EXHIBIT 10.2
EXHIBIT C
CTC COMMUNICATIONS GROUP, INC.
SERIES B PREFERRED STOCK
REGISTRATION RIGHTS AGREEMENT
Dated as of March __, 2000
REGISTRATION RIGHTS AGREEMENT
This Agreement (the "Agreement") is made as of _________, 2000 by and
among CTC COMMUNICATION GROUP, INC., a Delaware corporation (the "Company")
and the parties listed as Investors on Exhibit A hereto (the "Investors").
WHEREAS, the Company and the other parties hereto wish to provide
certain arrangements with respect to the registration of shares of Common
Stock of the Company under the Securities Act.
NOW, THEREFORE, in consideration of the mutual promises and obligations
contained herein, the parties agree as follows:
Definitions tc \l3 "Definitions .
"Commission" means the Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act or the Exchange
Act.
"Common Stock" means the Common Stock, $0.01 par value of the Company.
"Closing Date" means _______, 2000
"Exchange Act" means the Securities Exchange Act of 1934 and the rules
and regulations of the Commission thereunder, and any successor to such
statute or such rules and regulations.
"Form S-1", "Form S-3", "Form S-4" and "Form S-8" mean respective forms
under the Securities Act and any successor registration forms.
"Holder" means any person owning Registrable Securities or any assignee
thereof in accordance with Section 10 hereof.
"Initiating Holder" means, with respect to any registration of
securities of the Company, the holder or holders under the agreement pursuant
to which holder or holders first proposed registration of its securities and
exercised its right to initiate the registration of its securities for the
registration statement in question (i.e. by exercising its so called "demand"
rights).
"Majority Participating Holders" means, with respect to any
registration of Registrable Securities, the holder or holders at the relevant
time of at least a majority of the Registrable Securities to be included in
the registration statement in question.
"Preferred Stock" means the Company's Series B Convertible Preferred
Stock, $1.00 par value.
"Register", "registered", and "registration" refer to a registration
effected by preparing and filing a registration statement or similar document
in compliance with the Securities Act, and the automatic effectiveness or the
declaration or ordering of effectiveness of such registration statement or
document.
"Registrable Securities" means (i) any Common Stock (including Common
Stock into which shares of Preferred Stock are convertible) issued or
issuable to a Purchaser under the Stock Purchase Agreement, or (ii) any
common stock or other securities issued or issuable with respect to any
Registrable Securities by way of stock dividend or stock split or in
connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization or otherwise. Registrable Securities
shall cease to be Registrable Securities (i) when a registration statement
with respect to the sale of such securities shall have become effective under
the Securities Act and such securities shall have been disposed of in
accordance with such registration statement, (ii) when such securities shall
have been publicly distributed pursuant to an exemption from the registration
requirements of the Securities Act or (iii) when all of the Registrable
Securities held by a Holder could be sold under Rule 144 in a three (3) month
period. For purposes of this Agreement, the number of shares of Registrable
Securities outstanding at any time shall be determined by adding the number
of shares of Common Stock outstanding which are, and the maximum number of
shares of Common Stock issuable pursuant to then convertible or exercisable
securities which upon issuance would be, Registrable Securities.
"Registration Expenses" means all expenses incident to performance of
or compliance with Sections 2, 3 and 4 hereof by the Company, including
without limitation all registration and filing fees, all listing fees, all
fees and expenses of complying with securities or blue sky laws, all printing
and automated document preparation expenses, all messenger and delivery
expenses, the fees and disbursements of counsel for the Company and of its
independent public accountants, including the expenses of any special audits
required by or incident to such performance and compliance, and the fees and
disbursements of one counsel for the Holders on whose behalf Registrable
Securities are being registered, but excluding underwriting discounts and
commissions and applicable transfer taxes, if any, which shall be borne by
the sellers of the Registrable Securities in all cases.
"Rule 144" means Rule 144 promulgated under the Securities Act, and any
successor rule or regulation thereto, and in the case of any referenced
section of such rule, any successor section thereto, collectively and as from
time to time amended and in effect.
"Securities Act" means the Securities Act of 1933 or any successor
federal statute, and the rules and regulations of the Commission thereunder,
and in the case of any referenced section of any such statute, rule or
regulation, any successor section thereto, collectively and as from time to
time amended and in effect.
"Stock Purchase Agreement" means the Series B Preferred Stock Purchase
Agreement dated _______ by and between the Company and the Holders.
Required Registrations.
Registration on Request tc \l3 "Registration on Request .
(i) At any time after the first anniversary of the Closing, one
or more Holders of a majority of then outstanding Registrable
Securities may, by written notice to the Company, request that
the Company effect the registration under the Securities Act of
not less than the lesser of 20% or $30 million of the then
outstanding Registrable Securities held by such Holders as a
group. If the Holders initiating such registration intend to
distribute the Registrable Securities in an underwritten
offering, they shall so state in their request. Promptly after
receipt of such notice, the Company will give written notice of
such requested registration to all other holders of Registrable
Securities. The Company will then use reasonable efforts to
effect the registration as promptly as possible under the
Securities Act of the Registrable Securities which the Company
has been requested to register by such Holders, and all other
Registrable Securities which the Company has been requested to
register by other Holders of Registrable Securities by notice
delivered to the Company within fifteen (15) days after the
giving of such notice by the Company.
