, has the right to cause the Company, upon request,
to register with the SEC an offering and sale of shares of Common Stock of the
Company owned by AJI or any such Affiliate, subject to the terms of this
Agreement.
NOW, THEREFORE, in consideration of the premises and the agreements
herein contained, the parties of this Agreement agree as follows:
1. DEFINITIONS
As used in this Agreement, the capitalized terms shall have the
meanings set forth in the prospectus for the Initial Public Offering, unless
otherwise expressly set forth herein.
ADVICE: See the last paragraph of Section 5 hereof.
AFFILIATE: Any Person controlling or controlled by or under direct or
indirect common control with AJI; PROVIDED, that in no event shall the Company
be treated as an Affiliate of AJI, nor shall any Person directly or indirectly
controlled by the Company (including, without
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limitation, its officers, directors and employees) as a result of such Person's
relationship with the Company be treated as an Affiliate of AJI. For the
purposes of this definition, "control" means the power to direct the management
and policies of a Person, directly or indirectly, through the ownership of
securities, by contract or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
AGENT: Any Person authorized to act and who acts on behalf of AJI or
any Affiliate of AJI with respect to the transactions contemplated by the
Agreement.
COMMON STOCK: Shares of the Company's Class A Common Stock, par value
$.01 per share, and Class B Common Stock, par value $.01 which is convertible
into Class A Common Stock, as the same may be constituted from time to time.
COMPANY NOTICE: See Section 4 hereof.
DEMAND REGISTRATION: See Section 3(a) hereof.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended, and
the rules and regulations thereunder, as in effect from time to time.
INITIAL PUBLIC OFFERING: See Recitals.
OVERALLOTMENT OPTION: The option granted to the underwriters of the
Initial Public Offering by AJI and Larscom, respectively to purchase up to an
additional and shares, respectively, of Common Stock.
PERSON: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
PIGGYBACK NOTICE: See Section 4 hereof.
PIGGYBACK REGISTRATION STATEMENT: See Section 4.
PROSPECTUS: The prospectus included in any Registration Statement, as
amended or supplemented by any prospectus supplement with respect to the terms
of the offering of any portion of the Registrable Securities covered by the
Registration Statement and all other
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amendments and supplements to the Prospectus, including post-effective
amendments and all material incorporated by reference in such Prospectus.
REGISTRATION EXPENSES: See Section 6 hereof.
REGISTRABLE SECURITIES: (i) The Shares and (ii) any securities issued
or issuable with respect to the Shares by way of a stock dividend or stock split
or in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization, until such Shares or other securities are
not Restricted Securities as defined in Section 2(a); PROVIDED, HOWEVER, that
Shares sold pursuant to the Overallotment Option shall not be Registrable
Securities.
REGISTRATION STATEMENT: Any registration statement of the Company
which covers Registrable Securities pursuant to the provisions of this
Agreement, including (i) the Prospectus, (ii) amendments and supplements to such
Registration Statement, (iii) post-effective amendments, (iv) all exhibits and
all material incorporated by reference in such Registration Statement, (v) any
registration statement pursuant to a Demand Registration and (vi) any Piggyback
Registration Statement.
RESTRICTED SECURITIES: The Registrable Securities upon original
issuance thereof, subject to the provisions of Section 2(a) hereof.
SECURITIES ACT: The Securities Act of 1933, as amended from time to
time.
SEC: The Securities and Exchange Commission.
SHARES: The shares of Common Stock held by AJI as of ,
1996.
UNDERWRITTEN OFFERING: The offering and sale of securities of the
Company covered by any Registration Statement pursuant to a firm commitment
underwriting to an underwriter at a fixed price for reoffering or pursuant to
agency or best efforts arrangements with an underwriter.
Unless the context otherwise requires: (i) "or" is not exclusive; and
(ii) words in the singular include the plural and in the plural include the
singular.
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2. SECURITIES SUBJECT TO THIS AGREEMENT
(a) REGISTRABLE SECURITIES. The securities entitled to the benefits
of this Agreement are the Registrable Securities but, with respect to any
particular Registrable Security, only so long as such security continues to be
a Restricted Security. A Registrable Security ceases to be a Restricted
Security when (i) it has been effectively registered under the Securities Act
and disposed of in accordance with the Registration Statement covering it,
(ii) it has been distributed pursuant to Rule 144 (or any similar provisions
then in force) under the Securities Act, (iii) it has otherwise been transferred
and a new certificate or other evidence or ownership for it not bearing a legend
restricting transfer under the Securities Act and not subject to any stop
transfer order has been delivered by or on behalf of the Company and no other
restriction on transfer exists or (iv) it ceases to be outstanding.
