Exhibit 4.7
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of January 1, 2002, between XXXXXX
CHEMICAL, INC., a New Jersey corporation (the "Company"), XXXXXX HOLDINGS, INC.,
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a Delaware corporation ("Holdings"), and BDS TWO, INC., a Delaware corporation
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("BDS Two" and, together with Xxxxxx, the "Parents").
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RECITALS
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As of the date hereof, Holdings is the holder of 198,974,994 shares of
Common Stock, par value $.01 per share (the "Common Stock"), of the Company and
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BDS Two is the holder of 858,970 shares of Common Stock. The Company desires to
provide to the Parents and to each other Holder (as defined below) rights to
registration under the Securities Act (as defined below) of Registrable
Securities (as defined below), on the terms and subject to the conditions set
forth herein.
AGREEMENT
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1. Definitions. As used in this Agreement, the following
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capitalized terms shall have the following respective meanings:
"Common or Common Equivalent Registrable Securities": Registrable
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Securities which are (i) Common Stock or (ii) Preferred Stock or Warrants that
are convertible into or exchangeable or exercisable for Common Stock.
"Demand Party": (a) Xxxxxx, (b) BDS Two or (c) any other Holder or
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Holders, including, without limitation, any Person that may become an assignee
of either of the Parents' rights hereunder; provided that to be a Demand Party
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under this clause (c), a Holder or Holders must either individually or in
aggregate with all other Holders with whom it is acting together to demand
registration own at least 1% of the total number of Registrable Securities.
"Exchange Act": The Securities Exchange Act of 1934, as amended, or any
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similar federal statute then in effect, and a reference to a particular section
thereof shall be deemed to include a reference to the comparable section, if
any, of any such similar federal statute.
"Holder": The Parents and any other holder of Registrable Securities
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(including any direct or indirect transferees of either of the Parents who
agrees in writing to be bound by the provisions of this Agreement).
"Person": Any individual, partnership, joint venture, corporation,
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trust, unincorporated organization or government or any department or agency
thereof.
"Registrable Securities": Any Common Stock, Preferred Stock or Warrants
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acquired by either of the Parents from the Company or any affiliate of the
Company, Common Stock issued upon the conversion of any Preferred Stock or upon
the exercise of Warrants or otherwise, and any Common Stock, Preferred Stock or
Warrants which may be issued or distributed in respect thereof by way of stock
dividend or stock split or other distribution, recapitalization or
reclassification. Any particular Registrable Securities that are issued shall
cease to be Registrable Securities when (i) a registration statement with
respect to the sale by the Holder of such securities shall have become effective
under the Securities Act and such securities shall have been disposed of in
accordance with such registration statement, (ii) such securities shall have
been distributed to the public pursuant to Rule 144 (or any successor provision)
under the Securities Act, (iii) such securities shall have been otherwise
transferred, new certificates for such securities not bearing a legend
restricting further transfer shall have been delivered by the Company and
subsequent disposition of such securities shall not require registration or
qualification of such securities under the Securities Act or any state
securities or blue sky law then in force, or (iv) such securities shall have
ceased to be outstanding.
"Registration Expenses": Any and all expenses incident to performance of
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or compliance with this Agreement, including, without limitation, (i) all SEC
and stock exchange or National Association of Securities Dealers, Inc. (the
"NASD") registration and filing fees (including, if applicable, the fees and
expenses of any "qualified independent underwriter," as such term is defined in
Schedule E to the By-laws of the NASD, and of its counsel), (ii) all fees and
expenses of complying with securities or blue sky laws (including fees and
disbursements of counsel for the underwriters in connection with blue sky
qualifications of the Registrable Securities), (iii) all printing, messenger and
delivery expenses, (iv) all fees and expenses incurred in connection with the
listing of the Registrable Securities on any securities exchange pursuant to
clause (viii) of Section 4 and all rating agency fees, (v) the fees and
disbursements of counsel for the Company and of its independent public
accountants, including the expenses of any special audits and/or "cold comfort"
letters required by or incident to such performance and compliance, (vi) the
reasonable fees and disbursements of counsel selected pursuant to Section 7
hereof by the Holders of the Registrable Securities being registered to
represent such Holders in connection with each such registration, (vii) any fees
and disbursements of underwriters customarily paid by the issuers or sellers of
securities, including liability insurance if the Company so desires or if the
underwriters so require, and the reasonable fees and expenses of any special
experts retained in connection with the requested registration, but excluding
underwriting discounts and commissions and transfer taxes, if any, and (viii)
other reasonable out-of-pocket expenses of Holders (provided that such expenses
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shall not include expenses of counsel other than those provided for in clause
(vi) above).
"Securities Act": The Securities Act of 1933, as amended, or any
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similar federal statute then in effect, and a reference to a particular section
thereof shall be deemed to include a reference to the comparable section,
if any, of any such similar federal statute.
"SEC": The Securities and Exchange Commission or any other federal agency
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at the time administering the Securities Act or the Exchange Act.
