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Exhibit 10(a)
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
This Amended and Restated Registration Rights Agreement (this
"AGREEMENT") is made and entered into as of September 15, 1996 (the "EFFECTIVE
DATE") by and between Checkfree Corporation, a Delaware corporation (the
"COMPANY"), and Intuit Inc., a Delaware corporation ("INTUIT").
RECITALS
A. Intuit and the Company have entered into a certain Agreement and
Plan of Merger dated as of even date herewith (the "PLAN"), pursuant to which
Checkfree Acquisition Corporation II, a Delaware corporation and a wholly-owned
subsidiary of the Company ("NEWCO"), is to be merged with and into Intuit
Services Corporation, a Delaware corporation and a wholly-owned subsidiary of
Intuit ("SUB") in a statutory merger (the "MERGER").
B. Upon consummation of the Merger, Intuit, as Sub's sole stockholder,
will receive shares of the Common Stock of the Company upon the conversion of
the outstanding stock of Sub in the Merger. As a condition to the consummation
of the Merger, the Plan provides that Intuit shall be granted certain
registration rights with respect to the shares of the Company's Common Stock to
be issued to it in the Merger, all as more fully set forth herein.
C. This Agreement amends, restates, and supersedes that certain
Registration Rights Agreement dated as of September 15, 1996 previously entered
into by the parties (the "PRIOR REGISTRATION RIGHTS AGREEMENT").
1. REGISTRATION RIGHTS.
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1.1 DEFINITIONS. For purposes of this Section 1:
(a) REGISTRATION. The terms "REGISTER," "REGISTERED," and
"REGISTRATION" refer to a registration effected by preparing and filing a
registration statement in compliance with the Securities Act of 1933, as amended
(the "SECURITIES ACT"), and the declaration or ordering of effectiveness of such
registration statement.
(b) REGISTRABLE SECURITIES. The term "REGISTRABLE
SECURITIES" means: (1) all the shares of Common Stock of the Company issued to
Intuit in the Merger pursuant to the Plan, and (2) any shares of Common Stock of
the Company issued as (or issuable upon the conversion or exercise of any
warrant, right or other security which is issued as) a dividend or other
distribution with respect to, or in exchange for, or in replacement of, all such
shares of Common Stock of the Company described in clause (1) of this subsection
(b); EXCLUDING in all cases, however, any Registrable Securities sold by a
person in a transaction in which rights under this Section 1 are not assigned in
accordance with this Agreement or any Registrable Securities sold to the public
or sold pursuant to Rule 144 promulgated under the Securities Act.
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(c) SEC. The term "SEC" or "COMMISSION" means the U.S.
Securities and Exchange Commission.
(d) EFFECTIVE TIME; NASDAQ NM. The terms "EFFECTIVE TIME"
and "NASDAQ NM" shall have the same respective meanings that are given to such
terms in the Plan.
1.2 DEMAND REGISTRATION.
(a) REQUEST BY INTUIT. If the Company shall receive at
any time after the closing of the Merger a written request ("REQUEST") from
Intuit that the Company file a registration statement under the Securities Act
covering the registration of Registrable Securities pursuant to this Section
1.2, then the Company shall effect, as soon as practicable, the registration
under the Securities Act of all Registrable Securities which Intuit requests to
be registered in the Request, subject only to the limitations of this Section
1.2; PROVIDED, that the Registrable Securities requested by Intuit to be
registered pursuant to such request must be at least twenty percent (20%) of the
Registrable Securities issued to Intuit in the Merger; PROVIDED, HOWEVER, that
the first such request for registration under this Section 1.2(a) ("FIRST
REQUEST") may be for such lesser number of shares of Registrable Securities as
would reduce Intuit's ownership of the Company's Common Stock to less than
twenty percent (20%) of the shares of the Company's Common Stock outstanding
after such sale. Notwithstanding the foregoing, if due to action by an
underwriter as provided in Section 1.2(b), or for any other reason beyond
Intuit's control (including, but not limited to, actions by Checkfree or any
Checkfree stockholder, or any agreement to which Checkfree is a party), Intuit
is prevented from registering the minimum number of Registrable Securities
required for Intuit to request a registration of Registrable Securities under
this Section 1.2, then Intuit shall nevertheless be entitled to have registered
pursuant to this Section 1.2, such lesser number of Registrable Securities as it
is able to register. Notwithstanding the foregoing, the First Request may be
given by Intuit to the Company prior to the Effective Time, and if the First
Request is given to the Company prior to the Effective Time, then the Company
shall (i) immediately begin preparation of the registration statement to be used
to register the Registrable Securities to be covered in the registration that
is the subject of the First Request (the "FIRST REGISTRATION"); and (ii) use its
best efforts to file the registration statement for the First Registration with
the SEC as soon as practicable after the Effective Time.