(b) HOLDERS OF REGISTRABLE SECURITIES. Any reference herein to a
"Holder" or "Holders" of Registrable Securities shall mean AJI or any other
Person to whom AJI has transferred any of the Registrable Securities. A Holder
shall be deemed to be a holder of Registrable Securities whenever it owns
Registrable Securities or securities which are convertible into or exercisable
for Registrable Securities whether or not such conversion or exercise has
actually been effected and disregarding any legal restrictions upon such
conversion or exercise.
3. DEMAND REGISTRATION
(a) REQUESTS FOR REGISTRATION. At any time after 240 days from the
date of closing of the Initial Public Offering, a Holder may make a written
request for registration with the SEC under and in accordance with the
provisions of the Securities Act of all or part of the Registrable Securities (a
"Demand Registration"). All requests made pursuant to this Section 3(a) shall
specify the number of Registrable Securities to be registered and the intended
methods of disposition thereof. All such requests shall be delivered to the
Company in accordance with the provisions of Section 8(d) of this Agreement.
(b) NUMBER OF, AND LIMITATIONS ON, REGISTRATIONS. The Holders will
be entitled to request an aggregate of three Demand Registrations, one per
twelve-month period during each of the three twelve-month periods immediately
following
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240 days from the date of closing of the Initial Public Offering. The Company
will not be obligated to register any Registrable Securities pursuant to such a
Demand Registration unless there is requested to be included in such
registration at least 10% of the Registrable Securities then outstanding or, if
such number of shares represents less than 10% of the Shares, all of the
Registrable Securities then outstanding.
(c) SELECTION OF UNDERWRITERS. If any of the Registrable Securities
covered by a Demand Registration are to be sold in an underwritten offering, or
in a best efforts underwritten offering, the investment banker or investment
bankers and manager or managers that will administer the offering will be
selected by the Holders.
(d) The Company shall not grant to any Person any right to demand
registration or piggyback registration of any securities of the Company in
respect of a Demand Registration made pursuant to this Section 3.
4. PIGGYBACK REGISTRATION RIGHTS
REQUESTS FOR PIGGYBACK REGISTRATION. The Company covenants and agrees
with each Holder that in the event the Company proposes to file at any time and
from time to time after 240 days from the date of closing of the Initial Public
Offering a registration statement on any form for the general registration of
securities under the Securities Act with respect to the offering of any class of
security other than in connection with an offering solely to the Company's
employees pursuant to a registration statement on Form S-8 under the Securities
Act or an offering pursuant to a registration statement on Form S-4 under the
Securities Act, or any successor forms thereto (a "Piggyback Registration
Statement"), then the Company shall in each such case give written notice (a
"Company Notice") of such proposed filing to each Holder so that the Company
Notice is received by each Holder at least twenty (20) business days before the
anticipated filing date, and such notice shall offer to each Holder the
opportunity to include in such Piggyback Registration Statement such number of
Registrable Securities as each may request. Notwithstanding the foregoing, the
Company shall not be obligated to register the Registrable Securities of any
Holder (i) unless there shall have been received by the Company, within ten (10)
business days of receipt of the Company Notice by such Holder, written notice (a
"Piggyback Notice") from such Holder, which notice shall set forth the number of
Registrable Securities to be so included, or (ii) such Registrable Securities
can be
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transferred without registration in accordance with the Rule 144 under the
Securities Act or any other exemption from the registration provisions thereof
(other than Rule 144A).
