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EXHIBIT D
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
by and among
XXXXXX'X FURNITURE, INC.
and
THE STOCKHOLDERS LISTED ON THE SIGNATURE PAGES HEREOF
Dated as of January [ ], 2000
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Amended and Restated Registration Rights Agreement (this "Agreement"),
dated as of January [ ], 2000, by and among Xxxxxx'x Furniture, Inc., a Delaware
corporation (the "Company"), and each of the stockholders of the Company listed
on the signature pages hereto (the "Investors").
1. Background. The Investors own shares of either the Company's common
stock, par value $.001 per share (the "Common Stock") or the Company's Series A
Convertible Preferred Stock, par value $.0001 per share, (the "Series A
Preferred Stock"), which is convertible into Common Stock. In connection with a
Securities Purchase Agreement between the Company and the purchasers listed
thereto, dated August 26, 1996, the Company entered into a Registration Rights
Agreement with certain stockholders dated August 26, 1996 (the "Prior
Registration Rights Agreement").
Pursuant to a Securities Purchase Agreement among the Company and the
purchasers listed thereto, dated the date hereof, the Company and the Investors
have entered into this Agreement to amend, restate and supersede the Prior
Registration Rights Agreement.
2. Registration Under Securities Act, Etc.
2.1 Registration on Request.
(a) Request. Subject to Section 2.8 hereof, at any time and from time
to time upon the written request of Holders (the "Initiating Holders") of not
less than the Required Number of Shares that the Company effect the registration
under the Securities Act (other than pursuant to a Shelf Registration Statement)
of all or part of such Initiating Holders' Registrable Securities (provided that
the Company shall not be obligated to register less than the Required Number of
Shares pursuant to such request), the Company will promptly give written notice
of such requested registration to all registered Holders, and thereupon the
Company will use its best efforts to effect the registration under the
Securities Act of:
(i) the Registrable Securities (representing not less than the
Required Number of Shares) which the Company has been so requested to
register by such Initiating Holders, and
(ii) all other Registrable Securities which the Company has been
requested to register by the Holders thereof (such Holders together with
the Initiating Holders are hereinafter referred to as the "Selling
Holders") by
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written request given to the Company within 20 days after the giving of
such written notice by the Company, all to the extent required to permit
the disposition of the Registrable Securities so to be registered.
(b) Registration of Other Securities. Whenever the Company shall
effect a registration pursuant to this Section 2.1 in connection with an
underwritten offering by one or more Selling Holders, no securities other than
Registrable Securities shall be included among the securities covered by such
registration unless (i) the managing underwriter of such offering shall have
advised each Selling Holder to be covered by such registration in writing that
the inclusion of such other securities would not adversely affect such offering
or (ii) the Selling Holders of not less than a majority of all Registrable
Securities to be covered by such registration shall have consented in writing to
the inclusion of such other securities.
(c) Registration Statement Form. Registrations under this Section 2.1
shall be on such appropriate registration form of the Commission as shall be
selected by the Company.
(d) Expenses. The Company will pay the Registration Expenses in
connection with any registration requested pursuant to this Section 2.1.
(e) Effective Registration Statement. A registration requested
pursuant to this Section 2.1 shall not be deemed to have been effected:
(i) unless a registration statement with respect thereto has
become effective,
(ii) if after it has become effective, such registration is
interfered with by any stop order, injunction or other order or requirement
of the Commission or other governmental agency or court for any reason not
attributable to the Selling Holders and such registration has not
thereafter become effective, or
(iii) if the conditions to closing specified in the underwriting
agreement, if any, entered into in connection with such registration are
not satisfied or waived, other than by reason of a failure on the part of
the Selling Holders.
(f) Selection of Underwriters. The underwriter or underwriters of each
underwritten offering of the Registrable Securities shall be selected by the
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mutual agreement of the Company and the Selling Holders of a majority of the
Registrable Securities so to be registered.
(g) Priority in Requested Registration. If the managing underwriter of
any underwritten offering shall advise the Company in writing (with a copy to
each Selling Holder) that, in its opinion, the number of securities requested to
be included in such registration exceeds the number which can be sold in such
offering within a price range acceptable to the Selling Holders of a majority of
the Registrable Securities requested to be included in such registration, the
Company will include in such registration, to the extent of the number which the
Company is so advised can be sold in such offering, Registrable Securities
requested to be included in such registration, pro rata among the Selling
Holders on the basis of the percentage of the Registrable Securities of such
Selling Holders requested so to be registered. In connection with any such
registration to which this Section 2.1(g) is applicable, no securities other
than Registrable Securities shall be covered by such registration.
(h) Limitations on Registration on Request. Notwithstanding anything
in this Section 2.1 to the contrary, the Company shall not be required to
effect, in the aggregate pursuant to this Section 2.1, without regard to the
Holder making such request, more than two registrations during any twelve month
period.