(b) UNDERWRITING. The Registrable Securities covered by
the Request may be offered by means of an underwriting if Intuit so requests,
and Intuit shall so advise the Company as a part of its Request. If an
underwriting is requested by Intuit in its Request, then Intuit and the Company
shall enter into an underwriting agreement in customary form with the managing
underwriter or underwriters selected for such underwriting by the mutual
agreement of the Company and Intuit; PROVIDED, that neither the Company nor
Intuit shall unreasonably refuse to agree to a managing underwriter selected by
the other, but shall in good faith attempt to select mutually agreeable managing
underwriters. Notwithstanding any other provision of this Section 1.2, if the
underwriters advise the Company in writing that marketing factors require a
limitation of the number
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of securities to be underwritten, then the Company shall so advise Intuit, and
the number of Registrable Securities that may be included in the underwriting
shall be reduced as required by the underwriters; PROVIDED, HOWEVER, that the
number of shares of Registrable Securities to be included in such underwriting
and registration shall not be reduced unless all other securities of the Company
and any other selling securityholder are first entirely excluded from the
underwriting and registration. Any Registrable Securities excluded and withdrawn
from such underwriting shall be withdrawn from the registration.
(c) MAXIMUM NUMBER OF DEMAND REGISTRATIONS. The Company
is obligated to effect only one (1) such registration pursuant to this Section
1.2 per calendar year, commencing with 1997.
(d) EXPENSES. Intuit shall bear all discounts,
commissions or other amounts payable to underwriters or brokers with respect to
the sale of Registrable Securities by Intuit in such offering, as well as
Intuit's Pro Rata Share (as that term is defined below) of one-half of all other
expenses incurred in connection with a registration pursuant to this Section
1.2, including without limitation all federal and "blue sky" registration and
qualification fees, printers' and accounting fees, fees and disbursements of
counsel for the Company and for Intuit. As used in this Section 1.2(d), Intuit's
"PRO RATA SHARE" with respect to an offering, means the percentage obtained by
dividing (i) the number of shares of the Company's Common Stock registered and
sold by Intuit in such offering by (ii) the total number of shares of the
Company's Common Stock sold in such offering by all parties (including Intuit)
other than the Company.
(e) RIGHTS OF THE COMPANY. Notwithstanding anything to
the contrary in this Section 1.2 or otherwise in this Agreement, the Company
shall not be obligated to take any action to effect any such registration
pursuant to this Section 1.2 as follows:
(i) In any particular jurisdiction in which the
Company would be required to execute a general consent to service of process in
effecting such registration unless the Company is already subject to service in
such jurisdiction and except as may be required by the Securities Act;
(ii) If the Company, within ten (10) days of the
receipt of a registration Request of Intuit under Section 1.2, gives written
notice to Intuit of the Company's bona fide intention to effect the filing,
within thirty (30) days of receipt of such Request, of a registration statement
with the Commission for the sale of securities by the Company (other than with
respect to a registration statement relating to a Rule 145 transaction, an
offering solely to employees or any other registration which is not appropriate
for the registration of Registrable Securities), in which event, (x) Intuit
shall be entitled to exercise its piggyback registration rights under Section
1.3 hereof with respect to such registration, (y) the Company shall be required
in good faith to employ all reasonable efforts to cause its registration
statement to become effective and to give prompt written notice to Intuit if the
Company abandons its effort to file or causes its registration statement to
become effective, and (z) in the event the Company gives notice that it has
abandoned its registration
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statement efforts, the Company shall promptly renew its best efforts to register
the Registrable Securities that were the subject of Intuit's demand registration
Request if so requested in writing by Intuit within ten (10) days after Intuit's
receipt of notice that the Company has abandoned its registration efforts;
(iii) During the period starting with the filing of
and ending on the date ninety (90) days immediately following the effective date
of any registration statement pertaining to securities of the Company (other
than a registration of securities in a Rule 145 transaction or with respect to
an employee benefit plan), provided that the Company is actively employing in
good faith all reasonable efforts to cause such registration statement to become
effective;
(iv) If the Company shall furnish to Intuit a
certificate signed by the President of the Company stating that in the good
faith judgment of the Board of Directors of the Company it would be seriously
detrimental, for the specific reasons stated in such certificate, to the Company
or its shareholders for a registration statement to be filed in the near future,
then the Company's obligation to use its best efforts to register under this
Section 1.2 shall be deferred for a period not to exceed one hundred and twenty
(120) days from the date of receipt of the written Request from Intuit; PROVIDED
that the Company may not exercise this right with respect to the registration
requested by the First Request if such First Request is received by the Company
on or before March 1, 1997; or
(v) Unless at least one hundred and eighty (180)
days shall have expired from the effectiveness of a previous registration of
Registrable Securities pursuant to this Section 1.2 or pursuant to a previous
registration under Section 1.3 below in which Intuit was given the opportunity
to include in such registration at least the lesser of (i) five percent (5%) of
the Registrable Securities issued to Intuit in the Merger, or (ii) all
Registrable Securities then owned by Intuit.