The Company shall use its reasonable best efforts to cause the
underwriter of a proposed offering, if any, to permit the Holders holding
Registrable Securities requested to be included in the Piggyback Registration
Statement to include such Registrable Securities in the proposed offering on
terms and conditions at least as favorable to the Holders holding such
Registrable Securities as those offered with respect to the other securities of
the Company included therein. Notwithstanding the foregoing, if any underwriter
shall advise the Company in writing that, in its opinion, the distribution of
the Registrable Securities requested to be included in the Piggyback
Registration Statement concurrently with the securities being registered by the
Company would materially adversely affect the distribution of such securities by
the Company, then (i) if the securities being offered by the Company include
Common Stock (other than shares of Common Stock issuable on the conversion or
exchange of other securities then being offered), the Holders holding such
Registrable Securities shall delay their offering and sale for such period, not
to exceed ninety (90) calendar days, as such underwriter shall request, or
(ii) if the securities being offered by the Company do not include Common Stock,
the Holders holding such Registrable Securities shall withdraw their offering
and sale, as such underwriter shall request; PROVIDED, that the Holders holding
such Registrable Securities shall have no obligation to delay or withdraw if the
offering includes a secondary offering of any securities other than such
Registrable Securities. In the event of the delay described in clause (i) in
the preceding sentence, the Company shall file such supplements and
post-effective amendments, and take any such other steps as may be necessary to
permit such Holders to make their proposed offering and sale for a period of
ninety (90) calendar days immediately following the end of such period of delay.
5. REGISTRATION PROCEDURES
Whenever a Holder has requested that any Registrable Securities be
registered pursuant to this Agreement, the Company will promptly take all such
actions as may be necessary or desirable to permit the sale of such Registrable
Securities in accordance with the intended method or methods of disposition
thereof, and pursuant thereto the Company will promptly:
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(a) with respect to a request for a Demand Registration, use its best
efforts to prepare and file with the SEC, not later than 60 days after receipt
of such request (which 60-day period may be extended by the Company for up to an
additional 30 days if at the time of such request the Company is engaged to a
significant extent in negotiations looking toward its participation in a
material merger, acquisition or other form of business combination and if, by
reason of such negotiations, the Company is not in a position to timely prepare
and file the Registration Statement) a Registration Statement on a form for
which the Company then qualifies which is satisfactory to the Company and the
Holders (unless the offering is made on an underwritten basis, including on a
best efforts underwriting basis, in which event the managing underwriter or
underwriters shall determine the form to be used) and which form shall be
available for the sale of the Registrable Securities in accordance with the
intended method or methods of distribution thereof, and use its best efforts to
cause such Registration Statement to become effective; the Company shall not
file any Registration Statement pursuant to Section 3 or any amendment thereto
or any Prospectus or any supplement thereto (including such documents
incorporated by reference) to which the Holders or the underwriters, if any,
shall reasonably object in light of the requirements of the Securities Act or
any other applicable laws or regulations;
(b) before filing a Registration Statement or Prospectus or any
amendments or supplements thereto (excluding documents to be incorporated by
reference therein filed after the effectiveness of the Registration Statement),
the Company will, five business days prior to filing, furnish to the Holders and
the underwriters, if any, copies of all such documents in substantially the form
proposed to be filed (including documents incorporated therein by reference), to
enable the Holders and the underwriters, if any, to review such documents prior
to the filing thereof, and the Company shall make such reasonable changes
thereto (including changes to documents incorporated by reference) as may be
reasonably requested by the Holders and the managing underwriter or
underwriters, if any;
(c) prepare and file with the SEC such amendments and post-effective
amendments to the Registration Statement as may be necessary to keep the
Registration Statement continuously effective for a period of not less than
180 days or such longer period as is required for the intended method of
distribution, or such shorter period which will terminate when
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all Registrable Securities covered by such Registration Statement have been sold
or withdrawn; cause the Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424 under the
Securities Act; and comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such Registration
Statement during the applicable period in accordance with the intended methods
of disposition by the Holders thereof set forth in such Registration Statement
or supplement to the Prospectus;
(d) notify the Holders and the managing underwriters, if any,
promptly, and confirm such advice in writing, (1) when the Prospectus or any
Prospectus supplement or post-effective amendment has been filed, and, with
respect to the Registration Statement or any post-effective amendment, when the
same has become effective, (2) of any request by the SEC for amendments or
supplements to the Registration Statement or the Prospectus or for additional
information, (3) of the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any proceedings
for that purpose, (4) if at any time the representations and warranties of the
Company contemplated by paragraph (o) below cease to be true and correct, (5) of
