VANGUARD AIRLINES, INC.
REGISTRATION RIGHTS AGREEMENT
MARCH 20, 1998
TABLE OF CONTENTS
Page
1. General 1
1.1 Definitions 1
2. Restrictions on Transfer; Registration 3
2.1 Restrictions on Transfer 4
2.2 Demand Registration 5
2.3 Piggyback Registrations 5
2.4 Form S3 Registration 6
2.5 Obligations of the Company 7
2.6 Furnish Information 9
2.7 Delay of Registration 9
2.8 Indemnification 9
2.9 Assignment of Registration Rights 11
2.10 Termination of Registration Rights 11
2.11 "Market Stand-Off" Agreement 12
3. Miscellaneous 12
3.1 Governing Law 12
3.2 Survival 12
3.3 Successors and Assigns 12
3.4 Separability 12
3.5 Amendment and Waiver 12
3.6 Delays or Omissions 13
3.7 Notices 13
3.8 Attorneys' Fees 13
3.9 Titles and Subtitles 13
3.10 Counterparts 13
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is
entered into as of the 20th day of March, 1998, by and among
Vanguard Airlines, Inc., a Delaware corporation (the "Company"),
X.X. Xxxx Co., Inc., as nominee 1998-19 and The Xxxxxxxxx 1980
Revocable Trust (collectively, the "New Investors") and the
holders of a majority of the registrable securities under the
following agreements (the "Existing Investors," and together with
the New Investors, the "Investors"): (i)_the Amended and Restated
Investors' Rights Agreement dated as of August_24, 1994 by and
among the Company, the Series_A Purchasers and the Series_B
Purchasers (each as defined therein), (ii)_the Registration
Rights Agreement dated April 30, 1997 (the "1997 Registration
Rights Agreement") by and among the Company and the Holders (as
defined therein), and (iii)_the Registration Rights Agreement
dated as of September 9, 1996 (the "1996 Registration Rights
Agreement") by and among the Company and the Holders (as defined
therein) (collectively, the "Prior Agreements").
RECITALS
WHEREAS, as a condition to their purchase of Units pursuant
to a Unit Purchase Agreement of even date herewith by and among
the Company and the New Investors (the "Unit Purchase
Agreement"), the New Investors have requested that the Company
extend to them certain registration rights as set forth below;
WHEREAS, in order to facilitate the grant by the Company of
additional rights, the Company and the respective Existing
Investors desire to amend and restate the Prior Agreements and
set forth in a single agreement the registration rights granted
to the Investors; and
WHEREAS, the Existing Investors agree to consolidate the
Prior Agreements and to amend and restate all of their rights,
obligations and privileges as follows;
NOW, THEREFORE, in consideration of the mutual promises,
representations, warranties, covenants, and conditions set forth
in this Agreement and the Unit Purchase Agreement, the parties
mutually agree as follows:
1. General.
1.1.Definitions. As used in this Agreement the
following terms shall have the following respective meanings:
"1934 ACT" means the Securities Exchange Act of 1934,
as amended.
"1995 WARRANTS" means those certain Warrants for the
Purchase of Shares of Common Stock of the Company issued during
1995 to Xxxxxxx X. Xxxxxx, Xxxxxx X. Xxxxxx, H&Q TSP Investors,
L.P., Xxxxxxxxx & Xxxxx London Ventures and Starwood Investments,
L.P.
"1996 WARRANTS" means those certain Warrants for the
Purchase of Shares of Common Stock of the Company issued during
1996 to H&Q TSP Investors, L.P.
"1997 WARRANTS" means those certain Warrants for the
Purchase of Shares of Common Stock of the Company issued during
1997 to Xxxxxxx X. Xxxxxx, Xxxxxx X. Xxxxxx, H&Q TSP Investors,
L.P., Xxxxxxxxx & Xxxxx California and H&Q TSP II Investors, L.P.
"CONVERTIBLE NOTES" means those certain Convertible
Promissory Notes of the Company issued pursuant to that certain
Note Exchange Agreement dated the date hereof by and among the
Company and the Holders listed on Exhibit A attached thereto.
"FAMILY MEMBER" means a Holder's spouse, siblings,
children, stepchildren and grandchildren.
"FINAL PROSPECTUS" means an amended prospectus filed
with the SEC pursuant to SEC Rule 424(b) of the Securities Act.
"HOLDER" means any person owning of record Registrable
Securities.
