EXHIBIT 10.3
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (the "Agreement"), dated as of June 9,
1998, by and among Consolidated Graphics, Inc., a Texas corporation (the
"Company"), and Xxxx Xxxxxxx (the "Holder");
W I T N E S S E T H :
WHEREAS, it is a condition to the consummation of the transactions
contemplated by that certain Agreement and Plan of Reorganization by and among
the Company, Printing Acquisition, Inc., Web Acquisition, Inc., Mercury
Acquisition, Inc., Gilprin Acquisition, Inc., Printing, Inc., Web Graphics,
Inc., Mercury Web Printing, Inc. and the Holder dated as of June 9, 1998 (the
"Merger Agreement") that this Agreement be executed and delivered by the Company
and the Holder;
NOW, THEREFORE, in consideration of the mutual covenants herein contained
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company and the Holder agree as follows:
Section 1. DEFINITIONS. As used in this Agreement, the following terms
have the meanings indicated below:
AGENT shall mean any Person acting for or on behalf of a Holder of
Registrable Securities with respect to the holding or sale of such Registrable
Securities.
AGREEMENT shall mean this Registration Rights Agreement.
BUSINESS DAY shall mean any day other than a Saturday, Sunday, or legal
holiday for banks in the State of Texas.
COMMISSION shall mean the Securities and Exchange Commission.
COMMON STOCK shall mean the Company's common stock, par value $.01 per
share, or any successor class of the Company's common stock.
COMPANY shall mean Consolidated Graphics, Inc.
DEMAND REGISTRATION shall mean the registration, upon demand by any one or
more Holders, with the Commission of the offer and sale of Registrable
Securities under and in accordance with the provisions of the Securities Act and
as set forth in Section 3 of this Agreement.
EXCESS DEMAND REGISTRATION shall mean the registration upon demand of the
Excess Requested Shares with the Commission of the offer and sale of the Excess
Requested Shares under and in accordance with the provisions of the Securities
Act.
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EXCESS REQUESTED SHARES shall mean Registrable Securities that were
requested to be included in the (i) Demand Registration, but were not so
included pursuant to the terms of this Agreement, or (ii) a Piggyback
Registration pursuant to Section 3.e. hereof, but were not so included pursuant
to the terms of this Agreement.
EXCHANGE ACT shall mean the Securities Exchange Act of 1934, as amended.
HOLDER OR HOLDERS shall mean any Person holding Registrable Securities.
INSPECTORS shall mean a Requisite Group of the Holders of Registrable
Securities, any underwriter participating in any disposition of Registrable
Securities pursuant to a Demand Registration or Excess Demand Registration, and
any attorney, accountant or other agent retained by such Holders or underwriter.
LIABILITIES shall mean all losses, claims, damages, liabilities and
expenses (including reasonable costs of investigation).
MERGER AGREEMENT shall mean that certain Agreement and Plan of
Reorganization by and among the Company, Printing Acquisition, Inc., Web
Acquisition, Inc., Mercury Acquisition, Inc., Gilprin Acquisition, Inc.,
Printing, Inc., Web Graphics, Inc., Mercury Web Printing, Inc. and the Holder
dated as of June 9, 1998.
NEW COMMON STOCK shall mean the shares of Common Stock of the Company to
be acquired by the Holder pursuant to the Merger Agreement, together with any
Related Securities.
PERSON shall mean any individual, corporation, limited liability company,
partnership (general or limited), joint venture, association, joint-stock
company, trust, unincorporated organization or government or a political
subdivision, agency or instrumentality thereof or other entity or organization
of any kind.
PIGGYBACK REGISTRATION shall mean the registration of Registrable
Securities pursuant to a registration statement filed by the Company under the
Securities Act as set forth in Section 2 of this Agreement.
RECORDS shall mean all financial and other records, pertinent corporate
documents and properties of the Company.
REGISTRABLE SECURITIES shall mean the New Common Stock and the Related
Securities, until such time as the New Common Stock and the Related Securities
have been (i) distributed to the public pursuant to a registration statement
covering such securities that has been declared effective under the Securities
Act, (ii) distributed to the public in accordance with the provisions of Rule
144 (or any similar provision then in force) under the Securities Act or (iii)
repurchased by the Company.
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REGISTRATION EXPENSES shall mean all expenses incident to the Company's
performance of or compliance with any Piggyback Registration, Demand
Registration or Excess Demand Registration pursuant to this Agreement, including
without limitation all Commission and securities exchange or National
Association of Securities Dealers, Inc. registration and filing fees (including
fees and disbursements of the Company's counsel in connection therewith), fees
and expenses of compliance with securities or blue sky laws (including fees and
disbursements of the Company's counsel in connection with blue sky
qualifications of the Registrable Securities), rating agency fees, printing
expenses, messenger and delivery expenses, internal expenses (including salaries
and expenses of its officers and employees performing legal or accounting
duties), the fees and expenses incurred in connection with the listing of the
Registrable Securities to be registered on each securities exchange on which
similar securities issued by the Company are then listed and fees and
disbursements of counsel for the Company and its independent certified public
accountants (including the Company's expenses of any legal work, advice or
opinions and of any special audit or interim review or "cold comfort" letters
required by or incident to such performance), the fees and expenses of any
special experts retained by the Company in connection with such registration
(including any underwriting fees, discounts or commissions attributable to the
sale of Registrable Securities) and any out-of-pocket expenses of the Holders of
Registrable Securities.
RELATED SECURITIES shall mean any securities issued in exchange for, as a
dividend on or in replacement of, or otherwise issued in respect of (including
securities issued in a stock dividend, split or recombination or pursuant to the
exercise of preemptive rights), the New Common Stock.