2.2 Incidental Registration.
(a) Right to Include Registrable Securities. If the Company proposes
at any time to register any of its securities under the Securities Act (other
than a Shelf Registration Statement) by registration on Forms X-0, X-0 or S-3 or
any successor or similar form(s) (except registrations on such Forms or similar
form(s) solely for registration of securities in connection with an employee
benefit plan or dividend reinvestment plan or a merger, reorganization, or
consolidation), whether or not for sale for its own account, it will, subject to
Section 2.8 hereof, each such time give prompt written notice to all registered
Holders of its intention to do so and of such Holders' rights under this Section
2.2. Upon the written request of any such Holder (a "Requesting Holder") made as
promptly as practicable and in any event within 20 days after the receipt of any
such notice (10 days if the Company states in such written notice or gives
telephonic notice to all registered Holders , with written confirmation to
follow promptly thereafter, that (i) such registration will be on Form S-3 and
(ii) such shorter period of time is required because of a planned filing date)
(which request shall specify the Registrable Securities intended to be disposed
of by such Requesting Holder), the Company will, subject to Section 2.8 hereof,
use its
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best efforts to effect the registration under the Securities Act of all
Registrable Securities which the Company has been so requested to register by
the Requesting Holders thereof; provided, that if, at any time after giving
written notice of its intention to register any securities and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register or to
delay registration of such securities, the Company may, at its election, give
written notice of such determination to each Requesting Holder and (i) in the
case of a determination not to register, shall be relieved of its obligation to
register any Registrable Securities in connection with such registration (but
not from any obligation of the Company to pay the Registration Expenses in
connection therewith), without prejudice, however, to the rights of any Holder
or Holders entitled to do so to request that such registration be effected as a
registration under Section 2.1 and (ii) in the case of a determination to delay
registering, shall be permitted to delay registering any Registrable Securities,
for the same period as the delay in registering such other securities. No
registration effected under this Section 2.2 shall relieve the Company of its
obligation to effect any registration upon request under Section 2.1. The
Company will pay all Registration Expenses in connection with registration of
Registrable Securities requested pursuant to this Section 2.2.
(b) Priority in Incidental Registrations. If the managing underwriter
of any underwritten offering shall inform the Company (or, in the case of a
secondary offering, the selling stockholders initiating such offering) of its
belief that the number or type of Registrable Securities requested to be
included in such registration would materially adversely affect such offering,
then the Company will include in such registration, to the extent of the number
and type which the Company is (or the selling stockholders initiating such
offering are) so advised can be sold in (or during the time of) such offering,
first, all securities proposed by the Company (or, in the case of a secondary
offering, the selling stockholders initiating such offering) to be sold for its
(or their) own account, and second, such Registrable Securities and any other
securities of the Company requested to be included in such registration, pro
rata among all such Holders on the basis of the estimated gross proceeds of the
securities of such Holders requested to be so included.
(c) Selection of Managing Underwriter. The managing underwriter of any
underwritten offering pursuant to this Section 2.2 shall be selected by the
Company at its sole discretion.
2.3 Registration Procedures. If and whenever the Company is required to use
its best efforts to effect the registration of any Registrable Securities under
the
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Securities Act as provided in Section 2.1, 2.2 or 2.8, the Company will as
expeditiously as possible:
(a) in the case of a registration pursuant to Section 2.1 or 2.2,
prepare and (as soon as practicable, and in any event within 75 days in the case
of Form S-1 or S-2 and 30 days in the case of a registration requested on Form
S-3 after the end of the period within which requests for registration may be
given to the Company) file with the Commission the requisite registration
statement to effect such registration and thereafter use its best efforts to
cause such registration statement to become effective; provided, that the
Company may discontinue any registration of its securities which are not
Registrable Securities (and, under the circumstances specified in Section
2.2(a), its securities which are Registrable Securities) at any time prior to
the effective date of the registration statement relating thereto;
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective and
to comply with the provisions of the Securities Act with respect to the
disposition of all Registrable Securities covered by such registration statement
for such period as shall be required for the disposition of all of such
Registrable Securities, provided, that in the case of a registration pursuant to
Section 2.1 or 2.2, such period need not exceed 90 days;
(c) furnish to each seller of Registrable Securities covered by such
registration statement, such number of conformed copies of such registration
statement and of each such amendment and supplement thereto (in each case
including all exhibits), such number of copies of the prospectus contained in
such registration statement (including each preliminary prospectus and any
summary prospectus) and any other prospectus filed under Rule 424 under the
Securities Act, in conformity with the requirements of the Securities Act, and
such other documents, as such seller may reasonably request;
(d) use its best efforts:
(i) to register or qualify all Registrable Securities and other
securities covered by such registration statement under such other
securities or blue sky laws of such states of the United States of America
where an exemption is not available and as the sellers of Registrable
Securities covered by such registration statement shall reasonably request;
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(ii) to keep such registration or qualification in effect for so
long as such registration statement remains in effect; and
(iii) to take any other action which may be reasonably necessary
or advisable to enable such sellers to consummate the disposition in such
jurisdictions of the securities to be sold by such sellers, except that
the Company shall not for any such purpose be required to qualify generally
to do business as a foreign corporation in any jurisdiction wherein it
would not but for the requirements of this subdivision (d) be obligated to
be so qualified or to consent to general service of process in any such
jurisdiction;
(e) use its best efforts to cause all Registrable Securities covered
by such registration statement to be registered with or approved by such other
federal or state governmental agencies or authorities as may be necessary in the
opinion of counsel to the Company and counsel to the seller or sellers thereof
to consummate the disposition of such Registrable Securities;
(f) in the case of a registration pursuant to Section 2.1 or 2.2,
furnish to each seller of Registrable Securities a signed counterpart of (i) an
opinion of counsel for the Company and (ii) a "comfort" letter signed by the
independent public accountants who have certified the Company's financial
statements included or incorporated by reference in such registration statement
covering substantially the same matters with respect to such registration
statement (and the prospectus included therein) and, in the case of the
accountant's comfort letter, with respect to events subsequent to the date of
such financial statements, as are customarily covered in opinions of issuer's
counsel and in accountant's comfort letters delivered to the underwriters in
underwritten public offerings of securities (and dated the dates such opinions
and comfort letters are customarily dated) and, in the case of the accountant's
comfort letter, such other financial matters, and in the case of the legal
opinion, such other legal matters, as the sellers of a majority of the
Registrable Securities covered by such registration statement, or the
underwriters, may reasonably request;
(g) notify each seller of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, upon discovery that, or upon
the happening of any event as a result of which, in the judgment of the Company,
the prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading, in the light of the circum-
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stances under which they were made, and at the request of any such seller
promptly prepare and furnish to it a reasonable number of copies of a supplement
to or an amendment of such prospectus as may be necessary so that, in the
judgment of the Company, as thereafter delivered to the purchasers of such
securities, such prospectus shall not include an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading in the light of the circumstances
under which they were made;
(h) otherwise use its best efforts to comply with all applicable rules
and regulations of the Commission, and make available to its security holders,
as soon as reasonably practicable, an earnings statement covering the period of
at least twelve months, but not more than eighteen months, beginning with the
first full calendar month after the effective date of such registration
statement, which earnings statement shall satisfy the provisions of Section
11(a) of the Securities Act and Rule 158 promulgated thereunder, and promptly
furnish to each such seller of Registrable Securities a copy of any amendment or
supplement to such registration statement or prospectus;
(i) provide and cause to be maintained a transfer agent and registrar
(which, in each case, may be the Company) for all Registrable Securities covered
by such registration statement from and after a date not later than the
effective date of such registration; and
(j) use its best efforts to list all Registrable Securities covered by
such registration statement on any national securities exchange or national
quotations system on which Registrable Securities of the same class covered by
such registration statement are then listed.