Subject to the foregoing clauses (i) through (v), the Company shall file a
registration statement covering the Registrable Securities so requested to be
registered as soon as practicable after receipt of the request or requests of
Intuit.
1.3 PIGGYBACK REGISTRATIONS. The Company shall notify Intuit
in writing at least twenty (20) days prior to filing any registration statement
under the Securities Act for purposes of effecting a public offering of
securities of the Company (including, but not limited to, registration
statements relating to secondary offerings of securities of the Company, but
EXCLUDING registration statements relating solely to any registration under
Section 1.2 of this Agreement or any employee benefit plan or a Rule 145
transaction) and will afford Intuit, subject to the terms and conditions set
forth herein, an opportunity to include in such registration statement all or
any part of the Registrable Securities then held by Intuit. Intuit shall, within
five (5) business days after receipt of the above-described notice from the
Company, so notify the Company in writing, and in such notice shall inform the
Company of the number of Registrable Securities Intuit wishes to include in such
registration statement. If Intuit decides not to include all of its Registrable
Securities in any registration statement thereafter filed by the Company, Intuit
shall nevertheless continue to have the right to include any Registrable
Securities not included in such registration statement in any
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subsequent registration statement or registration statements as may be filed by
the Company with respect to offerings of its securities, all upon the terms and
conditions set forth herein. If Intuit is given the opportunity to include in
any registration statement filed under this Section 1.3 at least the lesser of
(i) five percent (5%) of the Margin Registrable Securities issued to Intuit in
the Merger, or (ii) all Registrable Securities then owned by Intuit, then Intuit
shall not make a request for registration under Section 1.2 hereof for at least
one hundred and eighty (180) days after the earlier of the termination of such
offering or the effectiveness of such registration statement.
(a) UNDERWRITING. If a registration statement under
which the Company gives notice under this Section 1.3 is for an underwritten
offering, then the Company shall so advise Intuit. In such event, Intuit's right
to include Registrable Securities in a registration pursuant to this Section 1.3
shall be conditioned upon Intuit's participation in such underwriting and the
inclusion of Intuit's Registrable Securities in the underwriting to the extent
provided herein. Intuit shall enter into an underwriting agreement in customary
form with the managing underwriter or underwriters selected for such
underwriting. Notwithstanding any other provision of this Agreement, if the
managing underwriter determines in good faith that marketing factors require a
limitation of the number of shares to be underwritten, then the managing
underwriters may exclude shares (including Registrable Securities) from the
registration and the underwriting, and the number of shares that may be included
in the registration and the underwriting shall be allocated, FIRST, to the
Company, and SECOND, to Intuit; PROVIDED, HOWEVER, that the right of the
underwriters to exclude shares (including Registrable Securities) from the
registration and underwriting as described above shall be restricted so that:
(i) the number of Registrable Securities included in any such registration is
not reduced below twenty percent (20%) of the shares included in the
registration; and (ii) all shares that are not Registrable Securities and are
held by other shareholders of the Company, (except those shareholders with
registration rights that, as of the Effective Date of the Plan, are senior to or
on a pari passu basis with those of Intuit and are disclosed to Intuit in the
Plan or any disclosure letter delivered to Intuit pursuant to the Plan), shall
first be excluded from such registration and underwriting before any Registrable
Securities are so excluded. If Intuit disapproves of the terms of any such
underwriting, Intuit may elect to withdraw therefrom by written notice to the
Company and the managing underwriter, delivered at least ten (10) business days
prior to the effective date of the registration statement. Any Registrable
Securities excluded or withdrawn from such underwriting shall be excluded and
withdrawn from the registration.
(b) EXPENSES. Intuit shall bear all discounts,
commissions or other amounts payable to underwriters or brokers with respect to
the sale of Registrable Securities by Intuit in any offering registered under
this Section 1.3 and fees and disbursements of counsel for Intuit in connection
with such offering. All other expenses incurred in connection with a
registration pursuant to this Section 1.3, including, without limitation all
federal and "blue sky" registration and qualification fees, printers' and
accounting fees, and fees and disbursements of counsel for the Company shall be
borne by the Company.
