REGISTRATION RIGHTS AGREEMENT
Exhibit
10.2
Execution Copy
This
REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made
as of March 4, 2008, by and among (i) Broadpoint Securities Group, Inc., a New
York corporation (the “Company”), (ii) Mast
Credit Opportunities Master Fund Limited, a Cayman Islands corporation (“Mast”),
and (iii) each person or entity that subsequently becomes a party to this
Agreement pursuant to, and in accordance with, the provisions of Section 12
hereof (collectively, the “Investor Permitted
Transferees” and each individually an “Investor Permitted
Transferee”).
WHEREAS,
the Company has agreed to issue and sell to Mast, and Mast has agreed to
purchase from the Company, 7,058,824 shares (the “Securities”) of the
Company’s common stock, $.01 par value per share (the “Common Stock”), upon
the terms and conditions set forth in that certain Stock Purchase Agreement,
dated of even date herewith, among the Company, Mast and the other investors
named therein (the “Stock Purchase
Agreement”);
WHEREAS,
the Company has also agreed to issue and sell to MatlinPatterson FA Acquisition
LLC, a Delaware limited liability company (“Matlin”) and to various other
investors named in the Stock Purchase Agreement, and Matlin and the other
investors have agreed to purchase from the Company, an aggregate of 4,520,764
shares of Common Stock, upon the terms and conditions set forth in the Stock
Purchase Agreement; and
WHEREAS,
the terms of the Stock Purchase Agreement provide that it shall be a condition
precedent to the closing of the transactions thereunder, for the Company and
Mast to execute and deliver this Agreement.
NOW,
THEREFORE, in consideration of the premises and mutual covenants contained
herein, the parties hereto hereby agree as follows:
1. DEFINITIONS. The
following terms shall have the meanings provided therefor below or elsewhere in
this Agreement as described below:
“Additional Filing
Date” shall mean, with respect to the Additional Registration Statement,
the earlier of (i) 190 days after the Initial Registration Statement is declared
effective by the SEC or (ii) the earliest practicable date on which the Company
is permitted by SEC Guidance to file the Additional Registration Statement
related to the Registrable Securities.
“Additional Registration
Statement” shall mean the registration statement filed pursuant to this
Agreement seeking to register with the SEC such Registrable Securities owned by
Mast as are not included in the Initial Registration Statement.
“Board” shall mean the
board of directors of the Company.
“Closing” and “Closing Date” shall
have the meanings ascribed to such terms in the Stock Purchase
Agreement.
“Exchange Act” shall
mean the Securities Exchange Act of 1934, as amended, and all of the rules and
regulations promulgated thereunder.
“Effectiveness Date”
means: (i) with respect to the Initial Registration Statement, as soon as
practicable, but in no event later than 120 calendar days after the Closing;
(ii) with respect to the Additional Registration Statement, 30 calendar days
following the date on which the Additional Registration Statement is required to
be filed hereunder (or 90 calendar days if the Additional Registration Statement
is reviewed by the SEC); and (iii) with respect to any additional Registration
Statements which may be required to be filed hereunder pursuant to
Section 3(c) or otherwise, 30 calendar days following the date on which the
additional Registration Statement is required to be filed hereunder (or 90
calendar days if such additional Registration Statement is reviewed by the SEC);
provided, however, that in the
event the Company is notified by the SEC that one of the above Registration
Statements will not be reviewed or is no longer subject to further review and
comment, the Effectiveness Date as to such Registration Statement shall be the
fifth Trading Day following the date on which the Company is so notified if such
date precedes the dates required above.
“Filing Date” shall
mean the Initial Filing Date, the Additional Filing Date, and any subsequent
filing date as required to register the Registrable Securities pursuant to
Section 3(c) hereof.
“Initial Filing Date”
means, with respect to the Initial Registration Statement, 30 calendar days
after the Closing.
“Initial Registration
Statement” means the initial Registration Statement filed pursuant to
this Agreement, seeking to register with the SEC Registrable Securities owned by
Mast.
“Investors” shall
mean, collectively, Mast and the Investor Permitted Transferees; provided, however, that the
term “Investors” shall not
include Mast or any of the Investor Permitted Transferees to the extent that
such parties do not own any Registrable Securities.
“Majority Holders”
shall mean, at the relevant time of reference thereto, those Investors holding
more than 50% of the Registrable Securities held by all of the
Investors.
“Mandatory Registration
Termination Date” shall mean the earlier of (i) the first date as of
which all of the Investors as selling stockholders thereunder may sell all of
the Registrable Securities registered for resale thereon without restriction
pursuant to Rule 144 or (ii) the first date as of which all of the Registrable
Securities registered thereunder shall have been sold.
“Registrable
Securities” shall mean the Securities, provided, however, such term
shall not include any Securities that have been sold pursuant to a Registration
Statement or Rule 144 or any of the Securities that become or have become
eligible for resale without restriction pursuant to Rule 144.
“Registration
Statement” means any one or more registration statements filed with the
SEC by the Company on Form S-3, or in the event the Company is not eligible to
use Form S-3, on Form S-1, for the purpose of registering under the Securities
Act the Registrable Securities for resale by, and for the account of, the
Investors, including the Initial Registration Statement and the Additional
Registration Statement, including (in each case) the prospectus included
therein, amendments to such registration statement or supplements to such
prospectus, including pre- and
-2-
post-effective
amendments, all exhibits thereto, and all material incorporated by reference or
deemed to be incorporated by reference in such registration
statement.
“Rule 144” shall mean
Rule 144 promulgated by the SEC pursuant to the Securities Act, as such rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC having substantially the same purpose and effect as such
rule.
“Rule 415” means
Rule 415 promulgated by the SEC pursuant to the Securities Act, as such
rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC having substantially the same purpose and effect as
such rule.
“Rule 424” means
Rule 424 promulgated by the SEC pursuant to the Securities Act, as such
rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC having substantially the same purpose and effect as
such rule.