"INITIATING HOLDERS" means the Holders of at least
forty percent (40%) of the Registrable Securities then
outstanding.
"REGISTER," "REGISTERED" and "REGISTRATION" refer to a
registration effected by preparing and filing a registration
statement in compliance with the Securities Act, and the
declaration or ordering of effectiveness of such registration
statement or document.
"REGISTRABLE SECURITIES" means (i)_all shares of Common
Stock issued or issuable upon conversion of the shares of Series
A Preferred Stock issued pursuant to the Unit Purchase Agreement;
(ii)_all shares of Common Stock issued or issuable upon the
exercise of Common Stock Purchase Warrants issued pursuant to the
Unit Purchase Agreement; (iii)_all shares of Common Stock issued
to the Investors and their affiliates in January 1998 pursuant to
the Company's rights offering; (iv)_all shares of Common Stock
issued or issuable pursuant to the exercise of the 1995 Warrants;
(v)_all shares of Common Stock issued or issuable pursuant to the
exercise of the 1996 Warrants; (vi)_all shares of Common Stock
issued or issuable pursuant to the exercise of the 1997 Warrants;
(vii)_all shares of Common Stock issued pursuant to the terms of
the Confidential Private Placement Memorandum dated August 16,
1996 (the "1996 PPM"); (viii)_all shares of Common Stock issued
or issuable upon the exercise of the Redeemable Common Stock
Purchase Warrants issued pursuant to the 1996 PPM; (ix)_all
shares of Common Stock issued pursuant to the Confidential
Private Placement Memorandum dated April 1, 1997 (the "1997
PPM"); (x)_all shares of Common Stock issued or issuable pursuant
to the exercise of the Redeemable Common Stock Purchase Warrants
issued pursuant to the 1997 PPM; (xi)_all shares of Common Stock
issued or issuable upon conversion of the Convertible Notes;
(xii)_all shares of Common Stock issued or issuable upon
conversion of the Shares as defined in the Amended and Restated
Investors' Rights Agreement dated August 24, 1994; and (xiii)_any
Common Stock of the Company issued as (or issuable upon the
conversion or exercise of any warrant, right or other security
which is issued as) a dividend or other distribution with respect
to, or in exchange for or in replacement of, such above-described
securities. Notwithstanding the foregoing, Registrable
Securities shall not include any securities sold by a person to
the public either pursuant to a registration statement or
Rule_144 or sold in a private transaction in which the
transferror's rights under this Agreement are not assigned.
"SECURITIES ACT" shall mean the Securities Act of 1933,
as amended.
"FORM S-3" means such form under the Securities Act as
in effect on the date hereof or any successor registration form
under the Securities Act subsequently adopted by the SEC which
permits inclusion or incorporation of substantial information by
reference to other documents filed by the Company with the SEC.
"SEC" or "COMMISSION" means the Securities and Exchange
Commission.
2. Restrictions on Transfer; Registration
2.1 Restrictions on Transfer.
(a) Each Holder agrees not to make any
disposition of all or any portion of the Registrable Securities
unless and until the transferee has agreed in writing for the
benefit of the Company to be bound by this Section_2.1, provided
and to the extent such Sections are then applicable and:
(i) There is then in effect a registration
statement under the Securities Act covering such proposed
disposition and such disposition is made in accordance with such
registration statement; or
(ii) Such Holder shall have notified the
Company of the proposed disposition and shall have furnished the
Company with a detailed statement of the circumstances
surrounding the proposed disposition, and if reasonably requested
by the Company, such Holder shall have furnished the Company with
an opinion of counsel, reasonably satisfactory to the Company,
that such disposition will not require registration of such
shares under the Securities Act.
(iii) Notwithstanding the provisions of
paragraphs_(i) and (ii) above, no such registration statement or
opinion of counsel shall be necessary for a transfer by (A) a
Holder which is a partnership to its partners in accordance with
partnership interests, (B) by a Holder that is a corporation to
its stockholders or (C)_to the Holder's family member or trust
for the benefit of an individual Holder, provided the transferee
will be subject to the terms of this Section_2.1 to the same
extent as if he were an original Holder hereunder.