2. Incidental Registrations. (a) Right to Include Common or
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Common Equivalent Registrable Securities. If the Company at any time after the
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date hereof proposes to register its Common Stock (or any security, including,
without limitation, Preferred Stock or Warrants, which is convertible into or
exchangeable or exercisable for Common Stock) under the Securities Act (other
than a registration on Form S-4 or S-8, or any successor or other forms
promulgated for similar purposes), whether or not for sale for its own account,
in a manner which would permit registration of Common or Common Equivalent
Registrable Securities for sale to the public under the Securities Act, it will,
at each such time, give prompt written notice to all Holders of Common or Common
Equivalent Registrable Securities of its intention to do so and of such Holders'
rights under this Section 2. Upon the written request of any such Holder made
within 15 days after the receipt of any such notice (which request shall specify
the Common or Common Equivalent Registrable Securities intended to be disposed
of by such Holder), the Company will use its best efforts to effect the
registration under the Securities Act of all Common or Common Equivalent
Registrable Securities which the Company has been so requested to register by
the Holders thereof, to the extent requisite to permit the disposition of the
Common or Common Equivalent Registrable Securities so to be registered; provided
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that (i) if, at any time after giving written notice of its intention to
register any securities and prior to the effective date of the registration
statement filed in connection with such registration, the Company shall
determine for any reason not to proceed with the proposed registration of the
securities to be sold by it, the Company may, at its election, give written
notice of such determination to each Holder of Common or Common Equivalent
Registrable Securities and, thereupon, shall be relieved of its obligation to
register any Common or Common Equivalent Registrable Securities in connection
with such registration (but not from its obligation to pay the Registration
Expenses in connection therewith), and (ii) if such registration involves an
underwritten offering, all Holders of Common or Common Equivalent Registrable
Securities requesting to be included in the Company's registration must sell
their Common or Common Equivalent Registrable Securities to the underwriters
selected by the Company on the same terms and conditions as apply to the
Company, with such differences, including any with respect to indemnification
and liability insurance, as may be customary or appropriate in combined primary
and secondary offerings. If a registration requested pursuant to this Section
2(a) involves an underwritten public offering, any Holder of Common or Common
Equivalent Registrable Securities requesting to be included in such registration
may elect, in writing prior to the effective date of the registration statement
filed in connection with such registration, not to register such securities in
connection with such registration. Nothing in this Section 2(a) shall operate
to limit the right of a Holder to (i) request the registration of Common Stock
issuable upon conversion or exercise of convertible securities held by such
Holder notwithstanding the fact that, at the time of request, such Holder holds
only convertible securities or (ii) request the registration at one time of both
Common Stock and Common Equivalent Registrable Securities.
(b) Expenses. The Company will pay all Registration Expenses in
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connection with each registration of Common or Common Equivalent Registrable
Securities requested pursuant to this Section 2.
(c) Priority in Incidental Registrations. If a registration pursuant
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to this Section 2 involves an underwritten offering and the managing underwriter
advises the Company in writing that, in its opinion, the number of securities
requested to be included in such registration exceeds the number which can be
sold in such offering, so as to be likely to have an adverse effect on the
price, timing or distribution of the securities offered in such offering as
contemplated by the Company, then the Company will include in such registration
(i) first, 100% of the securities proposed to be sold by the Company and (ii)
second, to the extent of the number of securities requested to be included in
such registration which, in the opinion of such managing underwriter, can be
sold without having the adverse effect referred to above, the number of
securities which the Holders have requested to be included in such registration,
such amount to be allocated pro rata among all requesting Holders on the basis
of the relative number of securities then held by each such Holder (provided
that any securities thereby allocated to any such Holder that exceed such
Holder's request will be reallocated among the remaining requesting Holders in
like manner).
