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EXHIBIT 10.31
EXECUTION COPY
AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
This AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT is
dated as of March __, 1998 by and among Sleepmaster Holdings L.L.C., a New
Jersey limited liability company (the "Company"), Sleep Investor L.L.C., a
Delaware limited liability company (the "Investor"), PMI Mezzanine Fund, L.P., a
Delaware limited partnership ("PMI"), and Xxxxxxx Xxxxxxxxxx, Xxxxx X. Xxxxxxx,
Xxxxxxx Xxxxxx, Xxxxxxx XxXxxx, Xxxxxxx Xxxxx, Xxxxxxx Xxxxxx, Xxxxxxx Xxxxxxxx
and each other executive of the Company or its subsidiaries who acquires Common
Interests (as defined below) from the Company after the date hereof and executes
a joinder hereto (collectively, the "Executives", and individually an
"Executive").
The original Registration Rights Agreement (the "Original
Agreement") was entered into among the Company, the Investor, PMI and certain of
the Executives as of November 14, 1996.
The Executives hold units of the Company's Class A Common
Interests (the "Class A Common"), and the Investor holds units of the Class A
Common and units of the Company's Class B Common Interests (the "Class B
Common"). The Company issued to PMI warrants to purchase units of Class A Common
pursuant to the Common Interest Purchase Warrants dated as of November 14, 1996
(as amended as of the date hereof the "1996 Warrant Agreement") and the Company
is issuing additional warrants to purchase units of Class A Common pursuant to
Common Interest Purchase Warrants dated the date hereof (the "New Warrant
Agreement," and, together with the 1996 Warrant Agreement, the "Warrant
Agreements").
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Agreement
hereby agree as follows:
1. Definitions. Capitalized terms used but not defined herein shall have the
meaning given such terms in the Second Amended and Restated Limited Liability
Company Operating Agreement of the Company, dated November 14, 1996 (the
"Operating Agreement"). As used herein, the following terms shall have the
following meanings.
"Affiliate" means as to any Person, any other Person which
directly or indirectly controls, or is under common control with, or is
controlled by, such Person. As used in this definition, "control" (including,
with its correlative meanings, "controlled by" and "under common control with")
shall mean possession, directly or indirectly, of power to direct or cause the
direction of management or policies (whether through ownership of securities or
partnership or other ownership interests, by contract or otherwise).
"Common Interests" means, collectively, the Class A Common,
the Class B Common, and any other class of securities of the Company which is
not limited to a fixed sum or percentage of par value or stated value in respect
of the rights of the holders thereof to participate in dividends and in the
distribution of assets upon the voluntary or involuntary liquidation,
dissolution or winding up of the issuer of such securities.
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"Company Registrable Securities" has the meaning given to that
term in Section 6(c).
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Executive Registrable Securities" means (i) any Common
Interests acquired by, or issued or issuable to, the Executives on or after the
date hereof (provided that if any such Common Interests are subject to vesting
under the terms of an Employment Agreement or other agreement executed by the
Company and/or Sleepmaster and any Executive, such Common Interests shall be
Executive Registrable Securities only if and to the extent such Common Interests
have vested pursuant to the terms of such agreement), and (ii) any securities of
the Company issued or issuable with respect to the securities referred to in
clause (i) by way of a distribution or of a combination, exchange, conversion or
division of such securities or in connection with a recapitalization, merger,
consolidation or other reorganization. As to any particular Executive
Registrable Securities, such securities shall cease to be Executive Registrable
Securities when they have been distributed to the public pursuant to an offering
registered under the Securities Act or sold to the public through a broker,
dealer or market maker in compliance with Rule 144. For purposes of this
Agreement, a Person will be deemed to be a holder of Executive Registrable
Securities whenever such Person has the right to acquire directly or indirectly
such Executive Registrable Securities (upon conversion or exercise in connection
with a transfer of securities or otherwise, but disregarding any restrictions or
limitations upon the exercise of such right), whether or not such acquisition
has actually been effected; provided, that if such Executive Registrable
Securities are Vesting Executive Securities (as defined in the applicable
Employment Agreement) or are otherwise subject to vesting, a Person will be
deemed to be a holder of such Executive Registrable Securities only if, and only
to the extent that, such securities have become Vested Interests (as defined in
the applicable Employment Agreement) or have otherwise vested in accordance with
the terms of any applicable agreement.
"Investor Registrable Securities" means (i) Common Interests
acquired by, or issued or issuable to, the Investor or its Affiliates on or
after the date hereof, and (ii) any securities of the Company issued or issuable
with respect to the securities referred to in clause (i) by way of a
distribution or of a combination, exchange, conversion, or division of such
securities or in connection with a recapitalization, merger, consolidation or
other reorganization. As to any particular Investor Registrable Securities, such
securities shall cease to be Investor Registrable Securities when they have been
distributed to the public pursuant to an offering registered under the
Securities Act or sold to the public through a broker, dealer or market maker in
compliance with Rule 144. For purposes of this Agreement, a Person will be
deemed to be a holder of Investor Registrable Securities whenever such Person
has the right to acquire directly or indirectly such Investor Registrable
Securities (upon conversion or exercise in connection with a transfer of
securities or otherwise, but disregarding any restrictions or limitations upon
the exercise of such right), whether or not such acquisition has actually been
effected.
"Person" means an individual, a partnership, a corporation, an
association, a joint stock company, a limited liability company, a trust, a
joint venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.