1.4 SHELF REGISTRATION. As soon as practicable after the
Effective Time (but not later than ten (10) business days after the Effective
Time), the Company shall file a registration statement on Form S-3 for a
continuous registered shelf offering under Rule 415 of the Securities
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Act (the "SHELF REGISTRATION STATEMENT") covering the registration of all
Registrable Securities (the "SHELF REGISTERED SECURITIES"). The Company shall
use its best efforts to cause the Shelf Registration Statement and the
registration of the Shelf Registered Securities thereunder to be declared
effective by the SEC as soon as practicable following the Effective Time, and
shall continuously maintain the effectiveness of the Shelf Registration
Statement at all times following the Effective Time until the second (2nd)
anniversary of the Effective Time. Intuit's right to offer and sell Shelf
Registered Securities pursuant to the Shelf Registration Statement shall be
subject to the following limitations:
(a) LIMITATION ON AMOUNT OF SECURITIES SOLD. For as
long as Intuit may be an affiliate of the Company as defined in the Securities
Act, the amount of Shelf Registered Securities that may be sold by Intuit in
each sale of Shelf Registered Securities in reliance on the Shelf Registration
Statement under this Section 1.4, together with all sales of other shares of the
Company's Common Stock for the account of Intuit within the preceding three
months (EXCLUDING any sales of the Company's Common Stock by Intuit pursuant to
registrations filed pursuant to Section 1.2 or 1.3 of this Agreement), shall not
exceed the greater of (i) one percent (1%) of the shares of the Company's Common
Stock outstanding as shown by the most recent report or statement published by
the Company, or (ii) the average weekly reported volume of trading in shares of
the Company's Common Stock on all national securities exchanges and/or reported
through the automated quotation system of a registered securities association
during the four calendar weeks preceding Intuit's delivery to the Company of the
notice required by Section 1.4(b).
(b) NOTICE OF PROPOSED SALE. Intuit shall give the
Company written notice of its bona fide intention to sell Shelf Registered
Securities pursuant to the Shelf Registration Statement at least seven (7)
business days in advance of the proposed date of sale, and the Company shall act
as soon as practicable to make any necessary filings with the Securities and
Exchange Commission and regulatory bodies as may be necessary to permit the sale
of the Shelf Registered Securities in accordance with Section 1.4(a).
(c) MINIMUM AMOUNT OF SECURITIES SOLD. Each request
to sell Shelf Registered Securities under this Section 1.4 shall be for such
number of shares of the Company's Common Stock having an aggregate sale price of
at least $250,000.
(d) EXPENSES. Intuit shall bear all discounts,
commissions or other amounts payable to underwriters or brokers and fees and
disbursements of counsel for Intuit in connection with sales of Shelf Registered
Securities by Intuit. All other expenses incurred in connection with a sale of
Shelf Registered Securities pursuant to this Section 1.4, including, without
limitation all federal and "blue sky" registration and qualification fees,
printers' and accounting fees, and fees and disbursements of counsel for the
Company shall be borne by the Company.
(e) CURATIVE MEASURES. If for any reason the Shelf
Registration Statement ceases to be effective at any time prior to the second
(2nd) anniversary of the Effective Time, then the Company shall use its best
efforts to cause the Shelf Registration Statement (or a new shelf
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registration statement conforming to the provisions of this Section 1.4) to be
declared effective by the SEC and remain effective until the second (2nd)
anniversary of the Effective Time.
1.5 OBLIGATIONS OF THE COMPANY. Whenever required to effect
the registration of any Registrable Securities under this Agreement, and except
as otherwise provided in this Section or otherwise in this Agreement, the
Company shall, as expeditiously as reasonably possible:
(a) Prepare promptly and 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, and, keep
such registration statement effective (i) with respect to a registration
statement filed pursuant to Section 1.2 or 1.3 hereof, for ninety (90) days (or
until the earlier sale of the Registrable Securities covered thereby), and (ii)
with respect to a shelf registration statement filed pursuant to Section 1.4
hereof, until the second (2nd) anniversary of the Effective Time, which
registration statement (including any amendments or supplements thereto and
prospectuses contained therein) shall not contain any 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, in light of the circumstances in which
they were made, not misleading.
(b) Prepare promptly and file with the SEC such
amendments and supplements to such registration statement and the prospectus
used in connection with such registration statement as may be necessary to
comply with the provisions of the Securities Act with respect to the disposition
of all securities covered by such registration statement.
(c) Furnish to Intuit such number of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as it may
reasonably request in order to facilitate the disposition of the Registrable
Securities owned by it that are included in such registration.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities or
Blue Sky laws of such jurisdictions as shall be reasonably requested by Intuit,
PROVIDED, that the Company shall not be required in connection therewith or as a
condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions.