REQUISITE GROUP shall mean Xxxx Xxxxxxx, for so long as he is a Holder, or
any one or more Holders of more than 10% of the Registrable Securities.
SECURITIES ACT shall mean the Securities Act of 1933, as amended.
Section 2. PIGGYBACK REGISTRATION. a. If at any time within one year of
the date hereof the Company proposes to file a registration statement under the
Securities Act with respect to an offering by the Company for its own account or
for the account of any other Person of any class of equity security, including
any security convertible into or exchangeable for any equity security, then the
Company shall in each case give written notice of such proposed filing to the
Holders of Registrable Securities at least 20 days before the anticipated filing
date, and such notice shall offer the Holders the opportunity to register such
number of Registrable Securities as each such Holder may request. The Company
shall use reasonable diligence to cause the managing underwriter or underwriters
of a proposed underwritten offering to permit the Holders of Registrable
Securities requested to be included in the registration for such offering to
include such securities in such offering on the same terms and conditions as any
similar securities of the Company included therein. Notwithstanding the
foregoing, if the managing underwriter or underwriters of such offering delivers
a written opinion to the Holders of Registrable Securities that the total amount
of securities which they or the Company and any other Persons intend to include
in such offering is sufficiently large to materially and adversely affect the
success of such offering, then the amount of Registrable Securities to be
offered for the accounts of the Holders of Registrable Securities shall be
reduced to the extent necessary, in the opinion of such managing underwriter, to
reduce the total amount of securities to
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be included in such offering to the amount recommended by such managing
underwriter. The Holder acknowledges and agrees that if the managing underwriter
determines that it is necessary to reduce the number of securities to be
registered on behalf of the Holders of Registrable Securities and any other
Persons, such reduction will not take place pro rata, but instead will be done
with a preference being given to those other Persons who are holders of
securities of the Company which were issued prior to the execution of this
Agreement or which are issuable pursuant to contracts entered into prior to the
execution of this Agreement. From and after the date of this Agreement, the
Company agrees that it shall not, without the prior written consent of a
Requisite Group, enter into any agreement with any Person who becomes a holder
of securities pursuant to contracts entered into subsequent to the execution of
this Agreement which would grant to such Person any piggyback registration
rights having a preference or priority over the piggyback registration rights
granted to the Holders pursuant to this Section 2.
b. Notwithstanding anything to the contrary contained in this Agreement,
the Company shall not be required to include Registrable Securities in any
registration statement if the proposed registration is (i) a registration of a
stock option or other employee incentive compensation plan or of securities
issued or issuable pursuant to any such plan, (ii) a registration of securities
issued or issuable pursuant to a stockholder reinvestment plan or other similar
plan, (iii) a registration of securities issued in exchange for any securities
or any assets of, or in connection with a merger or consolidation with, an
unaffiliated company, or (iv) a registration of securities pursuant to a
"rights" or other similar plan designed to protect the Company's stockholders
from a coercive or other attempt to take control of the Company.
c. The Company may withdraw any registration statement to which this
Section 2 relates and abandon any proposed offering initiated by the Company
without the consent of the Holder of Registrable Securities, notwithstanding the
request of the Holder to participate therein in accordance with this provision,
if the Company determines, in good faith in its sole discretion, that such
action is in the best interests of the Company and its shareholders (for this
purpose, the interest of the Holder shall not be considered).
Section 3. DEMAND REGISTRATION RIGHTS. a. Subject to the conditions stated
herein, at any time after July 9, 1998, and on or before April 5, 1999, a
Requisite Group may make a written request to the Company for registration with
the Commission of the offer and sale of the Registrable Securities held by the
members of such Requisite Group under and in accordance with the provisions of
the Securities Act. Following receipt of such request, the Company shall, no
later than ten (10) Business Days after receipt of such request, notify all
Holders of Registrable Securities that it will file a registration statement
covering the Registrable Securities for sale by certain Holders; provided,
however, that the Company may, if necessary, delay the filing of any
registration statement relating to the Demand Registration for such reasonable
period of time as is necessary to prepare the financial statements of the
Company for the fiscal period most recently ended prior to such written request,
such delay not to exceed ten (10) Business Days following the applicable filing
period relating to the Company's filing of such financial statements. If any
Holder of Registrable Securities shall, within ten (10) days after receipt of
such notice, withdraw such Holder's Registrable Securities from the Demand
Registration to the effect that a Requisite Group is no longer proposing to
participate
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in the Demand Registration, the Holders shall not have any further rights under
this Section 3, without regard to whether the Demand Registration becomes
effective under the Securities Act; provided, however, that if the Holders
requesting such Demand Registration pay or otherwise reimburse the Company for
all Registration Expenses incurred by the Company in connection with such
requested Demand Registration, the Holders shall continue to have the right to
request a Demand Registration pursuant to the terms of this Section 3.
b. All requests made pursuant to this Section 3 will specify the amount of
Registrable Securities to be registered and will also specify the intended
methods of disposition thereof. Any registration of Registrable Securities
pursuant to this Agreement shall include, but shall not be limited to, the
methods of distribution described in the proposed Plan of Distribution set forth
on Annex A to this Agreement.
c. The Holders of Registrable Securities shall be entitled, in the
aggregate, to one Demand Registration. Such Demand Registration must become
effective under the Securities Act to count as having occurred with respect to
such Registrable Securities. Except as otherwise provided in the last sentence
of Section 3.a above, the Registration Expenses of the Demand Registration,
whether or not it becomes effective, shall be paid as set forth in Section 11
below.
d. If the Demand Registration is an underwritten offering, the Holders of
a majority of the Registrable Securities to be included in such demand
registration will select a managing underwriter or underwriters to administer
the offering. Such managing underwriter or underwriters shall be acceptable to
the Company, and such acceptance will not be unreasonably withheld or delayed.
