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REGISTRATION RIGHTS AGREEMENT
dated as of July 30, 1997, among SAFETY 1ST,
INC., a Massachusetts corporation (the
"Company"), the INVESTORS (as defined below)
and XXXXXXX XXXXXX, an individual
("Xxxxxx").
The Investors have the right to purchase by the exercise
warrants owned by the Investors and issued to the Investors by the Company
pursuant to a Stock and Warrant Purchase Agreement of even rate shares of the
Common Stock, $.01 par value (the "Common Stock"), of the Company (or such other
class of common stock of the Company into which the Common Stock may be
converted or reclassified, and all references herein to the Common Stock shall
mean such other class of common stock, if applicable). The Company and the
Investors deem it to be in their respective best interests to set forth the
rights of the Investors in connection with public offerings and sales of the
capital stock of the Company.
ACCORDINGLY, in consideration of the premises and mutual
covenants and obligations hereinafter set forth, the Company and the Investors
hereby agree as follows:
SECTION 1. DEFINITIONS. As used in this Agreement, the
following terms shall have the following meanings:
"Affiliate" shall have the meaning ascribed to it in Rule
12b-2 promulgated under the Exchange Act.
"Bear, Xxxxxxx" shall mean Bear, Xxxxxxx & Co. Inc. and
includes any successor to, or transferee of, any such Person who or which agrees
in writing to be treated as an Investor hereunder and to be bound by the terms
and comply with all applicable provisions hereof.
"BT Capital" shall mean BT Capital Partners, Inc. and includes
any successor to, or transferee of, any such Person who or which agrees in
writing to be treated as an Investor hereunder and to be bound by the terms and
comply with all applicable provisions hereof.
"Commission" shall mean the Securities and Exchange Commission
or any other Governmental Authority at the time administering the Securities
Act.
"Common Stock" shall have the meaning ascribed to it in the
Preamble.
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"Common Stock Equivalent" shall mean one share of Common Stock
or the right to acquire, whether or not such right is immediately exercisable,
one share of Common Stock, whether evidenced by an option, warrant, convertible
security or other instrument or agreement.
"Exchange Act" shall mean the Securities Exchange Act of 1934
or any successor Federal statute, and the rules and regulations of the
Commission promulgated thereunder, all as the same shall be in effect from time
to time.
"Governmental Authority" shall mean any domestic or foreign
government or political subdivision thereof, whether on a federal, state or
local level and whether executive, legislative or judicial in nature, including
any agency, authority, board, bureau, commission, court, department or other
instrumentality thereof.
"Investors" shall mean, collectively, (i) the Persons listed
on Schedule I attached to this Agreement and (ii) any successor to, or assignee
or transferee of Restricted Securities held by an Investor who or which agrees
in writing to be treated as an Investor hereunder and to be bound by and comply
with all of the applicable terms and provisions hereof.
"Market Price" shall mean, as to any security, the average of
the closing prices of such security's sales on all United States securities
exchanges on which such security may at the time be listed, or, if there have
been no sales on any such exchange on any day, the average of the highest bid
and lowest asked prices on all such exchanges at the end of such day, or, if on
any day such security is not so listed, the average of the representative bid
and asked prices quoted in the NASDAQ System as of 4:00 P.M., New York time, on
such day, or, if on any day such security is not quoted in the NASDAQ System,
the average of the highest bid and lowest asked prices on such day in the
domestic over-the-counter market as reported by the National Quotation Bureau,
Incorporated, or any similar or successor organization, in each such case
averaged over a period of 21 days consisting of the day as of which such Market
Price is being determined and the 20 consecutive business days prior to such
day; provided, however, that if such security is listed on any domestic
securities exchange the term "business days" as used in this sentence means
business days on which such exchange is open for trading.
"Material Transaction" shall mean any material transaction in
which the Company or any of its subsidiaries proposes to engage or is engaged,
including a purchase or sale of assets or securities, financing, merger,
consolidation, tender offer or any other transaction or event that would require
disclosure pursuant to the Securities Act and/or the Exchange Act, and with
respect to which the Board of Directors of the
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Company reasonably has determined in good faith that compliance with this
Agreement may reasonably be expected to either materially interfere with the
Company's or such subsidiary's ability to consummate such transaction in a
timely fashion or require the Company to disclose material, non-public
information prior to such time as it would otherwise be required to be
disclosed.
"Other Shares" shall mean at any time those shares of Common
Stock which do not constitute Primary Shares or Registrable Shares.