(ii) If within twelve (12) months of the Closing Date Xxxxxx
Xxxxxxxxxxxx sells in excess of thirty percent (30%) of the total
number of shares of Common Stock beneficially owned by him
(including shares issuable upon the exercise or conversion of any
options, warrants, or other securities convertible into the
capital stock of the Company) as of the Closing Date, the Company
shall so notify the Holders and thereafter the Holders may
request in writing that the Company effect the registration under
the Securities Act of all or part of the Registrable Securities,
provided that such request is delivered prior to the later of (x)
the first anniversary of the Closing Date and (y) fifteen (15)
days following delivery by the Company of such notice.
Effective Registration. A registration requested pursuant to this
Section 2 shall not be deemed to be effected (i) if a registration statement
with respect thereto shall not have become effective, or (ii) if after it has
become effective, such registration is interfered with for any reason by any
stop order, injunction or other order or requirement of the Commission or any
other governmental agency or any court, and the result of such interference
is to prevent the Holder from disposing of the Registrable Securities to be
sold thereunder in accordance with the intended methods of disposition.
Underwriting. If the Holders so elect, the offering of Registrable
Securities pursuant to a registration request under this Section 2 shall be
in the form of an underwritten offering. The Company shall select the book-
running lead underwriter and any additional investment bankers and managers
in connection with the offering each of which shall be reasonably
satisfactory to the Holders.
Postponement tc \l3 "Effective Registration. A registration requested
pursuant to this Section 2 shall not be deemed to be effected (i) if a
registration statement with respect thereto shall not have become effective,
or (ii) if after it has become effective, such registration is interfered
with for any reason by any stop order, injunction or other order or
requirement of the Commission or any other governmental agency or any court,
and the result of such interference is to prevent the Holder from disposing
of the Registrable Securities to be sold thereunder in accordance with the
intended methods of disposition.Underwriting. If the Holders so elect, the
offering of Registrable Securities pursuant to a registration request under
this Section 2 shall be in the form of an underwritten offering. The Company
shall select the book-running lead underwriter and any additional investment
bankers and managers in connection with the offering each of which shall be
reasonably satisfactory to the Holders.Postponement and Suspension. The
Company may postpone the filing or the effectiveness of any registration
requested pursuant to this Section 2 for a period of up to ninety (90) days
if the Board of Directors of the Company in good faith determines that such
registration is likely to have an adverse effect on the Company; provided,
however, that the Company may not exercise such right of postponement more
frequently than one time in any twelve (12) month period. The Company may
suspend the effectiveness of any "shelf" registration statement if the Board
of Directors of the Company in good faith determines that such registration
is likely to have an adverse effect on the Company; provided, however, that
the Company may not suspend the effectiveness of any "shelf" registration
statement for more than a total of ninety (90) days.
Number of Requests; Form tc \l3 "Number of Requests; Form . The Company
shall not be required to effect more than three (3) registrations pursuant to
Section 2(a)(i). Each registration requested pursuant to Section 2(a) shall
be effected by the filing of a registration statement on Form S-1 or S-3, at
the Company's discretion; provided, that, if the Company elects Form S-3, it
will include such additional information that would have been required by
Form S-1 upon the reasonable request of the managing underwriter. The
Company shall not be required to effect more than one (1) registration under
this section 2 during any six (6) month period.
Payment of Expenses tc \l3 "Payment of Expenses . The Company hereby
agrees to pay, all Registration Expenses in connection with all registrations
effected pursuant to Section 2. However, the Company shall not be required
to pay for any expenses of such registration proceeding if the registration
request is withdrawn at any time at the request of the Majority Participating
Holders (in which case all participating Holders shall bear such expenses),
unless in the case of a registration requested pursuant to Section 2, the
Holders of a majority of the Registrable Securities agree to forfeit their
right to one demand registration pursuant to Section 2 at the time of any
such withdrawal, which forfeiture shall bind all holders of Registrable
Securities.
tc \l2 " Piggyback Registration.
If the Company at any time proposes to register any of its equity
securities under the Securities Act, for its own account or for the account
of any holder of its securities other than Registrable Securities (other than
on a Form X-0, X-0, or any form which not would permit registration of
Registrable Securities for sale to the public under the Securities Act), the
Company will each such time give written notice to all holders of Registrable
Securities. Any such holder may by written response delivered to the Company
within fifteen (15) days after the giving of any such notice request that all
or a specified part of the Registrable Securities held by such holder be
included in such registration. Such response shall also specify the intended
method of disposition of such Registrable Securities. The Company thereupon
will use reasonable efforts as a part of its filing of such form to effect
the registration under the Securities Act of all Registrable Securities which
the Company has been so requested to register by the holders of Registrable
Securities, to the extent required to permit the disposition (in accordance
with the intended methods thereof as aforesaid) of the Registrable Securities
so to be registered. If any Holder wishes to register securities of the same
class or series as the Company or any other holder, such registration shall
be on the same terms and conditions as the registration of the Company's or
other holder's securities. The Company shall be under no obligation to
complete any offering of its securities it proposes to make and shall incur
no liability to any holder for its failure to do so.
