Exhibit 99.A
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AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
among
XXXXXXXX'X, INC.
AND
THE OTHER PARTIES SPECIFIED HEREIN
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Dated as of April 15, 2002
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
THIS AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (the "Agreement")
amends and restates a Registration Rights Agreement dated as of June 12, 1996,
and is made as of the 15th day of April, 2002, by and among
- KIRKLAND HOLDINGS L.L.C., a Delaware limited liability company
("Holdings"),
- XXXXXXXX'X INC., a corporation incorporated under Tennessee law
("Kirkland's"),
- SSM VENTURE PARTNERS, L.P.
- XXXXXX X. XXXX, III
- XXXXXXXX X. XXXXX, XX.
- XXXX X. XXXXXXX
- CT/KIRKLAND EQUITY PARTNERS, L.P.,
- R-H CAPITAL PARTNERS, L.P.,
- TCW/KIRKLAND EQUITY PARTNERS, L.P.,
- CAPITAL RESOURCE LENDERS II, L.P. ("CRL"),
- ALLIED CAPITAL CORPORATION ("Allied"),
- CAPITAL TRUST INVESTMENTS, LTD. ("Capital Trust"),
- THE MARLBOROUGH CAPITAL INVESTMENT FUND, L.P. ("Marlborough" and
together with CRL, Allied and Capital Trust, the "Mezzanine Warrant
Holders"),
- GLOBAL PRIVATE EQUITY II LIMITED PARTNERSHIP,
- ADVENT DIRECT INVESTMENT PROGRAM LIMITED PARTNERSHIP,
- ADVENT PARTNERS LIMITED PARTNERSHIP,
- XXXX XXXXXXXX,
- XXXXXX XXXXXXXX,
- XXXXXX XXXXXXXX,
- THE XXX XXXXXXXXX XXXXXXXX TRUST, (the "AKA Trust"),
- THE XXXXXXX XXXXX XXXXXXXX TRUST (the "ALA Trust"),
- THE XXXX X. XXXXXXXX GRANTOR RETAINED ANNUITY TRUST 0000-0 (xxx "XXX
XXXX"), and
- XXXXXX XXXXXXX (Xxxx Xxxxxxxx, Xxxxxx Xxxxxxxx, Xxxxxx Xxxxxxxx, the
AKA Trust, the ALA Trust, the CTK GRAT and Xxxxxx Xxxxxxx being herein
referred to collectively as the "Individual Investors").
WHEREAS, on June 12, 1996, Holdings, the Company, and those companies then
affiliated with the Company (the "Affiliated Companies") and certain other
parties consummated the transactions contemplated by a Recapitalization
Agreement, dated as of April 26, 1996 (the "Recapitalization Agreement"), which,
among other things, included the issuance by the Company and the Affiliated
Companies of shares of Class A Preferred Stock, Class B Preferred Stock and
Class C Preferred Stock in accordance with the terms of the Recapitalization
Agreement. Capitalized terms used but not defined herein have the meanings set
forth in the Recapitalization Agreement;
WHEREAS, in connection with the Company's execution of the Senior
Subordinated Note and Warrant Purchase Agreement dated on or about June 12, 1996
(the "Mezzanine Purchase Agreement"), pursuant to which the Mezzanine Warrant
Holders have loaned a total of $20,000,000 in subordinated debt to the Company
and the Affiliated Companies, the Mezzanine Warrant Holders received warrants to
purchase shares of Common Stock ("Mezzanine Warrants" and the shares subject to
the Mezzanine Warrants, the "Mezzanine Warrant Shares"); and
WHEREAS, in connection with the transactions contemplated by the
Recapitalization Agreement, the Company granted options to purchase shares (the
"Option Shares") of Common Stock to Xxxx Xxxxxxxx and Xxxxxx Xxxxxxxx; and
WHEREAS, as an inducement to completion of the transactions contemplated by
the Recapitalization Agreement and the Mezzanine Purchase Agreement, the Company
and the Affiliated Companies provided on June 12, 1996 certain registration
rights pursuant to the terms of the Registration Rights Agreement dated as of
June 12, 1996 (the "Original Registration Rights Agreement"); and
WHEREAS, in connection with the consummation of the transactions
contemplated by the sixth amendment to that credit agreement between the
Company, the Affiliated Companies, BankBoston, N.A. and the other lenders
specified therein dated on or about July 7, 1999, the Company and the Affiliated
Companies issued to certain investors warrants to purchase shares of Common
Stock (the "1999 Warrants", and the shares subject to the 1999 Warrants the
"1999 Warrant Shares");
WHEREAS, on or about December 31, 1999, (i) the Affiliated Companies merged
with and into Kirkland's Stores, Inc., a wholly owned subsidiary of the Company
(the "Merger"), (ii) pursuant to the Merger; the Mezzanine Warrants and the 1999
Warrants became exercisable only with respect to shares of Common Stock of the
Company;
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WHEREAS, in connection with the consummation of the transactions
contemplated by a Securities Purchase Agreement dated on or about August 8, 2000
(the "Purchase Agreement"), the Company issued to the purchasers specified in
the Purchase Agreement additional shares of Common Stock, shares of Class D
Preferred Stock and warrants to purchase shares of Common Stock (the "2000
Warrants," and together with the 1999 Warrants and the Mezzanine Warrants, the
"Warrants," and the shares subject to the 2000 Warrants (the "2000 Warrant
Shares"), together with the Mezzanine Warrant Shares and the 1999 Warrant
Shares, the "Warrant Shares"); and
WHEREAS, the Company desires to hereby amend and restate the Original
Registration Rights Agreement, as amended, to incorporate the Class D Preferred
Stock, the 1999 Warrant Shares, the 2000 Warrant Shares and otherwise reflect
the Company's current capital structure.
NOW THEREFORE, in consideration of the premises and the mutual terms and
provisions hereof, the parties hereto hereby agree as follows:
1. DEFINITIONS. For purposes of this Agreement, the following terms shall
have the following respective meanings:
(a) "Act" shall mean the Securities Act of 1933, as amended, or any
similar federal statute enacted hereafter, and the rules and regulations of the
commission thereunder, all as the same shall be in effect from time to time.
(b) "Commission" shall mean the Securities and Exchange Commission or
any other federal agency at the time administering the Act.
(c) "Common Stock" shall mean (i) the common stock, par value $.01 of
each of the Company and/or any successor Company, and (ii) any other capital
stock of any class or classes (however designated) of the Company, authorized on
or after the date hereof, the holders of which shall have the right, without
limitation as to amount per share, either to all or to a share of the balance of
current dividends and liquidating distributions after the payment of dividends
and distributions on any shares entitled to preference in the payment thereof,
and the holders of which shall ordinarily, in the absence of contingencies, be
entitled to vote for the election of a majority of directors of the Company
(even though the right so to vote has been suspended by the happening of such a
contingency), and (iii) any other securities into which or for which any of the
securities described in (i) or (ii) above may be converted or exchanged pursuant
to a plan of recapitalization, reorganization, merger, sale of assets or
otherwise.
(d) "Company" shall mean Xxxxxxxx'x, Inc. or any successor by merger
or similar corporate consolidation thereto.
(e) "Counterpart" shall mean a counterpart to this Agreement in the
form of EXHIBIT A hereto, pursuant to the execution of which a Person shall
become bound by all of the terms and conditions to this Agreement.
(f) "Demand Piggybacker" shall have the meaning set forth in Section
2(c) hereof.