The Company may require each seller of Registrable Securities as to
which any registration is being effected to furnish the Company in writing as
promptly as reasonably practicable such information regarding such seller and
the distribution of such securities as the Company may from time to time
reasonably request in writing.
Each Holder agrees that upon receipt of any notice from the Company of
the happening of any event of the kind described in subdivision (g) of this
Section 2.3, such Holder will forthwith discontinue such Holder's disposition of
Registrable Securities pursuant to the registration statement relating to such
Registrable Securities until such Holder's receipt of the copies of the
supplemented or amended
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prospectus contemplated by subdivision (g) of this Section 2.3 and, if so
directed by the Company, will deliver to the Company (at the Company's expense)
all copies, other than permanent file copies, then in such Holder's possession,
of the prospectus relating to such Registrable Securities current at the time of
receipt of such notice.
2.4 Underwritten Offerings.
(a) Requested Underwritten Offerings. If requested by the underwriters
for any underwritten offering by Holders pursuant to a registration requested
under Section 2.1, the Company will enter into an underwriting agreement with
such underwriters for such offering, such agreement to be reasonably
satisfactory in substance and form to the Company, each such Holder and the
underwriters and to contain such representations and warranties by the Company
and such other terms as are generally prevailing in agreements of that type,
including, without limitation, indemnities to the effect and to the extent
provided in Section 2.7. The Holders of the Registrable Securities proposed to
be distributed by such underwriters will cooperate with the Company in the
negotiation of the underwriting agreement and will give consideration to the
reasonable suggestions of the Company regarding the form thereof. Such Holders
to be distributed by such underwriters shall be parties to such underwriting
agreement and may, at their option, require that any or all of the
representations and warranties by, and the other agreements on the part of, the
Company to and for the benefit of such underwriters shall also be made to and
for the benefit of such Holders and that any or all of the conditions precedent
to the obligations of such underwriters under such underwriting agreement be
conditions precedent to the obligations of such Holders . Any such Holder shall
not be required to make any representations or warranties to or agreements with
the Company or the underwriters other than representations, warranties or
agreements regarding such Holder, such Holder's Registrable Securities, such
Holder's intended method of distribution and any other representations required
by law.
(b) Incidental Underwritten Offerings. If the Company proposes to
register any of its securities under the Securities Act as contemplated by
Section 2.2 and such securities are to be distributed by or through one or more
underwriters, the Company will, subject to Section 2.8 hereof, if requested by
any Requesting Holder arrange for such underwriters to include all the
Registrable Securities to be offered and sold by such Requesting Holder among
the securities of the Company to be distributed by such underwriters. The
Holders of Registrable Securities to be distributed by such underwriters shall
be parties to the underwriting agreement between the Company and such
underwriters and may, at their option, require that
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any or all of the representations and warranties by, and the other agreements on
the part of, the Company to and for the benefit of such underwriters shall also
be made to and for the benefit of such Holders and that any or all of the
conditions precedent to the obligations of such underwriters under such
underwriting agreement be conditions precedent to the obligations of such
Holders. Any such Requesting Holder shall not be required to make any
representations or warranties to or agreements with the Company or the
underwriters other than representations, warranties or agreements regarding
such Requesting Holder, such Requesting Holder's Registrable Securities and such
Requesting Holder's intended method of distribution or any other representations
required by law. Notwithstanding the foregoing provisions of this Section
2.4(b), the Company need not include any Registrable Securities of any such
Requesting Holder in an underwritten offering of the Company's securities if the
inclusion of such Requesting Holder's securities, in the opinion of the managing
underwriter for such offering by the Company, might adversely affect such
offering by the Company.
(c) Hold-back Agreements.
(i) In the case of any underwritten public offering by the
Company of shares of Common Stock, each Holder agrees not to effect any
disposition (other than a disposition of Registrable Securities under such
underwritten public offering or a bona fide pledge or a disposition to an
Affiliate of such Holder who agrees to be bound by the provisions of this
paragraph) (a "Disposition") of any Registrable Securities, and not to
effect any such Disposition of any other equity security of the Company or
of any security convertible into or exchangeable or exercisable for any
equity security of the Company (in each case, other than as part of such
underwritten public offering) during the 15 days prior to, and during the
90-day period (or such longer period as may be reasonably requested by the
underwriter of such offering) beginning on, the effective date of such
registration statement (except as apart of such registration); provided
that each Holder has received written notice of such registration at least
15 days prior to such effective date.