If the managing underwriter or underwriters of such offering delivers a written
opinion to the Holders of Registrable Securities that the total amount of
securities which such Holders and, if applicable, the Company and other Persons
intend to include in such offering is sufficiently large to materially and
adversely affect the success of such offering, then the Company shall include in
such registration (i) first, the securities requested to be included therein by
the Holders of Registrable Securities exercising their right to request a Demand
Registration pursuant to this Agreement, and (ii) second, any other securities
requested to be included in such registration by the Company or such other
Person in such amount which in the opinion of such underwriters can be sold
without adversely affecting the marketability of the offering, such additional
securities to be included by the Company and such other Persons as they may
mutually agree. If the number of Registrable Securities being registered
pursuant to a Demand Registration under this Section 3 is reduced pursuant to
this subsection d., the Holders of the Excess Requested Shares shall be treated
as if there had been no Demand Registration and shall be entitled to the benefit
of Section 3 with respect to the Excess Requested Shares as if the Demand
Registration had not been requested; provided, however, that (i) if any such
Holder shall have been the managing underwriter of such offering, such Holder
shall not be entitled to request an Excess Demand Registration with respect to
any Excess Requested Shares held by such Holder, and (ii) the Company shall not
be required to file such Excess Demand Registration within 180 days of the
effective date of the Demand Registration or any Piggyback Registration
hereunder. With respect to such an Excess Demand Registration relating to the
Excess Requested Shares, only Excess Requested Shares shall be deemed
Registrable Securities with respect thereto, and no Holder shall have any
independent demand registration rights with respect to shares
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for which such Holder failed to request inclusion pursuant to Section 3 in the
Demand Registration that became effective.
e. Subject to the conditions herein, the Company covenants and agrees that
within 30 days of the date hereof, the Company shall, at the Company's option,
either (i) provide the Holders of the Registrable Securities notice of a
proposed filing of a registration statement under the Securities Act, such
filing to occur within 30 days of the date hereof, with respect to which such
Holders may exercise their rights to a Piggyback Registration pursuant to
Section 2, or (ii) file a registration statement covering the Registrable
Securities for sale by the Holders in accordance with the other provisions of
this Section 3 and such registration shall, for purposes of this Agreement,
constitute a Demand Registration. If within 30 days of the date hereof the
Company provides to the Holders an opportunity to participate in a Piggyback
Registration pursuant to which the Holders of the Registrable Securities may
register any such number of Registrable Securities as they may request, the
Company shall have fulfilled its obligations under this Section 3.e. and the
Holders shall have no further rights under this Section 3 to request a Demand
Registration unless the Piggyback Registration is an underwritten offering and
the number of shares of Registrable Securities to be offered for the accounts of
the Holders of the Registrable Securities shall be reduced pursuant to Section
2, in which event the Holders of the Excess Requested Shares shall be treated as
if there had been no Demand Registration and shall be entitled to the benefit of
Section 3 with respect to the Excess Requested Shares provided, however, that
(i) if any such Holder participating in such Piggyback Registration shall have
been the managing underwriter of such offering, such Holder shall not be
entitled to request an Excess Demand Registration with respect to any Excess
Requested Shares held by such Holder, (ii) the Company shall not be required to
file such Excess Demand Registration within 60 days of the effective date of the
Piggyback Registration, and (iii) with respect to such Excess Demand
Registration relating to the Excess Requested Shares, only Excess Requested
Shares shall be deemed Registrable Securities with respect thereto and no holder
shall have any independent demand registration rights with respect to shares for
which such Holder failed to request inclusion in such Piggyback Registration. If
the Company does not provide an opportunity to participate in a Piggyback
Registration filed within 30 days of the date hereof pursuant to this Section
3.e. but the Company files a registration statement covering the Registrable
Securities pursuant to clause (ii) of the first grammatical sentence of this
Section 3.e., such registration shall, for all purposes of this Agreement,
constitute a Demand Registration under this Section 3 and no holder of
Registrable Securities shall be entitled to request any additional Demand
Registration except as otherwise provided in Section 3.d. with respect to Excess
Requested Shares.
Section 4. COMPANY REGISTRATION. Notwithstanding the provisions of Section
3, the Company shall not be obligated to effect a registration requested
pursuant to Section 3 if within 15 days after receiving the notice provided by
any Holder under Section 3, the Company notifies all Holders of Registrable
Securities of its intention to file a registration statement for an underwritten
public offering of Common Stock for the sole account of the Company and within
60 days after providing such notice, the Company files a registration statement
for such offering. In such case, the Holders shall have all the rights provided
herein as if no such demand registration had been requested, with the latest
date by which a request for registration must be made delayed to a date 90 days
after the effective date of such registration statement filed for an offering
for the account of the
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Company that resulted in the application of this Section 4. If at any time the
Company fails to pursue diligently any such registration statement or offering,
the provisions of the preceding sentence shall not apply, and the Company shall
be obligated to satisfy its obligations under Section 3 promptly following
notice to do so from a Requisite Group. With respect to such Company
registration, the Company shall have the sole authority to select or terminate
the employment of underwriters and to make all decisions in connection with the
filing, effectiveness and consummation of the proposed offering, subject to the
express provisions hereof. The Company currently has no intention to file a
registration statement (other than a registration statement on Forms S-4 or S-8
(or their successor forms)) relating to a public offering of Common Stock for
the sole account of the Company.