“SEC” shall mean the
U.S. Securities and Exchange Commission.
“SEC Guidance” means
(i) any publicly-available guidance, or rule of general applicability of
the SEC staff, or (ii) comments, requirements or requests of the SEC staff
to the Company in connection with the review of a Registration
Statement.
“Securities Act” shall
mean the Securities Act of 1933, as amended, and all of the rules and
regulations promulgated thereunder.
“Trading Day” means
(a) if the Common Stock is listed or quoted on the NASDAQ Global Market, then
any day during which securities are generally eligible for trading on the NASDAQ
Global Market, or (b) if the Common Stock is not then listed or quoted and
traded on the NASDAQ Global Market, then any business day.
2. EFFECTIVENESS. This
Agreement shall become effective and legally binding upon execution and delivery
of the parties hereto.
3. MANDATORY
REGISTRATION.
(a) The
Company shall file a Registration Statement on or prior to each Filing Date
until all of the Registrable Securities have been registered for resale by the
Investors as selling stockholders thereunder.
(i) On
or prior to the Initial Filing Date, the Company shall prepare and file with the
SEC an Initial Registration Statement for the purpose of registering under the
Securities Act the resale of all Registrable Securities owned by Mast as selling
stockholder thereunder.
(ii) On
or prior to the Additional Filing Date, the Company shall prepare and file with
the SEC an Additional Registration Statement for the purpose of registering
under the Securities Act the resale of all Registrable Securities owned by Mast
and not theretofore registered pursuant to the Initial Registration Statement as
selling stockholder thereunder.
-3-
(iii) On
or prior to any subsequent Filing Date, the Company shall prepare and file with
the SEC a Registration Statement for the purpose of registering under the
Securities Act the resale of all Registrable Securities owned by Mast and not
theretofore registered on an effective Registration Statement as selling
stockholder thereunder.
Each such
Registration Statement shall indicate that the Registrable Shares are to be
offered and sold on a continuous basis pursuant to Rule 415. Each
Registration Statement may be amended by the Company from time to time to comply
with SEC Guidance, and the parties hereto acknowledge that any such amendment
may result in a decrease in the number of Registrable Securities registered
thereby. The Company shall advocate to the SEC to include the maximum
number of Registrable Securities in any given Registration Statement. Each
Registration Statement shall contain, to the extent permitted by law and SEC
Guidance, substantially the “Plan of Distribution” set forth in Exhibit B hereto.
Subject to the terms of this Agreement, the Company shall cause each
Registration Statement to be declared effective under the Securities Act as
promptly as possible after the filing thereof, but in any event on or prior to
the applicable Effectiveness Date.
(b) The
Company shall be required to keep each Registration Statement effective until
the Mandatory Registration Termination Date. Thereafter, the Company shall be
entitled to withdraw such Registration Statement, and the Investors shall have
no further right to offer or sell any of the Registrable Securities registered
for resale thereon pursuant to the respective Registration Statement (or any
prospectus relating thereto).
(c) If prior
to the Mandatory Registration Termination Date, the number of Registrable
Securities at any time exceeds the number of Securities then registered for
resale in a Registration Statement, then the Company shall file as soon as
reasonably practicable and consistent with SEC Guidance an additional
Registration Statement covering the resale by the Investors of not less than the
number of such Registrable Securities.
4. LIQUIDATED
DAMAGES/SUSPENSION OF A REGISTRATION STATEMENT
(a) If:
(i) the
Initial Registration Statement is not filed on or prior to the Initial Filing
Date, or
(ii) the
Company fails to file with the SEC a request for acceleration in accordance with
Rule 461 promulgated under the Securities Act within five Trading Days of
the date that the Company is notified by the SEC that the Initial Registration
Statement will not be reviewed or not be subject to further review,
or
(iii) prior
to the Effectiveness Date of the Initial Registration Statement, the Company
fails to file a pre-effective amendment and otherwise respond in writing to
comments made by the SEC in respect of such Initial Registration Statement
within 10 Trading Days after the receipt of written
-4-
comments
by or notice from the SEC that such amendment is required in order for such
Initial Registration Statement to be declared effective, or
(iv) the
Initial Registration Statement is not declared effective by the SEC by the
Effectiveness Date of the Initial Registration Statement, or
(v) subject
to the provisions of Section 11 hereof, after the Effectiveness Date of the
Initial Registration Statement, the Initial Registration Statement ceases for
any reason to remain continuously effective as to all Registrable Securities
registered thereon or Mast is otherwise not permitted to utilize the Prospectus
included therein to resell such Registrable Securities for more than 10
consecutive Trading Days or more than an aggregate of 20 Trading Days (which
need not be consecutive Trading Days) during any 12-month period,
(any such
failure or breach being referred to as a “4(a) Event”, and the
date upon which the occurrence of a 4(a) Event first becomes manifest being
referred to as a “4(a)
Event Date”), then as to each such 4(a) Event Date and each day until the
applicable 4(a) Event is cured, the Company shall pay to Mast, as liquidated
damages and not as a penalty, an amount in cash equal to one-thirtieth of 1% of
the aggregate purchase price paid by Mast pursuant to the Stock Purchase
Agreement for the Registrable Securities being registered with the SEC pursuant
to the Initial Registration Statement and owned by Mast on such
day. Such payments shall be made on a monthly basis within three
Trading Days of the end of each calendar month with respect to which a payment
is due.