"Person" shall be construed as broadly as possible and shall
include an individual person, a partnership (including a limited liability
partnership), a corporation, an association, a joint stock company, a limited
liability company, a trust, a joint venture, an unincorporated organization and
a Governmental Authority.
"Primary Shares" shall mean, at any time, the authorized but
unissued shares of Common Stock or Common Stock held by the Company in its
treasury.
"Prospectus" shall mean the prospectus included in a
Registration Statement, including any prospectus subject to completion, and any
such prospectus as amended or supplemented by any prospectus supplement with
respect to the terms of the offering of any portion of the Registrable Shares
and, in each case, by all other amendments and supplements to such prospectus,
including post-effective amendments, and in each case including all material
incorporated by reference therein.
"Registrable Shares" shall mean, at any time, and with respect
to any Investor, (i) the Reserved Common Shares, (ii) any other securities of
the Corporation into or for which the Reserved Common Shares may be exchanged,
converted or reclassified or which may be issued as a dividend or distribution
on or with respect thereto, and (iii) any securities received in respect of the
foregoing, in each case in clauses (i) and (ii) which at any time are held by
the Investors. As to any particular Registrable Shares, once issued, such
Registrable Shares shall cease to be Registrable Shares (A) when such
Registrable Shares have been registered under the Securities Act, the
Registration Statement in connection therewith has been declared effective and
they have been disposed of pursuant to and in the manner described in such
effective Registration Statement, (B) when such Registrable Shares are sold or
distributed pursuant to Rule 144, (C) when such Registrable Shares are
transferable pursuant to Rule 144(k) or (D) when such Registrable Shares have
ceased to be outstanding.
"Registration Date" shall mean the date upon which the
registration statement pursuant to which the Company shall have
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initially registered shares of Common Stock under the Securities Act for sale to
the public shall have been declared effective.
"Registration Statement" shall mean any registration statement
of the Company which covers any of the Registrable Shares, and all amendments
and supplements to any such Registration Statement, including post-effective
amendments, in each case including the Prospectus contained therein, all
exhibits thereto and all material incorporated by reference therein.
"Representative" of a Person shall be construed broadly and
shall include such Person's partners, officers, directors, employees, agents,
counsel, accountants and other representatives.
"Reserved Common Shares" shall have the meaning ascribed
thereto in the Stock and Warrant Purchase Agreement.
"Restricted Securities" shall mean, at any time and with
respect to any Investor, the Common Stock Equivalents and any other securities
received with respect to any such Common Stock Equivalents, which are held by
such Investor and which theretofore have not been sold to the public pursuant to
a Registration Statement or pursuant to Rule 144.
"Rule 144" shall mean Rule 144 promulgated under the
Securities Act or any successor rule thereto.
"Securities Act" shall mean the Securities Act of 1933 or any
successor Federal statute, and the rules and regulations of the Commission
promulgated thereunder, all as the same shall be in effect from time to time.
"Stock and Warrant Purchase Agreement" means the Stock and
Warrant Purchase Agreement dated as of the date hereof among the Company and the
Investors, as amended or modified from time to time.
"Suspension Period" shall have the meaning ascribed to it in
Section 9.
"Transfer" shall mean any disposition of any Restricted
Securities or of any interest therein which would constitute a sale thereof
within the meaning of the Securities Act, other than any such disposition
pursuant to a Registration Statement and in compliance with all applicable state
securities and "blue sky" laws.
SECTION 2. REQUIRED REGISTRATION.
(a) If at any time the Company shall be requested by an
Investor to effect the registration under the Securities Act
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of Registrable Shares which constitute at least 20% of the then outstanding
Registrable Shares or have an anticipated aggregate offering price of at least
$4,000,000, it shall promptly give written notice to the other Investors of its
requirement to so register such Registrable Shares and, upon the written
request, delivered to the Company within 30 days after delivery of any such
notice by the Company, of the other Investors to include in such registration
Registrable Shares (which request shall specify the number of Registrable Shares
proposed to be included in such registration), the Company shall, subject to
Section 2(c) below, promptly use its best efforts to effect such registration
under the Securities Act of the Registrable Shares which the Company has been so
requested to register.
