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EXHIBIT G
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") dated as of March
9, 2001, by and among Xxxx'x, Inc., a Delaware corporation (together with its
subsidiaries, the "Company"), Xxxxxx X. Xxxxxx and Xxxxxxxxxxx X. Xxxxxx, each
an individual residing in Houston, Texas (together, the "Purchaser").
RECITALS:
This Agreement is made pursuant to the Purchase Agreement, dated as of
March 9, 2001, between the Company and Purchaser (the "Purchase Agreement"). In
order to induce the Purchaser to enter into the Purchase Agreement, the Company
has agreed to provide the registration rights set forth in this Agreement.
AGREEMENT:
The parties hereto hereby agree as follows:
1. DEFINITIONS.
(a) As used in this Agreement, the following terms will have the
following meanings:
"AFFILIATE" means, with respect to any Person, a Person
directly or indirectly controlling, controlled by, or under common
control with such Person. For purposes hereof "control," (and the
correlative terms "controlling", "controlled by" and "under common
control with" means the possession, directly or indirectly, through one
or more intermediaries, by any Person or group (within the meaning of
Section 13(d)(3) under the Exchange Act) of the power or authority,
through ownership of voting securities, by contract or otherwise, to
control or direct the management and policies of the entity.
"AGREEMENT" has the meaning set forth in the recitals hereto.
"COMMON STOCK" means shares of the Company's Common Stock par
value $.32 per share and any capital stock for or into which such
Common Stock is hereafter exchanged, converted, or reclassified into.
"COMPANY" has the meaning set forth in the recitals hereto.
"DEMAND REGISTRATION" has the meaning set forth in Section
3(a).
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended from time to time and the rules and regulations of the SEC
promulgated thereunder.
"MAJORITY" means 51% or more.
"NOTES" means the Convertible Subordinated Notes due 2011 of
the Company issued pursuant to the Purchase Agreement.
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"OPTIONS" means the employee stock options issued to
Purchasers in connection with their employment by the Company pursuant
to the Employment Agreements of even date herewith.
"PERSON" means any individual, partnership, corporation,
limited liability company, trust or unincorporated organization, or a
government or agency or political subdivision thereof or any other
entity of any kind.
"PURCHASE AGREEMENT" has the meaning set forth in the recitals
hereto.
"PURCHASER" has the meaning set forth in the recitals hereto.
"REGISTRATION EXPENSES" has the meaning set forth in Section
7(a).
"REGISTRATION NOTICE" has the meaning set forth in Section
3(a).
"REGISTRABLE SECURITIES" means (i) the shares of Common Stock
issued or issuable upon conversion of the Notes or exercise of the
Options; (ii) shares of Common Stock issued or issuable as interest on
the Notes; and (iii) any securities issued with respect thereof by way
of conversion, dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise; provided, however, a Registrable Security
shall cease to be a Registrable Security to the extent so provided in
Section 2(a).
"SECURITIES ACT" means the Securities Act of 1933, as amended
from time to time and the rules and regulations of the SEC promulgated
thereunder.
"SEC" means the Securities and Exchange Commission.
"UNDERWRITTEN REGISTRATION" or "UNDERWRITTEN OFFERING" means
any registration in which securities of the Company are sold pursuant
to a firm commitment underwriting.
2. SECURITIES SUBJECT TO THIS AGREEMENT.
(a) Registrable Securities. The securities entitled to the
benefits of this Agreement are the Registrable Securities but, with respect to
any particular Registrable Security, only so long as such security continues to
be a Registrable Security. A Registrable Security shall cease to be a
Registrable Security when (i) it has been disposed of in a transaction
registered under the Securities Act, (ii) it has been sold pursuant to Rule 144
(or any similar provisions then in force) under the Securities Act, (iii) it has
otherwise been reissued, transferred or exchanged and a new certificate or other
evidence of ownership for it that does not bear a legend restricting further
transfer has been delivered (not subject to any stop transfer order) by or on
behalf of the Company, (iv) an opinion of counsel to the Company, reasonably
satisfactory to the holder of such Registrable Security, shall have been
delivered to such holder, or an opinion of counsel to the holder of such
Registrable Security, reasonably satisfactory to the Company, shall have been
delivered to the Company, in either case to the effect that the subsequent
disposition of such
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Registrable Security may be made pursuant to Rule 144(k) promulgated under the
Securities Act (or any successor provision), or (v) it has been sold or
transferred in a private transaction in which the transferor's rights under this
Agreement are not assigned.