(b) If:
(i) the
Additional Registration Statement and any other Registration Statement is not
filed on or prior to its Filing Date, or
(ii) the
Company fails to file with the SEC a request for acceleration in accordance with
Rule 461 promulgated under the Securities Act within five Trading Days of
the date that the Company is notified by the SEC that any such Registration
Statement will not be reviewed or is not subject to further review,
or
(iii) prior
to the Effectiveness Date of any such Registration Statement, the Company fails
to file a pre-effective amendment and otherwise respond in writing to comments
made by the SEC in respect of such Registration Statement within 10 Trading Days
after the receipt of written comments by or notice from the SEC that such
amendment is required in order for such Registration Statement to be declared
effective, or
(iv) such
Registration Statement is not declared effective by the SEC by the Effectiveness
Date of such Registration Statement, or
-5-
(v)
all of the Registrable Securities constituting the Securities are not registered
for resale pursuant to one or more effective Registration Statements on or
before June 30, 2009, or
(vi) subject
to the provisions of Section 11 hereof, after the Effectiveness Date of the
Additional Registration Statement or any other Registration Statement, such
Registration Statement ceases for any reason to remain continuously effective as
to all Registrable Securities included therein or the Investors are otherwise
not permitted to utilize the Prospectus included therein to resell such
Registrable Securities, for more than 10 consecutive Trading Days or more than
an aggregate of 20 Trading Days (which need not be consecutive Trading Days)
during any 12-month period,
(any such
failure or breach being referred to as a “4(b) Event”, and the date upon which
the occurrence of a 4(b) Event first becomes manifest being referred to as a
“4(b) Event Date”), then as to each such 4(b) Event Date and each day until the
applicable 4(b) Event is cured, the Company shall pay to each Investor, as
liquidated damages and not as a penalty, an amount in cash equal to
one-thirtieth of 1% of the aggregate purchase price paid by such Investor
pursuant to the Stock Purchase Agreement for the Registrable Securities being
registered with the SEC pursuant to the Additional Registration Statement or
such other Registration Statement, as applicable, and owned by such Investor on
such day. For purposes of this Section 4, any Investor Permitted Transferees
entitled to such payments shall be deemed to have paid an amount equal to the
purchase price per share for the Securities set forth in the Stock Purchase
Agreement multiplied by the number of shares owned by such Investor Permitted
Transferee on the date of the applicable 4(b) Event Date. Such payments shall be
made on a monthly basis within three Trading Days of the end of each calendar
month with respect to which a payment is due.
(c) The
parties agree that the maximum liquidated damages payable per day pursuant
to paragraph 4(a) and 4(b) hereof shall be one-thirtieth of 1% of the aggregate
amount paid by Investors pursuant to the Stock Purchase Agreement with respect
to those Securities included in the applicable Registration Statement and owned
by such Investor on such day, regardless of the number of Events that shall have
occurred and are not cured, and that the Company shall not be obligated to make
such payments with respect to more than of 365 days. If the Company fails to pay
any liquidated damages pursuant to this Section in full within seven calendar
days after the date payable, the Company will pay interest thereon at a rate of
18% per annum (or such lesser maximum amount that is required to be paid by
applicable law) to the Investor, accruing daily from the date such liquidated
damages are due until such amounts, plus all such interest thereon, are paid in
full. The liquidated damages pursuant to the terms hereof shall apply on a daily
pro-rata basis for any portion of a month prior to the cure of an
Event. In addition, the parties agree that no payments pursuant to
Section 4(a) or 4(b) shall be required in connection with a Suspension Period
(as hereinafter defined).
(d) The
Company shall notify the Investors by facsimile or email as promptly as
practicable, and in any event, within two Trading Days, after a Registration
Statement is declared effective and shall simultaneously provide the Investors
with copies of any related prospectus to be used in connection with the sale or
other disposition of the Securities covered thereby.
-6-
(e) No
Investor shall be entitled to a payment pursuant to this Section 4 if
effectiveness of a Registration Statement has been delayed or a prospectus has
been unavailable as a result of (i) a failure by such Investor to promptly
provide on request by the Company the information required under the Stock
Purchase Agreement or this Agreement or requested by the SEC as a condition to
effectiveness of a Registration Statement; (ii) the provision of inaccurate or
incomplete information by such Investor; or (iii) a statement or determination
of the SEC that any provision of the rights of the Investor under this Agreement
are contrary to the provisions of the Securities Act.
(f) The
Company shall not, at any time prior to the first date on which all Registrable
Securities then owned by Mast have been included in one or more Registration
Statements filed by the Company and declared effective by the SEC, file with the
SEC a registration statement under the Securities Act relating to an offering
for its own account or the account of others of any of its equity securities,
other than (i) registration statements relating to equity securities to be
issued in connection with an acquisition of, or business combination with, any
entity or business or equity securities issuable in connection with any stock
option, restricted stock or other employee benefit or equity incentive plans; or
(ii) pursuant to the exercise of a demand registration right under the
Registration Rights Agreement, dated as of September 21, 2007, as amended, among
the Company, Xxxxxx, Xxxxxx X. Fine and Xxxxxx X. Xxxxxxxxxx, so long as such
demand does not involve the filing of a registration statement with the SEC
prior to January 15, 2009.