(ii) If any registration of Registrable Securities shall be in
connection with an underwritten public offering, the Company agrees (x) not
to effect any public sale or distribution of any of its equity securities
or of any security convertible into or exchangeable or exercisable for any
equity security of the Company (other than any such sale or distribution of
such securities in connection with any merger or consolidation by the
Company or
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any subsidiary of the Company of the capital stock or substantially all the
assets of any other person or in connection with an employee stock option
or other benefit plan) during the 90 days prior to, and during the 180-day
period beginning on, the effective date of such registration statement
(except as part of such registration) and (y) that any agreement entered
into after the date of this Agreement pursuant to which the Company issues
or agrees to issue any privately placed equity securities shall contain a
provision under which Holders of such securities agree not to effect any
Disposition of any such securities during the period referred to in the
foregoing clause (x) (except as part of such registration, if permitted).
2.5 Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement under the Securities Act
pursuant to this Agreement, the Company will give the Holders of Registrable
Securities registered under such registration statement, their underwriters, if
any, and their respective counsel and accountants the opportunity to participate
in the preparation of such registration statement, each prospectus included
therein or filed with the Commission, and, to the extent practicable, each
amendment thereof or supplement thereto, and give each of them such access to
its books and records (to the extent customarily given to underwriters of the
Company's securities) and such opportunities to discuss the business of the
Company with its officers and the independent public accountants who have
certified its financial statements as shall be necessary, in the opinion of such
Holders' and such underwriters' respective counsel, to conduct a reasonable
investigation within the meaning of the Securities Act.
2.6 Limitations, Conditions and Qualifications to Obligations Under
Registration Covenants. The obligation of the Company to use its best efforts to
cause the Registrable Securities to be registered under the Securities Act is
subject to the following limitations, conditions and qualifications.
(a) The Company shall be entitled to postpone for a reasonable period
of time (but not exceeding 180 days, in the case of a registration pursuant to
Section 2.1 or 2.2, and 30 days in the case of a registration pursuant to
Section 2.8) the filing of any registration statement otherwise required to be
prepared and filed by it pursuant to Section 2.1, if the Company determines, in
its reasonable judgment, that such registration and offering (i) would interfere
with any financing, acquisition, merger, consolidation, material joint venture,
corporate reorganization or other material transaction involving the Company or
any of its Affiliates, or (ii) would require premature disclosure of any of the
foregoing transactions (or of the existence
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of negotiations, discussions or pending proposals with respect thereto) or of
any pending or threatened litigation, claim, assessment or governmental
investigation which would be material to the Company, and promptly gives the
Holders requesting registration thereof pursuant to Section 2.1 written notice
of such delay. If the Company shall so postpone the filing of a registration
statement, such Holders of Registrable Securities requesting registration
thereof pursuant to Section 2.1 shall have the right to withdraw the request for
registration by giving written notice to the Company within 30 days after
receipt of the notice of postponement and, in the event of such withdrawal, such
request shall not be counted for purposes of the requests for registration to
which Holders are entitled pursuant to Section 2.1 hereof.
(b) The Company shall not be obligated to effect the registration of
Registrable Securities of any Holder pursuant to Section 2.1, 2.2 or 2.8 unless
such Holder consents to reasonable conditions imposed by the Company, including
without limitation:
(i) conditions prohibiting the sale of shares by such Holder
until the registration shall have been effective for a specified period of
time;
(ii) conditions requiring such Holder to comply with all
prospectus delivery requirements of the Securities Act and with all
anti-stabilization, anti-manipulation and similar provisions of Section 10
of the Exchange Act and any rules issued thereunder by the Commission, and
to furnish to the Company information about sales made in such public
offering;
(iii) conditions prohibiting such Holder from effecting the sale
of shares upon receipt of telegraphic or written notice from the Company
(until further notice) given to permit the Company to correct or update a
registration statement or prospectus; and
(iv) conditions requiring that at the end of the period during
which the Company is obligated to keep the registration statement effective
under Section 2.3(b) or 2.8(c), such Holder shall discontinue sales of
shares pursuant to such registration statement upon receipt of notice from
the Company of its intention to remove from registration the shares covered
by such registration statement that remain unsold, and requiring such
Holder to notify the Company of the number of Registrable Securities
registered that remain unsold promptly upon receipt of notice from the
Company.
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(c) Holders shall use their reasonable best efforts to effect as wide
a distribution of such Registrable Securities as reasonably practicable, and in
no event shall any sale of Registrable Securities be made knowingly to (i) any
Person (including its Affiliates) or (ii) any Persons or entities which are to
the knowledge of such Holders (or to the knowledge of any underwriter for such
Holders) part of any "group" within the meaning of Regulation 13D of the
Exchange Act which includes such purchaser or any of its Affiliates that, after
giving effect to such sale, would beneficially own securities representing more
than 5% of the aggregate voting power of all outstanding voting securities of
the Company. The Holders of such Registrable Securities shall secure the
agreement of their underwriter or underwriters, if any, for such offering to
comply with the foregoing.
2.7 Indemnification.
(a) Indemnification by the Company. In the event of any registration
of any securities of the Company under the Securities Act, the Company will, and
hereby does, indemnify and hold harmless, in the case of any registration
statement filed pursuant to Section 2.1, 2.2 or 2.8, each seller of any
Registrable Securities covered by such registration statement, its directors,
officers, partners, agents and Affiliates and each other Person who participates
as an underwriter in the offering or sale of such securities and each other
Person, if any, who controls such seller or any such underwriter within the
meaning of the Securities Act (a "Controlling Person"), insofar as losses,
claims, damages or liabilities (or actions or proceedings, whether commenced or
threatened, in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in any
registration statement under which such securities were registered under the
Securities Act, any preliminary prospectus, final prospectus or summary
prospectus contained therein, or any amendment or supplement thereto, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein in light of the
circumstances in which they were made not misleading, and the Company will
reimburse such seller and each such director, officer, partner, agent or
affiliate, underwriter and Controlling Person for any legal or any other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, liability, action or proceeding; provided, that
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage, liability (or action or proceeding in respect thereof) or
expense arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
any such preliminary prospectus, final prospectus, summary prospectus, amendment
or
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supplement in reliance upon and in conformity with written information furnished
to the Company through an instrument executed by or on behalf of such seller or
underwriter, as the case may be, specifically stating that it is for use in the
preparation thereof; and provided further, that the Company shall not be liable
to any Person who participates as an underwriter in the offering or sale of
Registrable Securities or any other Person, if any, who controls such
underwriter within the meaning of the Securities Act, in any such case to the
extent that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of such Person's failure to send or give
a copy of the final prospectus, as the same may be then supplemented or amended,
to the Person asserting an untrue statement or alleged untrue statement or
omission or alleged omission at or prior to the written confirmation of the sale
of Registrable Securities to such Person if such statement or omission was
corrected in such final prospectus so long as such final prospectus, and any
amendments or supplements thereto, have been furnished to such underwriter. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of such seller or any such director, officer, partner,
agent or affiliate or Controlling Person and shall survive the transfer of such
securities by such seller.