(b) Each certificate representing Registrable
Securities shall (unless otherwise permitted by the provisions of
this Agreement) be stamped or otherwise imprinted with a legend
substantially similar to the following (in addition to any legend
required under applicable state securities laws or as provided
elsewhere in this Agreement):
THE SECURITIES REPRESENTED HEREBY HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT") OR THE LAWS OF
ANY STATE. THEY MAY NOT SOLD, OFFERED FOR
SALE, PLEDGED, HYPOTHECATED OR OTHERWISE
TRANSFERRED, EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE ACT, OR AN
OPINION OF COUNSEL SATISFACTORY TO THE
COMPANY THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER SUCH ACT OR UNLESS SOLD
PURSUANT TO RULE_144 UNDER SUCH ACT.
(c) The Company shall be obligated to reissue
promptly unlegended certificates at the request of any holder
thereof if the holder shall have obtained an opinion of counsel
(which counsel may be counsel to the Company) reasonably
acceptable to the Company to the effect that the securities
proposed to be disposed of may lawfully be so disposed of without
registration, qualification or legend.
(d) Any legend endorsed on an instrument pursuant
to applicable state securities laws and the stop-transfer
instructions with respect to such securities shall be removed
upon receipt by the Company of an order of the appropriate blue
sky authority authorizing such removal.
2.2 Demand Registration.
(a) Subject to the conditions of this
Section_2.2, if the Company shall receive at any time a written
request from the Initiating Holders that the Company file a
registration statement under the Securities Act covering the
registration of Registrable Securities, then the Company shall,
within thirty (30) days of the receipt thereof, give written
notice of such request to all Holders, and subject to the
limitations of Section_2.2(b), effect, as soon as practicable,
the registration under the Securities Act of at least 25% of the
Registrable Securities held by such Initiating Holders; provided,
however, that the Company may register less than 25% of such
Registrable Securities if the anticipated aggregate offering
price, net of underwriting discounts and commissions, exceeds
$5,000,000.
(b) If the Initiating Holders intend to
distribute the Registrable Securities covered by their request by
means of an underwriting, they shall so advise the Company as a
part of their request made pursuant to this Section_2.2 and the
Company shall include such information in the written notice
referred to in Section_2.2(a). In such event, the right of any
Holder to include his Registrable Securities in such registration
shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable
Securities in the underwriting (unless otherwise mutually agreed
by a majority in interest of the Initiating Holders and such
Holder) to the extent provided herein. All Holders proposing to
distribute their securities through such underwriting shall enter
into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by a
majority in interest of the Initiating Holders (which underwriter
or underwriters shall be reasonably acceptable to the Company).
Notwithstanding any other provision of this Section_2.2, if the
underwriter advises the Company in writing that marketing factors
require a limitation of the number of securities to be
underwritten (including Registrable Securities) then the Company
shall so advise all Holders of Registrable Securities which would
otherwise be underwritten pursuant hereto, and the number of
shares that may be included in the underwriting shall be
allocated to the Holders of such Registrable Securities on a pro
rata basis based on the number of Registrable Securities held by
all such Holders (including the Initiating Holders). Any
Registrable Securities excluded or withdrawn from such
underwriting shall be withdrawn from the registration.
(c) The Company shall not be obligated to effect
more than two (2) registrations pursuant to this Section_2.2.
(d) Notwithstanding the foregoing, if the Company
shall furnish to Holders requesting a registration statement
pursuant to this Section_2.2, a certificate signed by the
Chairman of the Board stating that in the good faith judgment of
the Board of Directors of the Company, it would be seriously
detrimental to the Company and its stockholders for such
registration statement to be filed and it is therefore essential
to defer the filing of such registration statement, the Company
shall have the right to defer such filing for a period of not
more than ninety (90) days after receipt of the request of the
Initiating Holders; provided that such right to delay a request
shall be exercised by the Company no more than once in any
one-year period.
(e) All expenses incurred in connection with a
registration pursuant to this Section_2.2 (excluding
underwriters' discounts and commissions, which shall be paid by
the selling Holders pro rata with respect to their included
shares), including without limitation all registration, filing,
qualification, printers' and accounting fees, fees and
disbursements of counsel for the Company, and the reasonable fees
and disbursements of a single counsel for the selling Holders,
shall be borne by the Company; provided, however, that the
Company shall not be required to pay for any expenses of any
registration proceeding begun pursuant to Section_2.2 if the
registration request is subsequently withdrawn, unless the
withdrawal of the registration request results from either
(a)_intentional actions by the Company outside the normal course
of business that materially reduce the feasibility of the
registration proceeding, or (b)_the discovery of information
about the Company that was not known at the time of the
Initiating Holders' request made pursuant to Section_2.2(a), and
such information materially reduces the feasibility of the
registration proceeding. If the Company is required to pay the
registration expenses pursuant to this Section_2.2(e), then the
Holders shall not forfeit their rights pursuant to this
Section_2.2 to a demand registration.