"PMI Registrable Securities" means (i) Common Interests
acquired by, or issued or issuable to, PMI pursuant to the terms and conditions
of the Warrant Agreements on or after the date hereof, and (ii) any securities
of the Company issued or issuable with respect to the securities
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referred to in clause (i) by way of a distribution or of a combination,
exchange, conversion, or division of such securities or in connection with a
recapitalization, merger, consolidation or other reorganization. As to any
particular PMI Registrable Securities, such securities shall cease to be PMI
Registrable Securities when they have been distributed to the public pursuant to
an offering registered under the Securities Act or sold to the public through a
broker, dealer or market maker in compliance with Rule 144. For purposes of this
Agreement, a Person will be deemed to be a holder of PMI Registrable Securities
whenever such Person has the right to acquire directly or indirectly such PMI
Registrable Securities (upon conversion or exercise in connection with a
transfer of securities or otherwise, but disregarding any restrictions or
limitations upon the exercise of such right), whether or not such acquisition
has actually been effected.
"Put Notice" has the meaning given to that term in the Warrant
Agreements.
"Put Option" has the meaning given to that term in the Warrant
Agreements.
"Qualified Public Offering" means the sale, in an underwritten
public offering registered under the Securities Act, of equity securities of the
Company having an aggregate value of at least $20 million.
"Registrable Securities" means, collectively, the Investor
Registrable Securities, the PMI Registrable Securities, and the Executive
Registrable Securities.
"Registration Expenses" means all expenses incident to the
Company's performance of or compliance with this Agreement, including without
limitation all registration and filing fees, fees and expenses of compliance
with securities or blue sky laws, printing expenses, messenger and delivery
expenses, and fees and disbursements of counsel for the Company and all
independent certified public accountants, underwriters (excluding discounts and
commissions) and other Persons retained by the Company.
"Rule 144" means Rule 144 under the Securities Act (or any
similar rule then in force).
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Successor Agreement" means, in the event a Termination Event
occurs, the agreement or undertaking which replaces and is substituted for this
Agreement (if such replacement and substitution is necessary, as determined by
the Company's Board of Advisors in its good faith business judgment), which
Successor Agreement will give registration rights to the holders of Registrable
Securities which are substantially similar to the registration rights of the
holders of Registrable Securities set forth herein.
"Successor Entity" means, if a Termination Event has occurred,
the entity that replaces or succeeds the Company, including: (a) if the Company
is dissolved and liquidated, Sleepmaster (to the extent Sleepmaster is still
owned by the Company at the time of the Company's liquidation), (b) if the
Company is being converted to corporate form, the corporation that succeeds
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to the interests of and replaces the Company or (c) if the existence of the
Company is being terminated as a result of a merger, consolidation,
restructuring or other major transaction, the entity that survives such
transaction and succeeds to the interests of the Company. If there is a
Successor Entity, all references to the Company in this Agreement shall be
deemed to be references to such Successor Entity.
"Termination Event" means (a) the dissolution and liquidation
of the Company, (b) the conversion of the Company to corporate form and/or (c)
any other merger, consolidation, restructuring or other transaction involving
the Company in which the Company does not survive as an existing entity.
2. Demand Registrations.
(a) Requests for Registration. Subject to Section 2(b) below,
(i) at any time and from time to time, the holders of a majority of the Investor
Registrable Securities may request registration, whether underwritten or
otherwise, under the Securities Act of all or part of their Registrable
Securities on Form S-1 or any similar long-form registration ("Long-Form
Registrations") or on Form S-2 or S-3 or any similar short-form registration
("Short-Form Registrations") if available. In addition, subject to Section 2(g)
below, the holders of a majority of the Investor Registrable Securities may
request that the Company file with the SEC a registration statement under the
Securities Act on any applicable form pursuant to Rule 415 under the Securities
Act (a "415 Registration"), and (ii) from time to time prior to November 14,
2009, in the event that the Company shall fail for any reason (including,
without limitation, the unavailability of financing or the failure to obtain any
necessary approval) to purchase any PMI Registrable Securities following the
receipt of a validly delivered Put Notice pursuant to the terms and conditions
of the Warrant Agreements, on or after the ninetieth (90th) day following the
date of the Put Notice, so long as such Put Notice has not been revoked, the
holders of a majority of the PMI Registrable Securities may request a Long-Form
Registration, whether underwritten or otherwise, of all or any part of the PMI
Registrable Securities; provided, that the registration rights set forth in this
clause (ii) shall terminate upon the termination of the Put Option pursuant to
the terms of the Warrant Agreements. In connection with a Demand Registration
described in the foregoing clause 2(a)(ii), the Company shall use its
commercially reasonable efforts to cause to be included in such registration
Common Interests having an aggregate value (based on the midpoint of the
proposed offering price range specified in the registration statement used to
offer such securities) which will likely provide aggregate net proceeds from the
offering (individually or when aggregated with any prior public offerings of the
Common Interests) of not less than $30,000,000. Each request for a Long-Form
Registration or Short-Form Registration shall specify the approximate number of
Registrable Securities requested to be registered and the anticipated per share
price range for such offering. Within ten days after receipt of any such request
for a Long-Form Registration or Short-Form Registration, the Company will give
written notice of such requested registration to all other holders of
Registrable Securities and will include (subject to the provisions of this
Agreement) in such registration, all Registrable Securities with respect to
which the Company has received written requests for inclusion therein within 20
days after the receipt of the Company's notice. All registrations requested
pursuant to this Section 2(a) are referred to herein as "Demand Registrations".