(b) Anything contained in Sections 2(a) to the contrary
notwithstanding, the Company shall not be obligated to effect pursuant to
Sections 2(a) any registration under the Securities Act except in accordance
with the following provisions:
(i) the Company shall not be obligated to use its
best efforts to file and cause to become effective (A) more than one
Registration Statement initiated by each of BT Capital and Bear Xxxxxxx
pursuant to Section 2(a), provided that if the Investors were unable to
sell at least 80% of the Registrable Shares requested to be included in
the registration pursuant to Section 2(a) as a result of an
underwriter's cutback, then additional registrations shall be added to
this Section 2(b)(i) until the foregoing condition is satisfied, or (B)
any Registration Statement during any period in which any other
registration statement (other than on Form S-4 or Form S-8 promulgated
under the Securities Act or any successor forms thereto) pursuant to
which Primary Shares are to be or were sold has been filed and not
withdrawn or has been declared effective within the prior 90 days;
(ii) the Company may delay the filing or
effectiveness of any Registration Statement for a period of up to 180
days after the date of a request for registration pursuant to Section
2(a) if at the time of such request the Company is engaged in a
Material Transaction; and
(iii) with respect to any registration pursuant to
Section 2(a), the Company may include in such registration any Primary
Shares or Other Shares; provided, however, that if the managing
underwriter advises the Company that the inclusion of all Registrable
Shares, Primary Shares and Other
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Shares proposed to be included in such registration would interfere
with the successful marketing (including pricing) of all such
securities, then the number of Registrable Shares, Primary Shares and
Other Shares proposed to be included in such registration shall be
included in the following order:
(A) first, the Registrable Shares held by
the Investors requesting that their Registrable Shares be
included in such registration pursuant to Section 2(a) or
2(b), pro rata based upon the number of Restricted Securities
owned by each such Investor at the time of such registration;
(B) second, the Primary Shares; and
(C) third, the Other Shares.
(c) A requested registration under this Section 2 may be
rescinded prior to such registration being declared effective by the
Commission by written notice to the Company from each of the Investors;
provided, however, that such rescinded registration shall not count as a
registration initiated pursuant to this Section 2 for purposes of subclause
(A) of clause (i) of subsection (b) above if and only if the Company shall
have been reimbursed (pro rata by the Investors requesting registration or
in such other proportion as they may agree) for all out-of-pocket expenses
incurred by the Company in connection with such rescinded registration.
SECTION 3. PIGGYBACK REGISTRATION.
If the Company at any time proposes for any reason to register
Primary Shares or Other Shares under the Securities Act (other than on Form S-4
or Form S-8 promulgated under the Securities Act or any successor forms
thereto), it shall promptly give written notice to each Investor of its
intention so to register the Primary Shares or Other Shares and, upon the
written request, given within 20 days after delivery of any such notice by the
Company, of any such Investor to include in such registration Registrable Shares
(which request shall specify the number of Registrable Shares proposed to be
included in such registration), the Company shall use its best efforts to cause
all such Registrable Shares to be included in such registration on the same
terms and conditions as the securities otherwise being sold in such
registration; provided, however, that if the managing underwriter advises the
Company that the inclusion of all Registrable Shares or Other Shares proposed to
be included in such registration would interfere with the successful marketing
(including pricing) of Primary Shares proposed to be registered by the Company,
then the number of Primary Shares, Registrable Shares and Other Shares proposed
to be included in such registration shall be included in the following order:
(i) first, the Primary Shares; and
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(ii) second, the Registrable Shares and the Other Shares, pro
rata based upon the number of Common Stock Equivalents owned by each
such Investor and the holders of Other Shares, at the time of such
registration; and provided further, however, that, notwithstanding the
immediately preceding proviso, if any shares of Xxxxxx are included in
any registration of the Company in any circumstance, then the number of
Registrable Shares to be included in such registration shall be equal
to the number of Other Shares which are owned by Xxxxxx and are
included in such registration.
SECTION 4. HOLDBACK AGREEMENT.
(a) If the Company at any time shall register shares of Common Stock
under the Securities Act (including any registration pursuant to Section 2 or 3)
for sale to the public in an underwritten offering, the Investors shall not
sell, make any short sale of, grant any option for the purchase of, or otherwise
dispose of any Restricted Securities (other than those Registrable Shares
included in such registration pursuant to Section 2 or 3) without the prior
written consent of the Company for a period as shall be determined by the
managing underwriters, which period cannot begin more than 30 days prior to the
effectiveness of such Registration Statement and cannot last more than 180 days
after the effective date of such Registration Statement.
(b) If the Company at any time pursuant to Section 2 or 3 of this
Agreement shall register under the Securities Act Registrable Shares held by the
Investors for sale to the public pursuant to an underwritten offering, the
Company shall not, without the prior written consent of each of the Investors,
effect any public sale or distribution of securities similar to those being
registered, or any securities convertible into or exercisable or exchangeable
for such securities, for such period as shall be determined by the managing
underwriters, which period shall not begin more than 10 days prior to the
effectiveness of the Registration Statement pursuant to which such public
offering shall be made and shall not last more than 180 days after the closing
of sale of shares pursuant to such Registration Statement.
