REGISTRATION RIGHTS AGREEMENT
Exhibit 10.1
THIS
REGISTRATION RIGHTS AGREEMENT (this "Agreement") is
entered into as of October __, 2018, by and among (i) RumbleOn,
Inc., a Nevada corporation (including any successor entity thereto,
the "Parent"), (ii) each
of the shareholders of the Company set forth in Schedule 1
(individually and collectively, the "Investor" or
"Investors") of the
Merger Agreement (as defined below) and (iii) Xxxxxx Xxxxxxxx, a
Tennessee resident, as the representative of each Investor (the
"Representative").
WHEREAS, on October 26, 2018, the
Parent, RMBL Tennessee, LLC, a Nevada limited liability company and
a wholly-owned subsidiary of Parent ("Merger Sub"),
Wholesale, Inc., a Tennessee corporation (the "Company"), the
Investors and the Representative entered into that certain
Agreement and Plan of Merger (as amended from time to time in
accordance with the terms thereof (the "Merger Agreement"),
pursuant to which, subject to the terms and conditions thereof, the
Company will merge with and into Merger Sub, with Merger Sub
continuing as the surviving entity upon the terms and subject to
the conditions set forth in the Merger Agreement (the "Merger");
WHEREAS, in connection with the Merger, the
Investors will receive the Conversion Shares that are convertible
into shares of Parent’s Class B common stock, par value
$0.001 per share (the "Class B Common
Stock");
WHEREAS, resales by the Investors of the
Class B Common Stock may be required to be registered under the
Securities Act of 1933, as amended (the "Securities Act") and
applicable state securities laws, depending upon the status of an
Investor or the intended method of distribution of the Class B
Common Stock; and
WHEREAS, the parties desire to enter
into this Agreement to provide each Investor with certain rights
relating to the registration of the Class B Common Stock held by
him or her or which her or she may acquire.
NOW, THEREFORE, in consideration of the
mutual covenants and agreements set forth herein, and for other
good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as
follows:
1. DEFINITIONS. Any capitalized
term used but not defined in this Agreement will have the meaning
ascribed to such term in the Merger Agreement. The following
capitalized terms used herein have the following
meanings:
"Agreement" means
this Agreement, as amended, restated, supplemented, or otherwise
modified from time to time.
"Class B Common
Stock" is defined in the recitals to this
Agreement.
"Company" is defined
in the recitals to this Agreement.
"Exchange Act" is
defined as the Securities Exchange Act of 1934, as amended from
time to time.
"Form S-3" is defined
in Section 2.3.
"Indemnified Party"
is defined in Section 4.3.
"Indemnifying Party"
is defined in Section 4.3.
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"Investor" and
"Investors" are
defined in the preamble to this Agreement, and include any
transferee of the Registrable Securities (so long as they remain
Registrable Securities) of the respective Investor permitted under
this Agreement.
"Investor Indemnified
Party" is defined in Section 4.1.
"Merger" is defined
in the recitals to this Agreement.
"Merger Agreement" is
defined in the recitals to this Agreement.
"Merger Sub" is
defined in the recitals to this Agreement.
"Parent" is defined
in the preamble to this Agreement, and shall include Parent’s
successors by merger, acquisition, reorganization or
otherwise.
"Piggy-Back
Registration" is defined in Section 2.2.1.
"Pro Rata" is defined
in Section 2.2.2(a).
"Proceeding" is
defined in Section 6.10.
"register,"
"registered,"
and "registration" mean a
registration effected by preparing and filing a registration
statement or similar document in compliance with the requirements
of the Securities Act, and the applicable rules and regulations
promulgated thereunder, and such registration statement becoming
effective.
"Registrable
Securities" means, at any time, the Class B Common Stock
owned by each Investor, whether owned on the date hereof or
acquired hereafter, including any shares of Class B Common Stock
which may be issued or distributed in respect of such shares of
Class B Common Stock by way of conversion, concession, stock
dividend or stock split or other distribution, recapitalization or
reclassification or similar transaction; provided, however, that
Registrable Securities shall not include any shares (i) the sale of
which has been registered pursuant to the Securities Act and which
shares have been sold pursuant to such registration (other than,
for the avoidance of doubt, the sale of shares to the Investor as a
result of the consummation of the transactions contemplated by the
Merger Agreement) or (ii) which have been sold pursuant to Rule
144.
"Registration
Expenses" is defined in Section 3.3.
"Registration
Statement" means a registration statement filed by Parent
with the SEC in compliance with the Securities Act and the rules
and regulations promulgated thereunder for a public offering and
sale of equity securities, or securities or other obligations
exercisable or exchangeable for, or convertible into, equity
securities (other than a registration statement on Form S-4 or Form
S-8, or their successors, or any registration statement covering
only securities proposed to be issued in exchange for securities or
assets of another entity).