(b) Holders of Registrable Securities. A Person is deemed to be a
holder of Registrable Securities whenever such Person owns Registrable
Securities or has the right to acquire such Registrable Securities.
3. DEMAND REGISTRATION.
(a) Requests for Registration. Subject to the provisions of
Section 3(b), at any time after the earlier of (i) October 1, 2002, or (ii) the
acquisition of Registrable Securities, any holder or holders of a Majority (by
number of shares) of the then outstanding Registrable Securities may request by
written notice to the Company ("Registration Notice") a registration by the
Company under the Securities Act of all or part of its or their Registrable
Securities (a "Demand Registration") be effected provided that the number of
Registrable Shares then requested to be registered shall be equal to at least 1%
of the Company's then outstanding Common Stock. Within ten days after receipt of
such request, the Company will provide written notice of such registration
request to all holders of Registrable Securities and will, subject to the
provisions of Section 2(a) and Section 3(b), include in such registration all
Registrable Securities with respect to which the Company has received written
requests for inclusion therein within 15 days after distribution to the
applicable holder of the Company's notice. All requests made pursuant to this
Section 3(a) will specify the amount of Registrable Securities to be registered
and will also specify the intended method of disposition thereof; provided,
however, that such method of disposition will be limited to an underwritten
offering if so requested by the holders of the Registrable Securities who
initiated the request.
(b) Number of Registrations. The holders of Registrable Securities
will be entitled to request an aggregate of three Demand Registrations. A
registration initiated as a Demand Registration will not constitute a Demand
Registration (i) unless such registration has been declared effective by the SEC
and remains effective for the period set forth in Section 6(a)(iii), and (ii) if
after such registration has been declared effective by the SEC it is subject to
any stop order, injunction or other adverse order or action of the SEC or other
governmental authority which is not removed within 15 days.
(c) Registration Expenses. Except as provided in Section 3(d), in
any registration initiated as a Demand Registration, the Company will pay all
Registration Expenses, whether or not the registration has been declared
effective; provided, however, the Company shall not be required to pay for any
such Registration Expenses if the request for registration is subsequently
withdrawn at any time by a Majority (by number of shares to be registered) of
the initiating holder(s) of Registrable Securities (in which case the initiating
holders shall bear such expenses).
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(d) No Rights of Company or Other Securityholders to Piggyback on
Demand Registrations. Neither the Company nor any of its securityholders (other
than the holders of Registrable Securities in such capacity) has any right to
include any of the Company's securities in a registration statement initiated as
a Demand Registration under this Section 3 if such Demand Registration is for an
underwritten offering unless (i) such securities are of the same class as the
Registrable Securities being registered, the (ii) managing underwriters agree
that some or all of such securities can be included without adversely affecting
the offering of the Registrable Securities or the offering price for the
Registrable Securities and (iii) the Company, or the selling securityholders, as
applicable, agree to sell their securities on the same terms and conditions as
apply to the Registrable Securities and the holders of such Registrable
Securities. If any securityholders of the Company (other than the holders of
Registrable Securities in such capacity) register securities of the Company in a
Demand Registration (in accordance with the provisions of this Section 3(d)),
such securityholders will pay the fees and expenses of counsel to such
securityholders and their pro rata share of the Registration Expenses if such
pro rata share of the Registration Expenses for such registration are not paid
by the Company for any reason.
(e) Priority on Demand Registrations. If a Demand Registration is
for an underwritten offering and the managing underwriters advise the Company
and the selling holders of the Registrable Securities in writing that in their
opinion the number of Registrable Securities requested to be included exceeds
the number of securities which can be sold in such offering without adversely
affecting the proposed offering or the offering price, the Company will include
in such registration the number of Registrable Securities which in the opinion
of such underwriters can be sold without adversely affecting the proposed
offering or the offering price, and such securities will be allocated pro rata
among the holders of Registrable Securities on the basis of the number of the
Registrable Securities requested to be included in such registration by their
respective holders. If securities (other than Registrable Securities) are
proposed to be included by the Company or its other securityholders in a Demand
Registration which is for an underwritten offering (subject to and in accordance
with the provisions of Section 3(d)) and the managing underwriters advise the
Company and the selling holders of Registrable Securities in writing that some
but not all of said other securities can be sold without adversely affecting the
proposed offering or the offering price in such underwritten offering, in
addition to all of the Registrable Securities being registered, those securities
which are permitted to be included will be allocated (i) first, to the Company
and (ii) second, to the securityholders of such securities, allocated among them
in such proportions as such securityholders and the Company may agree or if they
cannot so agree as the Company shall determine. The Company and any such
securityholders may withdraw their securities from a Demand Registration;
provided, however, if the Demand Registration is for an underwritten offering,
they may do so only on the reasonable and customary terms agreed upon by the
managing underwriters for such offering.