SECTION 5. PREPARATION AND FILING. If and whenever the Company is under
an obligation pursuant to the provisions of this Agreement to use its best
efforts to effect the registration of any Registrable Shares, the Company shall,
as expeditiously as practicable:
(i) use its best efforts to cause a Registration Statement
that registers such Registrable Shares to become and remain effective
for a period of 90
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days or until all of such Registrable Shares have been disposed of (if
earlier);
(ii) furnish, at least five business days before filing a
Registration Statement that registers such Registrable Shares, a
Prospectus relating thereto and any amendments or supplements relating
to such Registration Statement or Prospectus, to one counsel selected
by the Investors (the "Investors' Counsel"), copies of all such
documents proposed to be filed (it being understood that such
five-business-day period need not apply to successive drafts of the
same document proposed to be filed so long as such successive drafts
are supplied to such counsel in advance of the proposed filing by a
period of time that is customary and reasonable under the
circumstances);
(iii) prepare and file with the Commission 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 at least a period of 90 days or until all of
such Registrable Shares have been disposed of (if earlier) and to
comply with the provisions of the Securities Act with respect to the
sale or other disposition of such Registrable Shares;
(iv) notify the Investors' Counsel promptly in writing (A) of
any comments by the Commission with respect to such Registration
Statement or Prospectus, or any request by the Commission for the
amending or supplementing thereof or for additional information with
respect thereto, (B) of the issuance by the Commission of any stop
order suspending the effectiveness of such Registration Statement or
Prospectus or any amendment or supplement thereto or the initiation of
any proceedings for that purpose and (C) of the receipt by the Company
of any notification with respect to the suspension of the qualification
of such Registrable Shares for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purposes;
(v) use its best efforts to register or qualify such
Registrable Shares under such other securities or blue sky laws of such
jurisdictions as any seller of Registrable Shares reasonably requests
and do any and all other acts and things which may be reasonably
necessary or advisable to enable such seller of Registrable Shares to
consummate the disposition in such jurisdictions of the Registrable
Shares owned by such seller; provided, however, that the Company will
not be required to qualify generally to do business, subject itself to
general taxation or consent to general service of process in any
jurisdiction where it would not otherwise be required so to do but for
this clause (v);
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(vi) furnish to each seller of such Registrable Shares such
number of copies of a summary Prospectus or other Prospectus, including
a preliminary Prospectus, in conformity with the requirements of the
Securities Act, and such other documents as such seller of Registrable
Shares may reasonably request in order to facilitate the public sale or
other disposition of such Registrable Shares;
(vii) use its best efforts to cause such Registrable Shares to
be registered with or approved by such other governmental agencies or
authorities as may be necessary by virtue of the business and
operations of the Company to enable the seller or sellers thereof to
consummate the disposition of such Registrable Shares;
(viii) notify on a timely basis each seller of such
Registrable Shares at any time when a Prospectus relating to such
Registrable Shares is required to be delivered under the Securities Act
within the appropriate period mentioned in clause (i) of this Section 5
of the happening of any event as a result of which 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 light of the circumstances then existing and,
at the request of such seller, prepare and furnish to such seller a
reasonable number of copies of a supplement to or an amendment of such
Prospectus as may be necessary so that, as thereafter delivered to the
offerees of such shares, 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 light of the circumstances then existing;
(ix) make available for inspection by any seller of such
Registrable Shares, any underwriter participating in any disposition
pursuant to such Registration Statement and any attorney, accountant or
other agent retained by any such seller or underwriter (collectively,
the "Inspectors"), all pertinent financial, business and other records,
pertinent corporate documents and properties of the Company
(collectively, the "Records"), as shall be reasonably necessary to
enable them to exercise their due diligence responsibility, and cause
the Company's officers, directors and employees to supply all
information (together with the Records, the "Information") reasonably
requested by any such Inspector in connection with such Registration
Statement (and any of the Information which the Company determines in
good faith to be confidential, and of which determination the
Inspectors are so notified, shall
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not be disclosed by the Inspectors unless (A) the disclosure of such
Information is necessary to avoid or correct a misstatement or omission
in the Registration Statement, (B) the release of such Information is
ordered pursuant to a subpoena or other order from a court of competent
jurisdiction (subject to clause (D) below) or (C) such Information has
been made generally available to the public, and (D) the seller of
Registrable Shares agrees that it will, upon learning that disclosure