the receipt by the Company of any notification with respect to the suspension of
the qualification of the Registrable Securities for sale in any jurisdiction or
the initiation or threatening of any proceeding for such purpose, and (6) of the
happening of any event which makes any statement made in the Registration
Statement, the Prospectus or any document incorporated therein by reference
untrue or which requires the making of any changes in the Registration
Statement, the Prospectus or any document incorporated therein by reference in
order to make the statements therein not misleading, so that, in the case of the
Registration Statement, it 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 that in the case
of the Prospectus, it 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, in light of the circumstances under which they were
made, not misleading;
(e) make every reasonable effort to obtain the withdrawal of any
order suspending the effectiveness of the Registration Statement at the earliest
possible moment;
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(f) as promptly as practicable after the filing with the SEC of any
document which is incorporated by reference into the Registration Statement or
the Prospectus (after initial filing of the Registration Statement) provide
copies of such document to counsel to the Holders and to the managing
underwriters, if any;
(g) furnish to the Holders and each managing underwriter, if any,
without charge, at least one signed copy of the Registration Statement and any
post-effective amendment thereto, including financial statements and schedules,
all documents incorporated therein by reference and all exhibits (including
those incorporated by reference) and a reasonable number of conformed copies of
all such documents;
(h) deliver to the Holders and the underwriters, if any, as many
copies of the Prospectus (including each preliminary prospectus) and any
amendment or supplement thereto as such Persons may reasonably request; the
Company consents to the use of the Prospectus or any amendment or supplement
thereto by the Holders and the underwriters, if any, in connection with the
offering and sale of the Registrable Securities covered by the Prospectus or any
amendment or supplement thereto;
(i) prior to the date on which the Registration Statement is declared
effective, use its best efforts to register or qualify or cooperate with the
Holders and the underwriters, if any, and their respective counsel in connection
with the registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or blue sky laws of such jurisdictions as any seller or underwriter
reasonably requests in writing and do any and all other acts or things necessary
or advisable to enable the disposition in such jurisdictions of the Registrable
Securities covered by the Registration Statement; PROVIDED, that the Company
will not be required to qualify generally to do business in any jurisdiction
where it is not then so qualified or to take any action which would subject it
to general service of process in any such jurisdiction where it is not then so
subject;
(j) cooperate with the Holders and the managing underwriters, if any,
to facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any restrictive legends; and
enable such Registrable Securities to be in such denominations and registered in
such names as the managing underwriters, if any,
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or the Holders may request at least two business days prior to any such sale of
Registrable Securities;
(k) use its best efforts to cause the Registrable Securities covered
by the Registration Statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the seller or
sellers thereof or the underwriters, if any, to consummate the disposition of
such Registrable Securities;
(l) upon the occurrence of any event contemplated by paragraph (d)(6)
above, prepare a supplement or post-effective amendment to the Registration
Statement or the Prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable Securities, the Prospectus will not contain an
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading;
(m) use its best efforts to cause all Registrable Securities covered
by the Registration Statement to be listed on each securities exchange or
authorized to be quoted on the National Association of Securities Dealers
Automated Quotation ("NASDAQ") National Market if similar securities issued by
the Company are then so listed or authorized, if requested by the Holders or the
managing underwriters, if any;
(n) provide a transfer agent and registrar for all Registrable
Securities;
(o) enter into such agreements (including an underwriting agreement)
and take all such other actions in connection therewith as the Holders or the
managing underwriters, if any, reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities;
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(p) make available for inspection during normal business hours by the
Holders, any underwriter participating in any disposition pursuant to such
Registration Statement, and any attorney, accountant or other agent retained by
any such Holder or underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause the Company's
officers, directors and employees to supply all information reasonably requested
by any such Holder, underwriter, attorney, accountant or agent in connection
with such Registration Statement; PROVIDED, that any records, information or
documents that are designated by the Company in writing as confidential shall be
kept confidential by such Persons;
(q) otherwise use its best efforts to comply with all applicable
rules and regulations of the SEC, and make generally available to its security
holders, earnings statements satisfying the provisions of Section 11(a) of the
Securities Act, no later than 45 days after the end of any 12-month period
(1) commencing at the end of any fiscal quarter in which Registrable Securities
are sold to underwriters in a firm or best efforts underwriting offering, and
(2) beginning with the first month of the Company's first fiscal quarter
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commencing after the effective date of the Registration Statement, which
statements shall cover said 12-month periods.