(b) Indemnification by the Sellers. As a condition to including any
Registrable Securities in any registration statement, the Company shall have
received an undertaking satisfactory to it from the prospective seller of such
Registrable Securities, to indemnify and hold harmless (in the same manner and
to the same extent as set forth in subdivision (a) of this Section 2.7) the
Company, and each director of the Company, each officer of the Company and each
other Person, if any, who controls the Company within the meaning of the
Securities Act (a "Company Controlling Person"), with respect to any statement
or alleged statement in or omission or alleged omission from such registration
statement, any preliminary prospectus, final prospectus or summary prospectus
contained therein, or any amendment or supplement thereto, if such statement or
alleged statement or omission or alleged omission was made in reliance upon and
in conformity with written information furnished to the Company through an
instrument duly executed by such seller specifically stating that it is for use
in the preparation of such registration statement, preliminary prospectus, final
prospectus, summary prospectus, amendment or supplement; provided, however,
that the liability of such indemnifying party under this Section 2.7(b) shall be
limited to the amount of proceeds received by such indemnifying party in the
offering giving rise to such liability. Such indemnity shall remain in full
force and effect, regardless of any investigation made by or on behalf
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of the Company or any such director, officer or Company Controlling Person and
shall survive the transfer of such securities by such seller.
(c) Notices of Claims, etc. Promptly after receipt by an indemnified
party of notice of the commencement of any action or proceeding involving a
claim referred to in the preceding subdivisions of this Section 2.7, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party, give written notice to the latter of the commencement of
such action; provided, however, that the failure of any indemnified party to
give notice as provided herein shall not relieve the indemnifying party of its
obligations under the preceding subdivisions of this Section 2.7, except to the
extent that the indemnifying party is actually prejudiced by such failure to
give notice. In case any such action is brought against an indemnified party,
unless in such indemnified party's reasonable judgment a conflict of interest
between such indemnified and indemnifying parties is reasonably likely to exist
in respect of such claim, the indemnifying party shall be entitled to
participate in and, to assume the defense thereof, jointly with any other
indemnifying party similarly notified to the extent that it may wish, with
counsel reasonably satisfactory to such indemnified party, and after notice from
the indemnifying party to such indemnified party of its election so to assume
the defense thereof, the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses subsequently incurred by the
latter in connection with the defense thereof other than reasonable costs of
investigation unless in such indemnified party's reasonable judgment a conflict
of interest between such indemnified and indemnifying parties arises in respect
of such claim after the assumption of the defense thereof and the indemnified
party notifies the indemnifying party of such indemnified party's judgment and
the basis therefor. No indemnifying party shall be liable for any settlement of
any action or proceeding effected without its written consent, which consent
shall not be unreasonably withheld. No indemnifying party shall, without the
consent of the indemnified party, consent to entry of any judgment or enter into
any settlement which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release from
all liability in respect of such claim or litigation.
(d) Contribution. If the indemnification provided for in this Section
2.7 shall for any reason be held by a court to be unavailable to an indemnified
party under subparagraph (a) or (b) hereof in respect of any loss, claim, damage
or liability, or any action in respect thereof, then, in lieu of the amount
paid or payable under subparagraph (a) or (b) hereof, the indemnified party and
the indemnifying party under subparagraph (a) or (b) hereof shall contribute to
the aggregate losses, claims,
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damages and liabilities (including legal or other expenses reasonably incurred
in connection with investigating the same), (i) in such proportion as is
appropriate to reflect the relative fault of the Company and the prospective
sellers of Registrable Securities covered by the registration statement which
resulted in such loss, claims, damage or liability, or action in respect
thereof, with respect to the statements or omissions which resulted in such
loss, claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as shall
be appropriate to reflect the relative benefits received by the Company and such
prospective sellers from the offering of the securities covered by such
registration statement. 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. Such prospective sellers' obligations to contribute as
provided in this subparagraph (d) are several in proportion to the relative
value of their respective Registrable Securities covered by such registration
statement and not joint. In addition, no Person shall be obligated to contribute
hereunder any amounts in payment for any settlement of any action or claim
effected without such Person's consent, which consent shall not be unreasonably
withheld.
(e) Other Indemnification. Indemnification and contribution similar to
that specified in the preceding subdivisions of this Section 2.7 (with
appropriate modifications) shall be given by the Company and each seller of
Registrable Securities with respect to any required registration or other
qualification of securities under any Federal or state law or regulation of any
governmental authority other than the Securities Act.
(f) Indemnification Payments. The indemnification and contribution
required by this Section 2.7 shall be made by periodic payments of the amount
thereof during the course of the investigation or defense, as and when bills are
received or expense, loss, damage or liability is incurred. In any case in which
it shall be judicially determined that a party is not entitled to
indemnification or contribution, any payments previously received by such party
hereunder shall be promptly reimbursed.