Section 5. LIMITATIONS ON OBLIGATIONS OF COMPANY. The obligations of the
Company under Section 3 are subject to each of the following limitations,
conditions and qualifications:
a. The Company shall be entitled to postpone for a reasonable period of
time (not exceeding 60 days) the filing (but not the preparation) of any
registration statement otherwise required to be prepared and filed by it
pursuant hereto if, at the time the Company receives a request for such
registration, the Company is in possession of material non-public information
that would be required to be disclosed in a registration statement, but that has
not been and will otherwise not be disclosed to the public, and the Company
deems disclosure not to be in the best interests of the Company and its
shareholders (for this purpose, the interest of the Holders shall not be
considered). The Company shall be entitled to postpone the filing of such a
registration statement for additional 60-day periods (not to exceed in any event
an aggregate of 120 days) if it delivers to the Holders of the Registrable
Securities an opinion of counsel to the effect that there is a reasonable
likelihood that the filing of a registration statement would result in the
disclosure of material non-public information that would be required to be
disclosed in a registration statement, the disclosure of which at such time
appears not to be in the best interests of the Company and its shareholders (for
this purpose, the interest of the Holders shall not be considered).
b. The Company shall be entitled to postpone for a reasonable period of
time (not exceeding 90 days) the distribution of preliminary or final
prospectuses under any registration statement required to be prepared and filed
by it pursuant hereto, if at the time such distribution would otherwise be made,
the Company is engaged in an issuer tender offer within the meaning of Section
13(e) of the Exchange Act for securities of the same class (within the meaning
of the Exchange Act) as the Registrable Securities that are proposed to be
registered, unless the Holders of the Registrable Securities proposed to be
registered can obtain a no-action letter from the staff of the Commission to the
effect that the staff would not recommend enforcement action to the Commission
if offers or sales were made pursuant to a prospectus under such circumstances.
Except as otherwise provided below, if as a result of the Company's postponement
of the distribution of the preliminary or final prospectus the Holders of the
Registrable Securities requesting such registration are unable to continue with
the requested underwritten offering, such Holders shall be treated as if there
had been no Demand Registration and shall be entitled to make a subsequent
request for a Demand Registration pursuant to Section 3. Notwithstanding the
foregoing, if the Board of Directors of the Company had authorized, by
resolution, any such tender offer before the Company's
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receipt of a request for registration hereunder, and the Holders requesting such
registration elect to continue with such registration, the Holders shall not be
entitled to any additional Demand Registration even if any postponement of the
distribution of the preliminary or final prospectus results in such Holders
being unable to continue with the requested underwritten offering.
c. The Company shall be entitled to postpone for a reasonable period of
time (not exceeding 90 days) the effectiveness (but not the filing or
preparation) of any registration statement otherwise required to be prepared and
filed by it pursuant hereto if, within ten (10) Business Days after it receives
a request for a registration pursuant hereto, the Company's investment banking
firm determines (and the Company so notifies the Holders of the Registrable
Securities) that in its judgment, such registration and offering would
materially interfere with any financing, acquisition, corporate reorganization
or other material transaction involving the Company that before such request was
made the Board of Directors of the Company had agreed by resolution to pursue.
Section 6. RESTRICTIONS ON PUBLIC SALE BY HOLDERS OF REGISTRABLE
SECURITIES. To the extent not inconsistent with applicable law, including
insurance codes, each Holder of Registrable Securities that are included in a
registration statement which registers Registrable Securities pursuant to this
Agreement agrees not to effect any public sale or distribution of the issue
being registered (or any securities of the Company convertible into or
exchangeable or exercisable for securities of the same type as the issue being
registered) during the 14 days before, and during the 90-day period beginning
on, the effective date of a registration statement filed by the Company (except
as part of such registration), but only if and to the extent requested in
writing (with reasonable prior notice) by the managing underwriter or
underwriters in the case of an underwritten public offering by the Company of
securities of the same type as the Registrable Securities; provided, however,
that the period of time for which the Company is required to keep such
registration statement which includes Registrable Securities continuously
effective shall be increased by a period equal to such requested holdback
period.
Section 7. RESTRICTIONS ON PUBLIC SALE BY THE COMPANY. If the registration
in which the Holders of Registrable Securities are participating is an
underwritten offering and the managing underwriter or underwriters of such
registration shall so require, the Company agrees not to effect, for the account
of the Company, any public sale or distribution of any securities similar to
those being registered in such registration, or any securities convertible into
or exchangeable or exercisable for such securities, during the 14 days before,
and during the 90-day period beginning on, the effective date of any
registration statement in which the Holders of Registrable Securities are
participating; provided, however, that the foregoing shall not prohibit or
adversely affect the Company's right to (i) participate in such registration
statement, (ii) undertake a registration for its own account or for the account
of any other Person of any class of equity security pursuant to a Registration
Statement on Forms S-4 or S-8 (or their successor forms).
Section 8. COOPERATION BY HOLDERS. The offering of Registrable Securities
by any Holder shall comply in all respects with the applicable terms, provisions
and requirements set forth in this Agreement, and such Holders shall timely
provide the Company with all information and materials required to be included
in a registration statement that (i) relate to the offering, (ii) are in
possession
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of such Holder and (iii) relate to such Holder, and to take all such action as
may be reasonably required in order not to delay the registration and offering
of the securities by the Company. The Company shall have no obligation to
include in such registration statement shares of a Holder who has failed to
furnish such information which, in the written opinion of counsel to the
Company, is required in order for the registration statement to be in compliance
with the Securities Act. If a Holder of Registrable Securities which are the
subject of the Demand Registration or an Excess Demand Registration shall fail
to furnish such information and such Demand Registration or Excess Demand
Registration shall not become effective under the Securities Act as a result of
such Holder's failure to furnish such information, such Holder shall not have a
right to request inclusion of the Holder's Registrable Securities in a future
registration with respect to Registrable Securities.