3. Registration on Request. (a) Request by the Demand Party.
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At any time upon the written request of the Demand Party requesting that the
Company effect the registration under the Securities Act of all or part of such
Demand Party's Registrable Securities and specifying the amount and intended
method of disposition thereof, the Company will promptly give written notice of
such requested registration to all other Holders of such Registrable Securities,
and thereupon will, as expeditiously as possible, use its best efforts to effect
the registration under the Securities Act of:
(i) such Registrable Securities (including, if such
request relates to Preferred Stock or Warrants which are convertible into or
exchangeable or exercisable for shares of Common Stock, the shares of Common
Stock issuable upon such conversion, exchange or exercise) which the Company has
been so requested to register by the Demand Party; and
(ii) all other Registrable Securities of the same class
or series as are to be registered at the request of a Demand Party and which the
Company has been requested to register by any other Holder thereof by written
request given to the Company within 15 days after the giving of such written
notice by the Company (which request shall specify the amount and intended
method of disposition of such Registrable Securities),
all to the extent necessary to permit the disposition (in accordance with the
intended method thereof as aforesaid) of the Registrable Securities so to be
registered; provided that, with respect to any Demand Party other than the
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Parents, the Company shall not be obligated to effect any registration of
Registrable Securities under this Section 3(a) unless such Demand Party requests
that the Company register at least 1% of the total number of Registrable
Securities; and provided, further, that, unless Holders of a majority of the
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shares of Registrable Securities held by Holders consent thereto in writing, the
Company shall not be obligated to file a registration statement relating to any
registration request under this Section 3(a) (x) within a period of nine months
after the effective date of any other registration statement relating to any
registration request under this Section 3(a) which was not effected on Form S-3
(or any successor or similar short-form registration statement) or relating to
any registration effected under Section 2, or (y) if with respect thereto the
managing underwriter, the SEC, the Securities Act or the rules and regulations
thereunder, or the form on which the registration statement is to be filed,
would require the conduct of an audit other than the regular audit conducted by
the Company at the end of its fiscal year, in which case the filing may be
delayed until the completion of such regular audit (unless the Holders of the
Registrable Securities to be registered agree to pay the expenses of the Company
in connection with such an audit other than the regular audit). Nothing in this
Section 3(a) shall operate to limit the right of a Holder to (i) request the
registration of Common Stock issuable upon conversion or exercise of convertible
securities held by such Holder notwithstanding the fact that, at the time of
request, such Holder holds only convertible securities or (ii) request the
registration at one time of both Common Stock and Common Equivalent Registrable
Securities.
(b) Registration Statement Form. If any registration requested
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pursuant to this Section 3 which is proposed by the Company to be effected by
the filing of a registration statement on Form S-3 (or any successor or similar
short-form registration statement) shall be in connection with an underwritten
public offering, and if the managing underwriter shall advise the Company in
writing that, in its opinion, the use of another form of registration statement
is of material importance to the success of such proposed offering, then such
registration shall be effected on such other form.
(c) Expenses. The Company will pay all Registration Expenses in
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connection with the first six (6) registrations of each class or series of
Registrable Securities pursuant to this Section 3 upon the written request of
any of the Holders, provided that, for purposes hereof, a request to register
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Common Stock into which Preferred Stock or Warrants are convertible,
exchangeable or exercisable in conjunction with a registration of such Preferred
Stock or Warrants shall be deemed to be one request for registration of a class
or series of Registrable Securities. All expenses for any subsequent
registrations of Registrable Securities pursuant to this Section 3 shall be paid
pro rata by the Company and all other Persons (including the Holders)
participating in such registration on the basis of the relative number of shares
of Common Stock or relative aggregate liquidation preference of the shares of
Preferred Stock, or the relative number of Warrants, as the case may be, of each
such person whose Registrable Securities are included in such registration.
(d) Effective Registration Statement. A registration requested
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pursuant to this Section 3 will not be deemed to have been effected unless it
has become effective; provided that if, within 180 days after it has become
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effective, the offering of Registrable Securities pursuant to such registration
is interfered with by any stop order, injunction or other order or requirement
of the SEC or other governmental agency or court, such registration will be
deemed not to have been effected.
(e) Selection of Underwriters. If a requested registration pursuant
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to this Section 3 involves an underwritten offering, the Holders of a majority
of the shares of Registrable Securities which are held by Holders and which the
Company has been requested to register shall have the right to select the
investment banker or bankers and managers to administer the offering; provided,
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however, that such investment banker or bankers and managers shall be reasonably
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satisfactory to the Company.
(f) Priority in Requested Registrations. If a requested
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registration pursuant to this Section 3 involves an underwritten offering and
the managing underwriter advises the Company in writing that, in its opinion,
the number of securities requested to be included in such registration
(including securities of the Company which are not Registrable Securities)
exceeds the number which can be sold in such offering, the Company will include
in such registration only the Registrable Securities requested to be included in
such registration. In the event that the number of Registrable Securities
requested to be included in such registration exceeds the number which, in the
opinion of such managing underwriter, can be sold, the number of such
Registrable Securities to be included in such registration shall be allocated
pro rata among all requesting Holders on the basis of the relative number of
shares of Registrable Securities then held by each such Holder (provided that
any shares thereby allocated to any such Holder that exceed such Holder's
request shall be reallocated among the remaining requesting Holders in like
manner). In the event that the number of Registrable Securities requested to be
included in such registration is less than the number which, in the opinion of
the managing underwriter, can be sold, the Company may include in such
registration the securities the Company proposes to sell up to the number of
securities that, in the opinion of the underwriter, can be sold.
(g) Additional Rights. If the Company at any time grants to any
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other holders of Common Stock, Preferred Stock or Warrants any rights to request
the Company to effect the registration under the Securities Act of any such
shares of Common Stock, Preferred Stock or Warrants on terms more favorable to
such holders than the terms set forth in this Section 3, the terms of this
Section 3 shall be deemed amended or supplemented to the extent necessary to
provide the Holders such more favorable rights and benefits.