of such Information is sought in a court of competent jurisdiction,
give notice to the Company and allow the Company, at the Company's
expense, to undertake appropriate action to prevent disclosure of the
Information deemed confidential);
(x) use its best efforts to obtain from its independent
certified public accountants a "cold comfort" letter in customary form
and covering such matters of the type customarily covered by cold
comfort letters;
(xi) use its best efforts to obtain, from its counsel, an
opinion or opinions in customary form (which shall also be addressed to
the Investors selling Registrable Shares in such registration);
(xii) provide a transfer agent and registrar (which may be the
same entity and which may be the Company) for such Registrable Shares;
(xiii) issue to any underwriter to which any seller of
Registrable Shares may sell shares in such offering certificates
evidencing such Registrable Shares;
(xiv) use its best efforts to list such Registrable Shares on
any national securities exchange on which any shares of the Common
Stock are listed or, if the Common Stock is not listed on a national
securities exchange, use its best efforts to qualify such Registrable
Shares for inclusion on the automated quotation system of the National
Association of Securities Dealers, Inc. (the "NASD"), National Market
System ("NMS"), or such other national securities exchange as the
holders of a majority of such Registrable Shares shall request included
in such registration;
(xv) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make available
to its securityholders, as soon as reasonably practicable, earnings
statements which need not be audited covering a period of 12 months
beginning within three months after the effective date of the
Registration Statement, which earnings statements shall satisfy the
provisions of Section 11(a) of the Securities Act; and
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(xvi) use its best efforts to take all other steps necessary
to effect the registration of such Registrable Shares contemplated
hereby.
SECTION 6. EXPENSES. All expenses incurred by the Company in complying
with Section 5, including, without limitation, all registration and filing fees
(including all expenses incident to filing with the NASD), fees and expenses of
complying with securities and blue sky laws, printing expenses, fees and
expenses of the Company's counsel and accountants and fees and expenses of one
special legal counsel to the Investors selected by the Investors, shall be paid
by the Company; provided, however, that all underwriting discounts and selling
commissions applicable to the Registrable Shares shall not be borne by the
Company but shall be borne by the seller or sellers thereof, in proportion to
the number of Registrable Shares sold by such seller or sellers.
SECTION 7. INDEMNIFICATION.
(a) In connection with any registration of any Registrable Shares under
the Securities Act pursuant to this Agreement, the Company shall indemnify and
hold harmless the seller of such Registrable Shares, each underwriter, broker or
any other Person acting on behalf of such seller, each other Person, if any, who
controls any of the foregoing Persons within the meaning of the Securities Act
and each Representative of any of the foregoing Persons, against any losses,
claims, damages or liabilities, joint or several, to which any of the foregoing
Persons may become subject under the Securities Act or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement under which such
Registrable Shares were registered, any preliminary Prospectus or final
Prospectus contained therein, any amendment or supplement thereto or any
document incident to registration or qualification of any Registrable Shares, or
arise out of or are based upon the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading or, with respect to any Prospectus, necessary
to make the statements therein in light of the circumstances under which they
were made not misleading, or any violation by the Company of the Securities Act
or state securities or blue sky laws applicable to the Company and relating to
action or inaction required of the Company in connection with such registration
or qualification under such state securities or blue sky laws, and the Company
shall promptly reimburse such seller, such underwriter, such broker, such
controlling Person or such Representatives for any legal or other expenses
incurred by any of them in connection with investigating or defending any such
loss, claim, damage, liability or action; provided, however, that the Company
shall not be liable to any
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such Person to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in said Registration Statement, preliminary
Prospectus, amendment, supplement or document incident to registration or
qualification of any Registrable Shares in reliance upon and in conformity with
information furnished to the Company, or a Person duly acting on their behalf,
specifically for use in the preparation thereof; provided further, however, that
the foregoing indemnity agreement is subject to the condition that, insofar as
it relates to any untrue statement, allegedly untrue statement, omission or
alleged omission made in any preliminary Prospectus but eliminated or remedied
in the final Prospectus (filed pursuant to Rule 424 of the Securities Act), such
indemnity agreement shall not inure to the benefit of any indemnified party from
whom the Person asserting any loss, claim, damage, liability or expense
purchased the Registrable Shares which are the subject thereof, if a copy of
such final Prospectus had been timely made available to such indemnified Person
and such final Prospectus was not delivered to such Person with or prior to the
written confirmation of the sale of such Registrable Shares to such Person.