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"Specified Courts" is
defined in Section 6.10.
"Underwriter" means a
securities dealer who purchases any Registrable Securities as
principal in an underwritten offering and not as part of such
dealer’s market-making activities.
2. REGISTRATION
RIGHTS.
2.1 Piggy-Back
Registration.
2.1.1 Piggy-Back
Rights. If at any time after the Closing Parent proposes to
file a Registration Statement under the Securities Act or conducts
a takedown from an effective Shelf Registration Statement with
respect to an offering of equity securities, or securities or other
obligations exercisable or exchangeable for, or convertible into,
equity securities, by Parent for its own account or for security
holders of Parent for their account, other than a Registration
Statement (i) filed in connection with any employee share option or
other benefit plan, (ii) for an exchange offer or offering of
securities solely to Parent’s existing shareholders, (iii)
for an offering of debt that is convertible into equity securities
of Parent or (iv) for a dividend reinvestment plan, then Parent
shall (x) give written notice of such proposed filing to the
Investor as soon as practicable but in no event less than five (5)
days before the anticipated filing date, which notice shall
describe the amount and type of securities to be included in such
offering, the intended method(s) of distribution, and the name of
the proposed managing Underwriter or Underwriters, if any, of the
offering, and (y) offer to the Investor in such notice the
opportunity to register the sale of such number of Registrable
Securities as the Investor may request in writing within five (5)
days following receipt of such notice (a "Piggy-Back
Registration"). To the extent permitted by applicable
securities laws with respect to such registration by Parent or
another demanding shareholder, Parent shall cause such Registrable
Securities to be included in such registration and shall use its
best efforts to cause the managing Underwriter(s) of a proposed
underwritten offering to permit the Registrable Securities
requested to be included in a Piggy-Back Registration on the same
terms and conditions as any similar securities of Parent and to
permit the sale or other disposition of such Registrable Securities
in accordance with the intended method(s) of distribution thereof.
If the Investor proposes to distribute its Registrable Securities
through a Piggy-Back Registration that involves an Underwriter or
Underwriters, the Investor shall enter into an underwriting
agreement in customary form with the Underwriter or Underwriters
selected for such Piggy-Back Registration. Each participating
Investor may, at its option, require that any or all of the
representations and warranties by, and the other agreements on the
part of, Parent to and for the benefit of such Underwriter(s) also
be made to and for such participating Investor’s benefit and
that any or all of the conditions precedent to the obligations of
such Underwriter(s) under such underwriting agreement also be
conditions precedent to its obligations.
2.1.2 Reduction
of Offering. If the managing Underwriter(s) for a Piggy-Back
Registration that is to be an underwritten offering in good faith
advises Parent and the Investor in writing that the dollar amount
or number of Class B Common Stock Parent desires to sell, taken
together with the Registrable Securities as to which registration
has been requested under this Section 2.1.2 exceeds the maximum
number of shares that can be sold in such offering without
adversely affecting the proposed offering price, the timing, the
distribution method, or the probability of success of such offering
(such maximum dollar amount or maximum number of shares, as
applicable, the "Maximum Number of
Shares"), then Parent shall include in any such
registration: (i) first, the Class B Common Stock or other
securities that Parent desires to sell that can be sold without
exceeding the Maximum Number of Shares; and (ii) second, to the
extent that the Maximum Number of Shares has not been reached under
the foregoing clause (i), the Registrable Securities of the
Investor as to which registration has been requested pursuant to
this Section 2.1.2 that can be sold without exceeding the Maximum
Number of Shares. If an Investor is unable to include all of its
Registrable Securities in a Piggy-Back Registration due to the
limitations of this Section 2.1.2, such Investor shall nevertheless
continue to have the right to include any Registrable Securities in
any subsequent Piggyback Registration as described in Section
2.1.1.
2.1.3 Withdrawal.
The Investor may elect to withdraw its request for inclusion of
Registrable Securities in any Piggy-Back Registration by giving
written notice to Parent of such request to withdraw. Parent may
withdraw a Registration Statement at any time before the pricing of
the proposed equity offering without any liability to the Investor.
Notwithstanding any such withdrawal, Parent shall pay all expenses
incurred in connection with such Piggy-Back
Registration.