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(g) "Demand Registration" shall mean a Non-Mezzanine Demand
Registration or a Mezzanine Demand Registration.
(h) "Holder" shall mean each of the Shareholders if such Shareholder
holds Registrable Securities and any other person holding Registrable Securities
or such other securities to whom these registration rights have been transferred
pursuant to Section 12 of this Agreement; PROVIDED, HOWEVER, that any person who
acquires any of the Registrable Securities in a distribution pursuant to a
registration statement filed by the Company under the Act or pursuant to a sale
under Rule 144 under the Act shall not be considered a Holder.
(i) "Management Investors" shall mean Xxxx Xxxxxxxx and Xxxxxx
Xxxxxxxx, the AKA Trust, the ALA Trust and the CTK GRAT.
(j) "Mezzanine Demand Registration" shall have the meaning set forth
in Section 2(a) hereof.
(k) "Mezzanine Warrant Stock" shall mean, as of the applicable date
of determination, shares of Common Stock then issued or issuable to the
Mezzanine Warrant Holders upon exercise of the Mezzanine Warrants, assuming the
maximum potential exercise of the Mezzanine Warrants as of such date of
determination.
(l) "Non-Mezzanine Demand Registration" shall have the meaning set
forth in Section 2(b) hereof.
(m) "Person" shall mean an individual, partnership, corporation,
limited liability company, limited liability partnership, trust, joint venture,
unincorporated association, or other entity or association.
(n) "Piggyback Registration" shall have the meaning set forth in
Section 3.
(o) "Preferred Stock" shall mean shares of the Class A Preferred
Stock, Class B Preferred Stock and Class D Preferred Stock of the Company from
time to time outstanding.
(p) "Public Offering" shall mean an underwritten public offering of
Common Stock registered pursuant to the Act resulting in gross proceeds to the
Company of at least Thirty Million Dollars ($30,000,000).
(q) The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Act and the declaration or ordering of effectiveness of such
registration statement by the Commission.
(r) "Registered Holder" shall mean, with respect to a registration
statement, each Holder of Registrable Securities covered by such registration
statement.
(s) "Registered Securities" shall mean, with respect to a
registration statement, the Registrable Securities covered by such registration
statement.
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(t) "Registrable Securities" shall mean (i) shares of Common Stock
held by the Shareholders from time to time and shall include Warrant Shares,
provided the warrants under which the Warrant Shares may be purchased are
exercised no later than the effective date of any registration with respect to
which the Holder of such warrants (A) demanded a Demand Registration, (B) is a
Demand Piggybacker, or (C) requested a Piggyback Registration as to the Common
Stock issuable upon exercise of such Warrants, (ii) shares of Common Stock
acquired by any Shareholder other than pursuant to a registration, either from
any other shareholder of the Company in compliance with the terms of the
Shareholders Agreement, or directly from the Company, and (iii) securities
issued or received in respect of, or in exchange or in substitution for any of
the foregoing, including, but not limited to, those arising from a stock
dividend, stock split, reclassification, reorganization, merger, consolidation/
sale of assets or other exchange of securities.
(u) "Shareholder" shall mean any Person who holds, from time to time,
any Common Stock, Preferred Stock or Warrants, and who is or who becomes a party
to this Agreement pursuant to the terms hereof.
(v) "Shareholders Agreement" shall mean that certain Amended and
Restated Shareholders Agreement dated as of the date hereof and among the
parties hereto, as amended from time to time.
(w) "1934 Act" shall mean the Securities Exchange Act of 1934, as
amended, or any similar federal statute enacted hereafter, and the rules and
regulations of the Commission thereunder, all as the same shall be in effect
from time to time.
2. DEMAND REGISTRATIONS. The Holders may make a demand for registration
of Common Stock as provided in this Section 2 at any time.
(a) MEZZANINE DEMAND. If the Company shall receive a written request
from Mezzanine Warrant Holders holding more than sixty-six and two-thirds
percent (66.67%) of the Mezzanine Warrant Stock (determined without taking into
account any shares of Common Stock previously sold to the public in a public
offering) that the Company file a registration statement under the Act covering
the registration for the offer and sale of all or part of the Mezzanine Warrant
Stock (determined without taking into account any shares of Common Stock
previously sold to the public in a public offering) (a "Mezzanine Demand
Registration"), then the Company shall promptly notify in writing all other
Holders of Registrable Securities (including other Mezzanine Warrant Holders) (a
"Company Mezzanine Demand Notice").
(b) OTHER DEMAND. If the Company shall receive a written request from
Holders of more than fifty percent (50%) of the Registrable Securities other
than the Mezzanine Warrant Stock, that the Company file a registration statement
under the Act covering the registration for the offer and sale of all or part of
such Holders' Registrable Securities (a "Non-Mezzanine Demand Registration"),
then the Company shall promptly notify in writing all other Holders of
Registrable Securities (including the Mezzanine Warrant Holders) of such request
(the "Company Non-Mezzanine Demand Notice"). Upon receipt of the Company
Non-Mezzanine Demand Notice, the Mezzanine Warrant Holders holding more than
sixty-six and two-thirds percent (66.67%) of the Mezzanine Warrant Stock
(determined without taking into account any shares of Common Stock previously
sold to the public in a public offering) shall be
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entitled to render such demand for a Non-Mezzanine Demand Registration
ineffective, null and void by making a demand for registration under subsection
(a) of this Section 2 for a Mezzanine Demand Registration within thirty (30)
days after the Company Non-Mezzanine Demand Notice is given. In such event, (i)
the preempted Non-Mezzanine Demand Registration shall be treated for all
purposes, including for purposes of Section 2(d) hereof, as if it had never been
made, (ii) the Company shall give a Company Mezzanine Demand Notice to other
Holders contemplated by Section 2(a) (with all notices previously given by other
Holders in connection with such Non-Mezzanine Demand Registration pursuant to
Section 2(c) being void), and (iii) Holders other than the Mezzanine Warrant
Holders shall not be entitled to make a demand under this Section 2(b) until the
Mezzanine Demand Registration shall have been completed or abandoned and all
waiting periods required by this Agreement shall have been complied with.
(c) PROCEDURE. Each request for a Mezzanine Demand Registration or a
Non-Mezzanine Demand Registration shall specify the number of shares of
Registrable Securities requested to be sold. Within thirty (30) calendar days
after a Company Mezzanine Demand Notice or Company Non-Mezzanine Demand Notice
has been given, any other Holder (a "Demand Piggybacker") may give written
notice to the Company of its intent to include its Registrable Securities in the
registration (including without limitation any Holder whose demand is preempted
under Section 2(b) above). As soon as practicable after the expiration of such
thirty (30) day period, the Company shall cause all Registrable Securities that
Holders have requested be registered to be registered under the Act, subject to
the limitations contained in this Agreement.
(d) NUMBER OF DEMANDS. Subject to the provisions of Section 8 below,
a demand (i) may not be made unless the reasonably anticipated price to the
public of such public offering would exceed Five Million Dollars ($5,000,000),
(ii) may be made under Section 2(a) hereof a total of one (1) time and (iii) may
be made under Section 2(b) hereof a total of two (2) times. An effective Demand
Registration will not count as a Demand Registration for purposes of the
preceding sentence if (a) the Holders whose Registrable Securities are to be
included in such registration have not registered for sale at least seventy
percent (70%) of the Registrable Securities requested to be registered in the
registration statement for such registration by such Holders, or (b) the Holders
have withdrawn their request for Demand Registration and have paid all fees and
expenses as provided in Section 8 hereof.