(b) In connection with any registration of Registrable Shares under the
Securities Act pursuant to this Agreement, each seller of Registrable Shares
shall indemnify and hold harmless (in the same manner and to the same extent as
set forth in the paragraph (a) of this Section 7) the Company, each underwriter
or broker involved in such offering, each other seller of Registrable Shares
under such Registration Statement, each Person who controls any of the foregoing
Persons within the meaning of the Securities Act and any Representative of the
foregoing Persons with respect to any statement or omission from such
Registration Statement, any preliminary Prospectus or final Prospectus contained
therein, any amendment or supplement thereto or any document incident to
registration or qualification of any Registrable Shares, if such statement or
omission was made in reliance upon and in conformity with written information
furnished to the Company or such underwriter through an instrument duly executed
by such seller or a Person duly acting on their behalf specifically for use in
connection with the preparation of such Registration Statement, preliminary
Prospectus, final Prospectus, amendment or supplement; provided, however, that
the maximum amount of liability in respect of such indemnification shall be
limited, in the case of each seller of Registrable Shares, to an amount equal to
the net proceeds actually received by such seller from the sale of Registrable
Shares effected pursuant to such registration.
(c) Promptly after receipt by an indemnified party of notice of the
commencement of any action involving a claim referred to in the preceding
paragraphs of this Section 7, such indemnified party will, if a claim in respect
thereof is made against an indemnifying party, give written notice to the latter
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of the commencement of such action (provided that an indemnified party's failure
to give such notice in a timely manner shall only relieve the indemnification
obligations of an indemnifying party to the extent such indemnifying party is
prejudiced by such failure). In case any such action is brought against an
indemnified party, 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 shall not be responsible for any legal or other
expenses subsequently incurred by the indemnified party in connection with the
defense thereof; provided, however, that if any indemnified party shall have
reasonably concluded that there may be one or more legal or equitable defenses
available to such indemnified party which are in addition to or conflict with
those available to the indemnifying party, or that such claim or litigation
involves or could have an effect upon matters beyond the scope of the indemnity
agreement provided in this Section 7, the indemnifying party shall not have the
right to assume the defense of such action on behalf of such indemnified party
and such indemnifying party shall reimburse such indemnified party and any
Person controlling such indemnified party for that portion of the fees and
expenses of any one lead counsel (plus appropriate special and local counsel)
retained by the indemnified party which are reasonably related to the matters
covered by the indemnity agreement provided in this Section 7.
(b) If the indemnification provided for in this Section 7 is held by a
court of competent jurisdiction to be unavailable to an indemnified party with
respect to any loss, claim, damage or liability referred to herein, then the
indemnifying party, in lieu of indemnifying such indemnified party hereunder,
shall contribute to the amounts paid or payable by such indemnified party as a
result of such loss, claim, damage or liability in such proportion as is
appropriate to reflect the relative fault of the indemnifying party on the one
hand and of the indemnified party on the other hand in connection with the
statements or omissions which resulted in such loss, claim, damage or liability
as well as any other relevant equitable considerations; provided, however, that
the maximum amount of liability in respect of such contribution shall be
limited, in the case of each seller of Registrable Shares, to an amount equal to
the net proceeds actually received by such seller from the sale of Registrable
Shares effected pursuant to such registration. The relative fault of the
indemnifying party and of the indemnified party shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission to state a material fact relates to information
supplied by the indemnifying party or by the indemnified party and the parties'
relative intent,
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knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) The indemnification and contribution provided for under this
Agreement will remain in full force and effect regardless of any investigation
made by or on behalf of the indemnified party and will survive the transfer of
securities.
SECTION 8. UNDERWRITING AGREEMENT.
(a) Notwithstanding the provisions of Sections 5 and 7, to the extent
that the Investors selling Registrable Shares in a proposed registration shall
enter into an underwriting or similar agreement, which agreement contains
provisions covering one or more issues addressed in such Sections of this
Agreement, the provisions contained in such Sections of this Agreement
addressing such issue or issues shall be of no force or effect with respect to
such registration, but this provision shall not apply to the Company if the
Company is not a party to the underwriting or similar agreement.
(b) If any registration pursuant to Section 2 is requested to be an
underwritten offering, the Company shall negotiate in good faith to enter into a
reasonable and customary underwriting agreement with the underwriters thereof.
The Company shall be entitled to receive indemnities from lead institutions,
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
specifically for inclusion in any Prospectus or Registration Statement and to
the extent customary given their role in such distribution.