(f) Selection of Underwriters. If any Demand Registration is for
an underwritten offering, or a best efforts underwritten offering, the
investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the holders of a Majority of the
Registrable Securities requested to be included in such offering; provided,
however, such investment bankers and managers must be reasonably satisfactory to
the Company.
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(g) Other Registration Rights Agreements. Without the prior
written consent of the holders of a Majority of the then outstanding Registrable
Securities, the Company will neither enter into any new registration rights
agreements that conflict with the terms of this Agreement nor permit the
exercise of any other registration rights in a manner that conflicts with the
terms of the registration rights granted hereunder.
4. REGISTRATION FOR CONTINUOUS SALES.
As to any of their Demand Registration rights provided in Section 3,
holders of a Majority of the Registrable Securities shall be entitled to request
in the Registration Notice that the Company register for resale, in accordance
with Rule 415 under the Securities Act (or any successor rule thereunder) all or
a portion of their Registrable Securities on Form S-3 (or any similar short form
registration) if the Company and the transaction then qualify for the use of
such short form registration. On receipt of the Registration Notice, the Company
will notify all of the holders of Registrable Securities entitled to notice of a
proposed registration pursuant to Section 3(a) of such request. Upon receipt by
the Company of the Registration Notice, the Company will, subject to Section 5
and Section 11(a), use its reasonable best efforts to file a registration
statement on Form S-3 (or any similar short form registration) in accordance
with the terms of this Section 4 and Section 6 as soon as practicable after
receipt of such Registration Notice. The Company will, subject to Sections 5 and
11(a), use its reasonable best efforts to maintain the effectiveness of the
registration statement until the first anniversary of the effectiveness of such
registration statement or such earlier date when all the Registrable Securities
covered by such registration statement are sold. All Registration Expenses shall
be borne by the Company. A holder of Registrable Securities that are covered by
a registration statement pursuant to this Section 4 will give the Company at
least 24 hours written notice prior to any resales by such holder thereunder.
5. DEFERRAL OF FILING; SUSPENSION OF SHELF REGISTRATION STATEMENT.
(a) Deferral of Filing. Anything herein to the contrary
notwithstanding, the Company may defer the filing of any registration statement
otherwise required to be filed by it pursuant to Section 3 or Section 4 if (i)
the Company notifies each requesting holder that it is in good faith
contemplating filing a registration statement for an underwritten offering of
Common Stock or a security convertible into Common Stock within 60 days of its
receipt for the demand for registration or (ii) the Company notifies each
requesting holder that the Company's Board of Directors has determined that the
requested registration and offering would require disclosure of pending matters
or information the disclosure of which would likely be materially detrimental to
the Company or materially interfere with its business or a financing,
acquisition, corporate reorganization or other material transaction involving
the Company or that appropriate financial statements will not be available when
registration is requested. In the case of clause (i) of this Section 5(a), the
Company shall use its reasonable best efforts, as soon as practicable, upon the
first to occur of the abandonment of such contemplated registration statement or
the expiration of such 60 day period, to register the Registrable Securities
which it otherwise would be obligated to register pursuant to Section 3 or
Section 4, unless the demand for registration is withdrawn or the Company has
filed the contemplated registration statement. In the case of clause (ii) of
this Section 5(a), the Company may delay the filing of the registration
statement otherwise required
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by Section 3 or Section 4 for a reasonable period of time not to exceed 120
days. If the Company shall so defer the filing of a registration statement, the
requesting holders may, within 20 days after its receipt of written notice of
the deferral, withdraw its request for registration by giving written notice to
the Company (and, in the event of such withdrawal, such request shall not be
counted for purposes of determining the number of requests for registration to
which the holders of Registrable Securities are entitled hereunder and the
provisions of the proviso contained in Section 3(c) hereof will not apply). In
addition to the foregoing deferral rights, the Company shall not be required to
file any registration statement pursuant to Section 3 or Section 4 (i) within
120 days after the effectiveness of a registration statement relating to a
Demand Registration or (ii) within 120 days after the effectiveness of a
registration statement filed by the Company.