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2.8 Shelf Registration Statements.
(a) Within 120 days of the date hereof, the Company shall have filed
with the Commission and shall use its best efforts to cause to be declared
effective within 180 days from the date hereof, a Shelf Registration Statement,
relating to the offer and sale of the Registrable Securities owned by the
Holders listed on Schedule A hereto.
(b) The Company will use its best efforts to keep the Shelf
Registration Statement continuously effective in order to permit the prospectus
forming part thereof to be usable by such Holders for a period of three years
from the date such Shelf Registration Statement is first declared effective by
the Commission, or for such shorter period that will terminate when all
Registrable Securities covered by such Shelf Registration Statement have been
sold pursuant thereto or cease to be outstanding or otherwise to be Registrable
Securities.
(c) The Company will pay the Registration Expenses in connection with
any Shelf Registration Statement pursuant to this Section 2.8.
3. Definitions. As used herein, unless the context otherwise requires, the
following terms have the following respective meanings (capitalized terms used
but not defined herein having the meanings set forth in the Stockholders
Agreement):
"Affiliate" shall have the meaning ascribed to such term in Rule 12b-2 of
the General Rules and Regulations under the Exchange Act.
"Commission" means the Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, or
any similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time. Reference to a
particular section of the Securities Exchange Act of 1934, as amended, shall
include a reference to the comparable section, if any, of any such similar
Federal statute.
"Holder" means any holder of Registrable Securities.
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"Person" means a corporation, an association, a partnership, an
organization, a business, an individual, a governmental or political subdivision
thereof or a governmental agency.
"Registration Expenses" means all expenses incident to the Company's
performance of or compliance with Section 2, including, without limitation, all
registration, filing and fees of the National Association of Securities Dealers,
Inc., all listing fees, all fees and expenses of complying with securities or
blue sky laws (including, without limitation, reasonable fees and disbursements
of counsel for the underwriters in connection with blue sky qualifications of
the Registrable Securities), all word processing, duplicating and printing
expenses, messenger and delivery expenses, the fees and disbursements of counsel
for the Company and of its independent public accountants, including the
expenses of "cold comfort" letters required by or incident to such performance
and compliance, any fees and disbursements of underwriters (including, without
limitation, fees and expenses of counsel to the underwriters) customarily paid
by issuers or sellers of securities and the reasonable fees and expenses of one
counsel to the Selling Holders (selected by Selling Holders representing at
least a majority of the Registrable Securities covered by such registration);
provided, however, that Registration Expenses shall exclude, and the sellers of
the Registrable Securities being registered shall pay, underwriters' fees and
underwriting discounts and commissions and transfer taxes in respect of the
Registrable Securities being registered.
"Registrable Securities" means (i) the shares of Common Stock and the
shares of Common Stock issuable upon conversion of the Series A Preferred Stock
held or otherwise acquired by the Investors (including by way of issuance upon
exercise or conversion of any warrants or other securities) and (ii) any Common
Stock of the Company issuable or issued with respect to the Common Stock, the
Series A Preferred Stock and/or warrants or other securities referred to in
clause (i) by way of a merger, consolidation, stock split, stock dividend,
recapitalization of the Company or similar transaction. As to any particular
Registrable Securities, once issued such securities shall cease to be
Registrable Securities when (a) a registration statement with respect to the
sale of such securities shall have become effective under the Securities Act and
such securities shall have been disposed of in accordance with such
registration statement, (b) they shall have been sold as permitted by, and in
compliance with, Rule 144 (or successor provision) promulgated under the
Securities Act, (c) they shall have been otherwise transferred, new certificates
for them not bearing a legend restricting further transfer under the Securities
Act shall have been delivered by the Company and subsequent public distribution
of them
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shall not require registration of them under the Securities Act, or (d) they
shall have ceased to be outstanding.
"Required Number of Shares" means shares of Common Stock (or securities
convertible into or exchangeable or exercisable for Common Stock) representing a
total of 1,000,000 shares of Common Stock, subject to adjustment as provided in
Section 12.
"Securities Act" means the Securities Act of 1933, as amended, or any
similar Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time. References to a
particular section of the Securities Act of 1933, as amended, shall include a
reference to the comparable section, if any, of any such similar Federal
statute.
"Shelf Registration Statement" means either Shelf Registration Statement
No. 1 or Shelf Registration Statement No. 2.
"Shelf Registration Statement" shall mean a "shelf" registration statement
of the Company filed pursuant to Section 2.8, on an appropriate form under Rule
415 under the Securities Act, or any similar rule that may be adopted by the
Commission, and all amendments and supplements to such registration statement,
including post-effective amendments, in each case including the prospectus
contained therein, all exhibits thereto and all material incorporated by
reference therein.
"Stockholders Agreement" shall mean the Amended and Restated Stockholders
Agreement dated the date hereof between the Company and the stockholders listed
on the signature pages thereof.
4. Rule 144. The Company shall take all actions reasonably necessary to
enable Holders of Common Stock or Series A Preferred Stock to sell such
securities without registration under the Securities Act within the limitation
of the exemptions provided by (a) Rule 144 under the Securities Act, as such
Rule may be amended from time to time, or (b) any similar rule or regulation
hereafter adopted by the Commission including, without limiting the generality
of the foregoing, filing on a timely basis all reports required to be filed by
the Exchange Act. Upon the request of any Holder of Common Stock or Series A
Preferred Stock, the Company will deliver to such Holder a written statement as
to whether it has complied with such requirements.