Section 9. REGISTRATION PROCEEDINGS. Whenever any Registrable Securities
are to be registered pursuant to Sections 2 or 3 of this Agreement, the Company
will use reasonable diligence to effect the registration of such Registrable
Securities in accordance with the intended method of disposition thereof as
quickly as practicable. In connection with any Piggyback Registration, Demand
Registration or Excess Demand Registration, the Company will act as
expeditiously as possible to:
a. prepare and file with the Commission a registration statement which
includes the Registrable Securities and use reasonable diligence to cause such
registration statement to become effective, notify the Holders of such
Registrable Securities and any managing underwriter of such effectiveness, and
to keep such registration statement effective for the period specified in
Section 9.b. Before filing a registration statement or prospectus or any
amendments or supplements thereto, including documents incorporated by reference
after the initial filing of the registration statement, the Company will furnish
to the Holders of the Registrable Securities covered by such registration
statement and the underwriters, if any, draft copies of all such documents
proposed to be filed at least five (5) Business Days prior thereto, which
documents will be subject to the reasonable review of the Holders and
underwriters, and the Company will not file any registration statement or
amendment thereto or any prospectus or any supplement thereto (including such
documents incorporated by reference) to which the Holders of a majority of the
Registrable Securities covered by such registration statement or the
underwriters with respect to such Registrable Securities, if any, shall
reasonably object, and will notify each Holder of the Registrable Securities of
any stop order issued or threatened by the Commission in connection therewith
and take all reasonable actions required to prevent the entry of such stop order
or to remove it if entered;
b. prepare and file with the Commission such amendments and post-effective
amendments to the registration statement as may be necessary to keep the
registration statement effective for a period of 180 days if the registration is
pursuant to Section 2 or for a period of one year if the registration is
pursuant to Section 3 (or such later date that results by adding the number of
days by which the effectiveness of the registration statement is delayed as a
result of any postponement permitted under subsections a through c of Section 5)
or such shorter period which will terminate when all Registrable Securities
covered by such registration statement have been sold or withdrawn, but not
before the expiration of the 90-day period referred to in Section 4(3) of the
Securities Act and Rule 174 thereunder, if applicable; cause the prospectus to
be supplemented by any required
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prospectus supplement, and as so supplemented to be filed pursuant to Rule 424
under the Securities Act; and comply with the provisions of the Securities Act
applicable to it with respect to the disposition of all securities covered by
such registration statement during the applicable period in accordance with the
intended methods of disposition by the sellers thereof set forth in such
registration statement or supplement to the prospectus; the Company shall not be
deemed to have complied with its obligations hereunder to keep a registration
statement effective during the applicable period if it voluntarily takes any
action (except for a public offering or other transaction requiring the Company
to suspend the use of the prospectus included in such registration statement as
provided in subsection d. and the last paragraph of this Section 9) that would
result in the selling Holders of the Registrable Securities being prevented from
selling such Registrable Securities during that period unless such action is
required under applicable law;
c. furnish to any Holder of Registrable Securities included in such
registration statement and the underwriter or underwriters, if any, without
charge, such number of conformed copies of the registration statement and any
post-effective amendment thereto (including exhibits) and such number of copies
of the prospectus (including each preliminary prospectus) and any amendments or
supplements thereto, and any documents incorporated by reference therein, as
such Holder or underwriter may reasonably request in order to facilitate the
disposition of the Registrable Securities being sold by such Holder (it being
understood that the Company consents to the use of the prospectus and any
amendment or supplement thereto, provided by the Company to each Holder of
Registrable Securities covered by the registration statement and the underwriter
or underwriters, if any, in connection with the offering and sale of the
Registrable Securities covered by the prospectus or any amendment or supplement
thereto); provided, however, that before filing a registration statement or
prospectus or any amendments or supplements thereto, the Company will furnish to
counsel selected by the Holders of a majority of the Registrable Securities
covered by such registration statement copies of all documents proposed to be
filed which documents will be subject to the review of such counsel;
d. notify each Holder of Registrable Securities included in such
registration statement, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, when the Company becomes
aware of the happening of any event as a result of which the prospectus included
in such registration statement (as then in effect) contains any untrue statement
of a material fact or omits to state a material fact necessary to make the
statements therein (in the case of the prospectus or any preliminary prospectus,
in light of the circumstances under which they were made) not misleading and, as
promptly as practicable thereafter, prepare and file with the Commission and
furnish a supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus will
not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading;
e. use reasonable diligence to cause all Registrable Securities included
in such registration statement to be listed, by the date of the first sale of
Registrable Securities pursuant to such registration statement, on each
securities exchange (including, for this purpose, NASDAQ) on which the Common
Stock of the Company is then listed or proposed to be listed, if any;
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f. make generally available to its security holders an earnings statement
satisfying the provisions of Section 11(a) of the Securities Act no later than
45 days after the end of the twelve-month period beginning with the first day of
the Company's first fiscal quarter commencing after the effective date of the
registration statement, which earnings statement shall cover said twelve-month
period, which requirement will be deemed to be satisfied if the Company timely
files complete and accurate information on Forms 10-Q, 10-K, and 8-K under the
Exchange Act and otherwise complies with Rule 158 under the Securities Act;
g. make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of the registration statement at the earliest
possible moment;
h. if reasonably requested by the managing underwriter or underwriters or
any Holder of Registrable Securities covered by the registration statement,
promptly incorporate in a prospectus supplement or post-effective amendment such
information as the managing underwriter or underwriters or such Holder requests
to be included therein, including without limitation, with respect to the number
of Registrable Securities being sold by such Holder to such underwriter or
underwriters, the purchase price being paid therefor by such underwriter or
underwriters and any other terms of the underwritten offering of such
Registrable Securities, and promptly make all required filings of such
prospectus supplement or post-effective amendment;
i. as promptly as practicable after filing with the Commission of any
document which is incorporated by reference into a registration statement,
deliver a copy of such document to each Holder of Registrable Securities covered