Payment of Expenses. The Company hereby agrees to pay all Registration
Expenses in connection with each registration of Registrable Securities
requested pursuant to this Section 3.
Registration Procedures tc \l2 "Registration Procedures . If and whenever the
Company is required to use reasonable efforts to effect the registration and
sale of any Registrable Securities under the Securities Act as provided in
Sections 2 or 3 hereof, subject to Section 2(c), the Company will use
reasonable efforts to:
Registration Statement tc \l3 "Registration Statement . Prepare and
(in the case of a registration pursuant to Section 2 hereof, promptly and in
any event within ninety (90) days after the end of the period within which
requests for registration may be delivered to the Company) file with the
Commission a registration statement with respect to such Registrable
Securities and use reasonable efforts to cause such registration statement to
become and remain effective. Such registration statement shall be for an
offering to be made on a continuous or delayed basis (a so-called "shelf"
registration statement) if the Company is eligible for the use thereof and
the Majority Participating Holders have requested a shelf registration
statement.
Amendments and Supplements to Registration Statement tc \l3 "Amendments
and Supplements to Registration Statement . 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 and to comply with the provisions of the
Securities Act with respect to the disposition of all Registrable Securities
and other securities, if any, covered by such registration statement until
the later of (i) such time as all of such Registrable Securities have been
disposed of in accordance with the intended methods of disposition by the
seller or sellers thereof set forth in such registration statement (but in no
event for a period of more than ninety (90) days after such registration
statement becomes effective, plus, in the case of a "shelf" registration, the
number of days for which the effectiveness of such registration was suspended
pursuant to Section 2(b)) or (ii) the expiration of the time when a
prospectus relating to such registration is required to be delivered under
the Securities Act.
Furnishing of Copies of Registration Statements and Other Documents tc
\l3 "Furnishing of Copies of Registration Statements and Other Documents .
Furnish to each seller of such Registrable Securities such number of
conformed copies of such registration statement and of each such amendment
and supplement thereto (in each case including all exhibits, except that the
Company shall not be obligated to furnish any such seller with more than two
copies of such exhibits other than incorporated documents), such number of
copies of the prospectus included in such registration statement (including
each preliminary prospectus and any summary prospectus), each in conformity
with the requirements of the Securities Act, such documents incorporated by
reference in such registration statement or prospectus and such other
documents as such seller may reasonably request in order to facilitate the
disposition of its Registrable Securities covered by such registration
statement.
State Securities Laws tc \l3 "State Securities Laws . Use reasonable
efforts to register or qualify such Registrable Securities under such
securities or blue sky laws of such jurisdictions as the sellers shall
reasonably request, and do any and all other acts and things which may be
necessary or advisable to enable each seller to consummate the disposition in
such jurisdictions of its Registrable Securities covered by such registration
statement; provided, however, that the Company shall not be obligated to file
any general consent to service of process or to qualify as a foreign
corporation or subject the Company to taxation in any jurisdiction in which
it is not so qualified.
Opinion of Counsel; Comfort Letter tc \l3 "Opinion of Counsel; Comfort
Letter . Use reasonable efforts to obtain all legal opinions, auditors'
consents and comfort letters as may be required in an underwritten offering,
including furnishing to any underwriter of such Registrable Securities (i) an
opinion of counsel for the Company and (ii) a "cold comfort" letter signed by
the independent public accountants who have certified the Company's financial
statements included in such registration statement, covering substantially
the same matters as are customarily covered in opinions of issuer's counsel
and in accountants' letters delivered to underwriters in underwritten public
offerings of securities.
Notice of Prospectus Defects tc \l3 "Notice of Prospectus Defects .
Notify each seller of Registrable Securities covered by such registration
statement, at any time when a prospectus relating thereto 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 any
material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, and at the request of any such seller prepare and furnish to such
seller a reasonable number of copies of a supplement to or an amendment of
such prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such Registrable Securities, such prospectus shall not include
an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing.
After the filing of the registration statement, the Company will
promptly notify the registering Holders of any stop order issued or
threatened by the Commission and take all reasonable actions required to
prevent the entry of such stop order or to remove it if entered.
General Compliance with Federal Securities Laws; Section 11(a) Earning
Statement tc \l3 "General Compliance with Federal Securities Laws;
Section 11(a) Earning Statement . Otherwise use reasonable efforts to comply
with the Securities Act, the Exchange Act and any other applicable rules and
regulations of the Commission, and make available to its security holders, as
soon as reasonably practicable, an earning statement covering the period of
at least twelve (12) months after the effective date of such registration
statement, which earning statement shall satisfy Section 11(a) of the
Securities Act and any applicable regulations thereunder, including Rule 158.
Exchange Listing tc \l3 "Exchange Listing . Use reasonable efforts to
list such Registrable Securities on Nasdaq or on any securities exchange on
which any equity security of the Company is then listed.