(b) Suspension of Shelf Registration Statement. In addition, if
the Company receives notice of a proposed sale under a shelf registration
statement filed pursuant to Section 4, the Company may give notice to the holder
requesting such sale that such sale under such shelf registration statement must
be deferred and not made for a reasonable period of time (not to exceed 120
days) after the date of receipt by the Company of such notice of proposed sale
if, at the time the Company receives such notice, the Company is engaged in
confidential negotiations or other confidential business activities, disclosure
of which would be required to be made in the prospectus included in such shelf
registration statement (but would not be required if such sale were not made) in
order to prevent such prospectus from containing any untrue statement of a
material fact or omitting to state any material fact necessary to make the
statements therein not misleading and the Company has determined in its
reasonable judgment that such disclosure would be materially detrimental to the
Company or would likely materially interfere with its business or a financing,
acquisition, corporate reorganization or other material transaction involving
the Company. Each holder of Registrable Securities agrees that, upon receipt of
any such notice from the Company pursuant to this Section 5(b), such holder
shall forthwith discontinue the disposition of Registrable Securities pursuant
to such shelf registration statement for the period of time contemplated by this
Section 5(b). A deferral of such proposed sale pursuant to this Section 5(b)
shall be lifted, and the sale may be forthwith made if the negotiations or other
activities are disclosed by the Company or terminated. The running of the period
provided for in Sections 4 and 6(a)(iii) hereof during which the Company is
required to maintain the effectiveness of a shelf registration shall be tolled
for the period for which there is a deferral of sale under this Section 5(b).
6. REGISTRATION PROCEDURES.
(a) Subject to the terms hereof, whenever the holders of
Registrable Securities have requested that any Registrable Securities be
registered in accordance with the terms and conditions of this Agreement, the
Company will use its reasonable best efforts to effect the registration and to
permit the sale of such Registrable Securities in accordance with the intended
method of disposition thereof, and pursuant thereto the Company will as
expeditiously as possible:
(i) prepare and file with the SEC, subject to the
availability of all required consents of independent accountants (which
the Company agrees to use its reasonable
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best efforts to obtain), not later than 30 days after receipt of a
request to file a registration statement with respect to such
Registrable Securities, a registration statement, including required
exhibits thereto, with respect to such Registrable Securities, and use
its reasonable best efforts to cause such registration statement to
become effective; each such registration statement will be on a form
for which the Company then qualifies, which is available for the sale
of the Registrable Securities in accordance with the intended method of
disposition thereof and which is reasonably satisfactory to the holders
of a Majority of the Registrable Securities being registered (or the
managing underwriters in the case of a firm or best efforts
underwriting offering);
(ii) notify each seller of Registrable Securities of any
stop order issued by the SEC and take all reasonable actions required
to prevent the entry of such stop order or to remove it at the earliest
possible time if entered;
(iii) prepare and file with the SEC 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 for a period of not less than 90 days (or not less
than one year in the case of registration on Form S-3 pursuant to
Section 4 hereof) or such shorter period as may be required if all
Registrable Securities covered by such registration statement are sold
prior to the expiration of such 90-day period or one year period, as
the case may be (except in connection with an underwritten offering, in
which case such registration statement shall be kept effective as long
as the underwriters reasonably request in the underwriting agreement),
and comply with the provisions of the Securities Act with respect to
the disposition of all securities covered by such registration
statement during such period in accordance with the intended methods of
disposition by the sellers thereof set forth in such registration
statement;
(iv) furnish to each seller of Registrable Securities such
number of copies of such registration statement, each amendment and
supplement thereto (in each case including all exhibits thereto), the
prospectus included in such registration statement (including each
preliminary prospectus) and such other documents as such seller may
reasonably request in order to facilitate the disposition of the
Registrable Securities owned by such seller;
(v) use its reasonable best efforts to register or
qualify such Registrable Securities under such other securities or blue
sky laws of such jurisdictions within the United States as any seller
requests and do any and all other acts and things which may be
reasonably necessary or advisable to enable such seller to consummate
the disposition in such jurisdictions of the Registrable Securities
owned by such seller; provided, however, that the Company will not be
required to (i) qualify generally to do business in any jurisdiction
where it would not otherwise be required to qualify but for this
Section 6(a)(v), (ii) subject itself to taxation in any such
jurisdiction or (iii) consent to general service of process in any such
jurisdiction;
(vi) use its reasonable best efforts to cause the
Registrable Securities covered by such registration statement to be
registered with or approved by such other governmental agencies or
authorities within the United States as may be necessary to
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enable the seller or sellers thereof to consummate the disposition of
such Registrable Securities;
(vii) notify each seller of such Registrable Securities, at
any time when a prospectus relating thereto is required to be delivered
under the Securities Act, of the happening of any event of which the
Company is aware as a result of which the prospectus included in such
registration statement or any document incorporated therein by
reference contains an untrue statement of a material fact or omits to
state any material fact necessary to make the statements therein not