The Company may require the Holders to furnish to the Company such
information and documents regarding the distribution of the Registrable
Securities and the Holders as the Company may from time to time reasonably
request in writing.
The Holders each agree by acquisition of such Registrable Securities
that, upon receipt of any notice from the Company of the happening of any event
of the kind described in Section 5(d)(6) hereof, such Holder will forthwith
discontinue disposition of Registrable Securities until such Holder's receipt of
the copies of the supplemented or amended Prospectus contemplated by
Section 5(1) hereof, or until it is advised in writing (the "Advice") by the
Company that the use of the Prospectus may be resumed, and has received copies
of any additional or supplemental filings which are incorporated by reference in
the Prospectus, and, if so directed by the Company, each Holder will, or will
request the underwriters (if any) to, deliver to the Company (at the Company's
expense) all copies, other than permanent file copies then in such Holder's
possession, of the Prospectus covering such Registrable Securities current at
the time of receipt of such notice. If the Company shall give such notice, the
time periods mentioned in Section 5(c) hereof shall be extended by the number of
days during the period from and including the date of the giving of such notice
pursuant to Section 5(d)(6) to and including the date when the Holders shall
have received the copies of the supplemented or amended prospectus contemplated
by Section 5(1) hereof or the Advice.
6. REGISTRATION EXPENSES
Except as otherwise provided herein, all expenses incident to the
Company's performance of or compliance with this Agreement will be borne by the
Company, whether or not a Registration Statement is filed or becomes effective,
including, without limitation, all registration and filing fees, including with
respect to filings required to be made with the National Association of
Securities Dealers, Inc. (the "NASD") fees and expenses of compliance with
securities or blue sky laws (including reasonable fees and disbursements of
counsel for the underwriters, if any, in connection with blue sky qualifications
of the Registrable Securities and determination of their eligibility for
investment under the laws of such jurisdictions as the managing underwriters or
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holders of a majority of the Registrable Securities being sold may designate),
printing expenses, messenger, telephone and delivery expenses, and fees and
disbursements of counsel for the Company and of all independent certified public
accountants (including the expenses of any special audit and "cold comfort"
letters required by or incident to such performance), the fees and expenses
incurred in connection with the listing of the securities to be registered on
any securities exchange or authorized to be quoted on NASDAQ, the reasonable
fees and expenses of any special experts retained by the Holders or by the
Company at the request of the managing underwriters in connection with such
registration and fees and expenses of other Persons retained by the Holders
(including, without limitation, any qualified independent underwriter or other
independent appraiser participating pursuant to the Bylaws of the NASD) (all
such expenses being herein called "Registration Expenses"). The Company shall
also pay its internal expenses (including, without limitation, all salaries and
expenses of its officers and employees performing legal or accounting duties)
and the expense of any annual audit, which are not "Registration Expenses" for
purposes of this Agreement. In no event shall the Company be liable for the
payment of any discounts or commissions of underwriters, selling brokers, dealer
managers or similar industry professionals relating to the distribution of the
Registrable Securities or any related fees and disbursements of counsel retained
by the Holders (if any). Each Holder shall be liable for the cost and expense
of the time spent by its officers, employees and Agents incurred in connection
with the registration of Registrable Securities owned by it.
7. INDEMNIFICATION
(a) INDEMNIFICATION BY COMPANY. The Company will indemnify and hold
harmless, to the full extent permitted by law, each Holder, its officers and
directors, their Agents and each Person who controls each such Holder (within
the meaning of the Securities Act) against all losses, claims, damages,
liabilities and expenses to which any such Person may be subject, under the
Securities Act or otherwise, and reimburse all such Persons for any legal or
other expenses incurred with investigating or defending against any such losses,
claims, damages or liabilities, insofar as such losses, claims, damages or
liabilities arise out of or are based upon any untrue or alleged untrue
statement of a material fact contained in a Registration Statement, Prospectus
or preliminary prospectus or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
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statements therein not misleading, except insofar as the same arise out of or
are based upon an untrue statement of a material fact or omission of a material
fact required to be stated therein or necessary to make the statements therein
not misleading, which statement or omission is made therein in reliance upon and
in conformity with information furnished in writing to the Company by such
Holder, expressly for use therein. The Company will also indemnify
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in the distribution, their officers and directors
and each Person who controls such Persons (within the meaning of the Securities
Act) to the same extent as provided above with respect to the indemnification of
each Holder of Registrable Securities.