5. OBLIGATIONS OF THE
COMPANY. The Company shall, as expeditiously as reasonably
possible:
(a) prepare
and file with the SEC such amendments and supplements to a Registration
Statement and the prospectus included therein as may be necessary to comply with
the provisions of the Securities Act with respect to the disposition of all
Registrable Securities covered by a Registration Statement;
(b) furnish
to the selling Investors (i) each item of correspondence furnished to the
Company by the SEC or the staff of the SEC, in each case relating to such
Registration Statement (other than any portion of any thereof which contains
information for which the Company has sought confidential treatment), and (ii)
such number of copies of a prospectus, in conformity with the requirements of
the Securities Act and such other documents (including, without limitation, any
prospectus supplements prepared by the Company in accordance with Section 5(a)
above) as the selling Investors may reasonably request in order to facilitate
the disposition of such selling Investors’ Registrable Securities;
(c) promptly
respond to any and all comments received from the SEC, with a view towards
causing each Registration Statement or any amendment thereto to be declared
effective by the SEC as soon as practicable;
(d) use
commercially reasonable efforts to comply with all applicable rules and
regulations of the SEC under the Securities Act applicable to the offer and sale
of the Registrable Securities, including, without limitation, Rule 172, file any
final prospectus, including any supplement thereto, with the SEC pursuant to
Rule 424 under the Securities Act,
-7-
promptly
inform the Investors in writing if, at any time during the Effectiveness Period,
the Company does not satisfy the conditions specified in Rule 172 and, as a
result thereof, the Investors are required to deliver a prospectus in connection
with any disposition of Registrable Securities; notify the selling Investors of
the happening of any event as a result of which the prospectus included in a
Registration Statement contains an untrue statement of a material fact or omits
any fact necessary to make the statements therein not misleading; and,
thereafter, subject to Section 11 hereof, promptly prepare (and, when completed,
give notice and provide a copy thereof to each selling Investor) a supplement to
such prospectus so that 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; provided that after
any such notification by the Company (which shall be a Suspension pursuant to
Section 11), the selling Investors will not offer or sell Registrable Securities
until the Company has notified the selling Investors that it has prepared a
supplement to such prospectus and filed it with the SEC or, if the Company does
not then meet the conditions for the use of Rule 172, delivered copies of such
supplement to the selling Investors;
(e) use
commercially reasonable efforts to register and qualify the Registrable
Securities covered by a Registration Statement under the securities or Blue Sky
laws of such states as the Investors shall reasonably request, 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, and provided further that
(notwithstanding anything in this Agreement to the contrary with respect to the
bearing of expenses) if any jurisdiction in which any of such Registrable
Securities shall be qualified shall require that expenses incurred in connection
with the qualification therein of any such Registrable Securities be borne by
the selling Investors, then the selling Investors shall, to the extent required
by such jurisdiction, pay their pro rata share of such qualification
expenses;
(f) subject
to the terms and conditions of this Agreement, the Company shall use its
commercially reasonable efforts to (i) prevent the issuance of any stop order or
other suspension of effectiveness of a Registration Statement, or the suspension
of the qualification of any of the Registrable Securities for sale in any
jurisdiction in the United States, and (ii) if such an order or suspension is
issued, obtain the withdrawal of such order or suspension at the earliest
practicable moment and notify each holder of Registrable Securities of the
issuance of such order and the resolution thereof or its receipt of notice of
the initiation or threat of any proceeding such purpose;
(g) comply
with all requirements of Nasdaq, Inc. with regard to the issuance of the
Securities and the listing thereof on the NASDAQ Global Market and such other
securities exchange or automated quotation system, as applicable;
and
(h) notify
the Investors of any pending proceeding against the Company under Section 8A of
the Securities Act in connection with the offering of the Registrable
Securities.
6. FURNISH
INFORMATION. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Agreement that
the selling Investors shall furnish to the Company such information regarding
them and the securities held by them as the Company shall reasonably request in
order to effect any registration by the Company pursuant to
-8-
this
Agreement. Each Investor shall promptly notify the Company of any
changes in the information furnished to the Company.
7. EXPENSES OF
REGISTRATION. Except as set forth in Section 5(e), all
expenses incurred in connection with the registration of the Registrable
Securities pursuant to this Agreement (excluding brokerage and other selling
commissions and discounts), including without limitation all registration and
qualification and filing fees, printing, and fees and disbursements of counsel
for the Company, shall be borne by the Company; provided however that, except as
set forth below, the Investors shall be required to pay the expenses of counsel
and any other advisors for the Investors and any brokerage or other selling
discounts or commissions and any other expenses incurred by the Investors for
their own account. The Company shall reimburse Mast for the reasonable fees and
expenses of its counsel, not to exceed $5,000 in the aggregate, incurred in
connection with the review of one or more of the Registration
Statements.
8. DELAY OF
REGISTRATION. The Investors shall not take any action to
restrain, enjoin or otherwise delay any registration as a result of any
controversy which might arise with respect to the interpretation or
implementation of this Agreement.
9. INDEMNIFICATION.
(a) To the
extent permitted by law, the Company will indemnify and hold harmless each
selling Investor, and each officer and director of such selling Investor and
each person, if any, who controls such selling Investor, within the meaning of
the Securities Act, against any losses, claims, damages or liabilities, joint or
several, to which they may become subject under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any untrue or alleged untrue statement
of any material fact contained in a Registration Statement in which such
Investor is named as a selling stockholder, in any prospectus relating thereto
or in any amendments to a Registration Statement or supplements to a prospectus
in which such Investor is named as a selling stockholder, or arise out of or are
based upon 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 and will reimburse such selling Investor, or such officer, director
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 9(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, damage, liability or action to the extent that it arises out
of or is based upon (i) an untrue statement or alleged untrue statement made in
connection with a Registration Statement, any prospectus relating thereto or any
amendments to a Registration Statement or supplements to a prospectus or any
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, in reliance upon and in
conformity with written information furnished expressly for use in connection
with a Registration Statement or any such prospectus by the selling Investors or
(ii) at any time when the Company has advised the Investor in writing that the
Company does not meet the conditions for use of Rule 172 and as a result the
Investor is required to deliver a current prospectus in connection with any
disposition of Registrable
-9-
Securities,
an untrue statement or alleged untrue statement or omission in a prospectus
corrected in any subsequent supplement to such prospectus that was delivered to
the selling Investor before the pertinent sale or sales by the selling
Investor.