(b) Long-Form Registrations. The holders of a majority of the
Investor Registrable Securities will be entitled to request, pursuant to the
terms of Section 2(a), up to five (5)
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Long-Form Registrations; provided, that such a registration will not count as a
permitted Long-Form Registration until it has become effective and unless the
holders of Registrable Securities are able to register and sell at least 90% of
the Registrable Securities requested to be included in such registration. The
holders of a majority of the PMI Registrable Securities will be entitled to
request, pursuant to the terms of Section 2(a)(ii), up to two (2) Long-Form
Registrations; provided, that such a registration will not count as a permitted
Long-Form Registration (i) until it has become effective, (ii) unless the
holders of PMI Registrable Securities are able to register and sell at least 90%
of the PMI Registrable Securities requested to be included in such registration,
and (iii) unless such registration (individually or when aggregated with any
prior public offerings of the Common Interests) shall have resulted in net
proceeds to the Company and/or the selling Securityholders of not less than $30
million.
(c) Short-Form Registrations. In addition to the Long-Form
Registrations provided pursuant to Section 2(b), the holders of the Investor
Registrable Securities will be entitled to request an unlimited number of
Short-Form Registrations. Demand Registrations (other than 415 Registrations)
will be Short-Form Registrations whenever the Company is permitted to use any
applicable short form. After the Company has become subject to the reporting
requirements of the Exchange Act, the Company will use its best efforts to make
Short-Form Registrations available for the sale of Registrable Securities.
(d) Priority on Demand Registrations.
(i) The Company will not include in any Long-Form
Registration or Short-Form Registration any securities which are not
Registrable Securities (other than Company Registrable Securities) without the
prior written consent of the holders of at least a majority of the Registrable
Securities included in such registration. Subject to paragraph (ii) below, if a
Long-Form Registration or a Short-Form Registration is an underwritten offering
and the managing underwriters advise the Company in writing that in their
opinion the number of Registrable Securities and, if permitted hereunder, other
securities requested to be included in such offering exceeds the number of
Registrable Securities and other securities, if any, which can be sold therein
without adversely affecting the marketability of the offering, the Company will
include in such registration (A) first, the number of Registrable Securities
requested to be included in such registration pro rata, if necessary, among the
holders of Registrable Securities based on the number of units of Registrable
Securities owned by each such holder, (B) second, any other securities of the
Company requested to be included in such registration pro rata, if necessary, on
the basis of the number of units of such other securities owned by each such
holder, and (C) third, if Company Registrable Securities are to be included in
such registration, the number of Company Registrable Securities to be included
in such registration is that number of Company Registrable Securities which is,
after giving effect to the foregoing clauses (A) and (B), required to attain the
$20 million threshold offering amount set forth in Section 6(c).
(ii) Notwithstanding the foregoing paragraph (i),
upon the receipt of a written request from the holders of a majority of the PMI
Registrable Securities, as provided in Section 2(a)(ii) above, the priority on
such a Demand Registration shall be (A) first, the number of Registrable
Securities requested to be included in such registration by the holders of PMI
Registrable Securities, (B) second, any other Registrable Securities requested
to be included in such registration pro rata, if necessary, among the holders of
such other Registrable Securities based on the number
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of units of Registrable Securities owned by each such holder, (C) third, any
other securities of the Company requested to be included in such registration
pro rata, if necessary, on the basis of the number of units of such other
securities owned by each such holder, and (D) fourth, if Company Registrable
Securities are to be included in such registration, the number of Company
Registrable Securities to be included in such registration is that number of
Company Registrable Securities which is, after giving effect to the foregoing
clauses (A), (B) and (C), required to attain the $30 million threshold offering
amount set forth in Section 2(a)(ii) above.
(e) Restrictions on Demand and Primary Registrations. (i) The
Company will not be obligated to effect any Demand Registration within six
months after the effective date of a previous Demand Registration and (ii) the
Company will not be entitled to effect, and no holder of Registrable Securities
will be entitled to request, any Demand Registration (other than pursuant to the
provisions of Section 2(a)(ii) above) or any primary registration on behalf of
the Company within six months after receipt of a validly delivered Put Notice
pursuant to the terms and conditions of the Warrant Agreements; provided, that
if the Company consummates the repurchase of PMI Registrable Securities upon or
at any time after receipt of a Put Notice, the provisions of this clause (ii)
shall terminate and be of no further force or effect.
(f) Selection of Underwriters. In the case of a Demand
Registration for an underwritten offering, the holders of a majority of the
Registrable Securities to be included in such Demand Registration will have the
right to select the investment banker(s) and manager(s) to administer the
offering (which investment banker(s) and manager(s) will be nationally
recognized) subject to the Company's approval which will not be unreasonably
withheld.
(g) 415 Registrations.
(i) The holders of a majority of the Investor
Registrable Securities will be entitled to request one (1) 415 Registration.
Subject to the availability of required financial information, within 45 days
after the Company receives written notice of a request for a 415 Registration,
the Company shall file with the SEC a registration statement under the
Securities Act for the 415 Registration. The Company shall use its best efforts
to cause the 415 Registration to be declared effective under the Securities Act
as soon as practical after filing, and once effective, the Company shall
(subject to the provisions of clause (ii) below) cause such 415 Registration to
remain effective for such time period as is specified in such request, but for
no time period longer than the period ending on the earlier of (i) the third
anniversary of the date of filing of the 415 Registration or (ii) the date on
which all Investor Registrable Securities have been sold pursuant to the 415
Registration or (iii) the date as of which there are no longer any Investor
Registrable Securities in existence.