(e) In the event of any underwritten public
offering, enter into and perform its obligations under an underwriting
agreement, in usual and customary form, with the managing underwriters of such
offering.
(f) Notify Intuit at any time when a prospectus
relating to the Registrable Securities is required to be delivered under the
Securities Act 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
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necessary to make the statements therein not misleading in the light of the
circumstances then existing.
(g) Furnish, at the request of Intuit, on the date
that such Registrable Securities are delivered to the underwriters for sale, if
such securities are being sold through underwriters, or, if such securities are
not being sold through underwriters, on the date that the registration statement
with respect to such securities becomes effective, (i) an opinion, dated as of
such date, of the counsel representing the Company for the purposes of such
registration, in form and substance as is customarily given to underwriters in
an underwritten public offering and reasonably satisfactory to Intuit, addressed
to the underwriters, if any, and to Intuit, and (ii) a "comfort" letter dated as
of such date, from the independent certified public accountants of the Company,
in form and substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering and reasonably
satisfactory to a Intuit, addressed to the underwriters, if any, and to Intuit.
(h) Make generally available to its security holders
as soon as practical, but not later than ninety (90) days after the close of the
period covered thereby, an earnings statement (in form complying with the
provisions of Rule 158 promulgated under the Securities Act) covering a
twelve-month period beginning not later than the first day of the Company's
fiscal quarter next following the effective date of any registration statement
and any post-effective amendment thereto.
(i) Make available for inspection by Intuit, any
underwriter participating in any underwritten offering of Registrable
Securities, and any attorney, accountant or other agent retained by Intuit or
any such underwriter (collectively, the "INSPECTORS"), all pertinent documents
of the Company (collectively, the "RECORDS"), as shall be reasonably necessary
to enable each Inspector to exercise its due diligence responsibility, if and to
the extent it has any such responsibility under the Securities Act, and cause
the Company's officers, directors and employees to supply all information which
any Inspector may reasonably request for purposes of exercising such due
diligence; PROVIDED, HOWEVER, that each Inspector shall hold in confidence and
shall not make any disclosure (except to Intuit) of any Record or other
non-public information relating to the Company received by such Inspector unless
(i) the disclosure of such Records is necessary to avoid or correct a
misstatement or omission in any Registration Statement, (ii) the release of such
Records is ordered pursuant to a subpoena or other order from a court or
government body of competent jurisdiction or (iii) the information in such
Records has been made generally available to the public other than by disclosure
in violation of this or any other agreement; and PROVIDED, FURTHER, HOWEVER,
that in the event Intuit obtains material nonpublic information concerning the
Company pursuant to this Section 1.5(i) or Section 1.5(a) or (f) or otherwise,
such Inspector shall not purchase or sell or otherwise trade in any securities
of the Company in violation of applicable law until such information is made
public by the Company. The Company shall not be required to disclose any
confidential information in such Records to any Inspector until and unless such
Inspector shall have entered into a confidentiality agreement (in form and
substance reasonably satisfactory to the Company) with the Company with respect
thereto, substantially in the form of this Section 1.5(i). Intuit agrees that it
shall, upon learning that disclosure of such Records is sought in or by a court
or
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governmental body of competent jurisdiction, give prompt notice to the Company
and allow the Company, at its expense, to undertake appropriate action to
prevent disclosure of, or to obtain a protective order for, the Records deemed
confidential.
(j) Use its best efforts either to (i) cause all the
Registrable Securities covered by any registration statement to be listed on a
national securities exchange, if the listing of such Registrable Securities is
then permitted under the rules of such exchange, or (ii) secure the quotation of
the Registrable Securities on the Nasdaq NM if such quotation is then permitted
under the rules of the Nasdaq NM.
(k) Provide a transfer agent and registrar, which
may be a single entity, for the Registrable Securities not later than the
effective date of any registration statement.
(l) Cooperate with Intuit and the managing
underwriter or underwriters of any offering involving Registrable Securities, if
any, to facilitate the timely preparation and delivery of certificates (not
bearing any restrictive legends) representing Registrable Securities to be sold
pursuant to a registration effected hereto, and enable such certificates to be
in such denominations or amounts as the case may be, and registered in such
names as the managing underwriter or underwriters, if any, or Intuit, may
reasonable request.
(m) Take all other reasonable actions necessary to
expedite and facilitate disposition by Intuit of the Registrable Securities
pursuant to the registration statement.
1.6 FURNISH INFORMATION. It shall be a condition precedent to
the obligations of the Company to take any action pursuant to Sections 1.2, 1.3,
or 1.4 that Intuit shall furnish to the Company such information regarding it,
the Registrable Securities held by it, and the intended method of disposition of
such securities as shall be required to timely effect the registration of its
Registrable Securities.