(c) No Investor may participate in any registration hereunder that is
underwritten unless such Investor agrees to (i) sell such Investor's Registrable
Shares proposed to be included therein on the basis provided in any underwriting
arrangements acceptable to the Company and the Investors and (ii) as
expeditiously as possible, notify the Company of the occurrence of any event
concerning such Investor as a result of which the Prospectus relating to such
registration contains 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, in light of the circumstances under which they were made, not
misleading.
SECTION 9. SUSPENSION. Anything contained in this Agreement to the
contrary notwithstanding, the Company may (not more than once with respect to
each registration), by notice in writing to each holder of Registrable Shares to
which a Prospectus relates, require such holder to suspend, for up to 90 days
(the "Suspension Period"), the use of any Prospectus
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included in a Registration Statement filed under Section 2 or 3 if a Material
Transaction exists that would require an amendment to such Registration
Statement or supplement to such Prospectus (including any such amendment or
supplement made through incorporation by reference to a report filed under
Section 13 of the Exchange Act). The period during which such Prospectus must
remain effective shall be extended by a period equal to the Suspension Period.
The Company may (but shall not be obligated to) withdraw the effectiveness of
any Registration Statement subject to this provision.
SECTION 10. INFORMATION BY HOLDER. Each holder of Registrable Shares to
be included in any registration shall furnish to the Company and the managing
underwriter such written information regarding such holder and the distribution
proposed by such holder as the Company or the managing underwriter may
reasonably request in writing and as shall be reasonably required in connection
with any registration, qualification or compliance referred to in this
Agreement.
SECTION 11. EXCHANGE ACT COMPLIANCE. From and after the Registration
Date or such earlier date as a registration statement filed by the Company
pursuant to the Exchange Act relating to any class of the Company's securities
shall have become effective, the Company shall use its best efforts to comply
with all of the reporting requirements of the Exchange Act (whether or not it
shall be required to do so) and shall use its best efforts to comply with all
other public information reporting requirements of the Commission which are
conditions to the availability of Rule 144 for the sale of the Common Stock. The
Company shall cooperate with each Investor in supplying such information as may
be necessary for such Investor to complete and file any information reporting
forms presently or hereafter required by the Commission as a condition to the
availability of Rule 144.
SECTION 12. NO CONFLICT OF RIGHTS. The Company represents and warrants
to the Investors that the registration rights granted to the Investors hereby do
not conflict with any other registration rights granted by the Company. The
Company shall not, after the date hereof, grant any registration rights which
conflict with or impair, or have any priority over, the registration rights
granted hereby. In any underwritten PUBLIC OFFERING, the managing underwriter
shall be a nationally recognized investment banking firm selected by the
Company, and reasonably acceptable to the Investors if the Investors would have
the right (prior to giving effect to any cutbacks) to include Registrable Shares
in such PUBLIC OFFERING.
SECTION 13. TERMINATION. This Agreement shall terminate and be of no
further force or effect when there shall not be any Registrable Shares, provided
that Sections 6 and 7 shall survive the termination of this Agreement.
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SECTION 14. SUCCESSORS AND ASSIGNS. This Agreement shall bind and inure
to the benefit of the Company and the Investors and, subject to Section 15,
their respective successors and assigns.
SECTION 15. ASSIGNMENT. Each Investor may assign its rights hereunder
to any permitted purchaser from such Investor of Restricted Securities;
provided, however, that such purchaser shall, as a condition to the
effectiveness of such assignment, be required to execute a counterpart to this
Agreement agreeing to be treated as an Investor hereunder, whereupon such
purchaser shall have the benefits of, and shall be subject to the restrictions
contained in, this Agreement as an Investor.
SECTION 16. ENTIRE AGREEMENT. This Agreement contains the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all prior arrangements or understandings with respect hereto.