(ii) If the holders of a majority of the Investor
Registrable Securities notify the Company in writing that they intend to effect
the sale of all or substantially all of the Investor Registrable Securities held
by such holders pursuant to a single integrated offering pursuant to a then
effective registration statement for a 415 Registration (a "Takedown"), the
Company and each holder of Registrable Securities shall not effect any public
sale or distribution of its equity securities, or any securities convertible
into or exchangeable or exercisable for its equity securities, during the 90-day
period beginning on the date such notice of a Takedown is received.
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(iii) If in connection with any Takedown the managing
underwriters (selected in accordance with clause (iv) below) advise the Company
that, in its opinion, the inclusion of any other securities other than Investor
Registrable Securities would adversely affect the marketability of the offering,
then no such securities shall be permitted to be included. Additionally, if in
connection with such an offering, the number of Investor Registrable Securities
and other securities (if any) requested to be included in such Takedown exceeds
the number of Investor Registrable Securities and other securities which can be
sold in such offering without adversely affecting the marketability of the
offering, the company shall include in such Sale (i) first, the Investor
Registrable Securities requested to be included in such Takedown, pro rata among
the holders of such Registrable Securities on the basis of the number of
Investor Registrable Securities owned by each such holder, and (ii) second,
other securities requested to be included in such Takedown to the extent
permitted hereunder.
(iv) The holders of a majority of the Investor
Registrable Securities shall have the right to retain and select an investment
banker and manager to administer the 415 Registration and any Takedown pursuant
thereto, subject to the Company's approval which will not be unreasonably
withheld.
(v) In addition to the provisions in Section 7
below, all expenses incurred in connection with the management of the 415
Registration (whether incurred by the Company or the holders of the Investor
Registrable Securities) shall be borne by the Company (including, without
limitation, all fees and expenses of the investment banker and manager)
(excluding discounts and commissions).
(h) Other Registration Rights. Except as provided in this
Agreement, the Company will not grant to any Persons the right to request the
Company to register any equity or similar securities of the Company, or any
securities convertible or exchangeable into or exercisable for such securities,
without the prior written consent of the holders of a majority of the Investor
Registrable Securities.
3. Piggyback Registrations.
(a) Right to Piggyback. Whenever the Company proposes to
register any of its Common Interests under the Securities Act (other than
pursuant to a Demand Registration, and other than pursuant to a registration
statement on Form S-8 or S-4 or any similar form or in connection with a
registration the primary purpose of which is to register debt securities (i.e.,
in connection with a so-called "equity kicker") and a registration form to be
used may be used for the registration of Registrable Securities (a "Piggyback
Registration"), the Company will give prompt written notice to all holders of
Registrable Securities of its intention to effect such a registration and will
include in such registration (subject to the provisions of this Agreement) all
Registrable Securities with respect to which the Company has received written
requests for inclusion therein within 20 days after the receipt of the Company's
notice. Notwithstanding the foregoing, in connection only with the initial
registered public offering of the Company's securities which offering is a
primary offering, no Registrable Securities shall be included in such
registration without the prior written consent of the holders of a majority of
Investor Registrable Securities.
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(b) Priority on Primary Registrations. If a Piggyback
Registration is an underwritten primary registration on behalf of the Company,
the Company will include in such registration all securities requested to be
included in such registration; provided, that if the managing underwriters
advise the Company in writing that in their opinion the number of securities
requested to be included in such registration exceeds the number which can be
sold in such offering without adversely affecting the marketability of the
offering, the Company will include in such registration (i) first, the
securities the Company proposes to sell, (ii) second, the Registrable Securities
requested to be included in such registration, pro rata among the holders of
such Registrable Securities on the basis of the number of units of Registrable
Securities owned by each such holder, and (iii) third, other securities, if any,
requested to be included in such registration.
(c) Priority on Secondary Registrations. If a Piggyback
Registration is an underwritten secondary registration on behalf of holders of
the Company's securities, and the managing underwriters advise the Company in
writing that in their opinion the number of securities requested to be included
in such registration exceeds the number which can be sold in such offering
without adversely affecting the marketability of the offering, the Company will
include in such registration (i) first, the securities requested to be included
therein by the holders requesting such registration, (ii) second, the
Registrable Securities requested to be included in such registration, pro rata
among the holders of such Registrable Securities on the basis of the number of
units of Registrable Securities owned by each such holder, and (iii) third,
other securities requested to be included in such registration not covered by
clause (i) or clause (ii) above (which registration was consented to pursuant to
Section 2(h) above).
(d) Selection of Underwriters. If any Piggyback Registration
is an underwritten offering, the investment banker(s) and manager(s) for the
offering will be selected by the holders of a majority of the Investor
Registrable Securities.
(e) Other Registrations. If the Company has previously filed a
registration statement with respect to Registrable Securities pursuant to this
Section 3, and if such previous registration has not been withdrawn or
abandoned, the Company will not file or cause to be effected any other
registration of any of its equity or similar securities or securities
convertible or exchangeable into or exercisable for its equity or similar
securities under the Securities Act (except on Forms S-4 or S-8 or any successor
forms), whether on its own behalf or at the request of any holder or holders of
such securities, until a period of at least six months has elapsed from the
effective date of such previous registration.
4. Holdback Agreements.
(a) Each holder of Registrable Securities hereby agrees not to
effect any public sale or distribution (including sales pursuant to Rule 144) of
equity securities of the Company, or any securities convertible into or
exchangeable or exercisable for such securities, during the seven days prior to
and the 120-day period (or, if the managing underwriters so request in writing,
a 180- day period) beginning on the effective date of any Demand Registration
(other than a 415 Registration) or Piggyback Registration for a public offering
to be underwritten on a firm commitment basis in which Registrable Securities
are included (except as part of such underwritten registration), if and to the
extent requested by the Company in the case of a non-underwritten public
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offering or if and to the extent requested by the underwriters managing an
underwritten public offering.