1.7 INDEMNIFICATION. In the event any Registrable Securities
are included in a registration statement under Sections 1.2, 1.3, or 1.4:
(a) BY THE COMPANY. To the extent permitted by law,
the Company will indemnify and hold harmless Intuit, officers and directors of
Intuit, any underwriter (as defined in the Securities Act) for Intuit and each
person, if any, who controls Intuit or such underwriter within the meaning of
the Securities Act or the Securities Exchange Act of 1934, as amended (the "1934
ACT"), against any losses, claims, damages, or liabilities (joint or several) to
which they may become subject under the Securities Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages, or liabilities
(or actions in respect thereof) arise out of or are based upon any of the
following statements, omissions or violations (collectively a "VIOLATION"):
(i) any untrue statement or alleged untrue
statement of a material fact contained in a registration
statement filed pursuant to this Section 1, including
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any preliminary prospectus or final prospectus contained
therein or in any amendments or supplements thereto;
(ii) the omission or alleged omission to state
in a registration statement filed pursuant to this Section 1
(including any preliminary prospectus or final prospectus
contained therein or in any amendments or supplements
thereto), a material fact required to be stated therein, or
necessary to make the statements therein not misleading; or
(iii) any violation or alleged violation by the
Company of the Securities Act, the 1934 Act, any federal or
state securities law or any rule or regulation promulgated
under the Securities Act, the 1934 Act or any federal or state
securities law in connection with the offering covered by such
registration statement;
and the Company will reimburse each of Intuit, such officer or director,
underwriter or controlling person for any legal or other expenses reasonably
incurred by them, as incurred, in connection with investigating or defending any
such loss, claim, damage, liability or action; PROVIDED, HOWEVER, that the
indemnity agreement contained in this subsection 1.7(a) shall not apply to
amounts paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of the Company (which consent
shall not be unreasonably withheld), nor shall the Company be liable in any such
case for any such loss, claim, damage, liability or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by Intuit, or by such, officer, director, underwriter or
controlling person of Intuit.
(b) BY INTUIT. To the extent permitted by law, Intuit
will indemnify and hold harmless the Company, each of its directors, each of its
officers who have signed the registration statement, each person, if any, who
controls the Company within the meaning of the Securities Act, and any
underwriter, against any losses, claims, damages or liabilities (joint or
several) to which the Company or any such director, officer, controlling person
or underwriter may become subject under the Securities Act, the 1934 Act or
other federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by Intuit expressly for use in connection with such registration; and
Intuit will reimburse any legal or other expenses reasonably incurred by the
Company or any such director, officer, controlling person, underwriter in
connection with investigating or defending any such loss, claim, damage,
liability or action; PROVIDED, HOWEVER, that the indemnity agreement contained
in this subsection 1.7(b) shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability or action if such settlement is effected
without the consent of Intuit, which consent shall not be unreasonably withheld;
and PROVIDED, FURTHER, that the total amounts payable in indemnity by Intuit
under this Section 1.7(b) in respect of any Violation shall not exceed the net
proceeds received by Intuit in the registered offering out of which such
Violation arises.
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(c) NOTICE. Promptly after receipt by an indemnified
party under this Section 1.7 of notice of the commencement of any action
(including any governmental action), such indemnified party will, if a claim for
indemnification in respect thereof is to be made against any indemnifying party
under this Section 1.7, deliver to the indemnifying party a written notice of
the commencement of such an action and the indemnifying party shall have the
right to participate in, and, to the extent the indemnifying party so desires,
jointly with any other indemnifying party similarly noticed, to assume the
defense thereof with counsel mutually satisfactory to the parties; PROVIDED,
HOWEVER, that an indemnified party shall have the right to retain its own
counsel, with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential conflict of
interests between such indemnified party and any other party represented by such
counsel in such proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action, if prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section
1.7, but the omission so to deliver written notice to the indemnifying party
will not relieve it of any liability that it may have to any indemnified party
otherwise than under this Section 1.7.
(d) DEFECT ELIMINATED IN FINAL PROSPECTUS. The
foregoing indemnity agreements of the Company and Intuit are subject to the
condition that, insofar as they relate to any Violation made in a preliminary
prospectus but eliminated or remedied in the amended prospectus on file with the
SEC at the time the registration statement in question becomes effective or in
the amended prospectus filed with the SEC pursuant to SEC Rule 424(b) (the
"FINAL PROSPECTUS"), such indemnity agreements shall not inure to the benefit of
any person if a copy of the Final Prospectus was furnished to the indemnified
party and was not furnished to the person asserting the loss, liability, claim
or damage at or prior to the time such action is required by the Securities Act.