2.2 Registrations on Form S-3. As
soon as practicable after the issuance of the Conversion Shares to
the Investor, and in any event within 10 days, Parent will prepare
and file a shelf registration on Form S-3 or any similar short-form
registration which may be available at such time (the "Shelf Registration
Statement") registering for resale the Registrable
Securities under the Securities Act. The plan of distribution
indicated in the Shelf Registration Statement will include all such
methods of sale as the Investor may reasonably request in writing
prior to the filing of the Shelf Registration Statement and that
can be included in the Shelf Registration Statement under the rules
and regulations of the SEC. Parent shall use commercially
reasonable efforts to cause the Shelf Registration Statement to be
declared effective by the SEC as promptly as practicable following
such filing. Until such time as all Registrable Securities cease to
be Registrable Securities or Parent is no longer eligible to
maintain a Shelf Registration Statement, Parent shall use
commercially reasonable efforts to keep current and effective such
Shelf Registration Statement and file such supplements or
amendments to such Shelf Registration Statement (or file a new
Shelf Registration Statement when such preceding Shelf Registration
Statement expires pursuant to the rules of the SEC) as may be
necessary or appropriate in order to keep such Shelf Registration
Statement continuously effective and useable for the resale of all
Registrable Securities under the Securities Act.
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The
Parent represents that any Shelf Registration Statement when
declared effective (including the documents incorporated therein by
reference) will comply in all material respects as to form with all
applicable requirements of the Securities Act and the Exchange Act
and will not contain 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, provided, however, that Parent makes no
representation with respect to information furnished to Parent, in
writing, by such Investor expressly for use in any Shelf
Registration Statement.
If
Parent is not S-3 eligible at the time of filing, Parent shall file
a Registration Statement for a Shelf Registration on Form S-1 (or
any successor to Form S-1, "Form S-1") and cause
it to be declared effective as soon as practicable. In the event
that Parent files on a Form S-1 and thereafter becomes eligible to
register the Conversion Shares on Form S-3, Parent shall, after
consultation with and receipt of consent by the Investor, use its
commercially reasonable efforts to convert the Form S-1 to a Form
S-3 as soon as practicable after Parent becomes so eligible. Parent
shall use its commercially reasonable efforts, (a) to the extent
required by the rules and regulations of Nasdaq, to prepare and
submit to Nasdaq the requisite notification and forms for the
listing of the Class B Common Stock to be issued in connection with
this Agreement, and to cause such shares to be approved for listing
(subject to official notice of issuance) prior to
issuance.
3. REGISTRATION
PROCEDURES.
3.1 Filings; Information. Whenever
Parent is required to effect the registration of any Registrable
Securities by the Investor pursuant to Section 2, Parent shall use
its best efforts to effect the registration and sale of such
Registrable Securities in accordance with the intended method(s) of
distribution thereof as expeditiously as practicable, and in
connection with any such request:
3.1.1 Copies.
Parent shall, prior to filing a Registration Statement or
prospectus, or any amendment or supplement thereto, furnish without
charge to the Investor and its legal counsel if the Investor is
including Registrable Securities in such registration copies of
such Registration Statement as proposed to be filed, each amendment
and supplement to such Registration Statement (in each case
including all exhibits thereto and documents incorporated by
reference therein), the prospectus included in such Registration
Statement (including each preliminary prospectus), and such other
documents as the Investor or its legal counsel may request in order
to facilitate the disposition of the Registrable Securities owned
by the Investor.
3.1.2 Amendments
and Supplements. Parent shall prepare and file with the SEC
such amendments, including post-effective 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 in compliance with the
provisions of the Securities Act until all Registrable Securities
and other securities covered by such Registration Statement have
been disposed of in accordance with the intended method(s) of
distribution set forth in such Registration Statement or such
securities have been withdrawn or until such time as the
Registrable Securities cease to be Registrable Securities as
defined by this Agreement.
3.1.3 Notification.
After the filing of a Registration Statement, Parent shall
promptly, and in no event more than three (3) Business Days after
such filing, notify the Investor of such filing, and shall further
notify the Investor promptly and confirm such advice in writing in
all events within three (3) Business Days after the occurrence of
any of the following: (i) when such Registration Statement becomes
effective; (ii) when any post-effective amendment to such
Registration Statement becomes effective; (iii) the issuance or
threatened issuance by the SEC of any stop order (and Parent shall
take all actions required to prevent the entry of such stop order
or to remove it if entered); and (iv) any request by the SEC for
any amendment or supplement to such Registration Statement or any
prospectus relating thereto or for additional information or of the
occurrence of an event requiring the preparation of a supplement or
amendment to such prospectus so that, as thereafter delivered to
the purchasers of the securities covered by such Registration
Statement, such prospectus will not contain an untrue statement of
a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not
misleading, and promptly make available to the Investor any such
supplement or amendment; except that before filing with the SEC a
Registration Statement or prospectus or any amendment or supplement
thereto, Parent shall furnish to the Investor and its legal counsel
copies of all such documents proposed to be filed no fewer than
three (3) days in advance of such filing to provide the Investor
and its legal counsel with a reasonable opportunity to review such
documents and comment thereon.