(f) A request by the New Investors that the
Company effect a registration under the Unit Purchase Agreement
shall not be deemed to be request for registration under this
Section 2.2.
2.3 Piggyback Registrations.
(a) The Company shall notify all Holders in
writing at least thirty (30) days prior to the filing of any
registration statement under the Securities Act for purposes of a
public offering of securities of the Company (including, but not
limited to, registration statements relating to secondary
offerings of securities of the Company, but excluding
registration statements relating to employee benefit plans and
corporate reorganizations) and will afford each such Holder an
opportunity to include in such registration statement all or part
of such Registrable Securities held by such Holder. Each Holder
desiring to include in any such registration statement all or any
part of the Registrable Securities held by it shall, within
twenty (20) days after receipt of the above-described notice from
the Company, so notify the Company in writing. Such notice shall
state the intended method of disposition of the Registrable
Securities by such Holder. If a Holder decides not to include
all of its Registrable Securities in any registration statement
thereafter filed by the Company, such Holder shall nevertheless
continue to have the right to include any Registrable Securities
in any subsequent registration statement or registration
statements as may be filed by the Company with respect to
offerings of its securities, all upon the terms and conditions
set forth herein. Notwithstanding anything to the contrary, the
foregoing shall not apply to any registrations occurring on or
after March 18, 2003.
(b) If the registration statement under which the
Company gives notice under this Section_2.3 is for an
underwritten offering, the Company shall so advise the Holders.
In such event, the right of any such Holder to be included in a
registration pursuant to this Section_2.3 shall be conditioned
upon such Holder's participation in such underwriting and the
inclusion of such Holder's Registrable Securities in the
underwriting to the extent provided herein. All Holders
proposing to distribute their Registrable Securities through such
underwriting shall enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for
such underwriting. Notwithstanding any other provision of the
Agreement, if the underwriter determines in good faith that
marketing factors require a limitation of the number of shares to
be underwritten, the number of shares that may be included in the
underwriting shall be allocated, first, to the Company; second,
to the Holders on a pro rata basis based on the total number of
Registrable Securities held by the Holders; and third, to any
stockholder of the Company (other than a Holder) on a pro rata
basis. No such reduction shall reduce the securities being
offered by the Company for its own account to be included in the
registration and underwriting, except that in no event shall the
amount of securities of the selling Holders included in the
registration be reduced below twenty percent (20%) of the total
amount of securities included in such registration.
(c) The Company shall bear all fees and expenses
incurred in connection with any registration under this Section
2.3 (excluding underwriters' discounts and commissions, which
shall be paid by the selling Holders pro rata with respect to
their included shares), including without limitation all
registration, filing, qualification, printers' and accounting
fees, fees and disbursements of counsel to the Company, and the
reasonable fees and disbursements of a single counsel to the
selling Holders (which counsel shall also be counsel to the
Company unless counsel to the Company has a conflict of interest
with respect to the representation of any selling Holder or the
underwriters object to the selling Holders representation by
Company counsel).
2.4 Form S3 Registration. In case the Company shall
receive at any time from the Holders of at least ten percent
(10%) of the Registrable Securities a written request or requests
that the Company effect a registration on Form S3 and any related
qualification or compliance with respect to all or a part of the
Registrable Securities owned by such Holder or Holders, the
Company will:
(a) promptly give written notice of the proposed
registration, and any related qualification or compliance, to all
other Holders of Registrable Securities; and
(b) use all reasonable efforts to effect, as soon
as practicable, such registration and all such qualifications and
compliances as may be so requested and as would permit or
facilitate the sale and distribution of all or such portion of
such Holder's or Holders' Registrable Securities as are specified
in such request, together with all or such portion of the
Registrable Securities of any other Holder or Holders joining in
such request as are specified in a written request given within
fifteen (15) days after receipt of such written notice from the
Company; provided, however, that the Company shall not be
obligated to effect any such registration, qualification or
compliance pursuant to this Section_2.4: (i)_if Form S-3 is not
available under the Securities Act or rules or regulations
promulgated thereunder for such offering by the Holders, (ii)_if
the Holders, together with the holders of any other securities of
the Company entitled to inclusion in such registration, propose
to sell Registrable Securities and such other securities (if any)
at an aggregate price to the public of less than $500,000,
(iii)_if the Company shall furnish to the Holders a certificate
signed by the Chairman of the Board of Directors of the Company
stating that in the good faith judgment of the Board of Directors
of the Company, it would be seriously detrimental to the Company
and its stockholders for such Form S-3 Registration to be
effected at such time, in which event the Company shall have the
right to defer the filing of the Form S3 registration statement
for a period of not more than ninety (90) days after receipt of
the request of the Holder or Holders under this Section 2.4,
provided that, such right to defer the filing may be exercised by
the Company no more than once in any twelve (12) month period,
(iv) if the Company has, within the twelve (12) month period
preceding the date of such request, already effected two (2)
registrations on Form S3 for the Holders pursuant to this Section
2.4, or (v) in any particular jurisdiction in which the Company
would be required to qualify to do business or to execute a
general consent to service of process in effecting such
registration, qualification or compliance.
(c) Subject to the foregoing, the Company shall
file a Form_S3 registration statement covering the Registrable
Securities and other securities so requested to be registered as
soon as practicable after receipt of the request or requests of
the Holders. All such expenses incurred in connection with
registrations requested pursuant to this Section_2.4 shall be
paid by the selling Holders pro rata with respect to their
included shares, including without limitation all registration,
filing, qualification, printers' and accounting fees, fees and
disbursements of counsel for the Company, and the reasonable fees
and disbursements of a single counsel for the selling Holder or
Holders.
(d) A request by the New Investors that the
Company effect a registration under the terms of the Unit
Purchase Agreement shall not be deemed to be a request for
registration under this Section 2.4.
2.5 Obligations of the Company. Whenever required to
effect the registration of any Registrable Securities, the
Company shall, as expeditiously as reasonably 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, and, upon the request of the Holders of a majority of
the Registrable Securities registered thereunder, keep such
registration statement effective for up to one hundred twenty
(120) days.
(b) Prepare and file with the SEC such amendments
and supplements to such registration statement and the prospectus
used in connection with such registration statement as may be
necessary to comply with the provisions of the Securities Act
with respect to the disposition of all securities covered by such
registration statement.
(c) Furnish to the Holders such number of copies
of a prospectus, including a preliminary prospectus, in
conformity with the requirements of the Securities Act, and such
other documents as they may reasonably request in order to
facilitate the disposition of Registrable Securities owned by
them that are included in such registration.
(d) Use its best efforts to register and qualify
the securities covered by such registration statement under such
other securities or Blue Sky laws of such jurisdictions as shall
be reasonably requested by the Holders, provided that the Company
shall not be required in connection therewith or as a condition
thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions.
(e) In the event of any underwritten public
offering, enter into and perform its obligations under an
underwriting agreement, in usual and customary form, with the
managing underwriter(s) of such offering. Each Holder
participating in such underwriting shall also enter into and
perform its obligations under such an agreement.
(f) Cause all such Registrable Securities
registered pursuant hereunder to be listed on each securities
exchange or automated quotation system on which similar
securities issued by the Company are then listed;
(g) Notify each Holder of Registrable Securities
covered by such registration statement at any time when a
prospectus relating thereto is required to be delivered under the
Securities Act of the happening of any event as a result of which
the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the
light of the circumstances then existing.
(h) Furnish, at the request of a majority of the
Holders participating in the registration, on the date that such
Registrable Securities are delivered to the underwriters for
sale, if such securities are being sold through underwriters, or,
if such securities are not being sold through underwriters, on
the date that the registration statement with respect to such
securities becomes effective, (i)_an opinion, dated as of such
date, of the counsel representing the Company for the purposes of
such registration, in form and substance as is customarily given
to underwriters in an underwritten public offering and reasonably
satisfactory to a majority in interest of the Holders requesting
registration, addressed to the underwriters, if any, and to the
Holders requesting registration of Registrable Securities and
(ii)_a letter dated as of such date, from the independent
certified public accountants of the Company, in form and
substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering
and reasonably satisfactory to a majority in interest of the
Holders requesting registration, addressed to the underwriters,
if any, and to the Holders requesting registration of Registrable
Securities.
2.6 Furnish Information. It shall be a condition
precedent to the obligations of the Company to take any action
pursuant to Sections 2.2, 2.3 or 2.4 that the selling Holders
shall furnish to the Company such information regarding
themselves, the Registrable Securities held by them, and the
intended method of disposition of such securities as shall be
required to effect the registration of their Registrable
Securities.
2.7 Delay of Registration. No Holder shall have any
right to obtain or seek an injunction restraining or otherwise
delaying any such registration as the result of any controversy
that might arise with respect to the interpretation or
implementation of this Article II.
2.8 Indemnification. In the event any Registrable
Securities are included in a registration statement under
Sections 2.2, 2.3 or 2.4:
(a) To the extent permitted by law, the Company
will indemnify and hold harmless each Holder, the partners,
shareholders, officers, directors, employees and agents of each
Holder, any underwriter (as defined in the Securities Act) for
such Holder and each person, if any, who controls such Holder or
underwriter within the meaning of the Securities Act or the 1934
Act, against any losses, claims, damages, or liabilities (joint
or several) to which they may become subject under the Securities
Act, the 1934 Act or other federal or state law, insofar as such
losses, claims, damages, or liabilities (or actions in respect
thereof) arise out of or are based upon any of the following
statements, omissions or violations (collectively a "Violation")
by the Company: (i)_any untrue statement or alleged untrue
statement of a material fact contained in such registration
statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements
thereto, (ii)_the omission or alleged omission to state therein a
material fact required to be stated therein, or necessary to make
the statements therein not misleading, or (iii)_any violation or
alleged violation by the Company of the Securities Act, the 1934
Act, any state securities law or any rule or regulation
promulgated under the Securities Act, the 1934 Act or any state
securities law in connection with the offering covered by such
registration statement; and the Company will reimburse each such
Holder, partner, shareholder, officer, director, employee, agent,
underwriter or controlling person for any legal or other expenses
reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action;
provided however, that the indemnity agreement contained in this
Section_2.8(a) shall not apply to amounts paid in settlement of
any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Company (which
consent shall not be unreasonably withheld), nor shall the
Company be liable in any such case for any such loss, claim,
damage, liability or action to the extent that it arises out of
or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished to the Company
expressly for use in connection with such registration by such
Holder, partner, officer, director, underwriter or controlling
person of such Holder.
(b) To the extent permitted by law, each selling
Holder will indemnify and hold harmless the Company, each of its
directors, each of its officers, each person, if any, who
controls the Company within the meaning of the Securities Act,
any underwriter and any other Holder selling securities under
such registration statement or any of such other Holder's
partners, directors or officers or any person who controls such
Holder, against any losses, claims, damages or liabilities (joint
or several) to which the Company or any such director, officer,
controlling person, underwriter or other such Holder, or partner,
director, officer or controlling person of such other Holder may
become subject under the Securities Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are
based upon any Violation, in each case to the extent (and only to
the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished to the Company by
such Holder expressly for use in connection with such
registration; and each such Holder will reimburse any legal or
other expenses reasonably incurred by the Company or any such
director, officer, controlling person, underwriter or other
Holder, or partner, officer, director or controlling person of
such other Holder in connection with investigating or defending
any such loss, claim, damage, liability or action if it is
judicially determined that there was such a Violation; provided,
however, that the indemnity agreement contained in this
Section_2.8(b) shall not apply to amounts paid in settlement of
any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which
consent shall not be unreasonably withheld; provided further,
that in no event shall any indemnity under this Section_2.8
exceed the net proceeds from the offering received by such
Holder.
(c) Promptly after receipt by an indemnified
party under this Section_2.8 of notice of the commencement of any
action (including any governmental action), such indemnified
party will, if a claim in respect thereof is to be made against
any indemnifying party under this Section_2.8, deliver to the
indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate
in, and, to the extent the indemnifying party so desires, jointly
with any other indemnifying party_similarly noticed, to assume
the defense thereof with counsel mutually satisfactory to the
parties; provided, however, that an indemnified party shall have
the right to retain its own counsel, with the fees and expenses
to be paid by the indemnifying party, if representation of such
indemnified party by the counsel retained by the indemnifying
party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party
represented by such counsel in such proceeding. The failure to
deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action, if
materially prejudicial to its ability to defend such action,
shall relieve such indemnifying party of any liability to the
indemnified party under this Section_2.8, but only to the extent
that such indemnifying party is prejudiced with respect to a
specific claim. The omission so to deliver written notice to the
indemnifying party will not relieve it of any liability that it
may have to any indemnified party otherwise than under this
Section 2.8.
(d) If the indemnification provided for in this
Section_2.8 is held by a court of competent jurisdiction to be
unavailable to an indemnified party with respect to any losses,
claims, damages or liabilities referred to herein, the
indemnifying party, in lieu of indemnifying such indemnified
party thereunder, shall to the extent permitted by applicable law
contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability in
such proportion as is appropriate to reflect the relative fault
of the indemnifying party on the one hand and of the indemnified
party on the other in connection with the Violation(s) that
resulted in such loss, claim, damage or liability, as well as any
other relevant equitable considerations. The relative fault of
the indemnifying party and of the indemnified party shall be
determined by a court of law by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information
supplied by the indemnifying party or by the indemnified party
and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement
or omission; provided that, in no event shall any contribution by
a Holder hereunder exceed the proceeds from the offering received
by such Holder. No person or entity guilty of fraudulent
misrepresentation (within the meaning of Section_II(f) of the
Securities Act) will be entitled to contribution from any person
or entity who was not guilty of such fraudulent
misrepresentation.
(e) The foregoing indemnity agreements of the
Company and Holders are subject to the condition that, insofar as
they relate to any Violation made in a preliminary prospectus but
eliminated or remedied in the amended prospectus on file with the
SEC at the time the registration statement in question becomes
effective or the Final Prospectus, such indemnity agreement shall
not inure to the benefit of any person obligated under the
Securities Act to furnish to the person asserting the loss,
liability, claim or damage a copy of the Final Prospectus if a
copy of the Final Prospectus was furnished to the indemnified
party and was not furnished to the person asserting the loss,
liability, claim or damage at or prior to the time such action is
required by the Securities Act.
(f) The obligations of the Company and Holders
under this Section 2.9 shall survive the completion of any
offering of Registrable Securities pursuant to a registration
statement, or otherwise.
2.9 Assignment of Registration Rights. The rights to
cause the Company to register Registrable Securities pursuant to
this Article II may be assigned by a Holder to a transferee or
assignee of Registrable Securities; provided, however, that no
such transferee or assignee shall be entitled to registration
rights under Sections 2.2, 2.3 or 2.4 hereof unless such
transferee or assignee: (i)_is a Holder; (ii)_holds after such
transfer or assignment at least one hundred thousand (100,000)
shares of Registrable Securities (as adjusted for stock
dividends, splits and combinations); or (iii)_is a Family Member
or a subsidiary, parent, general partner, limited partner,
retired partner or shareholder of a Holder. In each such case,
the Company shall, within twenty (20) days after such transfer,
be furnished with written notice of the name and address of such
transferee or assignee and the securities with respect to which
such registration rights are being assigned.
2.10 Termination of Registration Rights. No Holder
shall be entitled to exercise any right provided for in this
Section 2 after the time at which all Registrable Securities held
by such Holder (and any affiliate of the Holder with whom such
Holder must aggregate its sales under Rule 144) can be sold in
any three (3)-month period without registration in compliance
with Rule 144 of the Securities Act.
2.11 "Market Stand-Off" Agreement. If requested by the
Company and an underwriter of Common stock (or other securities)
of the Company, a Purchaser shall not sell or otherwise transfer
or dispose of any Common Stock (or other securities) of the
Company held by such Stockholder (other than those included in
the registration) for a period specified by the underwriters not
to exceed ninety_(90) days following the effective date of a
registration statement of the Company filed under the Securities
Act, provided, that all officers and directors of the Company and
holders of at least ten percent_(10%) of the Company's voting
securities enter into similar agreements. The obligations
described in this Section_2.11 shall not apply to a registration
relating solely to employee benefit plans on Form_S-1 or Form_S-8
or similar forms that may be promulgated in the future, or a
registration relating solely to a Commission Rule_145 transaction
on Form_S-4 or similar forms that may be promulgated in the
future. The Company may impose stop-transfer instructions with
respect to the shares (or securities) subject to the foregoing
restriction until the end of said ninety_(90) day period.
3. MISCELLANEOUS.
3.1 Governing Law. This Agreement shall be governed
by and construed under the laws of the State of California as
applied to agreements among California residents entered into and
to be performed entirely within California.
3.2 Survival. The representations, warranties,
covenants, and agreements made herein shall survive any
investigation made by any Holder and the closing of the
transactions contemplated hereby. All statements as to factual
matters contained in any certificate or other instrument
delivered by or on behalf of the Company pursuant hereto in
connection with the transactions contemplated hereby shall be
deemed to be representations and warranties by the Company
hereunder solely as of the date of such certificate or
instrument.