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5. Amendments and Waivers. This Agreement may be amended with the consent
of the Company and the Company may take any action herein prohibited, or omit to
perform any act herein required to be performed by it, only if the Company shall
have obtained the written consent to such amendment, action or omission to act,
of :
(i) the Holders of at least a majority of the Registrable Securities
(calculated on a fully diluted basis);
(ii) GE Capital Equity Investments, Inc. (collectively, with General
Electric Capital Corporation, "GECC"), in the event GECC beneficially owns at
least 2,000,000 shares of Registrable Securities; and
(iii) TH Xxx.Xxxxxx Internet Partners, L.P. and TH Xxx.Xxxxxx Internet
Parallel Partners, L.P. (collectively with their affiliates, "THLi"), in the
event THLi beneficially owns at least 2,000,000 shares of Registrable
Securities.
Each beneficial owner of any Registrable Securities at the time or thereafter
outstanding shall be bound by any consent authorized by this Section 5, whether
or not such Registrable Securities shall have been marked to indicate such
consent.
6. Nominees for Beneficial Owners. In the event that any Registrable
Securities are held by a nominee for the beneficial owner thereof, the
beneficial owner thereof may, at its election in writing delivered to the
Company, be treated as the Holder of such Registrable Securities for purposes of
any request or other action by any Holder or Holders pursuant to this Agreement
or any determination of any number or percentage of Registrable Securities held
by any Holder or Holders contemplated by this Agreement. If the beneficial owner
of any Registrable Securities so elects, the Company may require assurances
reasonably satisfactory to it of such owner's beneficial ownership of such
Registrable Securities.
7. Notices. All communications provided for hereunder shall be sent by
courier or other overnight delivery service, shall be effective upon receipt,
and shall be addressed as follows:
(a) if to an Investor, at such address as the Investor shall have
furnished to the Company in writing;
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21
(b) if to any other Holder , at the address that such Holder shall
have furnished to the Company in writing, or, until any such other holder so
furnishes to the Company an address, then to and at the address of the last
Holder of such Registrable Securities who has furnished an address to the
Company; or
(c) if to the Company, addressed to it at Xxxxxx'x Furniture, Inc. 000
Xxxxx Xxxxx Xxxxxx, Xxxx, XX 00000-0000, Attention: Xxxxxx X. Xxxxxx, Esq. or at
such other address as the Company shall have furnished to each Holder at the
time outstanding.
8. Assignment; Calculation of Interests in Registrable Securities.
(a) This Agreement shall be binding upon and inure the benefit of and
be enforceable by the parties hereto and, with respect to the Company, its
respective successors and assigns and, with respect to the Investors, any
beneficial owner of any Registrable Securities, subject to the provisions
respecting the minimum number or proportion of shares of Registrable Securities
required in order to be entitled to certain rights, or take certain actions,
contained herein.
(b) All references to Registrable Securities shall be calculated as if
all shares of Series A Preferred Stock had been converted into shares of Common
Stock as of the date of such calculation; provided, that any proportion of the
Registrable Securities necessary to be determined in connection with a specific
registration shall be calculated based upon the number of Registrable Securities
participating in such registration only (assuming any shares of Series A
Preferred Stock had been converted into shares of Common Stock.)
9. Descriptive Headings. The descriptive headings of the several sections
and paragraphs of this Agreement are inserted for reference only and shall not
limit or otherwise affect the meaning hereof.
10. Governing Law; Consent to Jurisdiction. This Agreement shall be
governed by and construed in accordance with the laws of the State of New York,
including, without limitation, Sections 5-1401 and 5-1402 of the New York
General Obligations Law and New York Civil Practice Laws and Rules 327(b). Each
of the parties hereto hereby irrevocably and unconditionally consents to submit
to the exclusive jurisdiction of the courts of the State of New York and of the
United States of America, in each case located in the County of New York, for
any action, proceeding or investigation in any court or before any governmental
authority ("litigation")
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arising out of or relating to this Agreement and the transactions contemplated
hereby (and agrees not to commence any litigation relating thereto except in
such courts), and further agrees that service of any process, summons, notice or
document by U.S. Registered Mail to its respective address set forth in this
Agreement shall be effective service of process for any litigation brought
against it in any such court. Each of the parties hereto hereby irrevocably and
unconditionally waives any objection to the laying of venue of any litigation
arising out of this Agreement or the transactions contemplated hereby in the
courts of the State of New York or the United States of America, in each case
located in the County of New York, and hereby further irrevocably and
unconditionally waives and agrees not to plead or claim in any such court that
any such litigation brought in any such court has been brought in an
inconvenient forum. Each of the parties irrevocably and unconditionally waives,
to the fullest extent permitted by applicable law, any and all rights to trial
by jury in connection with any litigation arising out of or relating to this
Agreement or the transactions contemplated hereby.
11. No Inconsistent Agreements. The Company will not hereafter enter into
any agreement with respect to its securities which is inconsistent with the
rights granted to the Holders in this Agreement.
12. Recapitalizations, etc. In the event that any capital stock or other
securities are issued in respect of, in exchange for, or in substitution of, any
Registrable Securities by reason of any reorganization, recapitalization,
reclassification, merger, consolidation, spin-off, partial or complete
liquidation, stock dividend, split-up, sale of assets, distribution to
stockholders or combination of the shares of Registrable Securities or any other
change in the Company's capital structure, appropriate adjustments shall be made
in this Agreement so as to fairly and equitably preserve, to the extent
practicable, the original rights and obligations of the parties hereto under
this Agreement. At the request of the Selling Holders of a majority of
Registrable Securities in connection with any registration pursuant to Section
2.1 hereof, the Company will effect such adjustments to the outstanding Common
Stock, by way of stock split or stock dividend as the Selling Holders may
reasonably request to facilitate the registration and sale of the Common Stock.
13. Attorneys' Fees. In any action or proceeding brought to enforce any
provision of this Agreement, or where any provision hereof is validly asserted
as a defense, the prevailing party to such action or proceeding shall be
entitled to recover reasonable attorneys' fees in addition to any other
available remedy.