Transfer Agent tc \l3 "Transfer Agent . Provide a transfer agent for
all such Registrable Securities not later than the effective date of such
registration statement.
Conversion only Upon Consummation of Offering. tc \l3 "Conversion only
Upon Consummation of Offering. No Holder shall be required by this
Agreement to convert any Registrable Security into Common Stock except at the
applicable closing or closings of an underwritten registered offering and
except upon the sale of such Registrable Security in the case of other
registered offerings.
Additional Procedures in Underwritten Offerings; Holder Lockups; Cutbacks
"Additional Procedures in Underwritten Offerings; Holder Lockups; Cutbacks .
Registrations Upon Request Pursuant to Section 2 tc \l3 "Registrations
Upon Request Pursuant to Section 2 . In the case of a registration pursuant
to Section 2 hereof, whenever the Majority Participating Holders shall
request that such registration shall be effected pursuant to an underwritten
offering, such registration shall be so effected, and only securities which
are to be distributed by the underwriters of that offering may be included in
such registration. If requested by such underwriters, the Company and each
participating seller will enter into an underwriting agreement with such
underwriters for such offering containing terms and provisions as are
customarily contained in underwriting agreements with respect to secondary
distributions, including, without limitation, indemnity and contribution.
(i) Cutbacks on Holder Demands. If the managing underwriter
advises the Holders requesting registration pursuant to Section
2(a) that the number of shares to be included in a registration
pursuant to Section 2(a) should be limited due to market
conditions, then the securities to be included in such
registration shall be reduced to the extent recommended by the
managing underwriter in the following order: (1) first,
securities proposed to be included by the Company or other
holders without rights to participate therein as determined by
the Company, (2) second, Common Stock of all holders with rights
to be included therein, except for those of the Holders, will be
excluded pro rata among all such Common Stock requested to be
included therein and (3) third, Registrable Securities of the
Holders, to be excluded pro rata based on the number of
Registrable Securities requested to be included therein by such
Holder (whether pursuant to Section 2 or Section 3 hereof).
b. Piggyback Registrations Pursuant to Section 3; Cutbacks tc \l3
"Piggyback Registrations Pursuant to Section 3; Cutbacks . In
connection with the exercise of any registration rights granted
to holders of Registrable Securities pursuant to Section 3
hereof, if the registration is to be effected by means of an
underwritten offering of Common Stock, the Company may condition
participation in such registration by such holders upon inclusion
of the Registrable Securities being so registered in such
underwriting and such holders executing such underwriting
agreements, questionnaires and related documents customarily
required of selling holders in an underwritten offering.
(i) Cutbacks on Company Registrations. If the managing
underwriter for an offering initiated by the Company shall advise
the Company in writing that the total amount of securities,
including Registrable Securities, requested by shareholders to be
included in such offering exceeds the amount of securities to be
sold other than by the Company that can be successfully offered,
then the Company shall be required to include in the offering only
that number of such securities, including Registrable Securities,
which the managing underwriter believes will not jeopardize the
success of the offering. In such case, the securities so included
shall be reduced in the following order: (1) first, all securities
proposed to be included, except for those of the Company, will be
excluded pro rata among all such securities requested to be
included therein and (2) second, securities proposed to be
included by the Company.
(ii) Cutbacks on other Holders Demands. If the managing
underwriter for an offering initiated by a holder other than the
Holders or the Company shall advise the Company in writing that
the total amount of securities, including Registrable Securities,
requested by shareholders to be included in such offering exceeds
the amount of securities that can be successfully offered, then
the Company shall be required to include in the offering only that
number of such securities, including Registrable Securities, which
the managing underwriter believes will not jeopardize the success
of the offering. In such case, the securities so included shall
be reduced in the following order: (1) first, securities proposed
to be included by the Company or other holders without rights to
participate therein as determined by the Company, (2) second,
securities of all holders except for those of the Initiating
Holder, will be excluded pro rata among all such securities
requested to be included therein and (3) third, registrable
securities of the Initiating Holders pro rata on the basis set
forth in the applicable agreement.
x. Xxxxxxx Party to Underwriting Agreement tc \l3 "x. Xxxxxxx
Party to Underwriting Agreement . The holders of Registrable
Securities to be distributed in any underwritten offering shall be
parties to the underwriting agreement entered into by the Company
in connection therewith.
Holder Lockup Agreements in Connection with Public Offering
Each Holder agrees that
without the consent of the managing underwriter it will not, for a period of
ninety (90) days following the effective date of the registration statement
for any underwritten offering by the Company of its equity securities,
directly or indirectly sell, offer to sell, grant any option for the sale of,
or otherwise dispose of any common equity or securities convertible into
common equity, except (i) for the Registrable Securities sold pursuant to
such registration statement, and (ii) transfers to Controlled Affiliates (as
defined in the Stock Purchase Agreement), or as part of a pro rata
distribution to partners or members of such Holder (each of whom shall have
furnished to the Company and the managing underwriter their written consent
to be bound by this Section 6 during such lockup period).