(e) CONTRIBUTION. In order to provide for just and
equitable contribution to joint liability under the Securities Act in any case
in which either (i) Intuit (and/or any officer, director, underwriter or
controlling person who may be indemnified under Section 1.7(a)), makes a claim
for indemnification pursuant to this Section 1.7 but it is judicially determined
(by the entry of a final judgment or decree by a court of competent jurisdiction
and the expiration of time to appeal or the denial of the last right of appeal)
that such indemnification may not be enforced in such case notwithstanding the
fact that this Section 1.7 provides for indemnification in such case, or (ii)
contribution under the Securities Act may be required on the part of Intuit
(and/or any officer, director, underwriter or controlling person who may be
indemnified under Section 1.7(a)) in circumstances for which indemnification is
provided under this Section 1.7; then, and in each such case, the Company and
Intuit (and/or such other person) will contribute to the aggregate losses,
claims, damages or liabilities to which they may be subject (after contribution
from others) in proportion to their relative fault as determined by a court of
competent jurisdiction; PROVIDED, HOWEVER, that in no event (i) shall Intuit be
responsible for more than the portion represented by the percentage that the
public offering price of the Registrable Securities offered and sold by Intuit
under the registration statement bears to the public offering price of all
securities offered and sold under such registration statement and (ii) shall
Intuit be required to contribute any amount in excess of the
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public offering price of all such Registrable Securities offered and sold by
Intuit pursuant to such registration statement; and in any event, no person or
entity guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) will be entitled to contribution from any person or
entity who was not guilty of such fraudulent misrepresentation.
(f) SURVIVAL. The obligations of the Company and
Intuit under this Section 1.7 shall survive the completion of any offering of
Registrable Securities in a registration statement, and otherwise.
1.8 RULE 144 REPORTING. With a view to making available the
benefits of certain rules and regulations of the Commission which may at any
time permit the sale of the Registrable Securities to the public without
registration, for so long as Intuit owns any Registrable Securities, the Company
agrees to:
(a) Make and keep public information available, as
those terms are understood and defined in Rule 144 under the Securities Act, at
all times;
(b) File with the Commission in a timely manner all
reports and other documents required of the Company under the 1934 Act; and
(c) So long as Intuit owns any Registrable
Securities, to furnish to Intuit forthwith upon request a written statement by
the Company as to its compliance with the reporting requirements of said Rule
144, a copy of the most recent annual or quarterly report of the Company, and
such other reports and documents of the Company as Intuit may reasonably request
in availing itself of any rule or regulation of the Commission allowing a Holder
to sell any such securities without registration.
1.9 TERMINATION OF THE COMPANY'S OBLIGATIONS. The Company
shall have no obligations to register Registrable Securities held by Intuit (i)
if all Registrable Securities have been registered and sold pursuant to
registrations effected pursuant to this Agreement, or (ii) after the fifth
anniversary of the Effective Time of the Merger; provided, however, that if the
Company defers a demand registration pursuant to Section 1.2(e)(iv), then the
expiration date under this clause (ii) shall be extended for one year for each
occasion on which the Company has exercised such rights.
1.10 PREFERENCE TO OUTSTANDING REGISTRATION RIGHTS. The
Company has previously entered into agreements dated as of May 6, 1996 granting
to certain holders of Common Stock of the Company issued in connection with the
acquisition of Security APL, Inc. registration rights with respect to such
securities that provides, that until May 9, 1998, the Company shall not enter
into any agreement granting any holder or prospective holder of any securities
of the Company registration rights with respect to such securities unless such
new agreement specifies that the rights of such holders under the May 6, 1996
agreements shall have preference to the holders of such new registration rights.
Accordingly, Intuit acknowledges that its registration rights under this
Agreement are subordinate to the registration rights granted under the May 6,
1996 agreements.
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1.11 LIMITATIONS ON SUBSEQUENT REGISTRATION RIGHTS. From and
after the date of this Agreement, the Company shall not, without the prior
written consent of Intuit, enter into any agreement with any holder or
prospective holder of any securities of the Company which would allow such
holder or prospective holder (a) to include such securities in any registration
filed under Section 1.2, 1.3, or 1.4 hereof, unless under the terms of such
agreement, such holder or prospective holder may include such securities in any
such registration only to the extent that the inclusion of his securities will
not reduce the amount of the Registrable Securities of Intuit which is included,
or (b) to make a demand registration which could result in such registration
statement being declared effective (i) during the effectiveness of any
registration statement effected pursuant to Section 1.2, or (ii) within one
hundred twenty (120) days of the effective date of any registration effected
pursuant to Section 1.2.