by such registration statement;
j. on or before the date on which the registration statement is declared
effective, use reasonable diligence to register or qualify, and cooperate with
the Holders of Registrable Securities included in such registration statement,
the underwriter or underwriters, if any, and their counsel, in connection with
the registration or qualification of the Registrable Securities covered by the
registration statement for offer and sale under the securities or blue sky laws
of each state and other jurisdiction of the United States as any such Holder or
underwriter reasonably requests in writing, to use reasonable diligence to keep
each such registration or qualification effective, including through new
filings, or amendments or renewals, during the period such registration
statement is required to be kept effective and to do any and all other acts or
things necessary or advisable to enable the disposition in all such
jurisdictions of the Registrable Securities covered by the applicable
registration statement; provided, however, that the Company will not be required
to qualify generally to do business in any jurisdiction where it is not then so
qualified or to take any action which would subject it to general service of
process in any such jurisdiction where it is not then so subject;
k. cooperate with the Holders of Registrable Securities covered by the
registration statement and the managing underwriter or underwriters, if any, to
facilitate the timely preparation and delivery of certificates (not bearing any
restrictive legends) representing securities to be sold under the registration
statement, and enable such securities to be in such denominations and registered
in such names as the managing underwriter or underwriters, if any, or such
Holders may request, subject to the underwriters' obligation to return any
certificates representing securities not sold;
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l. use reasonable diligence to cause the Registrable Securities covered by
the registration statement to be registered with or approved by such other
governmental agencies or authorities within the United States as may be
necessary to enable the seller or sellers thereof or the underwriter or
underwriters, if any, to consummate the disposition of such securities;
m. enter into such customary agreements (including an underwriting
agreement in customary form) and take all such other reasonable actions as the
Holders of a majority of the Registrable Securities being sold or the
underwriters retained by the Holders participating in an underwritten public
offering, if any, reasonably request in order to expedite or facilitate the
disposition of such Registrable Securities;
n. make available for inspection by the Inspectors such Records as shall
be reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors, and employees to
respond to all reasonable inquiries from, and to supply all Records reasonably
requested by, any such Inspector in connection with such registration statement;
provided, however, that with respect to any Records that are confidential, the
Inspectors shall execute such confidentiality agreements as the Company may
reasonably request in order to maintain the confidentiality of confidential
Records; and
o. use reasonable diligence in connection with any underwritten offering
to obtain (i) a "cold comfort" letter from the Company's independent public
accountants, and (ii) an opinion of counsel from the Company's counsel, each in
customary form and covering such matters of the type customarily covered by cold
comfort letters and opinions of counsel as the managing underwriter or
underwriters may reasonably request.
Notwithstanding the foregoing provisions of this Section 9, each Holder
acknowledges that there may occasionally be times when the Company must suspend
the use of the prospectus included in such registration statement until such
time as an amendment to the registration statement has been filed by the Company
and declared effective by the Commission, or until such time as the Company has
filed an appropriate report with the Commission pursuant to the Exchange Act.
Each Holder, upon receipt of any notice from the Company of the happening of any
event of the kind described in subsection d. of this Section 9, will forthwith
discontinue disposition of the Registrable Securities until the Holder's receipt
of the copies of the supplemented or amended prospectus contemplated by the
first sentence of this paragraph and subsection d. of this Section 9, or until
it is advised in writing by the Company that the use of the prospectus may be
resumed, and has received copies of any additional or supplemental filings which
are incorporated by reference in the prospectus, and, if so directed by the
Company, such Holder will, or will request the managing underwriter or
underwriters, if any, to, deliver to the Company (at the Company's expense) all
copies in their possession or control, other than permanent file copies then in
the Holder's possession, of the prospectus covering such Registrable Securities
current at the time of receipt of such notice. If the Company shall give any
such notice, the time periods mentioned in subsection b. of this Section 9 and
elsewhere herein shall be extended by the number of days during the period from
and including the date of the giving of such notice to and including the date
when each seller of Registrable Securities covered by such registration
statement shall have received the copies of the supplemented
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or amended prospectus contemplated by the first sentence of this paragraph and
subsection d. of this Section 9 hereof, or the notice that they may resume use
of the prospectus.
Section 10. REFERENCE TO HOLDERS IN REGISTRATION STATEMENT. If such
registration statement refers to any Holder by name or otherwise as the holder
of any securities of the Company, then such Holder shall have the right to
require (i) the insertion therein of language, in form and substance
satisfactory to such Holder, to the effect that the holding by such Holder of
such securities is not to be construed as a recommendation of such Holder of the
investment quality of the Company's securities covered thereby and that such
holding does not imply that such Holder will assist in meeting any future
financial requirements of the Company, or (ii) if such reference to such Holder
by name or otherwise is not required by the Securities Act or any similar
federal statute then in force, the deletion of the reference to such Holder.
Section 11. DEMAND AND PIGGYBACK REGISTRATION EXPENSES. All Registration
Expenses incident to the Company's performance of or compliance with the Demand
Registration, Excess Demand Registration or Piggyback Registration pursuant to
this Agreement, except underwriting fees, discounts or commissions attributable
to the sale of Registrable Securities and any out-of-pocket expenses of the
Holders of the Registrable Securities, will be borne by the Company.
Section 12. INDEMNIFICATION BY THE COMPANY. The Company agrees to
indemnify and hold harmless each Holder of Registrable Securities and each
Person who controls such Holder (within the meaning of the Securities Act), and
any Agent or investment advisor thereof against all Liabilities arising out of
or based upon any untrue or alleged untrue statement of material fact contained
in any registration statement, any amendment or supplement thereto, any
prospectus or preliminary prospectus, or any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, except insofar as any such Liabilities
arise out of or are based upon any untrue statement or omission with respect to
such indemnified Person furnished in writing to the Company by such indemnified
Person expressly for use therein. In connection with an underwritten offering,
the Company will indemnify the underwriters thereof, their officers and
directors and each Person who controls such underwriters (within the meaning of
the Securities Act) to the same extent as provided above with respect to the
indemnification of such Holder of Registrable Securities or to such other extent
as the Company and such underwriters may agree.