Term . This Agreement shall terminate on the earlier of: (i) the date
all Registrable Securities hereunder have been registered and sold.
Indemnification and Contribution tc \l2 "Indemnification and Contribution .
Indemnities of the Company and the Issuer tc \l3 "Indemnities of the
Company and the Issuer . In the event of any registration of any Registrable
Securities under the Securities Act pursuant to Section 2 or 3 hereof, the
Company will, and hereby does, indemnify and hold harmless each seller of
Registrable Securities and each other Person, if any, who controls any such
seller within the meaning of Section 15 of the Securities Act (each such
Person being referred to herein as a "Covered Person"), against any losses,
claims, damages, liabilities or expenses joint or several, to which such
Covered Person may be or become subject under the Securities Act, the
Exchange Act, any other securities or other law of any jurisdiction, common
law or otherwise, insofar as such losses, claims, damages, liabilities or
expenses (or actions or proceedings in respect thereof) arise out of or are
based upon (i) any untrue statement or alleged untrue statement of any
material fact contained or incorporated by reference in any registration
statement under the Securities Act, any preliminary prospectus or final
prospectus included therein, or any related summary prospectus, or any
amendment or supplement thereto, or any document incorporated by reference
therein, or (ii) any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein not misleading, and will reimburse such Covered Person for any legal
or any other expenses incurred by it in connection with investigating or
defending any such loss, claim, damage, liability, action or proceeding;
provided, however, that the Company shall not be liable to any Covered Person
in any such case for any such loss, claim, damage, liability, action or
proceeding (i) to the extent that it arises out of or is based upon an untrue
statement or alleged untrue statement or omission or alleged omission made in
such registration statement, any such preliminary prospectus, final
prospectus, summary prospectus, amendment or supplement or incorporated
document, in reliance upon and in conformity with written information
furnished to the Company or on behalf of such Covered Person expressly for
inclusion therein or (ii) such untrue statement or alleged untrue statement
or omission or alleged omission was contained in a preliminary prospectus and
corrected in a final or amended prospectus, and such Holder received and
failed to deliver a copy of the final or amended prospectus at or prior to
the confirmation of the sale of the Registrable Securities to the person
asserting any such loss, claim, damage or liability in any case in which such
delivery is required by the Securities Act. The indemnities of the Company
contained in this Section 8 shall remain in full force and effect regardless
of any investigation made by or on behalf of such Covered Person and shall
survive any transfer of Registrable Securities.
Indemnities to the Company tc \l3 "Indemnities to the Company . In the
event of any registration of Registrable Securities pursuant to Section 2 or
3, each selling Holder will, and hereby does, indemnify and hold harmless (in
the same manner and to the same extent as set forth in Section 8(a) hereof)
the Company, and each Person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act, with respect to any statement in
or omission from such registration statement, any preliminary prospectus or
final prospectus included therein, or any amendment or supplement thereto, or
any document incorporated therein, if such statement or omission was made in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of such seller expressly for inclusion therein,
provided that the Holder shall not be liable to the Company in any case in
which such untrue statement or alleged untrue statement or omission or
alleged omission was contained in a preliminary prospectus and corrected in a
final or amended prospectus, and the Company failed to deliver a copy of the
final or amended prospectus at or prior to the confirmation of the sale of
the securities to the person asserting any such loss, claim, damage or
liability in any case in which such delivery is required by the Securities
Act. Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of the Company or any such director,
officer or controlling Person and shall survive any transfer of Registrable
Securities.
Indemnification Procedures tc \l3 "Indemnification Procedures .
Promptly after receipt by an indemnified party of notice of the commencement
of any action or proceeding involving a claim of the type referred to in the
foregoing provisions of this Section 8, such indemnified party will, if a
claim in respect thereof is to be made against any indemnifying party, give
written notice to each such indemnifying party of the commencement of such
action; provided, however, that the failure of any indemnified party to give
notice to such indemnifying party as provided herein shall not relieve such
indemnifying party of its obligations under the foregoing provisions of this
Section 8, except to the extent that such indemnifying party is actually
prejudiced by such failure to give notice. In case any such action is
brought against an indemnified party, each 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 (who
shall not, except with the consent of the indemnified party, be counsel to
such an indemnifying party), and after notice from an indemnifying party to
such indemnified party of its election so to assume the defense thereof, such
indemnifying party will not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
defense thereof; provided, however, that (i) if the indemnified party
reasonably determines that there may be a conflict between the positions of
such indemnifying party and the indemnified party in conducting the defense
of such action or that there may be defenses available to such indemnified
party different from or in addition to those available to such indemnifying
party, then counsel for the indemnified party shall conduct the defense to
the extent reasonably determined by such counsel to be necessary to protect
the interests of the indemnified party and such indemnifying party shall
employ separate counsel for its own defense, (ii) in any event, the
indemnified party shall be entitled to have counsel chosen by such
indemnified party participate in, but not conduct, the defense and (iii) the
indemnifying party shall bear the legal expenses incurred in connection with
the conduct of, and the participation in, the defense as referred to in
clauses (i) and (ii) above and all such fees and expenses shall be reimbursed
as they are incurred. If, within a reasonable time after receipt of the
notice, such indemnifying party shall not have elected to assume the defense
of the action, such indemnifying party shall be responsible for any legal or
other expenses incurred by such indemnified party in connection with the
defense of the action, suit, investigation, inquiry or proceeding. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its consent, but if settled with such consent, or if there
be a final judgement for the plaintiff, the indemnifying party shall
indemnify and hold harmless such indemnified parties from and against any
loss or liability (to the extent stated above) by reason of such settlement
or judgement. No indemnifying party will consent to entry of any judgment or
enter into any settlement which does not include as an unconditional term
thereof the giving by the claimant or plaintiff to the indemnified party
subject to such proceeding of a release from all liability in respect to such
claim or litigation.