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3.1.4 State
Securities Laws Compliance. Prior to any public offering of
Registrable Securities, Parent shall use its best efforts to (i)
register or qualify the Registrable Securities covered by the
Registration Statement under such securities or "blue sky" laws of
such jurisdictions in the United States as the Investor (in light
of his or her intended plan of distribution) may reasonably request
and (ii) take such action necessary to cause such Registrable
Securities covered by the Registration Statement to be registered
with or approved by such other governmental authorities as may be
necessary by virtue of the business and operations of Parent and do
any and all other acts and things that may be necessary or
advisable to enable the Investor to consummate the disposition of
such Registrable Securities in such jurisdictions; provided, however, that Parent shall not
be required to qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for this
paragraph or take any action to which it would be subject to
general service of process or taxation in any such jurisdiction
where it is not then otherwise so subject.
3.1.5 Agreements
for Disposition. Parent shall enter into customary
agreements (including, if applicable, an underwriting agreement in
customary form) and take such other actions as are reasonably
required in order to expedite or facilitate the disposition of such
Registrable Securities. If requested by the Underwriter(s) for an
Underwritten Shelf Takedown, Parent shall enter into an
underwriting agreement with such Underwriter(s) for such offering,
such agreement to be form and substance (including with respect to
representations and warranties by Parent) as is customarily given
by Parent to underwriters in an underwritten public offering, and
to contain indemnities to the effect and to the extent provided in
Section 4. The participating Investors in the Underwritten Shelf
Takedown shall be parties to such underwriting agreement; provided,
however, that no such Investor shall be required to (i) make any
representations or warranties in connection with any such
registration other than representations and warranties as to (A)
such Investor’s ownership of his or her Registrable
Securities to be sold or transferred free and clear of all liens,
claims and encumbrances, (B) such Investor’s power and
authority to effect such transfer and (C) such customary matters
pertaining to compliance with securities laws as may be reasonably
requested or (ii) undertake any indemnification obligations to
Parent or the Underwriter(s) with respect thereto except as
otherwise provided in Section 4. No Investor may participate in the
Underwritten Shelf Takedown unless such Investor agrees to sell his
or her Registrable Securities on the basis provided in such
underwriting agreement and completes and executes all
questionnaires, powers of attorney, indemnities (subject to clause
(ii) in the above proviso) and other documents reasonably required
under the terms of such underwriting agreement.
Each
participating Investor may, at its option, require that any or all
of the representations and warranties by, and the other agreements
on the part of, Parent to and for the benefit of such
Underwriter(s) also be made to and for such participating
Investor’s benefit and that any or all of the conditions
precedent to the obligations of such Underwriter(s) under such
underwriting agreement also be conditions precedent to its
obligations.
3.1.6 Cooperation.
The principal executive officer of Parent, the principal financial
officer of Parent, the principal accounting officer of Parent and
all other officers and members of the management of Parent shall
cooperate fully in any offering of Registrable Securities
hereunder, which cooperation shall include the preparation of the
Registration Statement with respect to such offering and all other
offering materials and related documents, and participation in
meetings with Underwriter(s), attorneys, accountants and potential
investors.
3.1.7 Listing.
Parent shall use its best efforts to cause all Registrable
Securities that are Class B Common Stock included in any
registration to be listed on such exchanges or otherwise designated
for trading in the same manner as similar securities issued by
Parent are then listed or designated or, if no such similar
securities are then listed or designated, in a manner satisfactory
to the Investor.
3.2 Obligation to Suspend
Distribution. Upon receipt of any notice from Parent of the
happening of any event of the kind described in Section 3.1.3(iv),
or, in the case of a resale registration on Form S-3 pursuant to
Section 2.3 hereof, upon any suspension by Parent, pursuant to a
written xxxxxxx xxxxxxx compliance program adopted by
Parent’s Board of Directors, of the ability of all "insiders"
covered by such program to transact in Parent’s securities
because of the existence of material non-public information, the
Investor shall immediately discontinue disposition of its
Registrable Securities pursuant to the Registration Statement
covering such Registrable Securities until the Investor receives
the supplemented or amended prospectus contemplated by Section
3.1.3(iv) or the restriction on the ability of "insiders" to
transact in Parent’s securities is removed, as applicable,
and, if so directed by Parent, the Investor will deliver to Parent
all copies, other than permanent file copies then in the
Investor’s possession, of the most recent prospectus covering
such Registrable Securities at the time of receipt of such
notice.