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14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be executed and delivered by their respective officers thereunto
duly authorized as of the date first above written.
XXXXXX'X FURNITURE, INC.
By:
------------------------------------
Name:
Title:
25
GE CAPITAL EQUITY INVESTMENTS, INC.
By:
------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx, Xx.
Title: Senior Vice President
GENERAL ELECTRIC CAPITAL CORPORATION
By:
------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx, Xx.
Title: Department Operations Manager
26
PERMAL CAPITAL MANAGEMENT, INC.
By:
------------------------------------
Name:
Title:
PERMAL SERVICES, INC.
By:
------------------------------------
Name:
Title:
PERMAL CAPITAL PARTNERS, L.P.
By: PERMAL MANAGEMENT CORPORATION,
its Investment Manager
By:
------------------------------------
Name:
Title:
PERMAL ASSET MANAGEMENT
By:
------------------------------------
Name:
Title:
PERMAL SPECIAL OPPORTUNITIES, LTD.
By:
------------------------------------
Name:
Title:
00
XXXXX OMNIBUS LTD.
By:
------------------------------------
Name:
Title:
XXXX X. XXXXXXXX
By:
------------------------------------
XXXXX XXXXXX SOUEDE
By:
------------------------------------
XXXXXX X. XXXXXXX
By:
------------------------------------
XXXXXX X. AND XXXXX X. XXXXXXX
By:
------------------------------------
Name: Xxxxxx X. XxXxxxx
By:
------------------------------------
Name: Xxxxx X. XxXxxxx
28
UNITED GULF BANK (B.S.C.) E.C.
By:
------------------------------------
Name:
Title:
KUWAIT INVESTMENT PROJECTS COMPANY
By:
------------------------------------
Name:
Title:
ATCO HOLDINGS, LTD.
By:
------------------------------------
Name:
Title:
ATCO DEVELOPMENT, INC.
By:
------------------------------------
Name:
Title:
29
PILOT HOLDINGS, L.P.
By: SHED INVESTMENTS, LLC, its General
Partner
By:
------------------------------------
Name: Xxxxxx X. XxXxxxx
Title: Managing Member
30
XXXXXXX XXXXX XXXXXX TRUST I
By:
------------------------------------
Name:
Title:
XXXXXXX XXXX XXXXXX TRUST I
By:
------------------------------------
Name:
Title:
XXXXXXX XXXX XXXXXX TRUST I
By:
------------------------------------
Name:
Title:
XXXXXXX XXXXXX XXXXXX TRUST I
By:
------------------------------------
Name:
Title:
XXXXXX FAMILY TRUST
By:
------------------------------------
Name:
Title:
31
XX. XXXXXX X. XXXXXX, XX.
By:
------------------------------------
XXXXXX X. XXXXXX
By:
------------------------------------
32
TH XXX.XXXXXX INTERNET PARTNERS, L.P.
By: TH XXX.XXXXXX INTERNET FUND
ADVISORS, L.P., its General Partner
By: TH XXX.XXXXXX INTERNET FUND
ADVISORS, LLC, its General Partner
By:
------------------------------------
Name: Xxxxxxxxx Xxx
Title: Vice President
TH XXX.XXXXXX INTERNET PARALLEL
PARTNERS, L.P.
By: TH XXX.XXXXXX INTERNET FUND
ADVISORS, L.P., its General Partner
By: TH XXX.XXXXXX INTERNET FUND
ADVISORS, LLC, its General Partner
By:
------------------------------------
Name: Xxxxxxxxx Xxx
Title: Vice President
33
SCHEDULE A
Ascend Partners, L.P.
Xxxxx Xxxxx
Xxxxxxx Revocable Trust
Xxxxxxx Xxxxxxx Xxxxxx - XXX
Xxxxxxx X. Xxxxx
Xxxxx X. Xxxxx, UTMA, CA
Xxxxx X. Xxxxx, UTMA, CA
Xxxx X. Xxx
Xxxx Xxxxxx
Diamond A. Partners, L.P.
J. Xxxxxx Xxxxxxx
Xxxxx Xxxxxxxxx - XXX
Xxxxxxx Xxxxxxxxx - XXX
Xxxxxxx X. and Xxxxxxxx X. Xxxxxx
Xxxxxxxx & Xxxxx Xxxxxx Family Trust
Xxxxxx X. Xxxxxx
Xxxxxxx Xxxxx Xxxxxx Trust I
Xxxxxxx Xxxx Xxxxxx Trust I
Xxxxxx Family Trust
Xxxxxxx Xxxx Xxxxxx Trust I
Xxxxxxx Xxxxxx Xxxxxx Trust I
Xxxxxx X. Xxxxxx
Xx. Xxxxxx Xxxxxx, Xx.
Xxxxxx X. Xxxxxx
Xxxxxxx Xxxxx
Xxxxxxx Xxxxxxx Trust
Xxxxx Xxxxxxx
Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx Professional Corporation Defined Benefit Plan
Xxxx Xxxxxxx
Xxxxxx Xxxxxx
Xxxxxxxx X. Xxxxxxxxx
Xxxxx Xxxx
Xxxxxx London
Xxxxxxx X. Xxxxxx
The Muhl Family Trust
Pacific Security Group, Inc.
34
Pilot Holdings, L.P.
Pointe Investments Capital, Ltd.
Pollat, Xxxxx & Co., Inc.
Xxxxx and Xxxx Xxxxxxxxx
Xxxxxxx X. Xxxxxxx, Xx.
Xxxxxxx X. Xxxxxxx, III
G. Xxxxx Xxxxxxx.
Lord Xxxxx Xxxxxxx
Xxxxxxx Xxxxxxx Xxxxxxx
Wave Enterprises, Inc.
Xxx Xxxxxxxxxx
X.X. Xxxxx
Zaxis Partners, L.P.
Schedule A - 2