Contribution tc \l3 "Contribution . If the indemnification provided
for in Sections 8(a) or 8(b) hereof is unavailable to a party that would have
been an indemnified party under any such Section in respect of any losses,
claims, damages, liabilities or expenses (or actions or proceedings in
respect thereof) referred to therein, then each party that would have been an
indemnifying party thereunder shall, in lieu of indemnifying such indemnified
party, contribute to the amount paid or payable by such indemnified party as
a result of such losses, claims, damages, liabilities or expenses (or actions
or proceedings in respect thereof) in such proportion as is appropriate to
reflect the relative fault of such indemnifying party on the one hand and
such indemnified party on the other in connection with the statements or
omissions which resulted in such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof). The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by such indemnifying
party or such indemnified party and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The parties agree that it would not be just and equitable if
contribution pursuant to this Section 8(d) were determined by pro rata
allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the preceding sentence. The
amount paid or payable by a contributing party as a result of the losses,
claims, damages or liabilities (or actions or proceedings in respect thereof)
referred to above in this Section 8(d) shall include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. No Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation.
Limitation on Liability of Holders of Registrable Securities tc \l3
"Limitation on Liability of Holders of Registrable Securities . The
liability of each Holder in respect of any indemnification or contribution
obligation of such holder arising under this Section 8 shall not in any event
exceed an amount equal to the proceeds to such Holder (after deduction of all
underwriters' discounts and commissions) from the disposition of the
Registrable Securities disposed of by such Holder pursuant to such
registration.
Reports Under Securities Exchange Act of 1934 tc \l3 "Reports Under Securities
Exchange Act of 1934 . With a view to making available to the Holders the
benefits of Rule 144 and any other rule or regulation of the SEC that may at
any time permit a Holder to sell securities of the Company to the public
without registration, and with a view to making it possible for Holders to
register the Registrable Securities pursuant to a registration on Form S-3,
the Company agrees to:
(a) use reasonable efforts to make and keep public information
available, as those terms are understood and defined in Rule 144;
and
(b) use reasonable efforts to file with the SEC in a timely manner
all reports and other documents required of the Company under the
Securities Act and the Exchange Act.
Assignment of Registration Rights. The
rights to cause the Company to register Registrable Securities pursuant to
Sections 2 and 3 may be assigned by any Holder to a permitted transferee, and
by such transferee to a subsequent permitted transferee, but only if such
rights are transferred (a) to Controlled Affiliate (as defined in the Stock
Purchase Agreement), (b) as part of a pro rata distribution to partners or
members of such Holder or (c) in connection with the sale or other transfer
of not less than an aggregate of 200,000 Registrable Securities or some
lesser number, if such lesser number represents all the Registrable
Securities then held by such Holder. Any transferee to whom rights under
this Agreement are transferred shall (i) as a condition to such transfer,
deliver to the Company a written instrument by which such transferee agrees
to be bound by the obligations imposed upon Holders under this Agreement to
the same extent as if such transferee were a Holder under this Agreement and
(ii) be deemed to be a Holder hereunder.
Notices. All notices, requests, consents and demands shall be in
writing and shall be personally delivered, mailed, postage prepaid,
telecopied or telegraphed or delivered by any nationally recognized overnight
delivery service to the Company at:
CTC Communications Group, Inc.
000 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: President
Facsimile No.: 000-000-0000
with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxx Xxxxx, Esq.
Fax No.: (000) 000-0000
to each Investor at its address set forth on Exhibit A hereto with a
copy to:
Xxxxx Xxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxxxx
or such other address as may be furnished in writing to the other
parties hereto. All such notices, requests, demands and other
communication shall, when mailed (registered or certified mail,
return receipt requested, postage prepaid), personally delivered, or
telegraphed, be effective four days after deposit in the mails, when
personally delivered, or when delivered to the telegraph company,
respectively, addressed as aforesaid, unless otherwise provided
herein and, when telecopied or delivered by any nationally
recognized overnight delivery service, shall be effective upon
actual receipt.
Entire Agreement tc \l3 "Entire Agreement . This Agreement and the Stock
Purchase Agreement constitute the entire understanding of the parties
with respect to the subject matter hereof and thereof and supersede
any and all prior understandings and agreements, whether written or
oral, with respect to such subject matter.
Amendments, Waivers and Consents tc \l3 "Amendments, Waivers and Consents .