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3.3 Registration Expenses. Subject
to Section 4, Parent shall bear all costs and expenses incurred in
connection with any Piggy-Back Registration pursuant to Section
2.1, and any registration on Form S-3 effected pursuant to Section
2.2, and all expenses incurred in performing or complying with its
other obligations under this Agreement, whether or not the
Registration Statement becomes effective ("Registration
Expenses"),
including: (i) all registration and filing fees; (ii) fees and
expenses of compliance with securities or "blue sky" laws
(including fees and disbursements of counsel in connection with
blue sky qualifications of the Registrable Securities); (iii)
printing expenses; (iv) Parent’s internal expenses (including
all salaries and expenses of its officers and employees); (v) the
fees and expenses incurred in connection with the listing of the
Registrable Securities as required by Section 3.1.11; (vi)
Financial Industry Regulatory Authority fees; (vii) fees and
disbursements of counsel for Parent and fees and expenses for
independent certified public accountants retained by Parent
(including the expenses or costs associated with the delivery of
any opinions or comfort letters requested pursuant to Section
3.1.9); (viii) the fees and expenses of any special experts
retained by Parent in connection with such registration and (ix)
the reasonable fees and expenses of one legal counsel selected by
the Investor not to exceed $10,000 in connection with a Piggy-Back
Registration and $5,000 in connection with and any registration on
Form S-3 effected pursuant to Section 2.2. Parent shall have no
obligation to pay any underwriting discounts or selling commissions
attributable to the Registrable Securities being sold by the
Investor, which underwriting discounts or selling commissions shall
be borne by the Investor. Additionally, in an underwritten
offering, all selling security holders and Parent shall bear the
expenses of the Underwriter pro rata in proportion to the
respective amount of securities each is selling in such
offering.
3.4 Information. Each Investor
shall provide such information about such Investor, the Registrable
Securities held by such Investor and intended method of
disposition, in each case as may reasonably be requested by Parent,
or the managing Underwriter, if any, in connection with the
preparation of any Registration Statement including any Registrable
Securities of the Investor, including amendments and supplements
thereto, as is required to effect the registration of any
Registrable Securities under the Securities Act pursuant to Section
2 and in connection with the obligation to comply with federal and
applicable state securities laws. Any such information provided by
an Investor will not contain 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.
4. INDEMNIFICATION AND
CONTRIBUTION.
4.1 Indemnification by Parent.
Parent agrees to indemnify and hold harmless the Investor, and the
Investor’s affiliates, attorneys and agents, and each Person,
if any, who controls the Investor (within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act) (each, an
"Investor
Indemnified Party"), from and against any expenses, losses,
judgments, claims, damages or liabilities, whether joint or
several, arising out of or based upon any untrue statement of a
material fact contained in any Registration Statement under which
the sale of such Registrable Securities was registered under the
Securities Act, any preliminary prospectus, final prospectus or
summary prospectus contained in the Registration Statement, or any
amendment or supplement to such Registration Statement, or arising
out of or based upon any omission to state a material fact required
to be stated therein or necessary to make the statements therein
not misleading, or any violation by Parent of the Securities Act or
any rule or regulation promulgated thereunder applicable to Parent
and relating to action or inaction required of Parent in connection
with any such registration; and Parent shall promptly reimburse the
Investor Indemnified Party for any legal and any other expenses
reasonably incurred by such Investor Indemnified Party in
connection with investigating and defending any such expense, loss,
judgment, claim, damage, liability or action; provided, however, that Parent will not
be liable in any such case to the extent that any such expense,
loss, claim, damage or liability arises out of or is based upon any
untrue statement or omission to state therein a material fact
required to be stated therein made in such Registration Statement,
preliminary prospectus, final prospectus, or summary prospectus, or
any such amendment or supplement, in reliance upon and in
conformity with information furnished to Parent, in writing, by
such Investor expressly for use therein. Parent also shall
indemnify any Underwriter of the Registrable Securities, their
officers, affiliates, directors, partners, members and agents and
each Person who controls such Underwriter on substantially the same
basis as that of the indemnification provided above in this Section
4.1 and shall be part of the "Investor Indemnified
Party."
4.2 Indemnification by the
Investor. The Investor will, in the event that any
registration is being effected under the Securities Act pursuant to
this Agreement of any Registrable Securities held by the Investor,
indemnify and hold harmless Parent, each of its directors and
officers and each Underwriter (if any), and each other selling
holder and each other Person, if any, who controls another selling
holder or such Underwriter within the meaning of the Securities
Act, against any losses, claims, judgments, damages or liabilities,
whether joint or several, only insofar as such losses, claims,
judgments, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement of a material
fact contained in any Registration Statement under which the sale
of such Registrable Securities was registered under the Securities
Act, any preliminary prospectus, final prospectus or summary
prospectus contained in the Registration Statement, or any
amendment or supplement to the Registration Statement, or arise out
of or are based upon any omission to state a material fact required
to be stated therein or necessary to make the statement therein not
misleading, only if the statement or omission was made in reliance
upon and in conformity with information furnished in writing to
Parent by the Investor expressly for use therein, and shall
reimburse Parent, its directors and officers, each Underwriter and
each other selling holder or controlling Person for any legal or
other expenses reasonably incurred by any of them in connection
with investigation or defending any such loss, claim, damage,
liability or action. The Investor’s indemnification
obligations hereunder shall be several and not joint and shall be
limited to the amount of any net proceeds actually received by the
Investor.