misleading, and prepare and file promptly with the SEC a supplement or
amendment to such prospectus or any such document incorporated therein
by reference so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain an untrue
statement of a material fact or omit to state any material fact
necessary to make the statements therein not misleading;
(viii) cause all such Registrable Securities to be listed on
each securities exchange on which similar securities issued by the
Company are then listed;
(ix) enter into such customary agreements (including an
underwriting agreement in customary form, including customary indemnity
and contribution provisions) and take all such other actions in
connection therewith as the holders of a Majority of the Registrable
Securities being registered or the managing underwriters, if any,
reasonably request in order to expedite or facilitate the disposition
of such Registrable Securities;
(x) make available for inspection by any seller of
Registrable Securities, any underwriter participating in any
disposition pursuant to such registration statement, and any attorney,
accountant or other agent retained by any such seller or underwriter,
all financial and other records, pertinent corporate documents and
properties of the Company, and cause the Company's officers, directors
and employees to supply all information reasonably requested by any
such seller, underwriter, attorney, accountant or agent in connection
with such registration statement, in each case upon receipt of an
appropriate confidentiality agreement;
(xi) in the case of an underwritten offering, (i) obtain a
cold comfort letter from the Company's independent public accountants
in customary form and covering such matters of the type customarily
covered by cold comfort letters, as the managing underwriters
reasonably request and (ii) cause its outside counsel to prepare and
deliver to the underwriters and the SEC opinion letters of the type
customarily rendered in connection with registered underwritten
offerings; and
(xii) otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the SEC, 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 month after
the effective date of the Registration Statement, which earnings
statement will satisfy the provisions of Section 10(a) of the
Securities Act.
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(b) The Company may require each seller of Registrable Securities
as to which any registration is being effected to furnish to the Company such
information regarding the seller and the distribution of such securities as the
Company may from time to time reasonably request and to timely complete and
execute all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably requested by the Company.
7. REGISTRATION EXPENSES.
(a) All expenses incident to the Company's performance of or
compliance with this Agreement, including without limitation all registration
and filing fees, fees and expenses of compliance with securities or blue sky
laws (including reasonable fees and disbursements of counsel for the
underwriters, if any, in connection with blue sky qualifications of the
Registrable Securities), printing expenses, messenger, telephone and delivery
expenses, and fees and disbursements of counsel for the Company and of the
Company's independent certified public accountants (including the expenses of
any special audit or "cold comfort" letters required by or incident to such
performance), fees and expenses of underwriters customarily paid by issuers of
securities (including liability insurance if the Company so desires), the
reasonable fees and expenses of any special experts retained by the Company or
at the request of the managing underwriters in connection with such registration
and fees and expenses of other Persons retained by the Company, but excluding
underwriting discounts and commissions, fees, discounts and commissions of
brokers and dealers, transfer taxes, if any, relating to any sale of Registrable
Securities and the fees and disbursements of counsel for the holders of
Registrable Securities, will be borne by the Company (all such expenses being
herein called "Registration Expenses").
(b) Any fees or expenses incurred by any of the parties other than
Registration Expenses, including fees and disbursements of attorneys and
accountants other than as included in the definition of Registration Expenses,
shall be borne by the party that incurred them.
8. INDEMNIFICATION; CONTRIBUTION.
(a) Indemnification by Company. In the event of the registration
of any of the Registrable Securities pursuant to this Agreement, the Company
agrees to indemnify to the full extent permitted by law, each holder of such
Registrable Securities, its officers, directors and constituent partners, if
any, and each Person who controls such holder (within the meaning of the
Securities Act and the Exchange Act) against all losses, claims, damages,
liabilities and expenses (or actions in respect thereof) arising out of or based
upon any untrue or alleged untrue statement of a material fact contained in any
registration statement or prospectus relating to the registration of such
Registrable Securities or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, except insofar as the same are contained in any
information furnished in writing to the Company by or on behalf of such holder
or other indemnified Person expressly for use therein or caused by such holder's
failure to deliver a copy of the registration statement or prospectus or any
amendments or supplements thereto after the Company has furnished such holder
with a sufficient number of copies of the same. Subject to the provisions of
Section 8(c), the Company will reimburse each holder of Registrable Securities,
its officers, directors, constituent partners, if any, and controlling Persons
for any reasonable legal and other expenses as incurred in connection with
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investigating or defending any such losses, claims, damages, liabilities,
expenses or actions for which such Person is entitled to indemnification
hereunder, as such are incurred. In connection with a firm commitment or best
efforts underwritten offering, the Company will indemnify the underwriters or
agents, their officers, directors, constituent partners and each Person who
controls such underwriters (within the meaning of the Securities Act and the
Exchange Act) or agents to the same extent as provided above (or such greater
extent as may be customarily required by the managing underwriters) with respect
to the indemnification of the holders of Registrable Securities.