4. Registration Procedures. If and whenever the Company is
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required to use its best efforts to effect or cause the registration of any
Registrable Securities under the Securities Act as provided in this Agreement,
the Company will, as expeditiously as possible:
(i) prepare and, in any event within 120 days after the
end of the period within which a request for registration may be given to the
Company, file with the SEC a registration statement with respect to such
Registrable Securities and use its best efforts to cause such registration
statement to become effective, provided, however, that the Company may
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discontinue any registration of its securities which is being effected pursuant
to Section 2 at any time prior to the effective date of the registration
statement relating thereto;
(ii) prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective for
a period not in excess of 270 days and to comply with the provisions of the
Securities Act, the Exchange Act and the rules and regulations of the SEC
thereunder with respect to the disposition of all securities covered by such
registration statement during such period in accordance with the intended
methods of disposition by the seller or sellers thereof set forth in such
registration statement; provided that before filing a registration statement or
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prospectus, or any amendments or supplements thereto, the Company will furnish
to counsel selected pursuant to Section 7 hereof by the Holders of the
Registrable Securities covered by such registration statement to represent such
Holders, copies of all documents proposed to be filed, which documents will be
subject to the review of such counsel;
(iii) furnish to each seller of such Registrable
Securities such number of copies of such registration statement and of each
amendment and supplement thereto (in each case including all exhibits filed
therewith, including any documents incorporated by reference), such number of
copies of the prospectus included in such registration statement (including each
preliminary prospectus and summary prospectus), in conformity with the
requirements of the Securities Act, and such other documents as such seller may
reasonably request in order to facilitate the disposition of the Registrable
Securities by such seller;
(iv) use its best efforts to register or qualify such
Registrable Securities covered by such registration in such jurisdictions as
each seller shall reasonably request, and do any and all other acts and things
which may be reasonably necessary or advisable to enable such seller to
consummate the disposition in such jurisdictions of the Registrable Securities
owned by such Seller, except that the Company shall not for any such purpose be
required to qualify generally to do business as a foreign corporation in any
jurisdiction where, but for the requirements of this clause (iv), it would not
be obligated to be so qualified, to subject itself to taxation in any such
jurisdiction or to consent to general service of process in any such
jurisdiction;
(v) use its best efforts to cause such Registrable
Securities covered by such registration statement to be registered with or
approved by such other governmental agencies or authorities as may be necessary
to enable the seller or sellers thereof to consummate the disposition of such
Registrable Securities;
(vi) notify each seller of any such Registrable
Securities covered by such registration statement, at any time when a prospectus
relating thereto is required to be delivered under the Securities Act within the
appropriate period mentioned in clause (ii) of this Section 4, of the Company's
becoming aware that the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, and at the request of any such seller, prepare and furnish to such
seller a reasonable number of copies of an amended or supplemental prospectus as
may be necessary so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus shall not include an untrue statement of
a material fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein not misleading in the light of the
circumstances then existing;
(vii) otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC, and make available to its security
holders, as soon as reasonably practicable (but not more than eighteen months)
after the effective date of the registration statement, an earnings statement
which shall satisfy the provisions of Section 11(a) of the Securities Act and
the rules and regulations promulgated thereunder;
(viii) (A) if such Registrable Securities are Common
Stock (including Common Stock issuable upon conversion of a convertible
security), use its best efforts to list such Registrable Securities on any
securities exchange on which the Common Stock is then listed if such Registrable
Securities are not already so listed and if such listing is then permitted under
the rules of such exchange; (B) if such Registrable Securities are convertible
securities, upon the reasonable request of sellers of a majority of shares of
such Registrable Securities, use its best efforts to list the convertible
securities and, if requested, the Common Stock underlying the convertible
securities, notwithstanding that at the time of request such sellers hold only
convertible securities, on any securities exchange so requested, if such
Registrable Securities are not already so listed and if such listing is then
permitted under the rules of such exchange; and (C) and use its best efforts to
provide a transfer agent and registrar for such Registrable Securities covered
by such registration statement not later than the effective date of such
registration statement;
(ix) enter into such customary agreements (including an
underwriting agreement in customary form), which may include indemnification
provisions in favor of underwriters and other persons in addition to, or in
substitution for the provisions of Section 5 hereof, and take such other actions