(b) To the
extent permitted by law, each selling Investor will severally and not jointly
indemnify and hold harmless the Company, each of its directors, each of its
officers who have signed a Registration Statement, each person, if any, who
controls the Company within the meaning of the Securities Act, and all other
selling Investors against any losses, claims, damages or liabilities to which
the Company or any such director, officer, controlling person, or such other
selling Investor may become subject, under the Securities Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereto) arise out of or are based upon (i) any untrue or alleged untrue
statement of any material fact contained in a Registration Statement or any
prospectus, relating thereto or in any amendments to a Registration Statement or
supplements to a prospectus, or arise out of or are based upon 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, in each case to the
extent and only to the extent that such untrue statement or alleged untrue
statement or omission or alleged omission was made in a Registration Statement,
in any prospectus relating thereto or in any amendments to a Registration
Statement or supplements to any such prospectus, in reliance upon and in
conformity with written information furnished by the selling Investor expressly
for use in connection with a Registration Statement or any prospectus or (ii) at
any time when the Company has advised the Investor in writing that the Company
does not meet the conditions for use of Rule 172 and as a result that the
Investor is required to deliver a current prospectus in connection with any
disposition of Registrable Securities, was corrected in any subsequent
supplement to such prospectus that was delivered to the selling Investor before
the pertinent sale or sales by the selling Investor; and such selling Investor
will reimburse any legal or other expenses reasonably incurred by the Company or
any such director, officer, controlling person, or other selling Investor in
connection with investigating or defending any such loss, claim, damage,
liability or action, provided, however, that the
liability of each selling Investor hereunder shall be limited to the proceeds
received by such selling Investor from the sale of Registrable Securities giving
rise to such liability, and provided, further, however, that the
indemnity agreement contained in this Section 9(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 those selling Investor(s) against
which the request for indemnity is being made (which consent shall not be
unreasonably withheld).
(c) Promptly
after receipt by an indemnified party under this Section 9 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section 9,
notify the indemnifying party in writing of the commencement thereof and the
indemnifying party shall have the right to participate in and, to the extent the
indemnifying party desires, jointly with any other indemnifying party similarly
noticed, to assume at its expense the defense thereof with counsel satisfactory
to the indemnified party or parties, but the omission so to notify the
indemnifying party will not relieve it from any liability which it may have to
any indemnified party for indemnification, contribution or otherwise under the
indemnity agreement contained in this Section 9 except to the extent that such
omission materially and adversely affects the indemnifying person’s ability to
defend such action. In the event that the indemnifying party
-10-
assumes
any such defense, the indemnified party may participate in such defense with its
own counsel and at its own expense, provided, however, if the defendants in any
such action include both the indemnified party and the indemnifying party and
the indemnified party shall have reasonably concluded, based on an opinion of
counsel reasonably satisfactory to the indemnifying party, that there may be a
conflict of interest between the positions of the indemnifying party and the
indemnified party in conducting the defense of any such action or that there may
be legal defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the right to select separate counsel to
assume such legal defenses and to otherwise participate in the defense of such
action on behalf of such indemnified party or parties. Upon receipt of notice
from the indemnifying party to such indemnified party of its election to assume
the defense of such action and approval by the indemnified party of counsel, the
indemnifying party will not be liable to such indemnified party under this
Section 9 for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof unless the
indemnified party shall have employed such counsel in connection with the
assumption of legal defenses in accordance with the proviso to the preceding
sentence (it being understood, however, that the indemnifying party shall not be
liable for the expenses of more than one separate counsel and one local counsel,
reasonably satisfactory to such indemnifying party, representing all of the
indemnified parties who are parties to such action in which case the reasonable
fees and expenses of counsel shall be at the expense of the indemnifying
party).
(d) Notwithstanding
anything to the contrary herein, the indemnifying party shall not be entitled to
settle any claim, suit or proceeding unless in connection with such settlement
the indemnified party receives an unconditional release with respect to the
subject matter of such claim, suit or proceeding and such settlement does not
contain any admission of fault by the indemnified party.
(e) If the
indemnification provided for in this Section 9 is unavailable to or insufficient
to hold harmless an indemnified party under subsection (a) or (b) above in
respect of any losses, claims, damages or liabilities (or actions or proceedings
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative fault of the
Company on the one hand and the Investors on the other in connection with the
statements or omissions or other matters which resulted in such losses, claims,
damages or liabilities (or actions in respect thereof), as well as any other
relevant equitable considerations. The relative fault shall be
determined by reference to, among other things, in the case of an untrue
statement, whether the untrue statement relates to information supplied by the
Company on the one hand or an Investor on the other and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such untrue statement. The Company and the Investors agree that it would not be
just and equitable if contribution pursuant to this subsection (e) were
determined by pro rata allocation (even if the Investors were treated as one
entity for such purpose) or by any other method of allocation which does not
take into account the equitable considerations referred to above in this
subsection (e). The amount paid or payable by an indemnified party as
a result of the losses, claims, damages or liabilities (or actions in respect
thereof) referred to above in this subsection (e) shall be deemed to include any
legal or other expenses reasonably incurred by
-11-
such
indemnified party in connection with investigating or defending any such action
or claim. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Investors’ obligations in this subsection to contribute
are several in proportion to their sales of Registrable Securities to which such
loss relates and not joint. In no event shall the contribution obligation of an
Investor be greater in amount than the dollar amount of the proceeds (net of all
expenses paid by such Investor in connection with any claim relating to this
Section 9 and the amount of any damages such Investor has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission) received by it upon the sale of the Registrable Securities
giving rise to such contribution obligation.
10. REPORTS UNDER THE EXCHANGE
ACT. With a view to making available to the Investors the
benefits of Rule 144 and any other rule or regulation of the SEC that may at any
time permit the Investors to sell the Securities to the public without
registration, the Company agrees to use commercially reasonable efforts: (i) to
make and keep public information available as those terms are understood in Rule
144, (ii) to file with the SEC in a timely manner all reports and other
documents required to be filed by an issuer of securities registered under the
Exchange Act so that sellers of the Company’s securities may avail themselves of
Rule 144, (iii) as long as any Investor owns any Securities, to furnish in
writing upon such Investor’s request a written statement by the Company that it
has complied with the reporting requirements of the Exchange Act referred to in
Rule 144, and (iv) undertake any additional actions reasonably necessary to
maintain the availability of a Registration Statement or the use of Rule
144.