(b) INDEMNIFICATION BY HOLDERS. Each Holder will, severally and not
jointly, indemnify and hold harmless, to the full extent permitted by law, the
Company, its directors and officers and each Person who controls the Company
(within the meaning of the Securities Act) against any losses, claims, damages,
liabilities and expenses to which any such Person may be subject, under the
Securities Act or otherwise, insofar as such losses, claims, damages or
liabilities arise out of or are based upon any untrue or alleged untrue
statement of a material fact contained in a Registration Statement or Prospectus
or preliminary prospectus or any omission or alleged omission of a material
fact required to be stated therein or necessary to make the statements therein
not misleading, to the extent, but only if and to the extent, that such untrue
or alleged untrue statement or omission or alleged omission is made therein in
reliance upon and in conformity with the information furnished in writing by
such Holder specifically for inclusion therein. In no event shall the liability
of a Holder hereunder be greater in amount than the dollar amount of the net
proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation, unless such liability arises
out of or is based on willful conduct by such Holder. The Company shall be
entitled to receive indemnities from underwriters, selling brokers, dealer
managers and similar securities industry professionals participating in the
distribution, to the same extent as provided above with respect to information
so furnished in writing by such Persons.
(c) CONDUCT OF INDEMNIFICATION PROCEEDINGS. Any Person entitled to
indemnification hereunder will (i) give prompt notice to the indemnifying party
of any claim with respect to which it seeks indemnification and (ii) unless, in
such indemnified party's reasonable judgment, a conflict of interest may exist
between such indemnified and indemnifying
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parties with respect to such claim, permit such indemnifying party to assume at
its own expense the defense of such claim. The indemnified party shall have the
right to participate in the conduct of such defense by the indemnifying party
provided that it will pay for the fees of its own counsel. Whether or not such
defense is assumed by the indemnifying party, the indemnifying party will not be
subject to any liability for any settlement made without its consent (but such
consent will not be unreasonably withheld). No indemnifying party will consent
to entry into any judgment or enter into any settlement which does not include
as an unconditional term thereof the giving of the claimant or plaintiff to such
indemnified party of a release from all liability in respect to such claim or
litigation. An indemnifying party who is not entitled to, or elects not to,
assume the defense of a claim will not be obligated to pay the fees and expenses
of more than one counsel for all parties indemnified by such indemnifying party
with respect to such claim, unless in the reasonable judgment of any indemnified
party and any other of such indemnified parties with respect to such claim, in
which event the indemnifying party shall be obligated to pay the fees and
expenses of such additional counsel or counsels.
(d) CONTRIBUTION. If the indemnification provided for in
Section 7(a) or 7(b) is unavailable or insufficient to hold harmless an
indemnified party, then each indemnifying party in lieu of indemnifying such
indemnified party shall contribute to the amount paid or payable by such
indemnified party as a result of the losses, liabilities, claims or damages
referred to in Section 7(a) or 7(b) in such proportion as is appropriate to
reflect the relative fault of the indemnifying party on the one hand and any
indemnified party on the other hand in connection with the statements or
omissions which resulted in such losses, liabilities, claims or damages. The
relative fault 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 initially
supplied or developed by the indemnifying party or such indemnified party and
the parties' relative intent, knowledge, access to information and opportunity
to correct such untrue statement or omission. The amount paid by an indemnified
party as a result of the losses, liabilities, claims or damages referred to in
the first sentence of this Section 7(d) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any action or claim which is the subject of this
Section 7(d). No person guilty of fraudulent misrepresentation (within the
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meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
8. FUTURE RESTRICTIONS ON GRANTS REGISTRATION RIGHTS
For such time that AJI owns 50% or more of the voting power of the
Company's Common Stock, the Company shall not grant registration rights to any
other Person without the prior written consent of AJI.
9. MISCELLANEOUS
(a) REMEDIES. AJI and any Affiliate of AJI shall each be entitled to
exercise all rights provided herein or granted by law, including recovery of
damages, and each will be entitled to specific performance of their rights under
this Agreement. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions
of this Agreement and hereby agrees to waive the defense in any action for
specific performance that a remedy at law would be adequate.