(e) DELAY OF REGISTRATION. If at the time of any request to register
Registrable Securities pursuant to Section 2(a) or (b) the Company is preparing
or within thirty (30) days thereafter commences to prepare a registration
statement for a public offering (other than a registration effected solely to
implement an employee benefit plan or a transaction to which Rule 145 of the
Commission is applicable) which in fact is filed and becomes effective within
(90) days after the request, or is engaged in any activity which, in the good
faith determination of the Company's Board of Directors, would be adversely
affected by the requested registration to the material detriment of the Company,
then the Company may at its option direct that such request be delayed for a
period not in excess of four (4) months from the date of such request to
register Registrable Securities, such right to delay a request to be exercised
by the Company not more than once in any one (1) year period. Nothing in this
Section 2(e) shall preclude a holder of Registrable Securities from enjoying
registration rights which it might otherwise possess under Section 3 hereof.
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3. PIGGYBACK REGISTRATION. Subject to Section 9, if at any time the
Company proposes to register any of its equity securities under the Act, either
for its own account or for the account of others (unless already covered by
Section 2 hereof) or pursuant to a request under Section 4 hereof, in connection
with the public offering of such equity securities solely for cash, on a
registration form that would also permit the registration of Registrable
Securities (other than registration statement on Form S-8 or any successor form,
or a registration in connection with any stock option, stock purchase or other
benefit plan or for the purpose of offering such securities to another business
entity or the shareholders of such entity in connection with the acquisition of
assets or shares of capital stock, respectively, of such entity), the Company
shall, each such time, promptly give each Holder written notice of such proposal
(a "Piggyback Registration Notice"). Within thirty (30) days after the Piggyback
Registration Notice is given, the Holders shall give notice as to the number of
shares of Registrable Securities, if any, which such Holders request be
registered simultaneously with such registration by the Company ("Piggyback
Registration"). The Company shall use its best efforts to include any
Registrable Securities in such registration statement (or in a separate
registration statement concurrently filed) which the Holders thereof request to
be so included and to cause such registration statement to become effective with
respect to such Registrable Securities in accordance with the registration
procedures set forth in Section 5 hereof. Notwithstanding the foregoing, if at
any time after giving written notice of its intention to register equity
securities and before the effectiveness of the registration statement filed in
connection with such registration, the Company determines for any reason either
not to effect such registration or to delay such registration, the Company may,
at its election, by delivery of prior written notice to each Holder, (i) in the
case of a determination not to effect registration, relieve itself of its
obligation to register the Registrable Securities in connection with such
registration or (ii) in the case of a determination to delay registration, delay
the registration of such Registrable Securities for the same period as the delay
in the registration of such other equity securities. Each Holder requesting
inclusion in a registration pursuant to this Section 3 may, at any time before
the effective date of the registration statement relating to such registration,
revoke such request by delivering written notice of such revocation to the
Company (which notice shall be effective only upon receipt by the Company,
notwithstanding the provisions of Section 18 hereof); PROVIDED, HOWEVER, that if
the Company, in consultation with its financial and legal advisors, determines
that such revocation would require a recirculation of the prospectus contained
in the registration statement, then such Holder shall have no right to revoke
its request.
4. REGISTRATIONS ON FORMS S-2 AND S-3. After the conclusion by the
Company of an initial public offering of its Common Stock (which for purposes
hereof shall include any Registrable Securities sold pursuant to Section 2
above) pursuant to a registration under the Act, at such time as the Company
shall have qualified for the use of Forms S-2 and/or S-3 (as the case may be),
or any similar form or forms promulgated by the Commission, the Holders of
Registrable Securities shall each have the right to request an unlimited number
of registrations on Form S-2 and/or Form S-3 (as the case may be). Any such
request shall be in writing, shall specify the Registrable Securities intended
to be sold or disposed of by the Holders thereof, shall state the intended
method of disposition of such Registrable Securities by the Holder(s) requesting
such registration and shall relate to Registrable Securities (i) in an amount
exceeding two percent (2%) of all shares of Common Stock then outstanding, or
(ii) having proposed gross cash offering proceeds (prior to deduction of
underwriters commissions and expenses, if any) of Two Million Dollars
($2,000,000) or more for all Registrable Securities to be included, on the basis
of a reasonable (in light of the current market price) proposed per share
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offering price. The Company shall be obligated to effect such registration or
registrations on Form S-2 or Form S-3 (as the case may be) as soon as
practicable after receipt of such a request; PROVIDED, HOWEVER, that the Company
shall not be obligated to effect the filing of a registration pursuant to this
Section 4 (i) during the period starting with the date ninety (90) days prior to
the Company's estimated date of filing of, and ending on a date one hundred
eighty (180) days following the effective date of, a registration statement
pertaining to a public offering of Common Stock for the account of the Company,
provided that the Company is actively employing in good faith all reasonable
efforts to cause such registration statement to become effective and that, in
the good faith judgment of the Company's underwriter for an underwritten
offering or of the Company's Board of Directors for any other offering, an
offering pursuant to such a registration statement would interfere in any
material respect with the successful marketing (including pricing) of the Common
Stock to be included in the Company's proposed registration statement, or (ii)
if the Company's Board of Directors shall determine in good faith that such
filing will interfere in any material respect with a pending or contemplated
financing, merger, sale or assets, recapitalization or other similar corporate
action of the Company. In the event the Company's obligations are abated
pursuant to the foregoing PROVISO, and if any of the Holders on whose behalf the
requested registration statement would be filed and who were unable to have all
of the Registrable Securities included in the Company's registration statement
pursuant to Section 3 then want such registration statement to be filed, the
Company shall file such registration statement as promptly as practicable
following (x) one hundred eighty (180) days after the effective date of the
registration statement with respect to the offering referred to in clause (i)
above, or (y) the date on which the transactions referred to in clause (ii)
above shall have been completed or abandoned as the case may be); PROVIDED
FURTHER, HOWEVER, that the Company shall not be obligated to file and cause to
become effective (a) more than two (2) registrations on Forms S-2 and/or S-3 in
any one twelve (12) month period or (b) any registration on Form S-2 and/or S-3
within six (6) months after the effective date of any previous registration
statement filed under Section 2 or Section 3, with respect to which all Holders
who had requested the inclusion of any such shares in a registration statement
were entitled to include in such registration statement all Registrable
Securities requested to be included therein. No registration pursuant to this
Section 4 shall count as a Demand Registration pursuant to Section 2.
5. OBLIGATION OF THE COMPANY. Whenever required under this Agreement to
effect the registration of any Registrable Securities, the Company shall, as
expeditiously as reasonably possible:
(a) Prepare and file with the Commission a registration statement
covering such Registrable Securities and use its best efforts to cause such
registration statement to be declared effective by the Commission and to keep
such registration effective until the earlier of (i) the date when all
Registrable Securities covered by the registration statement have been sold or
(ii) in the case of a registration under Section 2 or 3 hereof, nine (9) months
after the effective date of the registration statement or prospectus or any
amendments or supplements thereto, or (iii) in the case of a shelf registration,
the applicable period permitted under the Act. The Company will furnish to each
Holder of Registrable Securities covered by such registration statement and the
underwriters, if any, copies of all such documents proposed to be filed
(excluding exhibits, unless any such person shall specifically request
exhibits), which documents will be subject to the review (for a reasonable
period of time in light of all facts and circumstances) of each Holder and the
underwriters, and the Company will not file such
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registration statement or any amendment thereto or any prospectus or any
supplement thereto including any documents incorporated by reference therein)
with the Commission if (i) the Holders of a majority of the Registrable
Securities covered by such registration statement or the underwriters, if any,
shall reasonably object to such filing or (ii) information in such registration
statement or prospectus concerning a particular Registered Holder is inaccurate.