11. SUSPENSION. Notwithstanding
anything in this Agreement to the contrary, in the event:
(i) of
any request by the SEC or any other federal or state governmental authority
during the period of effectiveness of a Registration Statement for amendments or
supplements to a Registration Statement or related prospectus or for additional
information;
(ii) of
the issuance by the SEC or any other federal or state governmental authority of
any stop order suspending the effectiveness of a Registration Statement or the
initiation of any proceedings for that purpose;
(iii) of
the receipt by the Company of any notification with respect to the suspension of
the qualification or exemption from qualification of any of the Registrable
Securities for sale under any state securities or “Blue Sky” laws, or the
initiation of any proceeding for such purpose;
(iv) of
any event or circumstance which necessitates the making of any changes in a
Registration Statement or related prospectus, or any document incorporated or
deemed to be incorporated therein by reference, so that, in the case of a
Registration Statement, it will not contain any untrue statement of a material
fact or any omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading, and that in the case of
the
-12-
prospectus,
it will not contain any untrue statement of a material fact or any omission to
state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; or
(v) that
the Board has made the good faith determination (A) that continued use by the
selling Investors of a Registration Statement for purposes of effecting offers
or sales of Registrable Securities pursuant thereto would require, under the
Securities Act, disclosure in a Registration Statement (or the prospectus
relating thereto) of material, nonpublic information concerning the Company, its
business or prospects or any proposed material transaction involving the
Company, (B) that such disclosure would be materially adverse to the Company,
its business or prospects or any such proposed material transaction or would
make the successful consummation by the Company of any such material transaction
less likely and (C) that it is therefore necessary to suspend the use by the
Investors of such Registration Statement (and the prospectus relating thereto)
for purposes of effecting offers or sales of Registrable Securities pursuant
thereto,
then the
Company shall furnish to the selling Investors a certificate signed by the
President or Chief Executive Officer of the Company setting forth one or more of
the above described circumstances, and the right of the selling Investors to use
a Registration Statement (and the prospectus relating thereto) shall be
suspended for a period (the “Suspension Period”)
of not more than 30 days after delivery by the Company of the certificate
referred to above in this Section 11; provided that the Company
shall be entitled to no more than one such Suspension Period in any fiscal
quarter, and the aggregate of all Suspension Periods during the 12-month period
commencing on the Closing and during each subsequent 12-month period until the
Mandatory Registration Termination Date (including any extension thereto) shall
not exceed 60 days. Notwithstanding the foregoing, no Suspension
Period shall exceed 15 days (or aggregate, with other such Suspension Periods,
30 days in any such 12-month period) if the cause of the Suspension Period shall
prevent the Company under the Securities Act and or applicable SEC Guidance,
from filing with the SEC or causing to be declared effective a Registration
Statement with respect to Registrable Securities owned by Mast and not
theretofore included in an effective Registration Statement. During
the Suspension Period, none of the Investors shall offer or sell any Registrable
Securities pursuant to or in reliance upon a Registration Statement (or the
prospectus relating thereto), and each of the Investors shall maintain in
confidence the existence and content of the above described
certificate. The Company shall use commercially reasonable efforts to
terminate any Suspension Period as promptly as practicable.
-13-
12. TRANSFER OF REGISTRATION
RIGHTS. An Investor may transfer or assign, in whole or from
time to time in part, to one or more persons its rights hereunder in connection
with the transfer of Registrable Securities by such Investor (other than by a
sale pursuant to a Registration Statement or Rule 144) to such person, provided
that such Investor complies with all laws applicable thereto and provides
written notice of assignment to the Company promptly after such assignment is
effected, and provided further that such person agrees to become a party to, and
bound by, all of the terms and conditions of, this Agreement by duly executing
and delivering to the Company an Instrument of Adherence in the form attached as
Exhibit A
hereto.
13. ENTIRE
AGREEMENT. This Agreement and the Stock Purchase Agreement
constitute and contain the entire agreement and understanding of the parties
with respect to the subject matter hereof, and supersede any and all prior
negotiations, correspondence, agreements or understandings with respect to the
subject matter hereof.
14. MISCELLANEOUS.
(a) This
Agreement may not be amended, modified or terminated, and no rights or
provisions may be waived, except with the written consent of the Majority
Holders and the Company.
(b) This
Agreement shall be governed by and construed and enforced in accordance with the
laws of the State of New York and without regard to any conflicts of laws
concepts which would apply the substantive law of some other jurisdiction, and
shall be binding upon and inure to the benefit of the parties hereto and their
respective heirs, personal representatives, successors or assigns, provided that, to the
extent applicable, the terms and conditions of Section 12 hereof are
satisfied. This Agreement shall also be binding upon and inure to the
benefit of any transferee of any of the Securities provided that the
terms and conditions of Section 12 hereof are
satisfied. Notwithstanding anything in this Agreement to the
contrary, if at any time any Investor shall cease to own any Registrable
Securities, all of such Investor’s rights under this Agreement shall immediately
terminate.
(c) Each of
the parties hereto irrevocably submits to the exclusive jurisdiction of the
courts of the State of New York located in New York County and the United States
District Court for the Southern District of New York for the purpose of any
suit, action, proceeding or judgment relating to or arising out of this
Agreement and the transactions contemplated hereby. Service of
process in connection with any such suit, action or proceeding may be served on
each party hereto anywhere in the world by the same methods as are specified for
the giving of notices under this Agreement. Each of the parties
hereto irrevocably consents to the jurisdiction of any such court in any such
suit, action or proceeding and to the laying of venue in such
court. Each party hereto irrevocably waives any objection to the
laying of venue of any such suit, action or proceeding brought in such courts
and irrevocably waives any claim that any such suit, action or proceeding
brought in any such court has been brought in an inconvenient forum. EACH OF THE PARTIES HERETO WAIVES ANY
RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH RESPECT TO THIS
AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS
WAIVER.