(b) Indemnification by Holder of Registrable Securities. In
connection with any registration statement in which a holder of Registrable
Securities is participating, each such holder will furnish to the Company in
writing such information and affidavits as the Company reasonably requests for
use in connection with any such registration statement or prospectus and agrees
to indemnify, to the full extent permitted by law, the Company, its directors
and officers, each Person who controls the Company (within the meaning of the
Securities Act and the Exchange Act) and all other prospective sellers and their
respective directors, officers and controlling Persons (within the meaning of
the Securities Act and the Exchange Act) against any losses, claims, damages,
liabilities and expenses (or actions in respect thereof) arising out of or based
upon any untrue or alleged untrue statement of a material fact or any omission
or alleged omission of a material fact required to be stated in the registration
statement or prospectus or any amendment thereof or supplement thereto or
necessary to make the statements therein not misleading, to the extent, but only
to the extent, that such untrue statement or omission is contained in any
written information or affidavit furnished by or on behalf of such holder
specifically for such registration statement or prospectus and then only to the
extent of the total proceeds received by such holder of Registrable Securities.
Subject to the provisions of Section 8(c), the holders of Registrable Securities
will reimburse, to the extent of the total proceeds received by the holders of
Registrable Securities, the Company, its officers, directors and controlling
Persons and all other prospective sellers and their respective directors,
officers and controlling Persons for any reasonable legal and other expenses as
incurred in connection with investigation or defending any such losses, claims,
damages, liabilities, expenses or actions.
(c) Conduct of Indemnification Proceedings. Any Person entitled to
indemnification hereunder will (i) give prompt notice to the indemnifying party
of any claim with respect to which it seeks indemnification (but omission of
such notice shall not relieve the indemnifying party from liability hereunder
except to the extent such indemnifying party is actually prejudiced by such
failure to give notice) and (ii) unless in such indemnified party's reasonable
judgment a conflict of interest may exist between such indemnified and
indemnifying parties with respect to such claim, permit such indemnifying party
to assume the defense of such claim with counsel reasonably satisfactory to the
indemnified party. If such defense is not assumed by the indemnifying party, the
indemnifying party will not be subject to any liability for any settlement made
without its consent (but such consent will not be unreasonably withheld). No
indemnifying party will 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 an unconditional release
from all liability in respect to such claim or litigation. An indemnifying party
who is not entitled to, or elects not to, assume the defense of a
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claim will not be obligated to pay the fees and expenses of more than one
counsel for all parties indemnified by such indemnifying party with respect to
such claim.
(d) Contribution. If the indemnification provided for in Section
8(a) or Section 8(b) is unavailable or insufficient to hold harmless each of the
indemnified parties against any losses, claims, damages, liabilities and
expenses (or actions in respect thereof) to which such persons may become
subject under the Securities Act, then the indemnifying party shall, in lieu of
indemnifying each party entitled to indemnification hereunder, contribute to the
amount paid or payable by such party as a result of such losses, claims,
damages, liabilities or expenses in such proportion as is appropriate to reflect
the relative fault of the indemnifying party on the one hand and such
indemnified persons on the other in connection with the statements or omissions
or alleged statements or omissions that resulted in such losses, claims,
damages, liabilities or expenses. The relative fault of such persons shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact, or omission or alleged omission to state a
material fact, relates to information supplied by or concerning the indemnifying
party on the one hand, or by such indemnified person on the other, and such
person's relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The parties hereto agree that it
would not be just and equitable if contribution pursuant to this Section 8(d)
were determined by pro rata allocation or by any other allocation that does not
take into account the equitable considerations referred to in this Section 8(d).
No person guilty of fraudulent misrepresentation within the meaning of the
Securities Act shall be entitled to contribution from any person that is not
guilty of such fraudulent misrepresentation.