(b) Prepare and file with the Commission such amendments and
post-effective amendments to such registration statement as may be necessary to
keep such registration statement effective until the earlier of the dates
referred to in clauses (i) and (ii) of Section 5(a) hereof and to comply with
the provisions of the Act with respect to the disposition of all securities
covered by such registration statement, and cause the prospectus to be
supplemented by any required prospectus supplement, and as so supplemented to be
filed with the commission pursuant to Rule 424 under the Act.
(c) Furnish to the Registered Holders such number of copies of such
registration statement, each amendment thereto, the prospectus included in such
registration statement (including each preliminary prospectus), each supplement
thereto and such other documents, as they may reasonably request in order to
facilitate the disposition of Registered Securities owned by them.
(d) Use its best efforts to register and qualify the Registered
Securities under such other securities laws of such jurisdictions as shall be
reasonably requested by any Registered Holder and do any and all other acts and
things which may be reasonably necessary or advisable to enable each Registered
Holder to consummate the disposition of the Registered Securities owned by such
Holder in such jurisdictions; provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify generally to transact
business in any such states or jurisdictions; and provided further that
(anything in this Agreement to the contrary notwithstanding with respect to the
bearing of expenses) if any jurisdiction in which the Registered Securities
shall be qualified shall require that expenses incurred in connection with the
qualification of the Registered Securities in that jurisdiction be borne by
selling shareholders, then such expenses shall be payable by the Registered
Holders pro rata, to the extent required by such jurisdiction.
(e) Promptly notify each Registered Holder at any time when a
prospectus is required to be delivered under the Act relating to the happening
of any event as a result of which the prospectus included in such registration
statement contains an untrue statement of a material fact or omits any fact
necessary to make the statements therein not misleading and, at the request of
any such Holder, the Company will promptly prepare a supplement or amendment to
such prospectus so that, as thereafter delivered to the purchasers of such
Registered Securities, such prospectus will not contain an untrue statement of a
material fact or omit to state any fact necessary to make the statements therein
not misleading.
(f) Make available for inspection by any Registered Holder, any
underwriter participating in any disposition pursuant to such registration
statement and any attorney, accountant or other agent retained by any such
Registered Holder or underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause the officers,
directors, employees and independent accountants of the Company to supply all
information reasonably requested by any such Registered Holder, underwriter,
attorney,
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accountant or agent in connection with such registration statement, which
information shall be subject to reasonable restrictions concerning
confidentiality and nondisclosure.
(g) Promptly notify the Registered Holders and the underwriters, if
any, of the following events and (if requested by any such person) confirm such
notification in writing and provide copies of any relevant documents relating
to: (1) the filing of the prospectus or any prospectus supplement and the
registration statement and any amendment or post-effective amendment thereto
and, with respect to the registration statement and any amendment or
post-effective amendment thereto, the declaration of the effectiveness of such
documents, (2) any comment letters from or requests by the Commission for
amendments or supplements to the registration statement or the prospectus or for
additional information, (3) the issuance or threat of issuance by the Commission
of any stop order suspending the effectiveness of the registration statement or
the initiation of any proceedings for that purpose and (4) the receipt by the
Company of any notification with respect to the suspension of the qualification
of the Registered Securities for sale in any jurisdiction or the initiation or
threat of initiation of any proceeding for such purpose.
(h) Make every reasonable effort to prevent the entry of any order
suspending the effectiveness of the registration statement and obtain the
withdrawal of any such order, if entered. (i) If reasonably requested by any
underwriter or a Registered Holder in connection with any underwritten offering,
incorporate in a prospectus supplement or post-effective amendment such
information as the underwriters and the Holders of a majority of the Registered
Securities agree should be included therein relating to the sale of the
Registered Securities, including, without limitation, information with respect
to the number of Registered Securities being sold to such underwriters, the
purchase price being paid therefor by such underwriters and any other terms of
the underwritten offering of the Registered Securities to be sold in such
offering, and make all required filings of such prospectus supplement or
Post-effective amendment after being notified of the matters to be incorporated
in such prospectus supplement or post-effective amendment.
(j) Cooperate with the Registered Holders and the underwriters, if
any, to facilitate the timely preparation and delivery of certificates
evidencing Registered Securities and not bearing any restrictive legends, and
enable such Registered securities to be in such lots and registered in such
names as the underwriters may request at least two (2) business days prior to
any delivery of Registered Securities to the underwriters.
(k) Provide a transfer agent, registrar and CUSIP number for all
Registrable Securities not later than the effective date of the registration
statement.
(l) Prior to the effectiveness of the registration statement and any
post-effective amendment thereto and at each closing of any underwritten
offering, (i) make such representations and warranties to the Registered Holders
and the underwriters, if any, with respect to the Registered Securities and the
registration statement as are customarily made by issuers to underwriters in
primary underwritten offerings; (ii) obtain opinions of counsel to the Company
and updates thereof (which opinions shall be reasonably satisfactory to the
underwriters, if any, and to the Holders of a majority of the Registered
Securities) addressed to
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each Registered Holder and the underwriters, if any, covering the matters
customarily covered in opinions requested in underwritten offerings and such
other matters as may be reasonably requested by such Holders and underwriters or
their counsel; (iii) obtain "cold comfort" letters and updates thereof from the
Company's independent certified public accountants addressed to the Registered
Holders and the underwriters, if any, such letters to be in customary form and
covering matters of the type customarily covered in "cold comfort" letters by
underwriters in connection with primary underwritten offerings; and (iv) deliver
such documents and certificates as may be reasonably requested by the Holders of
a majority of the Registered Securities being sold and by the underwriters, if
any, to evidence compliance with clause (i) above and with any customary
conditions contained in the underwriting agreement or other agreement entered
into by the Company.
(m) Enter into such agreements and take all such other reasonable
actions in connection therewith in order to expedite or facilitate the
disposition of such Registered Securities and in such connection, in the case of
an underwritten offering, enter into an underwriting agreement or other similar
agreement in form, scope and substance as is customary in underwritten offerings
which underwriting agreement shall set forth in full the indemnification
provisions and procedures of Section 13 hereof with respect to all parties to be
indemnified pursuant to said Section. The above shall be done at each closing
under such underwriting or similar agreement or as and to the extent required
thereunder.
(n) Use its best efforts to cause all Registered Securities included
in such registration statement to be listed, by the date of first sale of
Registered Securities pursuant to such registration statement, on each
securities exchange on which shares of Common Stock are then listed or proposed
by the Company to be listed, if any.
(o) Provide such reasonable assistance in the marketing of the
Registered Securities as is customary of issuers in public offerings (including
participation by its senior management in "road shows"), subject to reasonable
time and expense constraints.
(p) Otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission, and make generally available to its
security holders earnings statements satisfying the provisions of Section 11(a)
of the Act, no later than forty-five (45) days after the end of any twelve (12)
month period (i) commencing at the end of any fiscal quarter in which Registered
Securities are sold to underwriters in a firm or best efforts underwritten
offering, or (ii) if not sold to underwriters in such an offering, beginning
with the first day of the first fiscal quarter of the Company commencing after
the effective date of the registration statement.