(b) The Company agrees (i) not to effect any public sale or
distribution of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, during the seven days prior to
and during the 120-day period (or, if the managing underwriters so request in
writing, a 180-day period) beginning on the effective date of any underwritten
Demand Registration (other than a 415 Registration) or Piggyback Registration
(except as part of such underwritten registration or pursuant to registrations
on Forms S-4 or S-8 or any successor forms), unless the underwriters managing
the registered public offering otherwise agree, and (ii) to cause each holder of
Registrable Securities and each other holder of at least 5% (on a fully diluted
basis) of Common Interests, or any securities convertible into or exchangeable
or exercisable for Common Interests, purchased from the Company at any time
after the date of this Agreement (other than in a registered public offering) to
agree not to effect any public sale or distribution (including sales pursuant to
Rule 144) of any such securities during such period (except as part of such
underwritten registration, if otherwise permitted), if and to the extent
requested by the Company in the case of a non-underwritten public offering or if
and to the extent requested by the underwriters managing an underwritten public
offering.
5. Further Assurances.
(a) In the event that the Board of Advisors of the Company
(the "Board") or the holders of a majority of the units of Investor Registrable
Securities then outstanding, as applicable, approve an initial public offering
and sale of Common Interests (an "Initial Public Offering") pursuant to an
effective registration statement under the Securities Act, or if a Demand
Registration is requested pursuant to Section 2(a) prior to an Initial Public
Offering, then all of the parties to this Agreement shall take all necessary or
desirable actions in connection with the consummation of such Initial Public
Offering as the Board or the holders of a majority of the Investor Registrable
Securities so request. Without limiting the generality of the foregoing, for so
long as the Put Option has not been terminated pursuant to the terms and
conditions of the Warrant Agreements, in the event that a Demand Registration is
requested, then upon (i) the request of the Board, (ii) the request of the
holders of a majority of the units of the Investor Registrable Securities then
outstanding, or (iii) the request of the holders requesting such Demand
Registration, all of the parties shall take such actions as may be reasonably
necessary for the Company to convert to a corporate form, including without
limitation the approval of a merger of the Company with and into a corporation,
with the result that each Member shall hold common and preferred stock of such
surviving corporation with rights, preferences and privileges substantially
equivalent to their respective Common Interests and Preferred Interests.
(b) If the Company proposes to take any action that would
result in a Termination Event, then so long as the Put Option has not been
terminated pursuant to the terms and conditions of the Warrant Agreements, the
Members shall take all necessary action to enter into a Successor Agreement and
shall not permit the Company to take any actions that would result in a
Termination Event until the Successor Entity has entered into a Successor
Agreement with the Members (or has entered into a binding agreement to enter
into such a Successor Agreement). The Members acknowledge and agree that the
restrictions set forth in the section of such Successor Agreement
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which corresponds to this Section 5(b) override and shall be given effect over
any other conflicting provision or statement in either the Operating Agreement
or this Agreement.
6. Registration Procedures. Whenever the holders of Registrable Securities have
requested that any Registrable Securities be registered pursuant to this
Agreement, the Company will use its best efforts to effect the registration and
the sale of such Registrable Securities in accordance with the intended method
of disposition thereof, and pursuant thereto the Company will as expeditiously
as possible:
(a) prepare and file with the SEC a registration statement
with respect to such Registrable Securities and use its best efforts to cause
such registration statement to become effective (provided that before filing a
registration statement or prospectus or any amendments or supplements thereto,
the Company will furnish to the counsel selected pursuant to Section 7(b) below
copies of all such documents proposed to be filed);
(b) prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective for
a period of not less than six months and comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement during such period in accordance with the intended
methods of disposition by the sellers thereof set forth in such registration
statement;
(c) if requested by the holders of a majority of the Investor
Registrable Securities in connection with any Demand Registration requested by
such holders, use its commercially reasonable efforts to cause to be included in
such registration Common Interests having an aggregate value (based on the
midpoint of the proposed offering price range specified in the registration
statement used to offer such securities) of up to $20 million ("Company
Registrable Securities"), to be offered in a primary offering of the Company's
securities contemporaneously with such offering of Registrable Securities;
(d) furnish to each seller of Registrable Securities such
number of copies of such registration statement, each amendment and supplement
thereto, the prospectus included in such registration statement (including each
preliminary prospectus) and such other documents as such seller may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such seller;
(e) use its best efforts to register or qualify such
Registrable Securities under such other securities or blue sky laws of such
jurisdictions as any seller reasonably requests and do any and all other acts
and things which may be reasonably necessary or advisable to enable such seller
to consummate the disposition in such jurisdictions of the Registrable
Securities owned by such seller (provided that the Company will not be required
to (i) qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subsection, (ii) subject itself to
taxation in any such jurisdiction or (iii) consent to general service of process
(i.e., service of process which is not limited solely to securities law
violations) in any such jurisdiction);
(f) notify each seller of such Registrable Securities, at any
time when a prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of
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11
any event as a result of which the prospectus included in such registration
statement contains an untrue statement of a material fact or omits any fact
necessary to make the statements therein not misleading, and, at the request of
any such seller, the Company will promptly prepare a supplement or amendment to
such prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain an untrue statement of
a material fact or omit to state any fact necessary to make the statements
therein not misleading;
(g) cause all such Registrable Securities to be listed on each
securities exchange on which similar securities issued by the Company are then
listed and, if not so listed, to be listed on the Nasdaq National Market
("Nasdaq Market") and, if listed on the Nasdaq Market, use its best efforts to
secure designation of all such Registrable Securities covered by such
registration statement as a Nasdaq "National Market System security" within the
meaning of Rule 11Aa2-1 of the SEC or, failing that, to secure Nasdaq Market