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4.3 Conduct of Indemnification
Proceedings. Promptly after receipt by any Person of any
notice of any loss, claim, damage or liability or any action in
respect of which indemnity may be sought pursuant to Section 4.1 or
4.2, such Person (the "Indemnified Party")
shall, if a claim in respect thereof is to be made against any
other Person for indemnification hereunder, notify such other
Person (the "Indemnifying Party")
in writing of the loss, claim, judgment, damage, liability or
action; provided, however, that the failure by the Indemnified
Party to notify the Indemnifying Party shall not relieve the
Indemnifying Party from any liability which the Indemnifying Party
may have to such Indemnified Party hereunder, except and solely to
the extent the Indemnifying Party is actually prejudiced by such
failure. If the Indemnified Party is seeking indemnification with
respect to any claim or action brought against the Indemnified
Party, then the Indemnifying Party shall be entitled to participate
in such claim or action, and, to the extent that it wishes, jointly
with all other Indemnifying Parties, to assume control of the
defense thereof with counsel satisfactory to the Indemnified Party.
After notice from the Indemnifying Party to the Indemnified Party
of its election to assume control of the defense of such claim or
action, the Indemnifying Party shall not be liable to the
Indemnified Party for any legal or other expenses subsequently
incurred by the Indemnified Party in connection with the defense
thereof other than reasonable costs of investigation; provided,
however, that in any action in which both the Indemnified Party and
the Indemnifying Party are named as defendants, the Indemnified
Party shall have the right to employ separate counsel (but no more
than one such separate counsel) to represent the Indemnified Party
and its controlling Persons who may be subject to liability arising
out of any claim in respect of which indemnity may be sought by the
Indemnified Party against the Indemnifying Party, with the fees and
expenses of such counsel to be paid by such Indemnifying Party if,
based upon the written opinion of counsel of such Indemnified
Party, representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests
between them. No Indemnifying Party shall, without the prior
written consent of the Indemnified Party, consent to entry of
judgment or effect any settlement of any claim or pending or
threatened proceeding in respect of which the Indemnified Party is
or could have been a party and indemnity could have been sought
hereunder by such Indemnified Party, unless such judgment or
settlement includes an unconditional release of such Indemnified
Party from all liability arising out of such claim or
proceeding.
4.4 Contribution.
4.4.1 If
the indemnification provided for in the foregoing Sections 4.1, 4.2
and 4.3 is unavailable to any Indemnified Party in respect of any
loss, claim, damage, liability or action referred to herein, then
each such 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 loss, claim, damage,
liability or action in such proportion as is appropriate to reflect
the relative fault of the Indemnified Parties and the Indemnifying
Parties in connection with the actions or omissions which resulted
in such loss, claim, damage, liability or action, as well as any
other relevant equitable considerations. The relative fault of any
Indemnified Party and any Indemnifying Party shall be determined by
reference to, among other things, whether the untrue statement of a
material fact or the omission to state a material fact relates to
information supplied by such Indemnified Party or such Indemnifying
Party and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission.
4.4.2 The
parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 4.4 were determined by pro
rata allocation or by any other method of allocation which does not
take account of the equitable considerations referred to in the
immediately preceding Section 4.4.1.
4.4.3 The
amount paid or payable by an Indemnified Party as a result of any
loss, claim, damage, liability or action referred to in the
immediately preceding paragraph shall be deemed to include, subject
to the limitations set forth above, any legal or other expenses
incurred by such Indemnified Party in connection with investigating
or defending any such action or claim. Notwithstanding the
provisions of this Section 4.4, no Investor shall be required to
contribute any amount in excess of the dollar amount of the net
proceeds (after payment of any underwriting fees, discounts,
commissions or taxes) actually received by such the respective
Investor from the sale of such Registrable Securities which gave
rise to such contribution obligation. 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.
5. UNDERWRITING AND
DISTRIBUTION.
5.1 Rule 144. Parent covenants that
it shall file any reports required to be filed by it under the
Securities Act and the Exchange Act and shall take such further
action as the Investor may reasonably request, all to the extent
required from time to time to enable the Investor to sell
Registrable Securities without registration under the Securities
Act within the limitation of the exemptions provided by Rule 144
under the Securities Act, as such Rule may be amended from time to
time, or any similar rule or regulation hereafter adopted by the
SEC.
6. MISCELLANEOUS.
6.1 Other Registration Rights.
Parent represents and warrants that as of the date of this
Agreement, except as set forth in Schedule 4.6 of the Merger
Agreement, no Person has any right to require Parent to register
any of Parent’s capital stock for sale or to include
Parent’s capital stock in any registration filed by Parent
for the sale of capital stock for its own account or for the
account of any other Person.