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 Holders shall furnish to the Company such information regarding them, the
Registrable Securities held by them, and the intended method of disposition of
such Registrable Securities as the Company shall reasonably request and as shall
be required in connection with the action to be taken by the Company.
7. SUSPENSION OF DISPOSITION OF REGISTRABLE SECURITIES. Each Registered
Holder agrees that, upon receipt of any notice from the Company of the happening
of any event of the kind described in Section 5(e) or 5(g)(3) or (4) hereof,
such Registered Holder will
-11-
forthwith discontinue disposition of Registered Securities until such Registered
Holder's receipt of copies of a supplemented or amended prospectus contemplated
by Section 5(e) hereof, or until it is advised in writing (the "Advice") by the
Company that the use of the prospectus may be resumed, and has received copies
of any additional or supplemental filings which are incorporated by reference in
the prospectus, and, if so directed by the Company, such Registered Holder will
deliver to the Company (at the expense of the company) all copies, other than
permanent file copies then in such Registered Holder's possession, of the
prospectus covering such Registered Securities at the time of receipt of such
notice. In the event the Company shall give any such notice, the time period
mentioned in Section 5(a) hereof shall be extended by the number of days during
the period from and including the date of the giving of such notice pursuant to
Section 5(e) or 5(g)(3) or (4) hereof to and including the date when each
Registered Holder shall have received the copies of the supplemented or amended
prospectus contemplated by Section 5(e) hereof or the Advice.
8. EXPENSES OF REGISTRATION.
(a) Except as provided in Section 8(b) through 8(d) hereof, all
expenses incurred in connection with a registration pursuant to Sections 2, 3 or
4 (excluding underwriters' discounts and commissions), including, without
limitation all registration and qualification fees, fees and disbursements of
counsel for the Company, and, the reasonable fees and disbursements of one (1)
counsel chosen by the Registered Holders owning a majority of the Registered
Securities (or by the Registered Holders owning a majority of the Mezzanine
Warrant Stock constituting Registered Securities in the case of a Mezzanine
Demand Registration) shall be borne by the Company.
(b) If a registration proceeding is begun under Section 2 but
subsequently withdrawn at the request of the Registered Holders owning a
majority of the Registered Securities (or at the request of Registered Holders
owning a majority of the Mezzanine Warrant Stock constituting Registered
Securities in the case of a Mezzanine Demand Registration) such Registered
Holders shall have the option (exercisable by Registered Holders owning a
majority of the Registered Securities, or a majority of the Mezzanine Warrant
Stock constituting Registered Securities in the case of a Mezzanine Demand
Registration) of either (i) reserving their right to such Demand Registration
pursuant to Section 2, in which case the Registered Holders will pay all
expenses of such registration proceeding, or (ii) waiving their right to one (1)
Demand Registration under Section 2 (Section 2(a) if the registration proceeding
originated with a demand under Section 2(a) hereof), in which case the Company
will pay the expenses of such registration proceeding.
(c) Registered Holders may withdraw a request made within forty-five
(45) days after the end of the fiscal year if the audited financial statements
of the Company for such year and at such year-end materially and adversely
differ from the financial information furnished to such Holders by the Company
at the time of their request, in which event such Registered Holders shall not
be required to pay any of the expenses of such withdrawn registration and such
withdrawn registration shall be treated for all purposes of this Agreement,
including without limitation Section 2(d) hereof, as if it had never occurred.
(d) All expenses incurred in connection with a registration which
are, under this Section 8, to be borne by Registered Holders shall be borne pro
rata by the Registered
-12-
Holders on the basis of the number of such Holder's Registered Securities (or
Registrable Securities proposed to be registered, as the case may be); PROVIDED,
however, that if any such cost or expense is attributable solely to one
Registered Holder and does not constitute a normal cost or expense of such a
registration, such cost or expense shall be allocated to and borne by that
Registered Holder.
9. UNDERWRITING REQUIREMENTS: PRIORITIES.
(a) (i) With respect to a Mezzanine Demand Registration pursuant to
Section 2(a), the Registered Holders owning a majority of the Mezzanine Warrant
Stock included in the registration shall have the right to select the investment
banker(s) and manager(s), if any, to administer such registration, subject to
the approval of the Company, which will not be unreasonably withheld. With
respect to a Non-Mezzanine Demand Registration pursuant to Section 2(b), the
Registered Holders owning a majority of the Registered Securities shall have the
right to select the investment banker(s) and manager(s) to administer such
registration, subject to the approval of the Company, which will not be
unreasonably withheld.
(ii) The Registered Holders owning a majority of the Registered
Securities included in any registration under Section 4 shall have the right to
select the investment banker(s) and manager(s), if any, to administer the
offering, if any, subject to the approval of the Company, which will not be
unreasonably withheld.
(iii) The Company will have the right to select the investment
banker(s) and manager(s), if any, to administer any offering to which Section 3
hereof is applicable.
(b) (i) if a registration under Section 2(a) hereof is an
underwritten offering and the managing underwriters advise the Company in
writing that in their opinion the number of Registrable Securities requested to
be registered by the Mezzanine Warrant Holders and Demand Piggybackers exceeds
the number of shares which can be sold at the desired price in such offering,
the Company will include in such registration (i) first, the Mezzanine Warrant
Stock demanded to be registered under Section 2 (a) and the Mezzanine Warrant
Stock held by Demand Piggybackers (pro rata among the Holders thereof based on
the number of shares of Mezzanine Warrant Stock such Holders have requested to
be registered), and (ii) second, Registrable Securities other than Mezzanine
Warrant Stock owned by Demand Piggybackers (pro rata among the Holders thereof
on the basis of the number of Registrable Securities such Holders have requested
to be registered); provided that, such aggregate Registered Securities shall not
exceed the number of Registrable Securities requested to be included which in
the opinion of such underwriters can be sold at the desired price.
(ii) If a registration under Section 2(b) hereof is an
underwritten offering and the managing underwriters advise the Company in
writing that in their opinion the number of shares of Common Stock requested to
be registered exceeds the number of shares which can be sold at the desired
price in such offering, then the Company will include in such registration
Registrable Securities owned by Holders requesting registration of Registrable
Securities with respect to such registration pro rata among such Holders on the
basis of the number of Registrable Securities such Holders have requested to be
registered; provided
-13-
that, such aggregate Registered Securities shall not exceed the number of
Registrable Securities requested to be included therein which in the opinion of
such underwriters can be sold at the desired price.
(iii) If a registration under Section 3 hereof is an underwritten
registration and the managing underwriters advise the Company in writing that in
their opinion the number of securities requested to be included in such
registration exceeds the number which can be sold at the desired price in such
offering, the Company will include in such registration (i) first, the
securities the Company proposes to sell; (ii) second, the Registrable Securities
held by the Holders (other than Management Investors) requesting to be included
in such registration pursuant to Section 3 hereof (pro rata among the respective
Holders thereof on the basis of the number of Registered Securities such Holders
have requested to be registered); and (iii) third, the Registrable Securities
held by the Management Investors requesting to be included in such registration
pursuant to Section 3 hereof (pro rata among such Management Investors on the
basis of the number of Registered Securities such Management Investors have
requested to be registered).
(iv) If a registration under Section 4 hereof is an underwritten
offering and the managing underwriters advise the Company in writing that in
their opinion the number of Registrable Securities requested to be registered
exceeds the number of shares which can be sold at the desired price in such
offering, the Company will include in such registration the number of
Registrable Securities requested to be included which in the opinion of such
underwriters can be sold at the desired price. Registrable Securities held by
the Holders requesting to be included in such registration shall be included pro
rata among the respective Holders thereof on the basis of the number of
Registrable Securities such Holders have requested to be registered.