authorization for such Registrable Securities and, without limiting the
generality of the foregoing, to arrange for at least two market makers to
register as such with respect to such Registrable Securities with the National
Association of Securities Dealers;
(h) provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such registration
statement;
(i) enter into such customary agreements (including
underwriting agreements in customary form) and take all such other actions as
the holders of a majority of the Registrable Securities being sold or the
underwriters, if any, reasonably request in order to expedite or facilitate the
disposition of such Registrable Securities (including, without limitation,
effecting a stock split or a combination of units);
(j) make available for inspection by any seller of Registrable
Securities, any underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other agent retained by
any such seller or underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause the Company's
officers, directors, employees and independent accountants to supply all
information reasonably requested by any such seller, underwriter, attorney,
accountant or agent in connection with such registration statement;
(k) otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC, and make available to its security
holders, as soon as reasonably practicable, an earning statement covering the
period of at least twelve months beginning with the first day of the Company's
first full calendar quarter after the effective date of the registration
statement, which earning statement shall satisfy the provisions of Section 11(a)
of the Securities Act and Rule 158 promulgated thereunder;
(l) permit any holder of Registrable Securities which holder,
in its sole and exclusive judgment, might be deemed to be an underwriter or a
controlling person of the Company, to participate in the preparation of such
registration or comparable statement and to require the insertion therein of
material, furnished to the Company in writing, which in the reasonable judgment
of such holder and its counsel should be included;
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12
(m) in the event of the issuance of any stop order suspending
the effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any common stock included in such registration statement for sale in any
jurisdiction, the Company will use its reasonable best efforts promptly to
obtain the withdrawal of such order;
(n) use its best efforts to cause such Registrable Securities
covered by such registration statement to be registered with or approved by such
other governmental agencies or authorities as may be necessary to enable the
sellers thereof to consummate the disposition of such Registrable Securities;
and
(o) obtain a "cold comfort" letter from the Company's
independent public accountants in customary form and covering such matters of
the type customarily covered by "cold comfort" letters as the holders of a
majority of the Registrable Securities being sold reasonably request.
If any such registration or comparable statement refers to any holder by name or
otherwise as the holder of any securities of the Company and if, in its sole and
exclusive judgment, such holder is or might be deemed to be a controlling person
of the Company, such holder shall have the right to require (i) the insertion
therein of language, in form and substance satisfactory to such holder and
presented to the Company in writing, to the effect that the holding by such
holder of such securities is not to be construed as a recommendation by 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) in the event that 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; provided, that with respect to this clause (ii) such holder
shall furnish to the Company an opinion of counsel to such effect, which opinion
and counsel shall be reasonably satisfactory to the Company.
7. Registration Expenses.
(a) All expenses incident to the Company's performance of or
compliance with this Agreement, including without limitation all Registration
Expenses, will be borne by the Company.
(b) In connection with each Demand Registration, each
Piggyback Registration and each 415 Registration, the Company will reimburse the
holders of Registrable Securities covered by such registration for the
reasonable fees and disbursements of one counsel chosen by the holders of a
majority of the Registrable Securities initially requesting such registration.
8. Indemnification.
(a) The Company agrees to indemnify, to the extent permitted
by law, each holder of Registrable Securities, its officers and directors and
each Person who controls such holder (within the meaning of the Securities Act)
against all losses, claims, damages, liabilities and expenses arising out of or
based upon any untrue or alleged untrue statement of material fact contained in
any registration statement, prospectus or preliminary prospectus or any
amendment thereof or
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13
supplement thereto or any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, and shall reimburse such holder, director, officer or controlling
person for any legal or other expenses reasonably incurred by such holder,
director, officer or controlling person in connection with the investigation or
defense of such loss, claim, damage, liability or expense, except insofar as the
same are caused by or contained in any information furnished in writing to the
Company by such holder expressly for use therein or by such holder's failure to
deliver a copy of the registration statement or prospectus or any amendments or
supplements thereto after the Company has furnished such holder with a
sufficient number of copies of the same. In connection with an underwritten
offering, the Company will indemnify such underwriters, 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 the holders of Registrable Securities.
(b) 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 and affidavits as the Company
reasonably requests for use in connection with any such registration statement
or prospectus and, to the extent permitted by law, will indemnify the Company,
its directors and officers and each Person who controls the Company (within the
meaning of the Securities Act) against any losses, claims, damages, liabilities
and expenses resulting from any untrue or alleged untrue statement of material
fact contained in the registration statement, prospectus or preliminary
prospectus or any amendment thereof or supplement thereto or any omission or
alleged omission of a material fact required to be stated therein or necessary
to make the statements therein not misleading, but only to the extent that such
untrue statement or omission is contained in any information or affidavit so
furnished in writing by such holder; provided, that the obligation to indemnify
will be individual to each holder and will be limited to the net amount of
proceeds received by such holder from the sale of Registrable Securities
pursuant to such registration statement.
(c) Any Person entitled to indemnification hereunder will (i)
give prompt written notice to the indemnifying party of any claim with respect
to which it seeks indemnification and (ii) unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party. If such defense is assumed, the
indemnifying party will not be subject to any liability for any settlement made
by the indemnified party without its consent (but such consent will not be
unreasonably withheld). An indemnifying party who is not entitled to, or elects
not to, assume the defense of a claim will not be obligated to pay the fees and
expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of 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.