2. ASSIGNMENT.
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2.1 ASSIGNMENT. Notwithstanding anything herein to the
contrary, the registration rights of Intuit under Section 1 hereof may be
assigned only to (a) a party who acquires a number of shares of Company Common
Stock equal to at least fifty percent (50%) of the shares of Common Stock that
constituted the original number of Registrable Securities (as such number may be
adjusted to reflect subdivisions, combinations and stock dividends of the
Company's Common Stock) or (b) any party who acquires ownership or control of
Intuit through a merger, consolidation, sale of assets or similar business
combination; PROVIDED, HOWEVER that no party may be assigned any of the
foregoing rights until the Company is given written notice by the assigning
party at the time of such assignment stating the name and address of the
assignee and identifying the securities of the Company as to which the rights in
question are being assigned; and PROVIDED FURTHER, that any such assignee shall
receive such assigned rights subject to all the terms and conditions of this
Agreement, including without limitation the provisions of this Section 2.
3. GENERAL PROVISIONS.
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3.1 STANDOFF AGREEMENT. Intuit agrees, so long as it holds at
least five percent (5%) of the Company's outstanding voting equity securities,
that, upon request of the Company or the underwriters managing an underwritten
offering of the Company's securities, Intuit will not sell, make any short sale
of, loan, grant any option for the purchase of, or otherwise dispose of any
Registrable Securities (other than those included in the registration) without
the prior written consent of the Company or such underwriters, as the case may
be, for such period of time (not to exceed ninety (90) days) from the effective
date of such registration as may be requested by the underwriters; PROVIDED,
that if any officer or director of the Company who owns at least one percent
(1%) of the outstanding voting equity securities of the Company does not agree
to such restrictions, then Intuit shall not be required to do so either; and
PROVIDED that the foregoing provisions of this Section 3.1 shall not apply to
any sale of Registrable Securities by Intuit pursuant to the registration
requested by the First Request if such First Request is received by the Company
on or before March 1, 1997.
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3.2 NOTICES. Any notice, request or other communication
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given if personally delivered or if deposited in the U.S. mail by
registered or certified mail, return receipt requested, postage prepaid, as
follows:
(a) If to Intuit, at:
Intuit Inc.
0000 Xxxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Attention: Chief Executive Officer
with a copy to:
Fenwick & West LLP
Xxx Xxxx Xxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
(b) If to Checkfree:
Checkfree Corporation
0000 Xxxx Xxxxx Xxxxxx Xxxx
Xxxxxxxx, Xxxxxxx 00000
Attention: President
with a copy to:
Checkfree Corporation
0000 Xxxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxx 00000
Attn: General Counsel
and
Porter, Wright, Xxxxxx & Xxxxxx
00 Xxxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxx 00000
Attention: Xxxxxx X. Xxxxxxxx, Esq.
Any party hereto (and such party's permitted assigns) may by notice so given
provide and change its address for future notices hereunder. Notice shall
conclusively be deemed to have been given when personally delivered or when
deposited in the mail in the manner set forth above.
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3.3 ENTIRE AGREEMENT. This Agreement, constitutes and contains
the entire agreement and understanding of the parties with respect to the
subject matter hereof and supersedes any and all prior negotiations,
correspondence, agreements, understandings, duties or obligations between the
parties respecting the subject matter hereof, including but not limited to the
Prior Registration Rights Agreement.
3.4 AMENDMENT OF RIGHTS. Any provision of this Agreement may
be amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company and Intuit (and/or any of their permitted
successors or assigns).
3.5 GOVERNING LAW. This Agreement shall be governed by and
construed exclusively in accordance with the internal laws of the State of
Delaware as applied to agreements among Delaware residents entered into and to
be performed entirely within Delaware, excluding that body of law relating to
conflict of laws and choice of law.
3.6 SEVERABILITY. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, then such provision(s) shall
be excluded from this Agreement and the balance of this Agreement shall be
interpreted as if such provision(s) were so excluded and shall be enforceable in
accordance with its terms.
3.7 THIRD PARTIES. Nothing in this Agreement, express or
implied, is intended to confer upon any person, other than the parties hereto
and their successors and assigns, any rights or remedies under or by reason of
this Agreement.
3.8 SUCCESSORS AND ASSIGNS. Subject to the provisions of
Section 2.1, the provisions of this Agreement shall inure to the benefit of, and
shall be binding upon, the successors and permitted assigns of the parties
hereto.
3.9 CAPTIONS. The captions to sections of this Agreement have
been inserted for identification and reference purposes only and shall not be
used to construe or interpret this Agreement.
3.10 COUNTERPARTS. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date and year first above written.
CHECKFREE CORPORATION INTUIT INC.
By:__________________________ By:_____________________________
Title: _______________________ Title: ___________________________
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