(c) Notwithstanding the priorities set forth in Section 9(b), in the
event Individual Investors request registration of Registrable Securities under
Sections 2(a) (as Demand Piggybackers), 2(b), 3 or 4 hereof, such Individual
Investors, or any one of them, shall be given priority over all other holders of
Registrable Securities (other than Mezzanine Warrant Holders) to the extent such
priority is necessary to allow such Individual Investors to sell enough
Registrable Securities to qualify any redemption of other Company securities
from such Individual Investor occurring simultaneously with (or part of a series
of related transactions with) such offering for sale or exchange treatment under
Section 302(b)(2) of the Internal Revenue Code of 1986, as amended; PROVIDED
THAT the priority provided by this subparagraph (c) shall not extend to
Registrable Securities which constitute more than one and one-half percent
(1.5%) of the outstanding Common Stock of the Company at the time of (and
measured prior to) such redemption (the "Priority Inversion Percent"); and
PROVIDED FURTHER, THAT the rights provided to Individual Investors pursuant to
this subparagraph (c) may be terminated by Holdings if Holdings shall, or shall
cause the Company to, purchase the Priority Inversion Percent from the
Individual Investor and thereby reduce the number of Individual Investors'
Registrable Securities requested to be registered.
(d) In the case of a non-underwritten Demand Registration, the
priorities provided in Section 9(b)(i) or (ii) shall apply in the event the
number of shares salable (in the opinion of the Board of Directors) is less than
the total number of Registrable Securities sought to be registered.
-14-
(e) No Holder may participate in any underwritten registration
hereunder unless such Holder (i) agrees to sell such Holder's Registrable
Securities on the basis provided in any underwriting arrangements approved by
the persons entitled hereunder to approve such arrangements and (ii) completes
and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements.
(f) The Company shall not grant registration rights to any person
which impair in any way the priorities for inclusion in a registration set forth
in this Section 9, including, without limitation, by providing any such person
with higher priority than or equal priority to that provided to the Parties
herein with regard to any registration statement filed by be Company, whether
upon such person's demand or otherwise. In addition, in any demand registration
rights granted to any such person, the Company shall provide that such demand
registration rights shall be subject to a right of the Mezzanine Warrant Holders
to render such a demand thereunder ineffective by making demand for registration
under Section 2(a) of this Agreement in accordance with the procedures set forth
in Section 2(b) hereof. Notwithstanding anything to the contrary contained in
this paragraph (f), nothing in this paragraph (f) shall restrict the Company's
ability to register on Form S-8 (or any successor form) shares issuable upon
exercise of options which may be granted pursuant to any Stock Option Plan
adopted by the Company after the date hereof, providing for the issuance of
shares of Common Stock to certain employees of the Company.
10. RULE 144.
(a) The Company shall not be obligated under Section 2, 3 or 4 hereof
to register or include in any registration statement Registrable Securities that
any Holder has requested to be registered if the Company shall furnish such
Holder with a written opinion of counsel to the Company, which opinion shall be
reasonably satisfactory to such Holder, that all Registrable Securities that
such Holder holds may be publicly offered, sold and distributed within a single
ninety (90) day period without registration under the Act pursuant to Rule 144
promulgated by the Commission under the Act; PROVIDED, HOWEVER, that the
provisions of this Section 10(a) shall not apply if such Holder requesting
registration shall provide to the Company written advice from a refutable
investment banker reasonably satisfactory to such Holder and the Company, that
the per share price reasonably likely to be attainable in a sale under Rule 144
(net of expenses of such sale) is not substantially as great as the per share
price reasonably likely to be attainable pursuant to a Registration under the
applicable section. The cost of obtaining a letter from an investment banker
containing such advice shall be borne by the Company.
(b) At such time as the Company becomes subject to the reporting
requirements of the 1934 Act, the Company will file the reports required to be
filed by it under the Act and the 1934 Act and the rules and regulations adopted
by the Commission thereunder, and will use its best efforts to take such further
action as any Holder of Registrable Securities may reasonably deem to be
necessary, all to the extent required from time to time to enable such Holder to
sell Registrable Securities without registration under the Act within the
limitation of the exemptions provided by (i) Rule 144 under the Act, as such
Rule may be amended from time to time, or (ii) any similar rule or regulation
hereafter adopted by the Commission. Upon the request of any Holder of
Registrable Securities, the Company will deliver to such Holder a written
statement as to whether it has complied with such information and requirements.
-15-
11. LOCKUP AGREEMENT.
(a) All Holders agree that, upon the request of and to the extent
required by the underwriter(s) managing (i) an initial underwritten public
offering of Common Stock, or (ii) any other registration of Common Stock at the
time of which such Holder is a Restricted Holder (as defined in this section
11(a)), such Holders will not sell, make any short sale of, pledge, grant any
option for the purchase of or otherwise dispose of any Registrable Securities
(other than those included in the registration) without the prior written
consent of the Company or such underwriters), as the case may be, during the
seven (7) days prior to, and during the one hundred twenty (120) day period
beginning on, the effective date of such registration as the Company or the
underwriters) may specify. For purposes of this section 11(a), "Restricted
Holder" shall mean any Holder who beneficially owns (within the meaning of Rule
13d-3 of the 1934 Act or any successor rule) five percent (5%) or more of the
Common Stock ("5% Holder"), any director or officer of the Company (without
regard to his or her level of ownership of Common Stock), or any Holder whose
Registrable Securities are being included in the registration (without regard to
the amount of Registrable Securities being registered). Any lockup imposed on
Holders pursuant to clause (i) of this Section 11(a) shall be imposed on all
Holders and any lockup imposed on Restricted Holders pursuant to clause (ii) of
this Section 11(a) shall be imposed on all Restricted Holders.
(b) The Company agrees (i) not to effect any public sale or
distribution of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, during the seven (7) days prior
to and during the one hundred twenty (120) day period beginning on the effective
date of any registration statement related to an registered underwritten public
offering pursuant to which Registrable Securities are to be sold (except as part
of such underwritten registration or pursuant to registrations on Form S-8 or
any successor form), unless the underwriters) managing the registered public
offering otherwise agree, and (ii) to use its best efforts to cause each holder
of at least five percent (5%) (on a fully-diluted basis) of its equity
securities, or any securities convertible into or exchangeable or exercisable
for such securities, in either case purchased from the Company at any time after
the date of this Agreement (other than in a registered public offering) to agree
not to effect any sale or distribution of any such securities during such period
(except as part of such underwritten registration, if otherwise permitted),
unless the underwriters managing the registered public offering otherwise agree.
12. TRANSFER OF REGISTRATION RIGHTS. Provided that the Company is given
written notice by the Holder at the time of such transfer stating the name and
address of the transferee and identifying the securities with respect to which
the rights under this Agreement are being assigned, the registration rights
under this Agreement may be transferred in whole or in part in connection with
the transfer of Registrable Securities. Notwithstanding the foregoing, if such
transfer is subject to covenants, agreements or other undertakings restricting
transferability thereof the registration rights under this Agreement shall not
be transferred in connection with such transfer unless such transfer complies
with all such covenants, agreements and other undertakings. In all cases, such
registration rights shall not be transferred unless the transferee thereof
executes a counterpart signature page, agreeing the assume and be bound by the
obligations imposed upon Holders pursuant to this Agreement.