(d) The indemnification provided for under this Agreement will
remain in full force and effect regardless of any investigation made by or on
behalf of the indemnified party or any officer, director or controlling Person
of such indemnified party and will survive the transfer of securities. The
Company also agrees to make such provisions, as are reasonably requested by any
indemnified party, for contribution to such party in the event the Company's
indemnification is unavailable for any reason.
- 13 -
14
9. Participation in Underwritten Registrations. No Person may participate in any
registration hereunder which is underwritten unless such Person (a) agrees to
sell such Person's securities on the basis provided in any underwriting
arrangements approved by the Person or Persons entitled hereunder to approve
such arrangements and (b) completes and executes all customary questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements; provided,
that no holder of Registrable Securities included in any underwritten
registration shall be required to make any representations or warranties to the
Company or the underwriters other than representations and warranties regarding
such holder and such holder's intended method of distribution.
10. Rule 144 Reporting. With a view to making available to the holders of
Registrable Securities the benefits of certain rules and regulations of the SEC
which may permit the sale of the Registrable Securities to the public without
registration, the Company agrees to use its best efforts to:
(a) make and keep current public information available, within
the meaning of Rule 144 or any similar or analogous rule promulgated under the
Securities Act, at all times after it has become subject to the reporting
requirements of the Exchange Act;
(b) file with the SEC, in a timely manner, all reports and
other documents required of the Company under the Securities Act and Exchange
Act (after it has become subject to such reporting requirements); and
(c) so long as any party hereto owns any Registrable
Securities, furnish to such Person forthwith upon request, a written statement
by the Company as to its compliance with the reporting requirements of said Rule
144 (at any time commencing 90 days after the effective date of the first
registration filed by the Company for an offering of its securities to the
general public), the Securities Act and the Exchange Act (at any time after it
has become subject to such reporting requirements); a copy of the most recent
annual or quarterly report of the Company; and such other reports and documents
as such Person may reasonably request in availing itself of any rule or
regulation of the SEC allowing it to sell any such securities without
registration.
11. Amendment and Restatement of Original Agreement. The Original Agreement is
hereby amended and restated in its entirety.
12. Notices. All notices, demands or other communications to be given or
delivered under or by reason of the provisions of this Agreement will be in
writing and will be deemed to have been given when delivered personally, mailed
by certified or registered mail, return receipt requested and postage prepaid,
or sent via a nationally recognized overnight courier, or sent via facsimile to
the recipient accompanied by a certified or registered mailing. Such notices,
demands and other communications will be sent to the address indicated below:
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15
To the Company:
Sleepmaster Holdings L.L.C.
c/o Sleepmaster L.L.C.
0000 Xxxxx Xxxx
Xxxxxx, Xxx Xxxxxx 00000
Attention: Manager
Telecopy No.: (000) 000-0000
With copies, which shall not constitute notice, to:
Citicorp Venture Capital, Ltd.
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Mr. Xxxx Xxxxx
Telecopy No.: (000) 000-0000
Xxxxxxxx & Xxxxx
Citicorp Center
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxx X. Xxxxx, Esq.
Telecopy No.: (000) 000-0000
To the Investor:
Sleep Investor L.L.C.
c/o Citicorp Venture Capital, Ltd.
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Mr. Xxxx Xxxxx
Telecopy No.: (000) 000-0000
With copies, which shall not constitute notice, to:
Xxxxxxxx & Xxxxx
Citicorp Center
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxx X. Xxxxx, Esq.
Telecopy No.: (000) 000-0000
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16
PMI Mezzanine Fund, L.P.
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxxx Xxxxxxxxxxx
Telecopy No.: (000) 000-0000
Xxxxxxx, Phleger & Xxxxxxxx L.L.P.
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxxx Hilson, Esq.
Telecopy No.: (000) 000-0000
To PMI:
PMI Mezzanine Fund, L.P.
000 Xxxxxxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xx. Xxxxxx Xxxxxxxxxxx
Telecopy No.: (000) 000-0000
With a copy, which shall not constitute notice, to:
Xxxxxxx, Phleger & Xxxxxxxx L.L.P.
000 Xxxxx Xxxx Xxxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxxx Hilson, Esq.
Telecopy No.: (000) 000-0000
To any of the Executives:
Sleepmaster L.L.C.
0000 Xxxxx Xxxx
Xxxxxx, Xxx Xxxxxx 00000
Attention: [EXECUTIVE'S NAME]
Telecopy No.: (000) 000-0000
With a copy, which shall not constitute notice, to:
Xxxxxxxxx Xxxxxxx Xxxxxxx Xxxxxx
Xxxxx & Quentel
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxx, Esq.
Telecopy No.: (000) 000-0000
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17
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party.
13. Miscellaneous.
(a) No Inconsistent Agreements. The Company will not enter
into any agreement which is inconsistent with or violates the rights granted to
the holders of Registrable Securities in this Agreement.
(b) Remedies. Any Person having rights under any provision of
this Agreement will be entitled to enforce such rights specifically to recover
damages caused by reason of any breach of any provision of this Agreement and to
exercise all other rights granted by law. The parties hereto agree and
acknowledge that money damages may not be an adequate remedy for any breach of
the provisions of this Agreement and that any party may in its sole discretion
apply to any court of law or equity of competent jurisdiction (without posting
any bond or other security) for specific performance and for other injunctive
relief in order to enforce or prevent violation of the provisions of this
Agreement.