as sellers of a majority of shares of such Registrable Securities or the
underwriters, if any, reasonably request in order to expedite or facilitate the
disposition of such Registrable Securities;
(x) obtain a "cold comfort" letter or letters from the
Company's independent public accounts in customary form and covering matters of
the type customarily covered by "cold comfort" letters as the seller or sellers
of a majority of shares of such Registrable Securities shall reasonably request
(provided that Registrable Securities constitute at least 25% of the securities
covered by such registration statement);
(xi) make available for inspection by any seller of such
Registrable Securities covered by such registration statement, by any
underwriter participating in any disposition to be effected pursuant to such
registration statement and by any attorney, accountant or other agent retained
by any such seller or any such underwriter, all pertinent financial and other
records, pertinent corporate documents and properties of the Company, and cause
all of the Company's officers, directors and employees to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant or
agent in connection with such registration statement;
(xii) notify counsel (selected pursuant to Section 7
hereof) for the Holders of Registrable Securities included in such registration
statement and the managing underwriter or agent, immediately, and confirm the
notice in writing (i) when the registration statement, or any post-effective
amendment to the registration statement, shall have become effective, or any
supplement to the prospectus or any amendment prospectus shall have been filed,
(ii) of the receipt of any comments from the SEC, (iii) of any request of the
SEC to amend the registration statement or amend or supplement the prospectus or
for additional information, and (iv) of the issuance by the SEC of any stop
order suspending the effectiveness of the registration statement or of any order
preventing or suspending the use of any preliminary prospectus, or of the
suspension of the qualification of the registration statement for offering or
sale in any jurisdiction, or of the institution or threatening of any
proceedings for any of such purposes;
(xiii) make every reasonable effort to prevent the
issuance of any stop order suspending the effectiveness of the registration
statement or of any order preventing or suspending the use of any preliminary
prospectus and, if any such order is issued, to obtain the withdrawal of any
such order at the earliest possible moment;
(xiv) if requested by the managing underwriter or agent
or any Holder of Registrable Securities covered by the registration statement,
promptly incorporate in a prospectus supplement or post-effective amendment such
information as the managing underwriter or agent or such Holder reasonably
requests to be included therein, including, without limitation, with respect to
the number of Registrable Securities being sold by such Holder to such
underwriter or agent, the purchase price being paid therefor by such underwriter
or agent and with respect to any other terms of the underwritten offering of the
Registrable Securities to be sold in such offering; and make all required
filings of such prospectus supplement or post-effective amendment as soon as
practicable after being notified of the matters incorporated in such prospectus
supplement or post--effective amendment;
(xv) cooperate with the Holders of Registrable
Securities covered by the registration statement and the managing underwriter or
agent, if any, to facilitate the timely preparation and delivery of certificates
(not bearing any restrictive legends) representing securities to be sold under
the registration statement, and enable such securities to be in such
denominations and registered in such names as the managing underwriter or agent,
if any, or such Holders may request;
(xvi) obtain for delivery to the Holders of Registrable
Securities being registered and to the underwriter or agent an opinion or
opinions from counsel for the Company in customary form and in form, substance
and scope reasonably satisfactory to such Holders, underwriters or agents and
their counsel; and
(xvii) cooperate with each seller of Registrable
Securities and each underwriter or agent participating in the disposition of
such Registrable Securities and their respective counsel in connection with any
filings required to be made with the NASD.
The Company may require each seller of Registrable Securities as to which
any registration is being effected to furnish the Company with such information
regarding such seller and pertinent to the disclosure requirements relating to
the registration and the distribution of such securities as the Company may from
time to time reasonably request in writing.
Each Holder of Registrable Securities agrees that, upon receipt of any
notice from the Company of the happening of any event of the kind described in
clause (vi) of this Section 4, such Holder will forthwith discontinue
disposition of Registrable Securities pursuant to the registration statement
covering such Registrable Securities until such Holder's receipt of the copies
of the supplemented or amended prospectus contemplated by clause (vi) of this
Section 4, and, if so directed by the Company, such Holder will deliver to the
Company (at the Company's expense) all copies, other than permanent file copies
then in such Holder's possession, of the prospectus covering such Registrable
Securities current at the time of receipt of such notice. In the event the
Company shall give any such notice, the period mentioned in clause (ii) of this
Section 4 shall be extended by the number of days during the period from and
including the date of the giving of such notice pursuant to clause (vi) of this
Section 4 and including the date when each seller of Registrable Securities
covered by such registration statement shall have received the copies of the
supplemented or amended prospectus contemplated by clause (vi) of this Section
4.