13. INDEMNIFICATION. In the event any Registrable Securities are included
in a registration statement under this Agreement:
-16-
(a) To the full extent permitted by law, the Company will and hereby
does (i) indemnify and hold harmless each Holder, each director, officer,
partner, employee, or agent of or for such Holder, any underwriter (as defined
in the Act) for such Holder, and each person, if any, who controls such Holder
or underwriter within the meaning of the Act, against any losses, claims,
damages or liabilities, joint or several, to which they may become subject under
the Act and applicable state securities laws insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
on any untrue or alleged untrue statement of any material fact contained in such
registration statement, including any preliminary prospectus or final prospectus
contained therein or any amendments or supplements thereto, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein in light of the circumstances under which it was
made or necessary to make the statements therein not misleading, or arise out of
any violation by the company of any securities law, rule or regulation
applicable to the Company and relating to action or inaction required of the
company in connection with any such registration; and (ii) will reimburse each
such person or entity 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 13(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 or
delayed) nor shall the Company be liable in any such case for any such loss,
claim, damage, liability or action to the extent that it arises out of or is
based upon an untrue statement or an alleged untrue statement or omission or
alleged omission made in connection with such registration statement,
preliminary prospectus, final prospectus, or amendments or supplements thereto
in reliance upon and in conformity with written information furnished expressly
for use in connection with such registration by or on behalf of any such Holder,
underwriter or controlling person.
(b) To the full extent permitted by law, each Holder requesting or
joining in a registration under this Agreement will and hereby does (i)
indemnify and hold harmless the Company, each of its directors, each of its
officers who have signed the registration statement, each person, if any, who
controls the Company within the meaning of the Act, and any Underwriter (as
defined in the Act) for the Company, each other holder and each person, if any,
who controls such other Holder within the meaning of Section 15 of the Act,
against any losses, claims, damages or liabilities, joint or several, to which
the Company or any such director, officer, controlling person, other Holder or
underwriter may become subject, under the Act and applicable state securities
laws, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact contained in such registration statement,
including any preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto, 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
light of the circumstances, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in such registration statement, preliminary or final
prospectus, or amendments or supplements thereto, in reliance upon and in
conformity with written information furnished by such Holder expressly for use
in connection with such registration; and (ii) reimburse any legal or other
expenses reasonably incurred by the Company or any such director, officer, other
Holder, controlling person or underwriter attributable to investigating or
defending any loss, claim, damage, liability or action
-17-
indemnified by such Holder pursuant to clause (i); PROVIDED, HOWEVER, that the
indemnity agreement contained in this Section 13(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 such Holder (which consent shall
not be unreasonably withheld or delayed).
In no event shall the liability of any Registered Holder be greater than
the dollar amount of the proceeds received by such Registered Holder upon the
sale of the Registrable Securities giving rise to such indemnification
obligation.
(c) Promptly after receipt by an indemnified party under this Section
13 of notice of the commencement of any action or knowledge of a claim that
would, if asserted, give rise to a claim for indemnity hereunder, such
indemnified party will, if a claim in respect thereof is to be made against any
indemnifying party under this Section 13, notify the indemnifying party in
writing of the commencement thereof or knowledge thereof and the indemnifying
party shall have the right to participate in, and, to the extent the
indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties. The failure to notify an indemnifying party
promptly of the commencement of any such action or of the knowledge of any such
claim, if prejudicial to any material extent to his ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 13 to the extent so prejudiced, but the
omission so to notify the indemnifying party will not relieve him of any
liability that he may have to any indemnified party otherwise than under this
Section 13.
(d) If the indemnification provided for in this Section 13 is for any
reason, other than pursuant to the terms thereof, held to be unavailable to an
indemnified party in respect of any losses, claims, damages or liabilities (or
actions in respect thereof) referred to therein, then each indemnifying party
shall, in lieu of indemnifying such indemnified party, 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 benefits received by the indemnifying and
indemnified parties from the offering of Common Stock. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or otherwise results in a materially inequitable result (as
determined by the Board of Directors of the Company in its reasonable
discretion), then each indemnifying party shall contribute to such amount paid
or payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
indemnifying and indemnified parties in connection with the statements) or
omissions) which resulted in such losses, claims, damages, liabilities (or
actions in respect thereof), as well as any other relevant equitable
considerations. The relative benefits received by a party shall be deemed to be
in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by such party bears to the total net proceeds from
the offering received by all parties. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact relates to information supplied by the Company or a Holder
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
the Holders agree that it would not be just and equitable if contribution
pursuant to this subsection (d) were determined by PRO RATA allocation or by any
other method of allocation take into account the equitable considerations
referred to above in this subsection (d). The amount paid or payable by an
indemnified party as a result of the losses, claims, damages or
-18-
liabilities (or actions in respect thereof) referred to above in this subsection
(d) shall be deemed to include any legal or other expenses reasonably incurred
by 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 Act shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
14. REMEDIES. In addition to being entitled to exercise all rights
provided in this Agreement as well as all rights granted by law, including
recovery of damages, each Holder of Registrable Securities will be entitled to
specific performance of its rights under this Agreement. The Company agrees that
monetary damages would not be adequate compensation for any loss incurred by
reason of a breach by it of the provisions of this Agreement and hereby agrees
not to raise the defense in any action for specific performance that a remedy at
law would be adequate.
15. SUBSEQUENT ISSUANCES BY THE COMPANY. If the Board of Directors of the
Company determines that any Person hereafter issued hereafter issued any Common
Stock, Preferred Stock or Warrants by the Company should become a party to this
Agreement, then the execution of a Counterpart to this Agreement by such Person
shall result in such Person being deemed to be a Shareholder hereunder for all
purposes of this Agreement.
16. AMENDMENTS AND WAIVERS. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given unless the Company has obtained the written consent of all of the Holders;
PROVIDED, HOWEVER, that any such waiver or consent will be effective against any
Holder actually executing a written waiver or consent whether or not other
Holders of the outstanding Registrable Securities grant such waiver or consent.
17. FILING NOTICES AND COPIES. The Company shall provide to each Holder of
Registrable Securities such number of copies of any registration statement,
amendment thereto (including post-effective amendments) or other report,
document or notice that is filed with the Securities and Exchange Commission or
other authority under the securities laws, as may be reasonably requested by
such Holder of Registrable Securities. In addition, the Company shall provide
prior notice to any Holder of Registrable Securities of any such filing of a
registration statement or amendment thereto, provided that the foregoing notice
provision shall not shorten any other advance notice provision contained in this
Agreement.
18. NOTICES. All notices and other communications hereunder shall be in
writing and shall be given to the person either personally or by sending a copy
thereof by first class or express mail, postage prepaid, or by telegram (with
messenger service specified), telex or TWX (with answerback received) or courier
services, charges prepaid, or by telecopier, to such party's address (or to such
party's telex, TWX, telecopier or telephone number). If the notice is sent by
mail, it shall be deemed to have been given to the person entitled thereto five
(5) business days after being deposited in the United States mail, and if the
notice is sent by telegraph or courier services, it shall be deemed to have been
given to the person entitled thereto one (1) business day after deposited with a
telegraph office or courier service for delivery to that person or, in the case
of telex, TWX, or telecopy when dispatched.
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If to Holdings, to:
Kirkland Holdings L.L.C.
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
With a copy to:
Xxxxxx Xxxxxxxx LLP
0000 Xxx Xxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx, Esq.
Telecopy No.: (000) 000-0000
If to the Management Investors or the Company, to:
Xxxxxxxx'x, Inc.