(b) NO INCONSISTENT AGREEMENTS. The Company will not on or after the
date of this Agreement enter into any agreement with respect to its securities
which is inconsistent with the rights granted to AJI and any Affiliate of AJI in
this Agreement or otherwise conflicts with the provisions hereof. The Company
has not previously entered into any agreement with respect to its securities
granting any registration rights to any Person.
(c) AMENDMENTS. The Company and AJI may only amend, modify or
supplement this Agreement in such manner as may be agreed upon by both of them
in writing signed by an officer of each party.
(d) WAIVERS. The Company and AJI may only extend the time for, or
waive the performance of, any of the obligations of the other or waive
compliance by the other with any of the covenants or conditions contained in
this Agreement in writing signed by an officer of such party.
(e) NOTICES. Any notice, request, instruction or other document to
be given hereunder shall be in writing and delivered personally or sent by
telecopy or prepaid overnight courier, if to the Company, addressed to the
attention of Xxxxxxx X. Soon, President and Chief Executive Officer, Larscom
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Incorporated, 0000 Xxxxxxx Xxxxx Xxxxx, Xxxxx Xxxxx, XX 00000, Telecopy Number
000-000-0000; and if to AJI, addressed to the attention of Xxxx Xxxx, President
and Chief Executive Officer, Xxxx Xxxxxxx Inc., 000 Xxxxxxxx Xxxxxx, Xxxxxxxx,
XX 00000-0000, Telecopy Number 000-000-0000, with a copy to Xxxxx X. Xxxxx, Vice
President, General Counsel and Secretary, Xxxx Xxxxxxx Inc., 000 Xxxxxxxx
Xxxxxx, Xxxxxxxx, XX 00000-0000, Telecopy Number 000-000-0000. Any notice or
other communication transmitted in accordance with this Section 8(e) shall for
all purposes of this Agreement be treated as given or effective, if personally
delivered, upon receipt, or, if sent by courier, upon the earlier of receipt or
the end of the business day following the date of delivery to such courier, or,
if telecopied, upon transmission and confirmation of receipt.
(f) ENTIRE AGREEMENT. This Agreement embodies the entire agreement
between the parties and any and all prior oral or written agreements,
representations or warranties, contracts, understandings, correspondence,
conversations, and memoranda, whether written or oral, between the Company and
AJI or between any agents, representatives, parents, subsidiaries, affiliates,
predecessors in interest or successors in interest, with respect to the subject
matter hereof, are merged herein and replaced hereby.
(g) ASSIGNABILITY; THIRD-PARTY RIGHTS. Neither this Agreement nor
any of the parties' rights hereunder shall be assignable by any party hereto
without the prior written consent of the other party. In the event that any
such assignment is made, this Agreement shall be binding upon and shall inure
to the benefit of the parties hereto and their respective successors and
assigns. Nothing in this Agreement, express or implied, shall be deemed to
confer upon any other person any rights or remedies under, or by reason of, this
Agreement.
(h) GOVERNING LAW. This Agreement shall be construed in accordance
with the laws of the State of Delaware without giving effect to principles of
conflict of laws. Both parties consent to the jurisdiction of all state and
federal courts of record situated in the State of Delaware. Service of process
upon either party shall be deemed, in every respect, effective upon such party
if made by prepaid registered or certified mail, return receipt requested, or if
personally delivered against receipt to the address set forth in Section 8(e) or
to such other address as a party may designate in writing to the other.
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(i) HEADINGS; DEFINITIONS. The section and other headings contained
in this Agreement are for reference purposes only and shall not in any way
affect the meaning or interpretation of this Agreement. Wherever in this
Agreement words indicating the plural number appear, such words shall be
considered as words indicating the singular number and vice versa where the
context indicates the propriety of such use.
(j) COUNTERPARTS. This Agreement may be executed in counterparts,
each of which when so executed shall be deemed to be an original, and all such
counterparts shall together constitute but one and the same instrument.
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REGISTRATION RIGHTS AGREEMENT
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
LARSCOM INCORPORATED
By: ____________________________
Name:
Title:
XXXX XXXXXXX INC.
By: ____________________________
Name:
Title:
