EXHIBIT 4.03
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of August 30, 2002 (this
"Agreement"), is by and among INTERLAND, INC., a corporation organized under the
laws of Minnesota ("Interland"), SPIRE CAPITAL PARTNERS, L.P., a limited
partnership organized under the laws of Delaware (the "Stockholders'
Representative) and each of the other parties set forth on the signature pages
hereto (each of whom, together with Stockholders' Representative may sometimes
be referred to herein as and "Investor" or the "Investors").
W I T N E S S E T H:
WHEREAS, each of the Investors is a stockholder of iNNERHOST, INC.
("iNNERHOST");
WHEREAS, pursuant to the terms of that Agreement and Plan of Merger, dated
as of the date hereof (the "Merger Agreement"), PantherCub Acquisition
Corporation, a wholly-owned subsidiary of Interland is being merged with and
into iNNERHOST (the "Merger"); and
WHEREAS, in partial consideration for such Merger, each of the Investors is
receiving shares of Interland's Common Stock, par value $.01 per share ("Common
Stock") and Interland has agreed to give the Investors certain registration
rights with respect to such shares.
NOW, THEREFORE, in consideration of the mutual representations, warranties,
covenants and agreements hereinafter set forth, the parties hereto hereby agree
as follows:
ARTICLE 1
GLOSSARY OF DEFINED TERMS
1.1. Definitions. Capitalized terms used herein and not defined shall have
the meanings given to them in the Merger Agreement. As used herein, the
following capitalized terms shall have the following meanings (terms defined in
the singular to have the same meanings when used in the plural and vice versa):
"Average Price" shall mean the weighted average price of the Registrable
Securities for any date of determination, as reported by Bloomberg Financial
Services.
"Effective Registration Price" shall mean the Average Price on the
effective date of any registration statement.
"Gross Share Number" shall mean the product of (a) 75,000 and (b) the
number of days in any Post-Effective Suspension Period on which the Average
Price was greater than the Effective Registration Price, less the number of days
during the Post Suspension Period on which the Average Price exceeded the
Effective Registration Price.
"Holder" shall mean the beneficial owner of Interland's Common Stock.
"Liquidated Damages" shall mean the damages which Interland is required to
pay to the Stockholders' Representative for the benefit of the Holders, pursuant
to Section 2.8 below.
"NASDAQ" shall mean the NASDAQ National Market System, on which Interland's
Common Stock is traded.
"Post-Effective Suspension Period" shall mean any Suspension Period
occurring within the first thirty days following the effective date of a
registration statement.
"Post Suspension Period" shall mean the thirty day period beginning on the
thirtieth day following a Post-Effective Suspension Period.
"Registrable Securities" shall mean all of the shares of Interland's Common
Stock received by the Investors pursuant to the Merger Agreement but shall not
include any shares of Common Stock which have been either sold by a Holder
pursuant to an effective registration statement or Rule 144 of the Securities
Act, or which are no longer outstanding.
1.2. Additional Definitions. The following terms defined elsewhere in this
Agreement shall have the respective meanings therein defined:
Term Section No.
---- -----------
"Agreement" Caption
"Closing Date Shares" 2.1(b)(i)
"Exchange Act" 2.4
"Indemnitee" 3.1
"Interland" Caption
"Interland Indemnified Parties" 3.2
"Long-Form Registration" 2.1(b)(ii)
"Losses" 3.1(a)
"Re-Valuation Shares" 2.1(b)(i)
"SEC" 2.4
"Second Payment Shares" 2.1(b)(i)
"Short-Form Registration" 2.1(b)(ii)
"Stockholders' Representative" Caption
"Suspension Period" 2.8
"Termination Date" 2.3(a)(i)
ARTICLE 2
REGISTRATION RIGHTS
2.1. Securities Subject to this Registration Rights Agreement;
Registration.
(a) Securities. The securities entitled to the benefits of this
Agreement are the Registrable Securities.
2
(b) Registration.
(i) No later than twenty five (25) days following the date
hereof, Interland will file an amendment to the registration statement on Form
S-3 it currently has on file with the SEC to include in such statement all of
the shares of Common Stock (A) issued to the Investors on the date hereof
(including all of those shares of Common Stock placed into escrow in accordance
with Section 2.7(b)(iii) of the Merger Agreement) (the "Closing Date Shares")
and (B) to be issued pursuant to Section 2.7(c)(iii) of the Merger Agreement
(the "Re-Valuation Shares"), as part of a shelf-registration pursuant to Rule
415 under the Securities Act. No later than two (2) days following the issuance
of any Re-Valuation Shares, Interland will file a post-effective amendment
specifying the number of shares of Common Stock issued as Re-Valuation Shares to
the Investors and including the Investors to whom such shares were issued as
"selling stockholders" thereunder.
(ii) In the event that Interland is unable to include any portion
of the Closing Date Shares or Re-Valuation Shares in an amendment to a then
pending Form S-3 registration statement (including the registration statement
referred to in clause (i) above) then, no later than twenty (20) days after each
date of issuance of Closing Date Shares and Re-Valuation Shares, as the case may
be, which cannot be so included, Interland shall file a Form S-3 or similar
short form or "evergreen" registration statement (each, a "Short-Form
Registration") covering all such shares which it could not include. If a
Short-Form Registration is not available to Interland, then it shall promptly
prepare and file a registration statement on Form S-1 or any similar
registration statement ("Long-Form Registration") in the United States under the
Securities Act for the registration thereunder of any and all of the Registrable
Securities then held by the Holders and Interland shall use its best efforts to
cause such registration statement to become effective as expeditiously as
possible. Interland shall include in such registration statement all Registrable
Securities not previously registered under this Section 2.1. The right granted
hereunder shall not terminate with respect to any Registrable Securities
transferred in accordance with the terms hereof.
2.2. Information. As a condition to the inclusion of a Holder's Registrable
Securities in any registration statement, such Holder will furnish in writing to
Interland such information with respect to such Holder as is required to be
disclosed in the registration statement (and the prospectus included therein) by
the applicable rules, regulations and guidelines of the SEC. Failure of a Holder
to furnish such information shall not affect the obligation of Interland under
Section 2.1 to the remaining Holders of Registrable Securities.
2.3. Procedure. Interland will, at its own expense and as expeditiously as
possible (and in any event within the time periods specified herein):
(a) Prepare and file with the SEC a registration statement or
registration statements (or amendments thereto) with respect to such Registrable
Securities and use its best efforts to cause such registration statement(s) to
become and remain effective until the earlier of (1) the date that the
Registrable Securities covered thereby have been sold and (2) the date that all
3
such Registrable Securities are eligible for resale, without limitation,
pursuant to Rule 144(k) under the Securities Act, or similar rule hereafter
adopted by the SEC (the "Termination Date").
(b) Prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to such registration statement(s) and
the prospectus(es) used in connection therewith as may be necessary to keep such
registration statement(s) effective during all periods and to comply with the
provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by such registration statement(s) until the
Termination Date or (x) in the event that the registration statement(s) is filed
on Form S-1, or similar Long-Form Registration, for a period of three months
from the date of its effectiveness, or (y) in the event the registration
statement(s) is filed on Form S-3 or similar Short-Form Registration and
constitute a "shelf registration statement" pursuant to Rule 415 under the
Securities Act, for such time until all of such Registrable Securities have been
disposed of in accordance with the intended methods of disposition by the seller
or sellers thereof set forth in such registration statement(s), until all of the
Registrable Securities covered thereby cease to be Registrable Securities, or
for such shorter period of time as to which the Stockholders' Representative
shall consent (but in any event no sooner than the second anniversary of the
Closing).
(c) Furnish to each Holder of Registrable Securities to be included in
any such registration, without charge, (A) a copy of the order of the SEC
declaring such registration statement and any post-effective amendment thereto
effective, (B) such reasonable number of conformed copies of such registration
statement and of each such amendment and supplement thereto (in each case
including any documents incorporated therein by reference and all exhibits), (C)
such reasonable number of copies of the prospectus included in any such
registration statement (including such preliminary prospectus and any summary
prospectus), in conformity with the requirements of the Securities Act, and (D)
such other documents as such Holder may reasonably request in order to
facilitate the disposition of the Registrable Securities owned by such Holder.
(d) Use its best efforts to register or qualify such Registrable
Securities covered by such registration statement(s) under such other securities
or blue sky laws of such jurisdictions as a Holder shall reasonably request,
keep each such registration or qualification (or exemption therefrom) effective
for the period required pursuant to Section 2.3(a)(ii) above, and do any and all
other acts and things that may be reasonably necessary or advisable to enable
such Holders to consummate the disposition of the Registrable Securities owned
by such Holder, in such jurisdictions within such time periods (other than in
any jurisdiction where Interland would be required to execute a general consent
to service of process where it has not already filed such consent).
(e) Use its best efforts to prevent the issuance of any stop order
suspending the effectiveness of such registration statement(s), or of any order
suspending or preventing the use of any related prospectus or suspending the
qualification (or exemption from qualification) of any equity securities
included in such registration statement(s) for sale in any jurisdiction, and, if
4
such order is issued, use its best efforts to obtain the withdrawal of such
order at the earliest possible moment.
(f) Use its best efforts to cause such Registrable Securities covered
by such registration statement(s) to be registered with or approved by such
other governmental agencies or authorities as may be necessary to enable the
Holders or Investors to consummate the disposition of such Registrable
Securities and keep each such registration or approval effective for the period
required pursuant to Section 2.3(a)(ii) above.
(g) Immediately notify each Holder of Registrable Securities covered
by such registration statement(s), at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, of any event the
happening of which results in the prospectus included in such registration
statement(s) including an untrue statement of a material fact or omitting to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, and, at the request of any such Holder, prepare and deliver a
reasonable number of copies of an amended or supplemental prospectus as may be
necessary so that, as thereafter delivered to the purchasers of such Registrable
Securities, such prospectus shall not include an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in the light of the circumstances
then existing.
(h) Otherwise comply with all applicable rules and regulations of the
SEC and make generally available to the Investors, in each case as soon as
practicable, but not later than 45 calendar days after the close of the fiscal
period covered thereby (90 calendar days in case the fiscal period covered
corresponds to a fiscal year of Interland), an earnings statement of Interland
which will satisfy the provisions of Section 11(a) of the Securities Act.
(i) Promptly inform each Holder of Registrable Securities of any and
all correspondence between Interland and the SEC with respect to such
registration.
(j) Cause those Registrable Securities being registered and sold
pursuant to this Agreement to be listed on NASDAQ or such other national stock
exchange or trading system on which Interland's Common Stock is listed for
trading in the United States and for which the Registrable Securities are then
eligible for listing.
2.4. Rule 144. Interland covenants that it will file the reports required
to be filed by it under the Securities Act and the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and the rules and regulations adopted by
the Securities and Exchange Commission ("SEC") thereunder, and it will take such
further action as a Holder of Registrable Securities may reasonably request, all
to the extent required from time to time to enable such Holder to sell
Registrable Securities without registration under the Securities Act within the
limitation of the exemptions provided by (i) Rule 144 under the Securities Act,
as such Rule may be amended from time to time, or (ii) any similar rule or
regulation hereafter adopted by the SEC. Upon the request of a Holder of
5
Registrable Securities, Interland will deliver to such holder a written
statement as to whether it has complied with such requirements.
2.5. Expenses. As to all registrations under this Section 2, Interland
shall pay all costs, fees and expenses incident to the performance and
compliance by Interland with this Registration Rights Agreement, including
without limitation, (A) all registration and filing fees (including fees payable
to NASDAQ); (B) all printing expenses; (C) all fees and disbursements of counsel
and independent public accountants for Interland; (D) all blue sky fees and
expenses (including fees and expenses of counsel in connection with blue sky
surveys); (E) all transfer taxes; (F) the entire expense of any audits incident
to such registration required by the rules and regulations of the SEC; (G) the
cost of distributing the prospectuses in preliminary and final form as well as
any supplements thereto; (H) the fees and expenses of one counsel for the
Holders of Registrable Securities being registered who shall be selected by the
Stockholders' Representative, provided, however, that such fees and expenses
shall not exceed $10,000 with respect to any single Short Form Registration or
$20,000 with respect to any single Long-Form Registration; and (I) internal
expenses of Interland, reasonable messenger, telephone, duplication, word
processing and delivery expenses incurred by Interland in the performance of its
obligations hereunder, but excluding underwriting fees and commissions incurred
by the Holders of the Registrable Securities.
2.6. Interland Requests. In connection with the registration of any
Registrable Securities pursuant to any registration statement, each of the
Holders shall:
(a) complete and deliver to Interland a selling security holder
questionnaire to include the information required under Section 2.2 hereof.
(b) if notified by Interland of any event as a result of which the
prospectus included in such registration statement contains an untrue statement
of material fact or omits to state a material fact, or of any stop order or
other order suspending the effectiveness of such registration statement,
immediately discontinue any sale or other disposition of Registrable Securities
pursuant to such registration statement until the filing of an amendment or
supplement to the registration statement or the withdrawal or the stop order or
such other order;
(c) deliver a prospectus to the purchaser of such Registrable
Securities;
(d) promptly notify Interland when such Holder has sold such
Registrable Securities; and
(e) promptly notify Interland in the event that any information
supplied by such Holder in writing for inclusion in such registration statement
or related prospectus or any document referred to therein is untrue or omits to
state a material fact required to be stated therein or necessary to make such
information not misleading.
2.7. Black-Out Period. Each Holder of Registrable Securities agrees not to
effect any offer or sale of Registrable Securities, if so requested by Interland
in connection with any proposal or plan by Interland to engage in any material
financing or material acquisition or disposition by Interland or any subsidiary
6
thereof of the capital stock or substantially all the assets of any other person
(other than in the ordinary course of business), any tender offer or any merger,
consolidation, corporate reorganization, strategic partnership arrangement or
restructuring or other similar transaction material to Interland and its
subsidiaries taken as a whole, provided Interland has made the same request of
all of its officers and directors, as well. The period during which Interland
fails to keep a shelf registration statement effective and usable for resales of
Registrable Securities, or pursuant to this Section 2.7 requires that the
Holders of Registrable Securities not effect sales of Registrable Securities
pursuant to a shelf registration statement, or otherwise, is hereafter referred
to as the "Suspension Period." The Suspension Period shall not exceed twenty
(20) days, or with the consent of the Stockholders' Representative, sixty (60)
days, and Interland shall have the right to call for only two such Suspension
Periods in any twelve (12) month period, even if a Suspension Period shall be
less than sixty (60) days. In the event a Suspension Period shall occur within
the first thirty (30) days following the effective date of a registration
statement, Interland agrees that it shall pay the Holders of Registrable
Securities the Liquidated Damages provided for in Section 2.8 below. The
Suspension Period shall commence on the date set forth in a written notice by
Interland to the Holders that the shelf registration statement is no longer
effective or that the prospectus included in the shelf registration statement is
no longer usable for resales of Registrable Securities or, in the case of a
suspension pursuant to this Section 2.7 the date specified in the notice
delivered by Interland pursuant to this Section 2.7, and shall end on the date
when each Holder of Registrable Securities covered by the shelf registration
statement either receives the copies of the supplemented or amended prospectus
contemplated by Section 2.3(a)(iii) or is advised in writing by Interland that
use of the prospectus or sales may be resumed.
2.8. Liquidated Damages. For each day during a Post Suspension Period that
the Average Price is less than the applicable Effective Date Price, Interland
shall pay Liquidated Damages in an aggregate amount equal to the product of the
applicable Gross Share Number and the difference between the Average Price on
such date and the applicable Effective Date Price. The aggregate Liquidated
Damages related to a Post-Effective Suspension Period shall be paid by Interland
to the Stockholders' Representative within two (2) business days following the
end of the applicable Post Suspension Period, by wire transfer of immediately
available funds to the Stockholders' Wire Transfer Account and Interland shall
concurrently provide the Stockholders' Representative with a reasonably detailed
schedule setting forth its calculation of such Liquidated Damages.
ARTICLE 3
INDEMNIFICATION
3.1. General. Interland will, and it hereby agrees to, indemnify and hold
harmless, to the extent permitted by law, each Holder owning any Registrable
Securities covered by such registration statement, its directors and officers,
employees or agents, each other person who participates as an underwriter in the
offering or sale of such securities and each other person, if any, who controls
such Holder or any such underwriter within the meaning of the Securities Act
(each, an "Indemnitee"), as follows:
7
(a) against any and all loss, liability, claim, damage or expense
whatsoever including, without limitation, expenses contemplated by subparagraph
(iii) below (collectively, "Losses") arising out of or based upon an untrue
statement or alleged untrue statement of a material fact contained in any
registration statement (or any amendment or supplement thereto), including all
documents incorporated therein by reference, or other document related to
compliance, or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or arising out of an untrue statement or alleged untrue statement of
a material fact contained in any preliminary prospectus or prospectus (or any
amendment or supplement thereto) or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein not
misleading or any violation (or alleged violation) of the Securities Act or
other securities laws in connection with any such registration or compliance;
(b) against any and all Losses to the extent of the aggregate amount
paid in settlement of any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any such alleged untrue
statement or omission, if such settlement is effected with the written consent
of Interland; and
(c) against any and all expenses reasonably incurred by them in
connection with investigating, preparing or defending against any litigation, or
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the extent that
any such expense is not paid under subparagraph (a) or (b) above
provided, however, that this indemnity does not apply to any Loss incurred by an
Indemnitee, to the extent arising out of an untrue statement or alleged untrue
statement or omission or alleged omission made in reliance upon and in
conformity with written information furnished to Interland by or on behalf of
any such Indemnitee expressly for use in the preparation of any registration
statement (or any amendment thereto) or any preliminary prospectus or prospectus
(or any amendment or supplement thereto) such information to include but not be
limited to the questionnaire referenced in Section 2.2 hereof; and provided,
further, that Interland will not be liable to any person who participates as an
underwriter in the offering or sale of Registrable Securities or any other
person, if any, who controls such underwriter within the meaning of the
Securities Act, under the indemnity agreement in this Section 3.1 with respect
to any preliminary prospectus or final prospectus or final prospectus as amended
or supplemented, as the case may be, to the extent that any such Loss of such
underwriter or controlling person results from the fact that such underwriter
offered or sold Registrable Securities to a person to whom there was not sent or
given, at or prior to the written confirmation of such sale, a copy of the final
prospectus or of the final prospectus as then amended or supplemented, whichever
is most recent, if Interland has previously furnished copies thereof to such
underwriter. Such indemnity shall survive the transfer of such securities by
such Indemnitee.
8
3.2. Indemnification by Holders. Each Holder of Registrable Securities
participating in any registration hereunder shall severally and not jointly,
indemnify and hold harmless, to the fullest extent permitted by law, Interland,
its directors, officers, employees, affiliates and agents, and each Person who
controls Interland (within the meaning of the Securities Act) (collectively,
"Interland Indemnified Parties") against all losses, claims, damages,
liabilities and expenses, joint or several (including reasonable fees of counsel
and any amounts paid in settlement effected with such Holder's consent, which
consent shall not be unreasonably delayed or withheld) to which any Interland
Indemnified Party may become subject under the Securities Act, the Exchange Act,
any other federal law, any state or common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses (or actions or proceedings,
whether commenced or threatened, in respect thereof) are caused by (i) any
untrue statement or alleged untrue statement of a material fact contained in any
Registration Statement in which such Holder's Registrable Securities were
included or 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; (ii) any untrue statement or alleged untrue statement of a material
fact contained in any preliminary, final or summary prospectus any statement or
alleged statement in or omission or alleged omission from such registration
statement, any preliminary, final or summary prospectus (as amended or
supplemented if Interland shall have filed with the Commission any amendment
thereof or supplement thereto), or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, and in the cases described in clauses (i) and (ii) of
this Section 3.2, to the extent, but only to the extent, that such untrue
statement or omission is contained in any information furnished in writing by
such Holder relating to such Holder specifically stating that it is for use in
the preparation of the documents described in such clauses (i) and (ii) and
Interland does not know, at the time such information is included in the
Registration Statement, prospectus, preliminary prospectus, amendment or
supplement that such information is false or misleading; (iii) any violation by
such Holder of the Securities Act, the Exchange Act, any other federal law, any
state or common law, or any rule or regulation promulgated thereunder applicable
to such Holder and relating to action of or inaction by such Holder in
connection with any such registration; and (iv) with respect to any preliminary
prospectus delivered in a non-underwritten offering, the fact that such Holder
sold Registrable Securities to a person to whom there was not sent or given, at
or before the written confirmation of such sale, a copy of the prospectus
(excluding the documents incorporated by reference) or of the prospectus as then
amended or supplemented (excluding documents incorporated by reference) if
Interland has previously furnished copies thereof to such Holder in compliance
with this Agreement and the loss, claim, damage, liability or expense of such
Interland Indemnified Party results from an untrue statement or omission of a
material fact relating to information provided by such Holder contained in such
preliminary prospectus which was corrected in the prospectus (or the prospectus
as amended or supplemented); provided, however, that the liability of such
Holder under this Section 3.2 shall be limited to the net proceeds received by
such Holder in the offering giving rise to such liability. Such indemnity
obligation shall remain in full force and effect regardless of any investigation
9
made by or on behalf of Interland Indemnified Parties (except as provided above)
and shall survive the transfer of such securities by such Holder.
3.3. Actions. Promptly after receipt by an indemnified party hereunder of
written notice of the commencement of any action or proceeding involving a claim
referred to in this Article 3, such indemnified party will, if a claim in
respect thereof is to be made against an indemnifying party, give written notice
to such indemnifying party of the commencement of such action; provided,
however, that the failure of any indemnified party to give notice as provided
herein shall not relieve the indemnifying party of its obligations under this
Article 3, except to the extent (but only to the extent) that a court of
competent jurisdiction determines (which determination is not subject to appeal)
that the indemnifying party has been materially prejudiced by such failure to
give notice. In case any such action is brought against an indemnified party,
unless in such indemnified party's reasonable judgment a conflict of interest
between such indemnified and indemnifying parties may exist in respect of such
claim (in which case the indemnifying party shall not be liable for the fees and
expenses of more than one firm of counsel in addition to appropriate local
counsel chosen by the Stockholders' Representative, or more than one firm of
counsel for the underwriters in connection with any one action or separate but
similar or related actions), the indemnifying party will be entitled by giving
written notice of its intention to do so within 20 days of the date it receives
notice of such claim from the indemnified party to participate in and to assume
the defense thereof, jointly with any other indemnifying party similarly
notified, to the extent that it may wish with counsel reasonably satisfactory to
such indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless: (i) the indemnifying party agrees to pay such
fees and expenses; or (ii) the indemnifying party fails promptly to assume
and/or to vigorously maintain the defense of such proceeding or fails to employ
counsel satisfactory to such indemnified party; or (iii) the named parties to
any such proceeding (including any impleaded parties) include both such
indemnified party and the indemnifying party or an affiliate of the indemnifying
party, and there may be one or more defenses available to such indemnified party
that are in addition to, or in conflict with, those available to the
indemnifying party or affiliate or controlling person (in which case, if such
indemnified party, notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such
proceeding on behalf of such indemnified party), it being understood, however,
that the indemnifying party shall not, in connection with any one such
proceeding or separate but substantially similar or related proceedings in the
same jurisdiction arising out of the same general allegations or circumstances,
be liable for the fees and expenses of more than one separate firm of attorneys
(together with appropriate local counsel) at any time for such indemnified
party. If any Holder(s) is the indemnified party, then the Stockholders'
Representative shall be authorized to take all actions on behalf of any such
Holder(s) under this Section 3.3 and it shall receive copies of all notices to
any Holder hereunder.
10
3.4. Underwriter Indemnification. Interland and each Holder including
Registrable Securities on a registration statement shall provide for the
foregoing indemnity (with appropriate modifications) in any underwriting
agreement with respect to any required registration or other qualification of
securities under any federal or state law or regulation of any governmental
authority.
3.5. Contribution. In order to provide for just and equitable contribution
in circumstances under which the indemnity contemplated by Article 3 is for any
reason not available (or not sufficient to hold such indemnified party
harmless), the parties required to indemnify by the terms thereof shall
contribute to the aggregate Losses incurred by the indemnified party. In
determining the amounts which the respective parties shall contribute, there
shall be considered the relative fault of Interland on the one hand, and of the
indemnified or indemnifying party, on the other hand, in connection with the
actions, statements or omissions that resulted in such Losses, the parties'
relative knowledge and access to information concerning the matter with respect
to which the claim was asserted, the opportunity to correct and prevent any
statement or omission and any other equitable considerations appropriate under
the circumstances. The relative fault of Interland, on the one hand, and of an
indemnified or indemnifying party, on the other hand, shall be determined by
reference to, among other things, whether any action in question, including any
untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact has been taken by, or relates to information
supplied by, Interland or by an indemnified or indemnifying party and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent any such action, statement or omission; provided, that no
Holder indemnified party shall be required to contribute any amount in excess of
the amount such indemnified party would have been required to pay to an
indemnified party if the indemnity under Article 3 were available. Interland and
each such Holder agree with each other and the underwriters of the Registrable
Securities, if requested by such underwriters, that it would not be equitable if
the amount of such contribution were determined by pro rata or per capita
allocation (even if the underwriters were treated as one entity for such
purpose) or for the underwriters' portion of such contribution to exceed the
percentage that the underwriting discount bears to the initial public offering
price of the Registrable Securities or any other method that does not take
account of the equitable considerations referred to in this Section. For
purposes of this Section 3.5, each person, if any, who controls an underwriter
within the meaning of Section 15 of the Securities Act shall have the same
rights to contribution as such underwriter, and each director and each officer
of Interland who signed the registration statement, and each person, if any, who
controls Interland or a seller of Registrable Securities within the meaning of
Section 15 of the Securities Act shall have the same rights to contribution as
Interland or a Holder including Registrable Securities on a registration
statement, as the case may be.
ARTICLE 4
MISCELLANEOUS
4.1. Liability; Injunctive Relief. Except as otherwise provided herein, the
termination of Agreement shall not relieve any party of any liability for breach
of this Agreement prior to the date of termination. Each of the parties hereto
waives their right to punitive, consequential or exemplary damages for breach of
11
this Agreement by the other party. Moreover, each party shall be entitled to
injunctive or other equitable relief to enjoin any termination of this Agreement
not in accordance with the terms hereof or to require any other party to perform
its obligations hereunder.
4.2. Assignment. No party hereto may assign or transfer its rights or
obligations arising under this Agreement, without the prior written consent of
the other parties hereto, except that this Agreement shall be freely assignable
by each of the Investor Stockholders to its partners in connection with a
distribution-in-kind.
4.3. Notices. All notices, claims, waivers, consents and other
communications provided for herein shall be in writing and shall be deemed to
have been duly given if personally delivered, sent by facsimile transmission,
mailed, registered or certified mail, return receipt requested, postage prepaid
or by reputable overnight delivery service (a) if to Interland, to it at ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇, attention: Chief
Executive Officer, telecopier number (▇▇▇) ▇▇▇-▇▇▇▇, with a copy to its General
Counsel at the same office. If to the Investors, to them c/o Spire Capital
Partners, L.P., c/o Spire Capital Management L.L.C., ▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, telecopier
number: (▇▇▇) ▇▇▇-▇▇▇▇, with copies (which shall not constitute notice), to (1)
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇,
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, telecopier number (▇▇▇) ▇▇▇-▇▇▇▇, and (2) ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇, telecopier number (▇▇▇) ▇▇▇-▇▇▇▇ or, as to any party, at such
other address as shall be designated by such party in a notice to the other
parties hereto given in accordance with the provisions of this Section 4.3. All
notices and other communications hereunder shall be deemed to have been duly
given when sent by overnight mail, on the next Business Day, when transmitted by
telecopier, upon receipt of electronic confirmation of receipt, or personally
delivered on the day sent or delivered, or, in the case of a mailed notice, two
(2) Business Days after the date mailed, in each case when sent, delivered or
mailed to the intended recipient as aforesaid.
4.4. Choice of Law; Submission to Jurisdiction; Jury Waiver. This Agreement
shall be governed and construed in accordance with the laws of the State of New
York, without regard to any applicable principles of conflicts of law. EACH
PARTY TO THIS AGREEMENT HEREBY IRREVOCABLY AGREES THAT ANY LEGAL ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE TRANSACTION
DOCUMENTS, THE PARENT SHARES OR ANY OTHER AGREEMENT OR TRANSACTION CONTEMPLATED
HEREBY SHALL ONLY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK OR OF THE
UNITED STATES OF AMERICA FOR THE SOUTHERN DISTRICT OF NEW YORK AND HEREBY
EXPRESSLY SUBMITS TO THE EXCLUSIVE PERSONAL JURISDICTION AND VENUE OF SUCH
COURTS FOR THE PURPOSES THEREOF AND EXPRESSLY WAIVES ANY CLAIM OF IMPROPER VENUE
AND ANY CLAIM THAT SUCH COURTS ARE AN INCONVENIENT FORUM. EACH PARTY HEREBY
IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED
12
COURTS IN ANY SUCH SUIT, ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF
BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO ITS ADDRESS SET FORTH IN
SECTION 4.3, SUCH SERVICE TO BECOME EFFECTIVE 10 DAYS AFTER SUCH MAILING.
4.5. Entire Agreement; Amendment; Waiver. This Registration Rights
Agreement and other agreements between the parties referred to herein, contain
the entire understanding between the parties hereto concerning the subject
matter hereof and supersedes any and all prior representations, warranties,
undertakings, covenants and agreements between the parties. This Registration
Rights Agreement may not be changed, modified, altered or terminated except by
an agreement in writing executed by Interland, the Stockholders' Representative
and a majority-in-interest of the other Stockholders.
4.6. Remedies Cumulative. Each and all of the rights and remedies in this
Registration Rights Agreement, and each and all of the rights and remedies
allowed at law and in equity in like case, shall be cumulative, and the exercise
of one right or remedy shall not be exclusive of the right to exercise or resort
to any and all other rights or remedies provided in this Registration Rights
Agreement or at law or in equity.
4.7. No Third Party Beneficiaries. Except as provided herein, this
Registration Rights Agreement shall inure to the benefit of the parties and
their respective successors and permitted assigns only. Notwithstanding any
provision herein to the contrary, the parties agree that nothing in this
Registration Rights Agreement will be construed as giving any Person or other
entity, other than the parties hereto and their successors and permitted
assigns, any right, remedy or claim under or with respect to this Registration
Rights Agreement.
4.8. Counterparts. This Registration Rights Agreement may be executed in
any number of separate counterpart copies, each of which shall be deemed an
original but all of which taken together shall constitute a single instrument.
4.9. Separability. If any provision of this Registration Rights Agreement
is invalid or unenforceable, the balance of this Registration Rights Agreement
shall remain in effect.
4.10. Publicity. Except as required by applicable law or by a stock
exchange, no party shall issue any press release or other public statement
regarding the transactions contemplated by this Registration Rights Agreement
without the prior written consent of the other party.
4.11. Further Assurances. Each party agrees that it will execute and
deliver, or cause to be executed and delivered, on or after the date of this
Registration Rights Agreement, any further instruments, and will take all
commercially reasonable actions, as may be necessary to transfer to consummate
the transactions contemplated hereby, and to effectuate the provisions and
purposes hereof.
13
4.12. Headings. Headings and captions used herein are included herein for
convenience of reference only and shall not constitute a part of this
Registration Rights Agreement for any other purpose or be given any substantive
effect.
(Signatures continued on following page)
14
IN WITNESS WHEREOF, the parties hereto have duly executed this Registration
Rights Agreement on the day and year first above written.
INTERLAND, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President and General Counsel
SPIRE CAPITAL PARTNERS, L.P.
By: Spire Capital Partners, L.L.C., its General
Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Member
SPIRE INVESTMENT, L.L.C.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Member
▇▇▇▇▇▇-▇▇▇▇▇▇ MEDIA PARTNERS, L.P.
By: ▇▇▇▇▇▇-▇▇▇▇▇▇ Media, L.L.C.,
its General Partner
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
----------------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: Managing Member
[Signatures continued on following page]
15
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------
▇▇▇▇ ▇▇▇▇▇▇▇
[Signatures continued on following page]
16
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
[Signatures continued on following page]
17
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇
[Signatures continued on following page]
18
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇ ▇▇▇▇▇▇▇▇
[Signatures continued on following page]
19
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
[Signatures continued on following page]
20
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
---------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇
[Signatures continued on following page]
21
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
[Signatures continued on following page]
22
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇▇
[Signatures continued on following page]
23
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
---------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
[Signatures continued on following page]
24
/s/ ▇▇▇▇▇ ▇▇▇▇▇
---------------------------
▇▇▇▇▇ ▇▇▇▇▇
25
1509845