5. Indemnification. (a) Indemnification by the Company. In the
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event of any registration of any securities of the Company under the Securities
Act pursuant to Section 2 or 3, the Company will, and it hereby does, indemnify
and hold harmless, to the extent permitted by law, the seller of any Registrable
Securities covered by such registration statement, each affiliate of such seller
and their respective directors and officers or general and limited partners
(including any director, officer, affiliate, employee, agent and controlling
Person of any of the foregoing), each other Person who participates as an
underwriter in the offering or sale of such securities and each other Person, if
any, who controls such seller or any such underwriter within the meaning of the
Securities Act (collectively, the "Indemnified Parties"), against any and all
losses, claims, damages or liabilities, joint or several, and expenses
(including reasonable attorney's fees and reasonable expenses of investigation)
to which such Indemnified Party may become subject under the Securities Act,
common law or otherwise, insofar as such losses, claims, damages or liabilities
(or actions or proceedings in respect thereof, whether or not such Indemnified
Party is a party thereto) arise out of or are based upon (a) any untrue
statement or alleged untrue statement of any material fact contained in any
registration statement under which such securities were registered under the
Securities Act, any preliminary, final or summary prospectus contained therein,
or any amendment or supplement thereto, or (b) any omission or alleged omission
to state therein a material fact required to be stated therein or necessary to
make the statements therein (in the case of a prospectus, in light of the
circumstances under which they were made) not misleading, and the Company will
reimburse such Indemnified Party for any legal or any other expenses reasonably
incurred by it in connection with investigating or defending against any such
loss, claim, liability, action or proceeding; provided that the Company shall
not be liable to any Indemnified Party in any such case to the extent that any
such loss, claim, damage, liability (or action or proceeding in respect thereof)
or expense arises out of or is based upon any untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement or
amendment or supplement thereto or in any such preliminary, final or summary
prospectus in reliance upon and in conformity with written information furnished
to the Company with respect to such seller through an instrument duly executed
by such seller specifically stating that it is for use in the preparation
thereof; and provided, further, that the Company will not be liable to any
Person who participates as an underwriter in the offering or sale of Registrable
Securities or any other Person, if any, who controls such underwriter within the
meaning of the Securities Act, under the indemnity agreement in this Section
5(a) with respect to any preliminary prospectus or the final prospectus or the
final prospectus as amended or supplemented, as the case may be, to the extent
that any such loss, claim, damage or liability of such underwriter or
controlling Person results from the fact that such underwriter sold Registrable
Securities to a person to whom there was not sent or given, at or prior to the
written confirmation of such sale, a copy of the final prospectus or of the
final prospectus as then amended or supplemented, whichever is most recent, if
the Company has previously furnished copies thereof to such underwriter. For
purposes of the last proviso to the immediately preceding sentence, the term
"prospectus" shall not be deemed to include the documents incorporated therein
by reference, and no Person who participates as an underwriter in the offering
or sale of Registrable Securities or any other Person, if any, who controls such
underwriter within the meaning of the Securities Act, shall be obligated to send
or give any supplement or amendment to any document incorporated by reference in
any preliminary prospectus or the final prospectus to any person other than a
person to whom such underwriter had delivered such incorporated document or
documents in response to a written request therefor. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on
behalf of such seller or any Indemnified Party and shall survive the transfer of
such securities by such seller.
In addition, the Company will, and it hereby does, indemnify and hold harmless,
to the extent permitted by law, the Parents, each affiliate of the Parents, and
their respective directors and officers or general and limited partners
(including any director, officer, affiliate, employee, agent and controlling
Person or any of the foregoing), against any and all losses, claims, damages or
liabilities, joint or several, and expenses (including reasonable attorney's
fees and reasonable expenses of investigation) in any manner arising out of or
relating to (x) the purchase or ownership of capital stock or other securities
of the Company, by the Parents or any such other Person or (y) any litigation to
which the Parents or any other such Person is made a party in its capacity as a
stockholder or owner of securities (or a partner, director, affiliate, employee,
agent or controlling Person of a stockholder or owner of securities) of the
Company
(b) Indemnification by the Seller. The Company may require, as a condition to
-----------------------------
including any Registrable Securities in any registration statement filed in
accordance with Section 4 herein, that the Company shall have received an
undertaking reasonably satisfactory to it from the prospective seller of such
Registrable Securities or any underwriter to indemnify and hold harmless (in the
same manner and to the same extent as set forth in subdivision (a) of this
Section 5) the Company and all other prospective sellers with respect to any
untrue statement or alleged untrue statement in or omission or alleged omission
from such registration statement, any preliminary, final or summary prospectus
contained therein, or any amendment or supplement, if such untrue statement or
alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with written information furnished to the Company with
respect to such seller through an instrument duly executed by such seller or
underwriter specifically stating that it is for use in the preparation of such
registration statement, preliminary, final or summary prospectus or amendment or
supplement, or a document incorporated by reference into any of the foregoing.
Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company or any of the prospective
sellers, or any of their respective affiliates, directors, officers or
controlling Persons and shall survive the transfer of such securities by such
seller. In no event shall the liability of any selling Holder of Registrable
Securities hereunder be greater in amount than the dollar amount of the proceeds
received by such Holder upon the sale of the Registrable Securities giving rise
to such indemnification obligation.
(c) Notices of Claims, Etc. Promptly after receipt by an Indemnified
-------------------------
Party hereunder of written notice of the commencement of any action or
proceeding with respect to which a claim for indemnification may be made
pursuant to this Section 5, such Indemnified Party will, if a claim in respect
thereof is to be made against an indemnifying party, give written notice to the
latter of the commencement of such action; provided that the failure of the
Indemnified Party to give notice as provided herein shall not relieve the
indemnifying party of its obligations under the preceding subdivisions of this
Section 5, except to the extent that the indemnifying party is actually
prejudiced by such failure to give notice. In case any such action is brought
against an Indemnified Party, unless in such Indemnified Party's reasonable
judgment a conflict of interest between such Indemnified Party and indemnifying
parties may exist in respect of such claim, the indemnifying party will be
entitled to participate in and to assume the defense thereof, jointly with any
other indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such Indemnified Party, and after notice from
the indemnifying party to such Indemnified Party of its election so to assume
the defense thereof, the indemnifying party will not be liable to such
Indemnified Party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof other than reasonable costs of
investigation. No indemnifying party will consent to entry of any judgment or
enter into any settlement which does not include as an unconditional term
thereof, the giving by the claimant or plaintiff to such Indemnified Party of a
release from all liability in respect to such claim or litigation.