3.3 Successors and Assigns. Except as otherwise
expressly provided herein, the provisions hereof shall inure to
the benefit of, and be binding upon, the successors, assigns,
heirs, executors, and administrators of the parties hereto and
shall inure to the benefit of and be enforceable by each person
who shall be a holder of Registrable Securities from time to
time; provided, however, that prior to the receipt by the Company
of adequate written notice of the transfer of any Registrable
Securities specifying the full name and address of the
transferee, the Company may deem and treat the person listed as
the holder of such shares in its records as the absolute owner
and holder of such shares for all purposes, including the payment
of dividends or any redemption price.
3.4 Separability. In case any provision of the
Agreement shall be invalid, illegal, or unenforceable, the
validity, legality, and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
3.5 Amendment and Waiver. Any provision of this
Agreement may be amended and the observance thereof may be waived
(either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of
the Company and the Holders of a majority of the Registrable
Securities (including for purposes of such calculation Common
Stock issuable upon the conversion, exchange or exercise of
outstanding securities). Any amendment or waiver effected in
accordance with this Section_3.5 shall be binding upon each
Holder and the Company. By acceptance of any benefits under this
Agreement, Holders hereby agree to be bound by the provisions
hereunder. This Agreement and the Unit Purchase Agreement
contain the entire agreement of the parties with respect to the
subject matter contained herein.
3.6 Delays or Omissions. It is agreed that no delay
or omission to exercise any right, power, or remedy accruing to
any Holder, upon any breach, default or noncompliance of the
Company under this Agreement shall impair any such right, power,
or remedy, nor shall it be construed to be a waiver of any such
breach, default or noncompliance, or any acquiescence therein, or
of any similar breach, default or noncompliance thereafter
occurring. It is further agreed that any waiver, permit,
consent, or approval of any kind or character on any Holder's
part of any breach, default or noncompliance under the Agreement
or any waiver on such Holder's part of any provisions or
conditions of this Agreement must be in writing and shall be
effective only to the extent specifically set forth in such
writing. All remedies, either under this Agreement, by law, or
otherwise afforded to Holders, shall be cumulative and not
alternative.
3.7 Notices. All notices required or permitted
hereunder shall be in writing and be deemed to have been given or
made for all purposes: (i)_upon personal delivery, (ii)_upon
confirmation receipt that the communication was successfully sent
to the applicable number if sent by facsimile, (iii)_one day
after being sent, when sent by professional overnight courier
service, or (iv)_five_(5) days after posting when sent by
registered or certified mail. All communications shall be sent
to the party to be notified at the address as set forth on the
signature page hereof or at such other address as such party may
designate by ten (10) days advance written notice to the other
parties hereto.
3.8 Attorneys' Fees. If legal action is brought to
enforce or interpret this Agreement, the prevailing party shall
be entitled to recover its reasonable attorneys' fees and legal
costs in connection therewith.
3.9 Titles and Subtitles. The titles of the sections
and subsections of this Agreement are for convenience of
reference only and are not to be considered in construing this
Agreement.
3.10 Counterparts. This Agreement may be executed in
any number of counterparts, each of which shall be an original,
but all of which together shall constitute one instrument.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement as of the date set forth in the first paragraph
hereof.
COMPANY:
VANGUARD AIRLINES, INC.
By:
Title:
Address:
INVESTORS:
X.X. XXXX CO, INC. The Xxxxxxxxx 1980
Revocable Trust
By: By:
Title: Title:
Address: 000 Xxxx Xxxxxx Xxxx, 000 00xx Xxxxxx
Xxxxx 0 Xxx Xxxxxxxxx, XX 00000
Xxxxxx Xxxxxx, XX 00000
XXXXXXXXX & XXXXX CALIFORNIA H&Q TSP II INVESTORS, L.P.
By: By:
Title: Title:
Address: Xxx Xxxx Xxxxxx Xxxxxxx: Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000 Xxx Xxxxxxxxx, XX 00000
H&Q TSP INVESTORS, L.P.
By:
Title:
Address: Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
XXXXXXX X. XXXXXX XXXXXX X. XXXXXX
Address: 0000 Xxxxx Xxxx Xx. Address: 0000 X. 00xx Xx.,
Xxxxxxx, XX 00000-0000 Xxxxx Xxxx. 0000
Xxxxxxx, XX 00000-0000
STARWOOD INVESTMENTS, L.P. H&Q LONDON VENTURES
By: By:
Title: Title:
Address: 0000 X. Xxxx Xx., Xxxxxxx:
Xxxxx 000
Xxxxxxx, XX 00000