X.X. Xxx 0000
Xxxxxxx, XX 00000-0000
Attention: Xxxxxx Xxxxxxxx
Telecopy No.: (000) 000-0000
With a copy to:
Baker, Donelson, Bearman & Xxxxxxxx
20th Floor
First Tennessee Building
000 Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxx, Esq.
Telecopy No.: (000) 000-0000
If to Xxxxxx Xxxxxxxx, to:
Xxxxxx Xxxxxxxx
000 Xxxxxxx Xxxxxx Xxxx
Xxxxx Xxxx, Xxxxxxxxx 00000
Telecopy No.: (000) 000-0000
With a copy to:
Warner Law Firm PLC
000 Xxxx Xxxxxx Xxxxxx
Xxxxx Xxxx, Xxxxxxxxx 00000
Attention: Xxxx X. Xxxxxx, Xx., Esquire
Telecopy No.: (000) 000-0000
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If to Mezzanine Warrant Holders, to:
Capital Resource Lenders II, L.P.
00 Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxx, XX 00000
Attention: Xxxxxxxxx X. XxXxxxx
Telecopy No.: (000) 000-0000
Allied Capital Corporation
0000 X Xxxxxx, X.X.
Xxxxx 000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxx Xxxxxxxxx
Telecopy No.: (000) 000-0000
The Marlborough Capital Investment Fund, L.P.
000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxxxx Laroix
Telecopy No.: (000)000-0000
Capital Trust Investments, Ltd.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxx
Telecopy No.: (000) 000-0000
With a copy to:
Xxxxx, Xxxxxxx & Xxxxxxxxx, LLP
High Street Tower
000 Xxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Xx., Esquire
Telecopy No.: (000) 000-0000
If to any other party hereto, to the address of record as most recently
provided to the Company. Upon request by any party hereto, the Company agrees to
provide address and telecopier information for any other party for the purpose
of providing a notice in accordance with this Section 18.
Notice of any change in any such address shall also be given in the manner set
forth above. Whenever the giving of notice is required, the giving of such
notice may be waived by the party entitled to receive such notice.
19. COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed
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shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
20. HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
21. GOVERNING LAW. This Agreement shall be governed by and construes in
accordance with the laws of the State of Delaware.
22. SEVERABILITY. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained imp herein shall not be affected or impaired thereby.
23. Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein with respect to the registration rights granted by the
Company with respect to the Registrable Securities. This Agreement supersedes
all prior agreements and understandings between the parties with respect to such
subject matter.
24. PARTIES BENEFITED. Nothing in this Agreement, express or implied, is
intended to confer upon any third party any rights, remedies, obligations or
liabilities.
25. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective heirs, personal
representatives, successors and assigns including, without limitation,
subsequent Holders of Registrable Securities agreeing to be bound by all and the
terms and conditions of this Agreement.
IN WITNESS WHEREOF, this Amended and Restated Registration Rights Agreement
has been executed as of the date and year first above written.
KIRKLAND HOLDINGS L.L.C.
By:
------------------------------------
Name:
Title:
XXXXXXXX'X, INC.
By:
-----------------------------------
Name:
Title:
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[This page intentionally left blank.]
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SSM VENTURE PARTNERS, L.P.
By:
----------------------------------
Name:
Title:
----------------------------------
XXXXXX X. XXXX, III
----------------------------------
XXXXXXXX X. XXXXX, XX.
----------------------------------
XXXX X. XXXXXXX
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CT/KIRKLAND EQUITY PARTNERS, L.P.
By:
----------------------------------
Name:
Title:
R-H CAPITAL PARTNERS, L.P.
By:
----------------------------------
Name:
Title:
TCW/KIRKLAND EQUITY PARTNERS, L.P.
By:
----------------------------------
Name:
Title:
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CAPITAL RESOURCE LENDERS II, L.P., by
CAPITAL RESOURCE PARTNERS II, L.P.,
its General Partner
By:
----------------------------------
Name:
Title:
ALLIED CAPITAL CORPORATION
By:
----------------------------------
Name:
Title:
THE MARLBOROUGH CAPITAL INVESTMENT
FUND, L.P., by MARLBOROUGH CAPITAL
MANAGEMENT, L.P., its general partner
By:
---------------------------------------
Xxxxxxxx Xxxxxx, its authorized partner
CAPITAL TRUST INVESTMENTS, LTD.
By:
----------------------------------
Name:
Title:
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GLOBAL PRIVATE EQUITY II LIMITED
PARTNERSHIP
By:
----------------------------------
Name:
Title:
ADVENT DIRECT INVESTMENT PROGRAM LIMITED
PARTNERSHIP
By:
----------------------------------
Name:
Title:
ADVENT PARTNERS LIMITED PARTNERSHIP
By:
----------------------------------
Name:
Title:
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--------------------------------------
XXXX XXXXXXXX
--------------------------------------
XXXXXX XXXXXXXX
--------------------------------------
XXXXXX XXXXXXXX
THE XXX XXXXXXXXX XXXXXXXX TRUST
By:
----------------------------------
Name:
Title:
THE XXXXXXX XXXXX XXXXXXXX TRUST
By:
----------------------------------
Name:
Title:
THE XXXX X. XXXXXXXX GRANTOR RETAINED
ANNUITY TRUST 2001-1
By:
----------------------------------
Name:
Title:
--------------------------------------
XXXXXX XXXXXXX
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EXHIBIT A
COUNTERPART
-----------
THIS INSTRUMENT forms part of the Amended and Restated Registration Rights
Agreement (the "Agreement") made as of the 1st day of April 2002, among Kirkland
Holdings L.L.C., Xxxxxxxx'x Inc., SSM Venture Partners, L.P., Xxxxxx X. Xxxx,
III, Xxxxxxxx X. Xxxxx, Xx., Xxxx X. Xxxxxxx, CT/Xxxxxxxx Equity Partners, L.P.,
R-H Capital Partners, L.P., TCW/Kirkland Equity Partners, L.P., Capital Resource
Lenders II, L.P., Allied Capital Corporation, The Marlborough Capital Investment
Fund, L.P., Capital Trust Investments, Ltd., Global Private Equity II Limited
Partnership, Advent Direct Investment Program Limited Partnership, Advent
Partners Limited Partnership, Xxxx Xxxxxxxx, Xxxxxx Xxxxxxxx, Xxxxxx Xxxxxxxx,
The Xxx Xxxxxxxxx Xxxxxxxx Trust, The Xxxxxxx Xxxxx Xxxxxxxx Trust, The Xxxx X.
Xxxxxxxx Grantor Retained Annuity Trust 2001-1 and Xxxxxx Xxxxxxx, and any
additional Shareholders of the Company (as defined in the Agreement), from time
to time, which Agreement permits execution by counterpart. The undersigned
hereby acknowledges having received a copy of the said Agreement (which is
annexed hereto as Schedule I) and having read the said Agreement in its
entirety, and for good and valuable consideration, receipt and sufficiency of
which is hereby acknowledged, hereby agrees that the terms and conditions of the
said Agreement shall be binding upon the undersigned as a Shareholder and such
terms and conditions shall enure to the benefit of and be binding upon the
undersigned and its successors and permitted assigns.
IN WITNESS WHEREOF, the undersigned has executed this instrument this
____ day of ___________, 200_ .
---------------------------------
(Signature of Shareholder)
---------------------------------
(Name in block letters)
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