(d) Contribution. If the indemnification provided for in this
------------
Section 5 from the indemnifying party is unavailable to an Indemnified Party
hereunder in respect of any losses, claims, damages, liabilities or expenses
referred to herein, then the 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 such losses, claims, damages, liabilities or
expenses in such proportion as is appropriate to reflect the relative fault of
the indemnifying party and Indemnified Parties in connection with the actions
which resulted in such losses, claims, damages, liabilities or expenses, as well
as any other relevant equitable considerations. The relative fault of such
indemnifying party and Indemnified Parties shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact, has been made by, or relates to information supplied by,
such indemnifying party or Indemnified Parties, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such action. The amount paid or payable by a party under this Section 5(d) as a
result of the losses, claims, damages, liabilities and expenses referred to
above shall be deemed to include any legal or other fees or expenses reasonably
incurred by such party in connection with any investigation or proceeding.
The parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 5(d) were determined by pro rata allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding paragraph. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.
(e) Other Indemnification. Indemnification similar to that specified
-----------------------
in the preceding subdivisions of this Section 5 (with appropriate modifications)
shall be given by the Company and each seller of Registrable Securities with
respect to any required registration or other qualification of securities under
any federal or state law or regulation or governmental authority other than the
Securities Act.
(f) Non-Exclusivity. The obligations of the parties under this Section 5
-----------------
shall be in addition to any liability which any party may otherwise have to any
other party.
6. Rule 144. The Company covenants that it will file the
---------
reports required to be filed by it under the Securities Act and the Exchange Act
and the rules and regulations adopted by the SEC thereunder (or, if the Company
is not required to file such reports, it will, upon the request of any Holder of
Registrable Securities, make publicly available such information), and it will
take such further action as any Holder of Registrable Securities may reasonably
request, all to the extent required from time to time to enable such Holder to
sell shares of Registrable Securities without registration under the Securities
Act within the limitation of the exemptions provided by (i) Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or (ii) any
similar rule or regulation hereafter adopted by the SEC. Upon the request of
any Holder of Registrable Securities, the Company will deliver to such Holder a
written statement as to whether it has complied with such requirements.
Notwithstanding anything contained in this Section 6, the Company may deregister
under Section 12 of the Exchange Act if it then is permitted to do so pursuant
to the Exchange Act and the rules and regulations thereunder.
7. Selection of Counsel. In connection with any registration of
----------------------
Registrable Securities pursuant to Sections 2 and 3 hereof, the Holders of a
majority of the Registrable Securities covered by any such registration may
select one counsel to represent all Holders of Registrable Securities covered by
such registration; provided, however, that in the event that the counsel
selected as provided above is also acting as counsel to the Company in
connection with such registration, the remaining Holders shall be entitled to
select one additional counsel to represent all such remaining Holders.
8. Miscellaneous. (a) Other Investors. The Company may enter into
------------------
agreements with other purchasers of Common Stock who are then employees of the
Company or any of its subsidiaries, making them parties hereto (and thereby
giving them all, or a portion, of the rights, preferences and privileges of an
original party hereto) with respect to additional shares of Common Stock (the
"Supplemental Agreements"); provided, however, that pursuant to any such
Supplemental Agreement, such purchaser expressly agrees to be bound by all of
the terms, conditions and obligations of this Agreement as if such purchaser
were an original party hereto. All shares of Common Stock issued or issuable
pursuant to such Supplemental Agreements shall be deemed to be Registrable
Securities.
(b) Holdback Agreement. If any such registration shall be in
--------------------
connection with an underwritten public offering, each Holder of Registrable
Securities agrees not to effect any public sale or distribution, including any
sale pursuant to Rule 144 under the Securities Act, of any equity securities of
the Company, or of any security convertible into or exchangeable or exercisable
for any equity security of the Company (in each case, other than as part of such
underwritten public offering), within 7 days before or such period not to exceed
180 days as the underwriting agreement may require (or such lesser period as the
managing underwriters may permit) after the effective date of such registration
(except as part of such registration), and the Company hereby also so agrees and
agrees to cause each other holder of any equity security, or of any security
convertible into or exchangeable or exercisable for any equity security, of the
Company purchased from the Company (at any time other than in a public offering)
to so agree.