9. RULE 144 AND FORM S-3.
The Company covenants that it will timely file the reports required to
be filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the SEC thereunder, all to the extent required from time
to time (i) to enable such holder to sell Registrable Securities without
registration under the Securities Act within the limitation of the exemptions
provided by (y) Rule 144 under the Securities Act, as such Rule may be amended
from time to time, or (z) any similar rule or regulation hereafter adopted by
the SEC and (ii) to use its reasonable best efforts to maintain its eligibility
to use Form S-3 (or any successor form of similar import) for resales of
Registrable Securities as contemplated hereby. 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 requirements.
10. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS; MARKET STAND-OFF AGREEMENT.
(a) Participation in Underwritten Registration. No Person may
participate in any underwritten registration hereunder unless such Person (i)
agrees to sell such Person's 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 customary questionnaires,
powers of attorney, underwriting agreements and other documents required under
the terms of such underwriting arrangements.
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(b) Market Stand-Off Agreement. Each holder of Registrable
Securities agrees, whether or not it is participating in such registration
statement, that it shall not, to the extent requested by the Company or an
underwriter of Common Stock (or other securities of the Company), sell or
otherwise transfer or dispose of (other than to transferees who agree to be
similarly bound) any securities of the Company during the period following the
effective date of a registration statement of the Company filed under the
Securities Act (not to exceed 90 days) requested by the Company or an
underwriter. In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the securities of the Company owned
by holders of Registrable Securities until the end of such period.
11. MISCELLANEOUS.
(a) Right to Suspend. The Company may, by notice in writing to
each holder of Registrable Securities, require the holders of Registrable
Securities to suspend use of any prospectus included in a registration statement
filed hereunder if the Company reasonably determines that it contains an untrue
statement of a material fact or omits to state any material fact necessary to
make the statements therein not misleading or that any transaction in which the
Company is engaged or proposes to engage, or any event that has occurred or is
expected to occur, would require an amendment to such registration statement or
a supplement to such prospectus (including any such amendment or supplement made
through incorporation by reference to a report filed under Section 13 of the
Exchange Act). Each holder of Registrable Securities agrees that, upon receipt
of any notice from the Company of the happening of any event of the kind
described in this Section 11(a), such holder will forthwith discontinue
disposition of Registrable Securities pursuant to the registration statement
covering such Registrable Securities until such holder's receipt of the copies
of a properly supplemented or amended prospectus, and, if so directed by the
Company, such holder will deliver to the Company all copies, other than
permanent file copies, then in such holder's possession, of the most recent
prospectus covering such Registrable Securities at the time of receipt of such
notice. In the event the Company gives any such notice, the time period
mentioned in Section 4 and Section 6(a)(iii), if applicable, will be extended by
the number of days during the period from and including the date of the giving
of such notice to and including the date when each seller of Registrable
Securities covered by such registration statement has received the copies of
such supplemented or amended prospectus. The Company agrees to use its
reasonable best efforts to cause any suspension of use of any prospectus
pursuant to this paragraph to be as short a period of time as possible.
(b) Transfer of Assignment of Rights. The rights to cause the
Company to register Registrable Securities under this Agreement granted to the
Purchasers may be assigned or transferred by a Purchaser only to a transferee or
assignee of not less than 200,000 shares of Registrable Securities (as presently
constituted and subject to subsequent adjustments for stock splits, stock
dividends, reverse stock splits, and similar events), provided that the Company
is given written notice at the time of such transfer or assignment, stating the
name and address of the transferee or assignee and identifying the securities
with respect to which such registration rights are being transferred or
assigned; and provided further, that the transferee or assignee of such rights
assumes in writing the obligation of such Purchaser hereunder with respect
thereto.
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(c) Amendments and Waivers. The provisions of this Agreement 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 the holders of at least a Majority of the outstanding
Registrable Securities. Each holder of any Registrable Securities at the time or
thereafter shall be bound by any consent authorized by this Section 11(c),
whether or not such holder consented or whether or not such Registrable
Securities have been marked to indicate such consent. No waiver by any party
hereto at any time of any breach by any other party hereto of, or compliance
with, any condition or provision of this Agreement to be performed by such other
party shall be deemed a waiver of similar or dissimilar provisions or conditions
at the time or at any prior or subsequent time.
(d) Registrable Securities Held by the Company or its Affiliates.
Whenever the consent or approval of holders of all or any specified percentage
of Registrable Securities is required hereunder, Registrable Securities held by
the Company or any of its Affiliates (other than the Purchasers or their assigns
or any of Affiliates thereof if such Purchaser or assigns is such an Affiliate)
will not be counted in determining whether such consent or approval was given by
such holders.