Any provision in this Agreement may be made, and the observance
thereof may be waived, if the Company (a) shall obtain consent
thereto in writing from persons holding a majority of the Registrable
Securities then outstanding and (b) shall deliver copies of such
consent to any Holders who did not execute the same.
Binding Effect; Assignment tc \l3 "Binding Effect; Assignment . This
Agreement shall be binding upon and inure to the benefit of the
personal representatives, successors and assigns of the respective
parties hereto. Notwithstanding the foregoing sentence, the Company
shall not have the right to assign its obligations hereunder or any
interest herein without obtaining the prior written consent of the
Holders holding a majority of the Registrable Securities then
outstanding, provided in accordance with Section 13.
General. The headings contained in this Agreement are for reference
purposes only and shall not in any way affect the meaning or
interpretation of this Agreement. This Agreement shall be governed
by and construed in accordance with the laws of the State of New
York.
Severability. If any provision of this Agreement shall be found by any
court of competent jurisdiction to be invalid or unenforceable, the
parties hereby waive such provision to the extent that it is found to
be invalid or unenforceable. Such provision shall, to the maximum
extent allowable by law, be modified by such court so that it becomes
enforceable, and, as modified, shall be enforced as any other
provision hereof, all the other provisions hereof continuing in full
force and effect.
Counterparts. This Agreement may be executed in counterparts, all of which
together shall constitute one and the same instrument.
[Remainder of the page intentioanlly left blank]
IN WITNESS WHEREOF, the Company and the Investors have executed this
Agreement as of the date and year first above written.
The Company: CTC COMMUNICATIONS GROUP, INC.
By: _________________________
Name:
Title:
The Investors: CREDIT SUISSE FIRST BOSTON EQUITY PARTNERS, L.P.
By: Credit Suisse First Boston Advisory
Partners, LLC, as Investment Advisor
By: _________________________
Name:
Title:
CREDIT SUISSE FIRST BOSTON EQUITY PARTNERS (BERMUDA),
L.P.
By: Credit Suisse First Boston Advisory
Partners, LLC, as Investment Advisor
By: _________________________
Name:
Title:
CREDIT SUISSE FIRST BOSTON U.S. EXECUTIVE ADVISORS, L.P.
By: Credit Suisse First Boston Advisory
Partners, LLC, as Investment Advisor
By: _________________________
Name:
Title:
EMA PRIVATE EQUITY FUND 1999, L.P.
By: Credit Suisse First Boston (Bermuda) Limited, as
General Partner
By: _________________________
Name:
Title:
The Bain Funds:
XXXX CAPITAL FUND VI, L.P.
By: Xxxx Capital Partners VI, L.P., its general
partner
By: Xxxx Capital Investors VI, Inc., its general
partner
By:_______________________________
Name:
Title: Managing Director
XXXX CAPITAL VI COINVESTMENT FUND, L.P.
By: Xxxx Capital Partners VI, L.P., its general
partner
By: Xxxx Capital Investors VI, Inc., its general
partner
By:_______________________________
Name:
Title: Managing Director
BCIP ASSOCIATES II
By: Xxxx Capital, Inc., its Managing Partner
By:_______________________________
Name:
Title: Managing Director
BCIP TRUST ASSOCIATES II
By: Xxxx Capital, Inc., its Managing Partner
By:_______________________________
Name:
Title: Managing Director
BCIP ASSOCIATES II-B
By: Xxxx Capital, Inc., its Managing Partner
By:_______________________________
Name:
Title: Managing Director
BCIP TRUST ASSOCIATES II-B
By: Xxxx Capital, Inc., its Managing Partner
By:_______________________________
Name:
Title: Managing Director
BCIP ASSOCIATES II-C
By: Xxxx Capital, Inc., its Managing Partner
By:_______________________________
Name:
Title: Managing Director
PEP INVESTMENTS PTY LTD.
By: Xxxx Capital, Inc., its attorney-in-fact
By:_______________________________
Name:
Title: Managing Director
BROOKSIDE CAPITAL PARTNERS FUND, L.P.
By:_______________________________
Name:
Title: Managing Director
SANKATY HIGH YIELD ASSET PARTNERS, L.P.
By:_______________________________
Name:
Title: Managing Director
SANKATY HIGH YIELD PARTNERS II, L.P.
By:_______________________________
Name:
Title: Managing Director
The TH Xxx Investors:
XXXXXX X. XXX EQUITY FUND IV, L.P.
By: THL Equity Advisors IV, L.L.C. as General
Partner
By:_______________________________
Name:
Title:
XXXXXX X. XXX FOREIGN FUND IV, L.P.
By: THL Equity Advisors IV, L.L.C. as General
Partner
By:_______________________________
Name:
Title:
XXXXXX X. XXX FOREIGN FUND IV-B, L.P.