(c) Amendments and Waivers. This Agreement may be amended and the Company
-----------------------
may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, only if the Company shall have obtained the
written consent to such amendment, action or omission to act, of the Holders of
a majority of the Registrable Securities then outstanding; provided, however,
that no amendment, waiver or consent to the departure from the terms and
provisions of this Agreement that is adverse to either of the Parents or any of
their respective successors and assigns shall be effective as against any such
Person for so long as such Person holds any Registrable Securities unless
consented to in writing by such Person. Each Holder of any Registrable
Securities at the time or thereafter outstanding shall be bound by any consent
authorized by this Section 8(c), whether or not such Registrable Securities
shall have been marked to indicate such consent.
(d) Successors, Assigns and Transferees. This Agreement shall be
---------------------------------------
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns. Upon any merger or consolidation of the
Parents with the Company or any liquidation of the Parents, the stockholder or
stockholders of the Parents shall succeed to all of the Parents' rights and
obligations thereunder. In addition, and whether or not any express assignment
shall have been made, the provisions of this Agreement which are for the benefit
of the parties hereto other than the Company shall also be for the benefit of
and enforceable by any subsequent Holder of any Registrable Securities, subject
to the provisions contained herein. Without limitation to the foregoing, in the
event that either of the Parents or any of their respective successors or
assigns or any other subsequent Holder of any Registrable Securities distributes
or otherwise transfers any shares of the Registrable Securities to any of its
present or future shareholders, members, general or limited partners, the
Company hereby acknowledges that the registration rights granted pursuant to
this Agreement shall be transferred to such shareholders, members or partners on
a pro rata basis, and that at or after the time of any such distribution or
transfer, any such shareholder, member, partner or group of shareholders,
members or partners may designate a Person to act on its behalf in delivering
any notices or making any requests hereunder.
(e) Notices. All notices and other communications provided for hereunder
--------
shall be in writing and shall be sent by first class mail, telex, telecopier or
hand delivery:
(i) if to the Company, to:
Xxxxxx Chemical, Inc.
000 Xxxx Xxxxx Xxxxxx
Xxxxxxxx, Xxxx 00000
Attention: Chief Executive Officer
(ii) if to Xxxxxx Holdings, to:
Xxxxxx Holdings, Inc.
Xxx Xxxxxx Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
with copies to:
KKR Associates
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx
-and-
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq
(iii) if to BDS Two, to:
BDS Two, Inc.
Xxx Xxxxxx Xxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, XX 00000
with copies to:
KKR Associates
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx
-and-
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq
(iv) if to any other holder of Registrable Securities, to the
address of such other holder as shown in the stock record book of the
Company, or to such other address as any of the above shall have designated
in writing to all of the other above.
All such notices and communications shall be deemed to have been given or
made (A) when delivered by hand, (B) five business days after being deposited in
the mail, postage prepaid, (C) when telexed answer-back received or (D) when
telecopied, receipt acknowledged.
(f) Descriptive Headings. The headings in this Agreement are for
---------------------
convenience of reference only and shall not limit or otherwise affect
the meaning of terms contained herein.
(g) Severability. In the event that any one or more of the
-------------
provisions, paragraphs, words, clauses, phrases or sentences contained
herein, or the application thereof in any circumstances, is held invalid,
illegal or unenforceable in any respect for any reason, the validity,
legality and enforceability of any such provision, paragraph, word, clause,
phrase or sentence in every other respect and of the remaining provisions,
paragraphs, words, clauses, phrases or sentences hereof shall not be in
any way impaired, it being intended that all rights, powers and privileges of
the parties hereto shall be enforceable to the fullest extent permitted
by law.
(h) Counterparts. This Agreement may be executed in counterparts, and by
------------
different parties on separate counterparts, each of which shall be deemed an
original, but all such counterparts shall together constitute one and the same
instrument.
(i) Governing Law; Submission to Jurisdiction. This Agreement shall be
governed by and construed and enforced in accordance with the laws of the State
of New York applicable to contracts made and to be performed therein. The
parties to this Agreement hereby agree to submit to the jurisdiction of the
courts of the State of New York, the courts of the United States of America for
the Southern District of New York, and appellate courts from any thereof in any
action or proceeding arising out of or relating to this Agreement.
(j) Specific Performance. The parties hereto acknowledge and agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. Accordingly, it is agreed that they shall be entitled to an
injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically the terms and provisions hereof in any
court of competent jurisdiction in the United States or any state thereof, in
addition to any other remedy to which they may be entitled at law or in equity.
IN WITNESS WHEREOF, each of the undersigned has executed this Agreement or
caused this Agreement to be duly executed on its behalf as of the date first
written above.
XXXXXX CHEMICAL, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President
XXXXXX HOLDINGS, INC.
By: /s/ Xxxxxx X. Xxxxx
---------------------------
Name: Xxxxxx X. Xxxxx
Title: Secretary
BDS TWO, INC.
By: /s/ Xxxxxx X. Xxxxx
---------------------------
Name: Xxxxxx X. Xxxxx
Title: Vice President