6.2 Assignment; No Third Party
Beneficiaries. This Agreement and the rights, duties and
obligations of Parent hereunder may not be assigned or delegated by
Parent in whole or in part. This Agreement and the rights, duties
and obligations of the Investor hereunder may be freely assigned or
delegated by the Investor in conjunction with and to the extent of
any permitted transfer of Registrable Securities by the Investor.
In the event of any such assignment by the Investor of some but not
all of its rights hereunder, the assignee will be included in the
term "Investor" under this
Agreement and shall have pro rata rights under this Agreement with
respect to the Registrable Securities so transferred to it, but any
determination, consent or action by the Investor hereunder will
require the holders of a majority-in-interest of the Registrable
Securities. This Agreement and the provisions hereof shall be
binding upon and shall inure to the benefit of each of the parties,
to the permitted assigns of the Investor or of any assignee of the
Investor. This Agreement is not intended to confer any rights or
benefits on any Persons that are not party hereto other than as
expressly set forth in Article 4 and this Section 6.2.
7
6.3 Notices. All notices, consents,
waivers and other communications hereunder shall be in writing and
shall be deemed to have been duly given when delivered (i) in
person, (ii) by facsimile or other electronic means, with
affirmative confirmation of receipt, (iii) one Business Day after
being sent, if sent by reputable, nationally recognized overnight
courier service or (iv) three (3) Business Days after being mailed,
if sent by registered or certified mail, pre-paid and return
receipt requested, in each case to the applicable Party at the
following addresses (or at such other address for a Party as shall
be specified by like notice):
|
If to the Parent, to:
|
With a copy to (which shall not constitute notice:
|
|
0000 Xxxxxx Xxxx,
Xxxxx 000
Xxxxxxxxx,
XX 00000
|
Xxxxxxxx LLP
000 X. Xxx Xxxx
Xxxxxxxxx, Xxxxx 0000
Xxxx
Xxxxxxxxxx, XX 00000
|
|
Attn:
|
Attn: Xxxxxxx
Xxxxxxx
Xxxxxxxxx X.
Xxxxx
|
|
If to the Investors,to:
|
With a copy to (which shall not
constitute notice):
|
|
Xxxxxx
Xxxxxxxx
000
Xxxxxxxxx Xx.
Xxxxxxxxxxxxxx,
XX 00000
|
Bass, Xxxxx &
Xxxx PLC
000
Xxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxxxx,
XX 00000
|
|
Xxxxxxx
Xxxxxxxx
000 Xxxxxxxxx
Xx.
Xxxxxxxxxxxxxx,
XX 00000
|
Attn: Xxxxx
Xxxxxx
Xxxxxx
Xxxxxx
|
6.4 Severability. This Agreement
shall be deemed severable, and the invalidity or unenforceability
of any term or provision hereof shall not affect the validity or
enforceability of this Agreement or of any other term or provision
hereof. Furthermore, in lieu of any such invalid or unenforceable
term or provision, the parties hereto intend that there shall be
added as a part of this Agreement a provision as similar in terms
to such invalid or unenforceable provision as may be possible that
is valid and enforceable.
6.5 Counterparts. This Agreement
may be executed in multiple counterparts (including by facsimile or
pdf or other electronic document transmission), each of which shall
be deemed an original, and all of which taken together shall
constitute one and the same instrument.
6.6 Entire Agreement. This
Agreement (together with the Merger Agreement to the extent
incorporated herein, and including all agreements entered into
pursuant hereto or thereto or referenced herein or therein and all
certificates and instruments delivered pursuant hereto and thereto)
constitutes the entire agreement of the parties with respect to the
subject matter hereof and supersedes all prior and contemporaneous
agreements, representations, understandings, negotiations and
discussions between the parties, whether oral or written, relating
to the subject matter hereof; provided, that, for the
avoidance of doubt, the foregoing shall not affect the rights and
obligations of the parties under the Merger Agreement.
6.7 Interpretation. Titles and
headings of sections of this Agreement are for convenience only and
shall not affect the construction of any provision of this
Agreement. In this Agreement, unless the context otherwise
requires: (i) any pronoun used in this Agreement shall include the
corresponding masculine, feminine or neuter forms, and the singular
form of nouns, pronouns and verbs shall include the plural and vice
versa; (ii) "including" (and with correlative meaning "include")
means including without limiting the generality of any description
preceding or succeeding such term and shall be deemed in each case
to be followed by the words "without limitation"; (iii) the words
"herein," "hereto," and "hereby" and other words of similar import
in this Agreement shall be deemed in each case to refer to this
Agreement as a whole and not to any particular section or other
subdivision of this Agreement; and (iv) the term "or" means
"and/or". The parties have participated jointly in the negotiation
and drafting of this Agreement. Consequently, in the event an
ambiguity or question of intent or interpretation arises, this
Agreement shall be construed as if drafted jointly by the parties
hereto, and no presumption or burden of proof shall arise favoring
or disfavoring any party by virtue of the authorship of any
provision of this Agreement.