By: THL Equity Advisors IV, L.L.C. as General Partner
By:_______________________________
Name:
Title:
XXXXXX X. XXX INVESTORS LIMITED PARTNERSHIP
By:_______________________________
Name:
Title:
XXXXXX X. XXX CHARITABLE INVESTMENT LIMITED
PARTNERSHIP
By: Xxxxxx X. Xxx
as General Partner
By:_______________________________
1997 XXXXXX X. XXX NOMINEE TRUST
By: State Street Bank and Trust Company, as
Trustee
By:__________________________________
Name:
Title:
__________________________________
XXXXX X. XXXXXXX
__________________________________
THE HARKINS 1995 GIFT TRUST
__________________________________
XXXXX X. XXXXXX
__________________________________
X. XXXXXX XXXX
___________________________________
XXXXX X. XXXXXXXX
___________________________________
XXXXXXX X. XXXXXX
___________________________________
XXXXXX X. XXXXXXX
__________________________________
XXXXXX X. XXXXX, XX.
__________________________________
XXXX X. XXXXX
__________________________________
XXXX X. XXXXXX
__________________________________
XXXXXXXX X. XXXXXX
__________________________________
XXXX X. XXXXXXXX
__________________________________
XXXXXXX X. XXXXXXX
__________________________________
XXXXX X. XXXXXXX
__________________________________
XXXXX X. XXXXX
__________________________________
XXXXXX X. XXXXXXXX
__________________________________
XXXXX X. XXXXXX
__________________________________
XXXXXX X. XXXXXXX
__________________________________
XXXXXX XXXXXX XXX 1988 TRUST
__________________________________
XXXXXXX XXXXXXX XXX
__________________________________
XXXXXXX X. XXXXXX AS CUSTODIAN
FOR XXXXX XXX
__________________________________
XXXXXXX X. XXXXXX AS CUSTODIAN
FOR XXXXXX XXX
__________________________________
XXXXXXX X. XXXXXX
__________________________________
XXXXX XXXXXX
XXXXXX INVESTMENT HOLDINGS, LLC.
By:_______________________________
Name:
Title:
Exhibit A
NAMES AND ADDRESSES OF INVESTORS
Name Address
The Bain Investors:
5. Xxxx Capital Fund VI, L.P. c/o
6. Xxxx Capital VI Coinvestment Fund, X.X. Xxxx Capital, Inc.
7. BCIP Associates II Two Xxxxxx Place
8. BCIP Trust Associates II Xxxxxx, Xx 00000
9. BCIP Associates II-B Facsimile: (000) 000-0000
10. BCIP Trust Associates II-B
11. BCIP Associates II-C
12. PEP Investments Pty Ltd.
13. Brookside Capital Partners Fund, L.P.
14. Sankaty High Yield Asset Partners, L.P.
15. Sankaty High Yield Partners II, L.P.
with a copy to:
Skadden, Arps, Slate,
Xxxxxxx & Xxxx, L.L.P.
Xxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx Xxxxxxx, Esq.
Name Address
The THL Investors:
16. Xxxxxx X. Xxx Equity Fund IV, L.P. c/o
17. Xxxxxx X. Xxx Foreign Fund IV, L.P. Xxxxxx X. Xxx Company
18. Xxxxxx X. Xxx Foreign Fund IV-B, L.P. 00 Xxxxx Xxxxxx
19. Xxxxxx X. Xxx Investors Limited Xxxxx 0000
Xxxxxxxxxxx Xxxxxx, XX 00000
20. Xxxxxx X. Xxx Charitable Facsimile: (000) 000-0000
Investment Limited Partnership Attention: Xxxxxxx XxXxxx
21. 1997 Xxxxxx X. Xxx Nominee Trust and Xxxxx Xxxxxxxx
22. Xxxxx X. Xxxxxxx
23. The Harkins 1995 Gift Trust
24. Xxxxx X. Xxxxxx
25. X. Xxxxxx Xxxx
26. Xxxxx X. Xxxxxxxx
27. Xxxxxxx X. Xxxxxx
28. Xxxxxx X. Xxxxxxx
29. Xxxxxx X. Xxxxx, Xx.
30. Xxxx X. Xxxxx
31. Xxxx X. Xxxxxx
32. Xxxxxxxx X. Xxxxxx
33. Xxxx X. Xxxxxxxx
00. Xxxxxxx X. Xxxxxxx with a Copy To:
35. Xxxxx X. Xxxxxxx Skadden, Arps, Slate,
36. Xxxxx X. Xxxxx Xxxxxxx & Xxxx, L.l.p.
37. Xxxxxx X. Xxxxxxxx Four Times Square
38. Xxxxx X. Xxxxxx Xxx Xxxx, Xxx Xxxx 00000
39. Xxxxxx X. Xxxxxxx Facsimile: (000) 000-0000
40. Xxxxxx Xxxxxx Xxx 1988 Trust Attention: Xxxx Xxxxxxx, Esq.
41. Xxxxxxx Xxxxxxx Xxx
42. Xxxxxxx X. Xxxxxx as Custodian
for Xxxxx Xxx
43. Xxxxxxx X. Xxxxxx as Custodian
for Xxxxxx Xxx
44. Xxxxxxx X. Xxxxxx
45. Xxxxx Xxxxxx
46. Xxxxxx Investment Holdings, Llc.