(e) Notices. All notices and other communications hereunder shall be in
writing and shall be deemed given if delivered personally or mailed by
registered or certified mail (return receipt requested) to the parties at the
following addresses (or at such other address for a party as shall be specified
by like notice):
If to Purchasers:
Xxxxxx X. Xxxxxx and Xxxxxxxxxxx X. Xxxxxx
000 Xxxx
Xxxxxxx, Xxxxx 00000
with a copy to:
Xxxxx Xxxxxxxxxxx
000 Xxxxxxx Xxxx.
Xxxxxxx, Xxxxx 00000
and
Fulbright & Xxxxxxxx, L.L.P.
0000 XxXxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000-0000
Attn: Xxxxxxx X. Still
If to Luby's:
Xxxx'x, Inc.
0000 Xxxxxxxxx Xxxx 000
Xxx Xxxxxxx, Xxxxx 00000-0000
Attention: Chairman of the Board
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with a copy to:
Xxxxxxxx Xxxx Xxxxxxxxxx Xxxxxx
Xxxxxxx Xxxxxx & Xxxxxx Incorporated
000 X. Xx. Xxxx'x Xxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxx 00000
Attention: Xxxx X. Xxxxxx, Xx.
Any of the above addresses may be changed at any time by notice given
as provided above; provided, however, that any such notice of change of address
shall be effective only upon receipt. All notices, requests or instructions
given in accordance herewith shall be deemed received on the date of delivery,
if hand delivered, on the date of receipt, if telecopied, three Business Days
after the date of mailing, if mailed by registered or certified mail, return
receipt requested, and one Business Day after the date of sending, if sent by
Federal Express or other recognized overnight courier.
(f) Successors. Subject to compliance with any conditions to or
restrictions on the transfer of any Registrable Securities and to the express
assignment provisions of this Agreement, this Agreement will inure to the
benefit of and be binding upon the successors and assigns of each of the
parties.
(g) Counterparts. This Agreement may be executed and delivered
(including by facsimile transmission) in one or more counterparts, all of which
shall be considered one and the same agreement and shall become effective when
one or more counterparts have been signed by each of the parties hereto and
delivered to the other parties, it being understood that all parties need not
sign the same counterpart.
(h) Headings. The headings in this Agreement are for convenience
of reference only and are not part of the substance of this Agreement.
(i) Governing Law; Jurisdiction. This Agreement SHAll be governed
by and construed in accordance with the laws of the State of Texas, without
giving effect to ANY conflictS of law prOVISIONS.
(j) Severability. If any term or other provision of this Agreement
is invalid, illegal, or incapable of being enforced by any rule of applicable
law, or public policy, all other conditions and provisions of this Agreement
shall nevertheless remain in full force and effect so long as the economic or
legal substance of the transactions contemplated herein are not affected in any
manner materially adverse to any party. Upon such determination that any term or
other provision is invalid, illegal, or incapable of being enforced, the parties
hereto shall negotiate in
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good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in a mutually acceptable manner in order that the
transactions contemplated herein are consummated as originally contemplated to
the fullest extent possible.
(k) Entire Agreement. This Agreement (which term shall be deemed
to include the Exhibits and Schedules hereto and the other certificates,
documents and instruments delivered hereunder), the Purchase Agreement dated as
of March 9, 2001 by and between the Company and Purchaser (the "Purchase
Agreement") and the other Transaction Documents (as defined in the Purchase
Agreement) constitute the entire agreement of the parties hereto and supersede
all prior agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof. There are no representations
or warranties, agreements, or covenants other than those expressly set forth in
this Agreement, the Purchase Agreement, and the other Transaction Documents.
(l) Consent; Names and Address of Holders of Securities. Each
holder of Registrable Securities consents to the dissemination by the Company of
its name, address and Registrable Securities holdings to other holders of
Registrable Securities. Upon request, the Company will furnish to any holder of
Registrable Securities, the names and addresses of all other such holders to the
extent reasonably available or known to the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
XXXX'X, INC.
Company Address:
0000 Xxxxxxxxx Xxxx 410 By:
Xxx Xxxxxxx, Xxxxx 00000-0000 ------------------------------
Xxxxxx X. Xxxxxx
Chairman of the Board
------------------------------
Xxxxxx X. Xxxxxx
------------------------------
Xxxxxxxxxxx X. Xxxxxx
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