8
6.8 Amendments; Waivers. Any term
of this Agreement may be amended and the observance of any term of
this Agreement may be waived (either generally or in a particular
instance, and either retroactively or prospectively) only with the
written agreement or consent of Parent and the Investor. No failure
or delay by a party in exercising any right hereunder shall operate
as a waiver thereof. No waivers of or exceptions to any term,
condition, or provision of this Agreement, in any one or more
instances, shall be deemed to be or construed as a further or
continuing waiver of any such term, condition, or
provision
6.9 Remedies Cumulative. In the
event a party fails to observe or perform any covenant or agreement
to be observed or performed under this Agreement, the other parties
may proceed to protect and enforce its rights by suit in equity or
action at law, whether for specific performance of any term
contained in this Agreement or for an injunction against the breach
of any such term or in aid of the exercise of any power granted in
this Agreement or to enforce any other legal or equitable right, or
to take any one or more of such actions, without being required to
post a bond. None of the rights, powers or remedies conferred under
this Agreement shall be mutually exclusive, and each such right,
power or remedy shall be cumulative and in addition to any other
right, power or remedy, whether conferred by this Agreement or now
or hereafter available at law, in equity, by statute or
otherwise.
6.10 Governing
Law; Jurisdiction. This Agreement shall be governed by,
construed and enforced in accordance with the laws of the State of
Delaware without regard to the conflict of laws principles thereof.
All actions, claims or other legal proceedings arising out of or
relating to this Agreement (a "Proceeding") shall
be heard and determined exclusively in any state or federal court
located in Davidson County in the state of Tennessee (or in any
court in which appeal from such courts may be taken) (the
"Specified
Courts"). Each party hereto hereby (a) submits to the
exclusive jurisdiction of any Specified Court for the purpose of
any Proceeding brought by any party hereto and (b) irrevocably
waives, and agrees not to assert by way of motion, defense or
otherwise, in any such Proceeding, any claim that it is not subject
personally to the jurisdiction of the above-named courts, that its
property is exempt or immune from attachment or execution, that the
Proceeding is brought in an inconvenient forum, that the venue of
the Proceeding is improper, or that this Agreement or the
transactions contemplated hereby may not be enforced in or by any
Specified Court. Each party agrees that a final judgment in any
Proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner
provided by applicable law. Each party irrevocably consents to the
service of the summons and complaint and any other process in any
Proceeding, on behalf of itself, or its property, by personal
delivery of copies of such process to such party at the applicable
address set forth in Section 6.3. Nothing in this Section 6.10
shall affect the right of any party to serve legal process in any
other manner permitted by applicable law.
6.11 WAIVER
OF TRIAL BY JURY. EACH PARTY HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN ANY ACTION,
SUIT, COUNTERCLAIM OR OTHER PROCEEDING (WHETHER BASED ON CONTRACT,
TORT OR OTHERWISE) ARISING OUT OF, CONNECTED WITH OR RELATING TO
THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREBY, OR THE
ACTIONS OF THE INVESTORS IN THE NEGOTIATION, ADMINISTRATION,
PERFORMANCE OR ENFORCEMENT HEREOF.
6.12 Limitation
on Subsequent Registration Rights. After the date of this
Agreement, Parent shall not (i) enter into any agreement with any
holder or prospective holder of any securities of Parent that would
grant such holder or prospective holder rights to demand the
registration of any securities of Parent that are more favorable
than or inconsistent with the rights granted to the Investors
hereunder or (ii) enter into any agreement, take any action, or
permit any change to occur, with respect to its securities that
violates or subordinates the rights expressly granted to the
Investors in this Agreement, unless expressly approved by the
Investors in writing.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK;
SIGNATURE PAGES FOLLOW]
9
IN
WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be executed and delivered as of the date first written
above.
Parent:
By: /s/ Xxxxxxxx
Xxxxxxxx
Name: Xxxxxxxx
Xxxxxxxx
Title:
Chief Executive Officer
Investors:
/s/
Xxxxxx Xxxxxxxx
Name:
Xxxxxx Xxxxxxxx
/s/ Xxxxxxx
Xxxxxxxx
Name:
Xxxxxxx Xxxxxxxx
Representative:
/s/ Xxxxxx
Xxxxxxxx
Name:
Xxxxxx Xxxxxxxx
{Signature Page to Registration Rights Agreement}