-14-
(d) Any
notices, reports or other correspondence (hereinafter collectively referred to
as “correspondence”) required or permitted to be given hereunder shall be in
writing and shall be sent by postage prepaid first class mail, courier or
telecopy or delivered by hand to the party to whom such correspondence is
required or permitted to be given hereunder, and shall be deemed sufficient upon
receipt when delivered personally or by courier, overnight delivery service or
confirmed facsimile, or three (3) business days after being deposited in the
regular mail as certified or registered mail (airmail if sent internationally)
with postage prepaid, if such notice is addressed to the party to be notified at
such party’s address or facsimile number as set forth below:
(i) All correspondence to
the Company shall be addressed as follows:
Xxx Xxxx
Xxxxx, 00xx
Xxxxx
Xxx Xxxx,
Xxx Xxxx 00000
Facsimile:
(000) 000-0000
Attention: General
Counsel
with a copy by fax or messenger or
courier to:
Xxxxx
& XxXxxxx LLP
0000
Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx,
Xxx Xxxx 00000-0000
Facsimile:
(000) 000-0000
Attention: Xxxxxx
Xxxxxx and Xxxxxxxxxxx X. Xxxxxxxx
(ii) All correspondence to Mast shall
be addressed as follows:
MAST
Credit Opportunities I Master Fund Limited
c/o MAST
Capital Management, LLC
000
Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxx,
Xxxxxxxxxxxxx 00000
Attention:
Xxxx X. Xxxxxxxx
Fax:
(000) 000-0000
with a
copy by fax or messenger or courier to:
Xxxxx
Xxxx LLP
Bay
Colony Corporate Center
0000
Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx,
Xxxxxxxxxxxxx 00000
Attention:
Xxxxx X. Xxxxxxxx, Esq.
Fax:
(000) 000-0000
(iii) All correspondence to any
Investor shall be sent to such Investor at the address set forth in the
Instrument of Adherence furnished to the Company on behalf of any
Investor.
(iv) Any
entity may change the address to which correspondence to it is to be addressed
by written notification as provided for herein.
-15-
(e) The
parties acknowledge and agree that in the event of any breach of this Agreement,
remedies at law may be inadequate, and each of the parties hereto shall be
entitled to seek specific performance of the obligations of the other parties
hereto and such appropriate injunctive relief as may be granted by a court of
competent jurisdiction.
(f) Should
any part or provision of this Agreement be held unenforceable or in conflict
with the applicable laws or regulations of any jurisdiction, the invalid or
unenforceable part or provisions shall be replaced with a provision which
accomplishes, to the extent possible, the original business purpose of such part
or provision in a valid and enforceable manner, and the remainder of this
Agreement shall remain binding upon the parties hereto.
(g) This
Agreement may be executed in a number of counterparts, any of which together
shall for all purposes constitute one Agreement, binding on all the parties
hereto notwithstanding that all such parties have not signed the same
counterpart.
[Signature
Page to Follow]
-16-
IN
WITNESS WHEREOF, the parties hereto have executed this Registration Rights
Agreement as of the date and year first above written.
|
|
By:
|
/s/ Xxx Xxxxxxxxxxxx | |
| Name: Xxx Xxxxxxxxxxxx | |||
| Title: Chief Executive Officer | |||
|
|
|||
|
Mast
Credit Opportunities Master Fund Limited
|
|||
|
|
By:
|
/s/ Xxxxxxxxxxx X. Xxxxxxx | |
| Name: Xxxxxxxxxxx X. Xxxxxxx | |||
| Title: Partner | |||
|
|
|||
EXHIBIT
A
Instrument of
Adherence
Reference
is hereby made to that certain Registration Rights Agreement, dated as of
March __, 2008, among Broadpoint Securities Group, Inc., a Delaware
corporation (the “Company”), Mast and
the Investor Permitted Transferees, as amended and in effect from time to time
(the “Registration
Rights Agreement”). Capitalized terms used herein without definition
shall have the respective meanings ascribed thereto in the Registration Rights
Agreement.
The
undersigned, in order to become the owner or holder of [___________] shares of
common stock, par value $0.01 per share (the “Common Stock”), of
the Company hereby agrees that, from and after the date hereof, the undersigned
has become a party to the Registration Rights Agreement in the capacity of an
Investor Permitted Transferee, and is entitled to all of the benefits under, and
is subject to all of the obligations, restrictions and limitations set forth in,
the Registration Rights Agreement that are applicable to Investor Permitted
Transferees. This Instrument of Adherence shall take effect and shall
become a part of the Registration Rights Agreement immediately upon
execution.
All
Notice should be sent to the undersigned at the following address:
Name:
Address:
Attention:
Facsimile:
Email:
Executed
as of the date set forth below under the laws of the State of New
York.
|
Signature:
______________________________
Name:
Title:
|
Accepted:
[ ]
By:
_________________________
Name:
Title:
Date: _________,
200__
A-1
EXHIBIT
B
Plan of
Distribution
The
selling security holders, or their pledgees, donees, transferees, or any of
their successors in interest selling securities received from a named selling
security holder as a gift, partnership distribution or other non-sale-related
transfer after the date of this prospectus (all of whom may be selling security
holders), may sell the securities from time to time on any stock exchange or
automated interdealer quotation system on which the securities are listed, in
the over-the-counter market, in privately negotiated transactions or otherwise,
at fixed prices that may be changed, at market prices prevailing at the time of
sale, at prices related to prevailing market prices or at prices otherwise
negotiated. The selling security holders may sell the securities by one or more
of the following methods, without limitation:
|
(a)
|
block
trades in which the broker or dealer so engaged will attempt to sell the
securities as agent but may position and resell a portion of the block as
principal to facilitate the transaction;
|
|
|
(b)
|
purchases
by a broker or dealer as principal and resale by the broker or dealer for
its own account pursuant to this prospectus;
|
|
|
(c)
|
an
exchange distribution in accordance with the rules of any stock exchange
on which the securities are listed;
|
|
|
(d)
|
ordinary
brokerage transactions and transactions in which the broker solicits
purchases;
|
|
|
(e)
|
privately
negotiated transactions;
|
|
|
(f)
|
short
sales;
|
|
|
(g)
|
through
the writing of options on the securities, whether or not the options are
listed on an options exchange;
|
|
|
(h)
|
through
the distribution of the securities by any selling security holder to its
partners, members or stockholders;
|
|
|
(i)
|
one
or more underwritten offerings on a firm commitment or best efforts
basis;
|
|
|
(j)
(k)
|
any
combination of any of these methods of sale; and
any
other method permitted pursuant to applicable
law.