Section 13. INDEMNIFICATION BY HOLDERS OF REGISTRABLE SECURITIES. In
connection with any registration statement in which a Holder of Registrable
Securities is participating, each such Holder will furnish to the Company in
writing such information with respect to the name and address of such Holder and
the amount of Registrable Securities held by such Holder and such other
information as the Company shall reasonably request for use in connection with
any such registration statement or prospectus, and agrees to indemnify, to the
extent permitted by law, the Company, its directors and officers, and each
Person who controls the Company (within the meaning of the Securities Act)
against any losses, damages and expenses resulting from any untrue statement of
a material fact or any omission of a material fact required to be stated in the
registration statement or prospectus or any amendment thereof or supplement
thereto or necessary to make the statements
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therein not misleading, to the extent, but only to the extent, that such untrue
statement or omission is based upon any information with respect to such Holder
so furnished in writing by such Holder specifically for inclusion in any
prospectus or registration statement.
Section 14. CONDUCT OF INDEMNIFICATION PROCEEDINGS. Any Person entitled to
indemnification hereunder agrees to give prompt written notice to the
indemnifying party after the receipt by such Person of any written notice of the
commencement of any action, suit, proceeding or investigation or threat thereof
made in writing for which such Person may claim indemnification or contribution
pursuant to this Agreement (provided the failure to so notify the indemnifying
party shall not relieve it from any liability which it may have to any
indemnified party so long as the failure to so notify the indemnifying party
does not prejudice the indemnifying party's ability to defend any such action,
suit, investigation, proceeding or claim) and, unless in the written opinion of
counsel for such indemnified party a conflict of interest may exist between such
indemnified party and the indemnifying party with respect to such claim, permit
the indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to such indemnified party. Whether or not such defense
is assumed by the indemnifying party, the indemnifying party will not be subject
to any liability for any settlement made without its consent. No indemnifying
party will consent to entry of any judgment or enter into any settlement which
does not include as an unconditional term thereof the giving by the claimant or
plaintiff to such indemnified party of a release from all liability in respect
of such claim or litigation. If the indemnifying party is not entitled to, or
elects not to, assume the defense of a claim, it will not be obligated to pay
the fees and expenses of more than one counsel with respect to such claim,
unless in the opinion of counsel for any indemnified party a conflict of
interest may exist between such indemnified party and any other of such
indemnified parties with respect to such claim, in which event the indemnifying
party shall be obligated to pay the fees and expenses of such additional counsel
or counsels.
Section 15. CONTRIBUTION. If the indemnification provided for in Sections
12 and 13 from the indemnifying party is unavailable to or insufficient to hold
harmless an indemnified party hereunder in respect of any Liabilities referred
to therein, then the indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such Liabilities in such proportion as is
appropriate to reflect the relative fault of the indemnifying party and
indemnified parties in connection with the actions which resulted in such
Liabilities, as well as any other relative equitable considerations. The
relative fault of such indemnifying party and indemnified parties shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact, has been
made by, or relates to information supplied by, such indemnifying party or
indemnified parties, and the parties' relative intent, knowledge, access to
information, and opportunity to correct or prevent such action. The amount paid
or payable by a party as a result of any Liabilities referred to above shall be
deemed to include, subject to the limitations set forth in Section 14, any legal
or other fees or expenses reasonably incurred by such party in connection with
any investigation or proceeding. The parties hereto agree that it would not be
just and equitable if contribution pursuant to this Section 15 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 this paragraph. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f)
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of the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation. The obligations of the Company
pursuant to Sections 12, 13, 14 and 15 shall be further subject to such
additional express agreements of the Company as may be required to facilitate an
underwritten offering, provided, however, that no such agreement shall in any
way limit the rights of the Holders of Registrable Securities under this
Agreement, or create additional obligations of such Holders not set forth
herein, except as otherwise expressly agreed in writing by such Holders.
Notwithstanding anything in this Section to the contrary, Xxxx Xxxxxxx, to the
extent he is an indemnifying party, shall not be required pursuant hereto to
contribute any amount in excess of the amount by which the dollar amount of
proceeds received by him from the sale of the Registrable Securities (after
deducting any underwriting commissions, discounts and transfer taxes applicable
thereto) in the offering to which the losses, claims, damages, liabilities or
expenses of the indemnified parties relate exceeds the amount of any losses,
claims, damages, liabilities and expenses which he may have otherwise been
required to pay as indemnity or contribution hereunder by reason of such losses,
claims, damages, liabilities or expenses.
Section 16. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS. No Holder of
Registrable Securities may participate in any underwritten registration
hereunder unless such Holder (i) agrees to sell such Holder's securities on the
terms of and on the basis provided in any underwriting arrangements approved by
the Persons entitled hereunder to approve such arrangements (which shall be the
Company in the case of an offering of securities controlled by the Company), and
(ii) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements.
Section 17. RULE 144. The Company covenants that it will file the reports
required to be filed by it under the Securities Act and the Exchange Act and the
rules and regulations adopted by the Commission thereunder (or, if the Company
is not required to file such reports, it will, upon the request of any Holder of
Registrable Securities, make publicly available other nonconfidential
information so long as necessary to permit sales under Rule 144 under the
Securities Act), and it will take such other action as any Holder of Registrable
Securities may reasonably request, all to the extent required from time to time
to enable such Holder to sell Registrable Securities without registration under
the Securities Act within the limitation of the exemptions provided by (i) Rule
144 under the Securities Act, as such Rule may be amended from time to time, or
(ii) any similar rule or regulation hereafter adopted by the Commission. Upon
the request of any Holder of Registrable Securities, the Company will deliver to
such Holder a written statement as to whether it has complied with such
requirements.