(c) Amendments and Waivers. Except as otherwise provided
herein, the provisions of this Agreement may be amended or waived only upon the
prior written consent of the Company and holders of a majority of the
Registrable Securities; provided, that no amendment to the provisions of
Xxxxxxxx 0, 0, 0, xxxxxxxxxxx (x), (x), (x), (x) and (h) of Section 2, this
subsection 13(c), and the defined terms relating to the foregoing shall be
effective without the prior written consent of the holders of a majority of the
PMI Registrable Securities.
(d) Successors and Assigns. All covenants and agreements in
this Agreement by or on behalf of any of the parties hereto will bind and inure
to the benefit of the respective successors and assigns of the parties hereto
whether so expressed or not. In addition, whether or not any express assignment
has been made, the provisions of this Agreement which are for the benefit of
purchasers or holders of Registrable Securities are also for the benefit of, and
enforceable by, any subsequent holder of Registrable Securities.
(e) Severability. Whenever possible, each provision of this
Agreement will be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be prohibited
by or invalid under applicable law, such provision will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(f) Counterparts. This Agreement may be executed
simultaneously in two or more counterparts, any one of which need not contain
the signatures of more than one party, but all such counterparts taken together
will constitute one and the same Agreement.
(g) Descriptive Headings. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement.
(h) GOVERNING LAW. THE LIMITED LIABILITY COMPANY LAWS OF THE
STATE OF NEW JERSEY WILL GOVERN ALL QUESTIONS CONCERNING THE RELATIVE RIGHTS OF
THE COMPANY AND ITS
- 17 -
18
MEMBERS. ALL OTHER QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND
INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE DOMESTIC LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING
EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE
STATE OF NEW YORK OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF
THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK.
* * * * *
- 18 -
19
IN WITNESS WHEREOF, the parties hereto have executed this
Amended and Restated Registration Rights Agreement as of the date first above
written.
SLEEPMASTER HOLDINGS L.L.C.
By: ________________________________________
Name:
Title:
SLEEP INVESTOR L.L.C.
By: ________________________________________
Name:
Title:
PMI MEZZANINE FUND, L.P.
By: Pacific Mezzanine Investors, LLC, its
General Partner
By: ____________________________________
Name:
Title:
XXXXXXX XXXXXXXXXX
____________________________________________
XXXXX X. XXXXXXX
____________________________________________
XXXXXXX XXXXXX
____________________________________________
XXXXXXX XXXXXX
____________________________________________
20
XXXXXXX XXXXX
____________________________________________
XXXXXXX XXXXXX
____________________________________________
XXXXXXX XXXXXXXX
____________________________________________
21
EXHIBIT A
FORM OF JOINDER TO AMENDED AND
RESTATED REGISTRATION RIGHTS AGREEMENT
THIS JOINDER to the Amended and Restated Registration Rights
Agreement, dated as of March, 1998 by and among Sleepmaster Holdings L.L.C., a
New Jersey limited liability company (the "Company"), and certain
securityholders of the Company (the "Agreement"), is made and entered into as of
_________ by and between the Company and _________________ ("Holder").
Capitalized terms used herein but not otherwise defined shall have the meanings
set forth in the Agreement.
WHEREAS, Holder has acquired certain units of Common
Interests, and the Agreement and the Company contemplates that Holder, as a
holder of Common Interests, may be entitled to become a party to the Agreement,
and Holder agrees to do so in accordance with the terms hereof.
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Joinder hereby
agree as follows:
Agreement to be Bound. Holder hereby agrees that upon
execution of this Joinder, it shall become a party to the Agreement and shall be
fully bound by, and subject to, all of the covenants, terms and conditions of
the Agreement as though an original party thereto and shall be deemed a holder
of Executive Registrable Securities for all purposes thereof. In addition,
Holder hereby agrees that all Common Interests held by Holder shall be deemed
Executive Registrable Securities for all purposes of the Agreement.
1. Successors and Assigns. Except as otherwise provided
herein, this Joinder shall bind and inure to the benefit of and be enforceable
by the Company and its successors and assigns and Holder and any subsequent
holders of Common Interests and the respective successors and assigns of each of
them, so long as they hold any shares of Common Interests.
2. Counterparts. This Joinder may be executed in separate
counterparts each of which shall be an original and all of which taken together
shall constitute one and the same agreement.
3. Notices. For purposes of Section 12 of the Agreement, all
notices, demands or other communications to the Holder shall be directed to:
[Name]
[Address]
[Facsimile Number]
4. GOVERNING LAW. THE LIMITED LIABILITY COMPANY LAWS OF THE
STATE OF NEW JERSEY WILL GOVERN ALL QUESTIONS CONCERNING THE RELATIVE RIGHTS OF
THE COMPANY AND ITS
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22
MEMBERS. ALL OTHER QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND
INTERPRETATION OF THIS JOINDER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE DOMESTIC LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY
CHOICE OF LAW OR CONFLICT OF LAW PROVISION OR RULE (WHETHER OF THE STATE OF NEW
YORK OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF
ANY JURISDICTION OTHER THAN THE STATE OF NEW YORK.
5. DESCRIPTIVE HEADINGS. The descriptive headings of this
Joinder are inserted for convenience only and do not constitute a part of this
Joinder.
* * * * *
- 22 -
23
IN WITNESS WHEREOF, the parties hereto have executed this
Joinder as of the date first above written.
SLEEPMASTER HOLDINGS L.L.C.
By:________________________________
Name:
Title:
[HOLDER]
By:_________________________________