SECTION 17. NOTICES. All notices, requests, consents and other
communications hereunder to any party shall be deemed to be sufficient if
contained in a written instrument and shall be deemed to have been duly given
when delivered in Person, by telex, telegram or telecopy, by overnight courier,
or by first class registered or certified mail, postage prepaid, addressed to
such party at the address set forth below or such other address as may hereafter
be designated in writing by the addressee to the sender:
(i) if to the Company, to:
Safety 1st, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (412)
Attention: Xxxxxxx Xxxxxx;
with a copy to:
Xxxxxxx & Xxxxx, PC
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxx, Esq.;
(ii) if to any Investor, to him, her or its
address set forth on Schedule I or, if
none, in the books of the Company;
with a copy to:
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X'Xxxxxxxx Graev & Karabell, LLP
00 Xxxxxxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxxx, Esq..
(iii) if to Xxxxxx, to him at
Safety 1st, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxxxxxxxxx 00000
Telephone: (000) 000-0000
Telecopy: (412)
Attention: Xxxxxxx Xxxxxx;
with a copy to:
Xxxxxxx & Xxxxx, PC
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxx, Esq.;
All such notices, requests, consents and other communications shall be deemed to
have been delivered (a) in the case of personal delivery, telex, telegram or
telecopy, on the date of such delivery, (b) in the, case of overnight courier,
on the next business day, and (c) in the case of mailing, on the fifth business
day following such mailing.
SECTION 18. MODIFICATIONS; AMENDMENTS; WAIVERS. The terms and
provisions of this Agreement may not be modified or amended, nor may any
provision applicable to the Investors be waived, except pursuant to a writing
signed by (i) the Company and (ii) each of the Investors; provided, however,
that (A) any such amendment, modification, or waiver that would adversely affect
the rights hereunder of any Investor, in its capacity as an Investor, shall not
be effective as to such Investor without its prior written consent and (B)
Schedule I to this Agreement shall be deemed to be automatically amended from
time to time to reflect the addition to this Agreement of any Person identified
in clause (ii) of the definition of Investor without requiring the consent of
any party, and the Company will, from time to time, distribute to the Investors
revised Schedule I to reflect any such changes.
SECTION 19. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of
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reference only and shall not be deemed to be a part of this Agreement.
SECTION 20. SEVERABILITY. It is the desire and intent of the parties
that the provisions of this Agreement be enforced to the fullest extent
permissible under the law and public policies applied in each jurisdiction in
which enforcement is sought. Accordingly, if any provision of this Agreement
would be held in any jurisdiction to be invalid, prohibited or unenforceable for
any reason, such provision, as to such jurisdiction, shall be ineffective,
without invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.
Notwithstanding the foregoing, if such provision could be more narrowly drawn so
as not to be invalid, prohibited or unenforceable in such jurisdiction, it
shall, as to such jurisdiction, be so narrowly drawn, without invalidating the
remaining provisions of this Agreement or affecting the validity or
enforceability of such provision in any other jurisdiction.
SECTION 21. GOVERNING LAW; ETC. All questions concerning the
construction, interpretation and validity of this Agreement shall be governed by
and construed and enforced in accordance with the domestic laws of the State of
New York, without giving effect to any choice or conflict of law provision or
rule (whether in the State of New York or any other jurisdiction) that would
cause the application of the laws of any jurisdiction other than the State of
New York. In furtherance of the foregoing, the internal law of the State of New
York will control the interpretation and construction of this Agreement, even if
under such jurisdiction's choice of law or conflict of law analysis, the
substantive law of some other jurisdiction would ordinarily apply.
SECTION 22. COUNTERPARTS; VALIDITY. This Agreement may be executed in
any number of counterparts, each of which shall be an original, but all of which
taken together shall constitute one and the same agreement, and telecopied
signatures shall be effective. The failure of any Person holding Registrable
Shares to execute this Agreement shall not render this Agreement invalid as
between the Company and any other Person holding Registrable Shares.
SECTION 23. ENTIRE AGREEMENT This Agreement and the other documents,
certificates, instruments, writings and agreements referred to herein or
delivered pursuant hereto contain the entire understanding of the parties with
respect to the subject matter hereof and supersede in their entirety any and all
prior agreements and understandings between any of the parties hereto, all of
which are hereby terminated in their entirety and of no further force or effect.
* * * *
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IN WITNESS WHEREOF, the parties hereto have executed this Registration
Rights Agreement on the date first written above.
THE COMPANY:
SAFETY 1ST, INC.
By: /s/ Xxxxxxx X. Xxxx
-------------------------------
Name: Xxxxxxx X. Xxxx
Title: President
THE INVESTORS:
BT CAPITAL PARTNERS, INC.
By: /s/ Xxxxx X. Xxxxxxx
------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
BEAR, XXXXXXX & CO. INC.
By: /s/ Xxxxx X. Xxxxxxx
------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Managing Director
/s/ Xxxxxxx Xxxxxx
-----------------------------------
Xxxxxxx Xxxxxx
20
SCHEDULE I
INVESTORS
BT CAPITAL PARTNERS, INC.
BEAR, XXXXXXX & CO. INC.