Section 18. RECAPITALIZATIONS, EXCHANGES, ETC. The provisions of this
Agreement shall apply, to the full extent set forth herein, with respect to the
Registrable Securities, to any and all shares of equity capital of the Company
or any successor or assign of the Company (whether by merger, consolidation,
sale of assets, or otherwise) which may be issued in respect of, in exchange
for, or in substitution of the Registrable Securities, in each case as the
amounts of such securities outstanding are appropriately adjusted for any equity
dividends, splits, reverse splits, combinations, recapitalizations, and the like
occurring after the date of this Agreement.
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Section 19. OPINIONS. When any legal opinion is required to be delivered
hereunder, such opinion may contain such qualifications as may be customary or
otherwise appropriate for legal opinions in similar circumstances.
Section 20. NOTICES. For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when personally delivered or when mailed by United States
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:
IF TO COMPANY, TO: Consolidated Graphics, Inc.
0000 Xxxxxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attention: Xxx X. Xxxxx,
Chief Executive Officer
WITH A COPY TO: R. Xxxxx Xxxxxx, Xx.
Xxxxxxxx Xxxxxxxx & Xxxxxx, P.C.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
IF TO HOLDER: Xxxx Xxxxxxx
000 X. Xx. Xxxxxxx
Xxxxxxx, Xxxxxx 00000
WITH A COPY TO: Xxxxxxx X. Xxxxx
Sherwood & Xxxxxx
000 Xx. Xxxx
Xxxxxxx, Xxxxxx 00000
IF TO ANY PERSON OTHER THAN HOLDER:
to the address of such Person on the records of the transfer agent of the
Company as of the date prior to the date of any notice by the Company
or to such other address as any party may furnish to the others in writing in
accordance herewith, except that notices of changes of address shall be
effective only upon receipt, and that failure to copy legal counsel shall not
invalidate notices otherwise properly given.
Section 21. APPLICABLE LAW. This Agreement and all rights and obligations
hereunder, including matters of construction, validity and performance, shall be
governed by the laws of the State of Texas, without giving effect to the
principles of conflicts of laws thereof.
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Section 22. AMENDMENT AND WAIVER. This Agreement may be amended, and the
provisions hereof may be waived, only by a written instrument signed by (i) the
Holders of a majority of the Registrable Securities and (ii) the Company. No
failure by either party hereto at any time to give notice of any breach by the
other party of, or to require compliance with, any condition or provision of
this Agreement shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time.
Section 23. REMEDY FOR BREACH OF CONTRACT. The parties agree that if there
is any breach or asserted breach of the terms, covenants, or conditions of this
Agreement, the remedy of the parties hereto shall be at law and in equity and
injunctive relief shall lie for the enforcement of or relief from any provisions
of this Agreement. If any remedy or relief is sought and obtained by any party
against one of the other parties pursuant to this Section 23, the other party
shall, in addition to the remedy of relief so obtained, be liable to the party
seeking such remedy or relief for the reasonable expenses incurred by such party
in successfully obtaining such remedy or relief, including the reasonable fees
and expenses of such party's counsel.
Section 24. SEVERABILITY. It is a desire and intent of the parties that
the terms, provisions, covenants, and remedies contained in this Agreement shall
be enforceable to the fullest extent permitted by law. If any such term,
provision, covenant, or remedy of this Agreement or the application thereof to
any Person or circumstances shall, to any extent, be construed to be invalid or
unenforceable, in whole or in part, then such term, provision, covenant, or
remedy shall be construed in a manner so as to permit its enforceability under
the applicable law to the fullest extent permitted by law. In any case, the
remaining provisions of this Agreement, or the application thereof to any Person
or circumstances other than those to which they have been held invalid or
unenforceable, shall remain in full force and effect.
Section 25. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together will constitute one and the same Agreement.
Section 26. HEADINGS. The section and paragraph headings have been
inserted for purposes of convenience of reference only and shall not be used for
interpretive purposes.
Section 27. BINDING EFFECT. Unless otherwise provided herein, the
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective heirs, legal representatives,
successors, and permitted assigns, and is not intended to confer upon any other
Person any right or remedies hereunder; provided, however, that a transferee of
any Holder, other than as contemplated in (i), (ii) or (iii) of the definition
of Registrable Securities in Section 1, shall be deemed to be a Holder for
purposes of obtaining the benefits or enforcing the rights of a Holder.
Section 28. ENTIRE AGREEMENT. This Agreement, together with the other
agreements referenced herein, constitutes the entire agreement and supersedes
all prior agreements, understandings, both written and oral, among the parties
with respect to the subject matter hereof.
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Section 29. INFORMATION. So long as the Holders own Registrable
Securities, the Holders agree to deliver to the Company, upon request, such
information about the Holders and the Holders' holdings of Registrable
Securities as the Company may reasonably request as is necessary to permit the
Company to prepare and file its annual report on Form 10-K and its proxy
statements under the Exchange Act and any filings under the Securities Act. The
Holders further agree to report to the Company any sale or disposition of any
kind relating to the Holders' Registrable Securities.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
CONSOLIDATED GRAPHICS, INC.
By: /s/ G. XXXXXXXXXXX XXXXXXXX
G. Xxxxxxxxxxx Xxxxxxxx
Executive Vice President -
Mergers & Acquisitions
/s/ XXXX XXXXXXX
Xxxx Xxxxxxx
[SIGNATURE PAGE TO REGISTRATION RIGHTS AGREEMENT]
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