|
The
selling security holders may also transfer the securities by gift. We do not
know of any arrangements by the selling security holders for the sale of any of
the securities.
The
selling security holders may engage brokers and dealers, and any brokers or
dealers may arrange for other brokers or dealers to participate in effecting
sales of the securities. These brokers, dealers or underwriters may act as
principals, or as an agent of a selling security holder. Broker-dealers may
agree with a selling security holder to sell a specified number of the
securities at a stipulated price per security. If the broker-dealer is unable to
sell securities acting as agent for a selling security holder, it may purchase
as principal any unsold securities at the stipulated price. Broker-dealers who
acquire securities as principals may thereafter resell the securities from time
to time in transactions in any stock exchange or automated interdealer quotation
system on which the securities are then listed, at prices and on terms then
prevailing at the time of sale, at prices related to the then-current market
price or in negotiated transactions. Broker-dealers may use block transactions
and sales to and through broker-dealers, including transactions of the nature
described above. The selling security holders may also sell the securities in
accordance with Rule 144 under the Securities Act of 1933, as amended,
rather than pursuant to this prospectus, regardless of whether the securities
are covered by this prospectus.
From
time to time, one or more of the selling security holders may pledge,
hypothecate or grant a security interest in some or all of the securities owned
by them. The pledgees, secured parties or persons to whom the
B-1
securities
have been hypothecated will, upon foreclosure in the event of default, be deemed
to be selling security holders. The number of a selling security holder’s
securities offered under this prospectus will decrease as and when it takes such
actions. The plan of distribution for that selling security holder’s securities
will otherwise remain unchanged. In addition, a selling security holder may,
from time to time, sell the securities short, and, in those instances, this
prospectus may be delivered in connection with the short sales and the
securities offered under this prospectus may be used to cover short
sales.
To the
extent required under the Securities Act of 1933, as amended, the aggregate
amount of selling security holders’ securities being offered and the terms of
the offering, the names of any agents, brokers, dealers or underwriters and any
applicable commission with respect to a particular offer will be set forth in an
accompanying prospectus supplement. Any underwriters, dealers, brokers or agents
participating in the distribution of the securities may receive compensation in
the form of underwriting discounts, concessions, commissions or fees from a
selling security holder and/or purchasers of selling security holders’
securities of securities, for whom they may act (which compensation as to a
particular broker-dealer might be in excess of customary
commissions).
The
selling security holders and any underwriters, broker-dealers or agents that
participate in the distribution of the securities may be deemed to be
“underwriters” within the meaning of the Securities Act of 1933, as amended, and
any discounts, concessions, commissions or fees received by them and any profit
on the resale of the securities sold by them may be deemed to be underwriting
discounts and commissions.
A selling
security holder may enter into hedging transactions with broker-dealers and the
broker-dealers may engage in short sales of the securities in the course of
hedging the positions they assume with that selling security holder, including,
without limitation, in connection with distributions of the securities by those
broker-dealers. A selling security holder may enter into option or other
transactions with broker-dealers that involve the delivery of the securities
offered hereby to the broker-dealers, who may then resell or otherwise transfer
those securities. A selling security holder may also loan or pledge the
securities offered hereby to a broker-dealer and the broker-dealer may sell the
securities offered hereby so loaned or upon a default may sell or otherwise
transfer the pledged securities offered hereby.
The
selling security holders and other persons participating in the sale or
distribution of the securities will be subject to applicable provisions of the
Securities Exchange Act of 1934, as amended, and the rules and regulations
thereunder, including Regulation M. This regulation may limit the timing of
purchases and sales of any of the securities by the selling security holders and
any other person. The anti-manipulation rules under the Securities Exchange Act
of 1934, as amended, may apply to sales of securities in the market and to the
activities of the selling security holders and their affiliates. Furthermore,
Regulation M may restrict the ability of any person engaged in the
distribution of the securities to engage in market-making activities with
respect to the particular securities being distributed for a period of up to
five business days before the distribution. These restrictions may affect the
marketability of the securities and the ability of any person or entity to
engage in market-making activities with respect to the securities.
We have
agreed to indemnify in certain circumstances the selling security holders of the
securities covered by the registration statement, against certain liabilities,
including liabilities under the Securities Act of 1933, as amended. The selling
security holders have agreed to indemnify us in certain circumstances against
certain liabilities, including liabilities under the Securities Act of 1933, as
amended.
The
securities offered hereby were originally issued to the selling security holders
pursuant to an exemption from the registration requirements of the Securities
Act of 1933, as amended. We have agreed to pay all expenses in connection with
this offering, not including underwriting discounts, concessions, commissions or
fees of the selling security holders or any fees and expenses of counsel or
other advisors to the selling security holders. The registration rights
agreement permits us to suspend the use of this prospectus in connection with
sales of our common stock offered under this prospectus by holders during
periods of time under certain circumstances relating to pending corporate
developments and public filings with the SEC and similar events
We will
not receive any proceeds from sales of any securities by the selling security
holders.
B-2
We cannot
assure you that the selling security holders will sell all or any portion of the
securities offered hereby.
B-3
