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Exhibit 4.7
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") made and
entered into as of this 28th day of April, l998, by and among Asset Alliance
Corporation a Delaware corporation ("Parent"), and JMG Capital Management, Inc.,
a California corporation, Pacific Capital Management, Inc., a Delaware
corporation, Xxxxxxxx X. Xxxxxx, Xxxxx Xxxxxxx and Xxxxxx X. Xxxxx (each a
"Shareholder" and together, the "Shareholders").
WHEREAS, Parent and the Shareholders are parties to the Purchase
Agreement, dated as of March 26, 1998, by and among Parent, the Shareholders and
certain other parties as set forth therein (the "Purchase Agreement") pursuant
to which the Shareholders will collectively receive, among other consideration,
an aggregate of $29,854,477 in principal amount of convertible subordinated
debentures (the "Debentures") of Parent in the form attached to the Purchase
Agreement. As used in this Agreement, the term "Shares" refers to any shares of
Common Stock, par value $.01 per share, of Parent ("Parent Common Stock")
acquired upon conversion of the Debentures and, if applicable, any capital stock
of the Company issued by way of a stock split, stock dividend, recapitalization,
merger or other distribution with respect to, or in exchange for, or in
replacement of, such Parent Common Stock; and
WHEREAS, the Shareholders have requested that, in connection with
the Purchase Agreement, Parent provide a means of registering the Parent Common
Stock under the Securities Act of 1933, as amended (the "Securities Act"), and
Parent is willing to provide such registration as provided herein;
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NOW, THEREFORE, in consideration of the premises and the agreements
herein contained, the parties hereto agree as follows:
1. Piggyback Registrations.
(a) Right to Piggyback. Whenever Parent proposes to
register any of its equity securities under the Securities Act and the
registration form to be used may be used for the registration of Shares (a
"Piggyback Registration"), Parent will give prompt written notice to all
Shareholders of its intention to effect such a registration and will,
subject to paragraphs (b), (c) and (d) below, include in such registration
all Shares held by any Shareholder who holds, and is at such time
authorized under the terms of the Purchase Agreement to transfer to
persons other than members of its Immediate Family, in excess of 1% of the
then outstanding Shares (each, an "Eligible Shareholder") with respect to
which (i) such Shareholder is at such time authorized under the terms of
the Purchase Agreement to make such a transfer and (ii) Parent has
received written requests for inclusion therein within 15 days after the
receipt by such Shareholder of Parent's notice.
(b) Priority on Primary Registrations. If a Piggyback
Registration is an underwritten primary registration on behalf of Parent
(whether or not also on behalf of holders of Parent's securities), and the
managing underwriters advise Parent in writing that in their opinion the
number of securities requested to be included in such registration exceeds
the number which can be sold in such offering, Parent will include in such
registration (i) first, the securities Parent proposes to sell, (ii)
second, the Shares properly requested to be included in such registration,
pro rata among shareholders who are entitled to request
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such inclusion, and (iii) third, other securities requested to be included
in such registration.
(c) Priority on Secondary Registra-tions. If a Piggyback
Registration is an underwritten secondary registration on behalf of
holders of Parent's securities, and the managing underwriters advise
Parent in writing that in their opinion the number of securities requested
to be included in such registration exceeds the number which can be sold
in such offering, Parent will include in such registration (i) first, the
securities requested to be included therein by the holders demanding such
registration and (ii) second, the Shares requested to be included in such
registration, pro rata among shareholders who are entitled to request such
inclusion and (iii) third, other securities requested to be included in
such registration.
(d) Nothing in this Section 1 will prohibit Parent, in
its sole discretion, from determining, at any time, not to file a
registration statement or, if filed, to withdraw such registration
statement or terminate the registration related thereto.
2. Selection of Underwriters. If any offering pursuant to a
Registration Statement is an underwritten offering, Parent will select a
managing underwriter or underwriters to administer the offering.
3. Registration Expenses. All expenses incident to Parent's
performance of or compliance with its obligations under this Agreement
(excluding underwriting discounts, selling commissions and brokerage fees, which
will be paid by the participating Shareholders) will be paid by Parent,
regardless of whether Shares are sold pursuant to any registration statement
filed pursuant to Section 1 above (a "Registration Statement").
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4. Indemnification; Contribution.
(a) Indemnification by Parent. Parent agrees to indemnify each
Shareholder and any agent or investment adviser thereof against all
losses, claims, damages, liabilities and expenses (including reasonable
attorneys' fees and expenses of investigation) incurred by such party
pursuant to any actual or threatened action, suit, proceeding or
investigation arising out of or based upon (i) any untrue or allegedly
untrue statement of material fact contained in any Registration Statement,
any prospectus or preliminary prospectus, or any amendment or supplement
to any of the foregoing or (ii) any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make
the statements therein (in the case of a prospectus or a preliminary
prospectus, in light of the circumstances then existing) not misleading,
except in each case insofar as the same arise out of or are based upon,
any such untrue statement or omission made in reliance on and in
conformity with information with respect to such indemnified party
furnished in writing to Parent by such indemnified party or its counsel
expressly for use therein. Notwithstanding the foregoing provisions of
this paragraph (a), Parent will not be liable to any Shareholder, any
person who participates as an underwriter in the offering or sale of
Shares or any other person, if any, who controls such holder or
underwriter (within the meaning of the Securities Act), under the
indemnity agreement in this paragraph (a) for any such loss, claim,
damage, liability (or action or proceeding in respect thereof) or expense
that arises out of such Shareholder's or other person's failure to send or
give a copy of the final prospectus 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
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sale of the Shares to such person if such statement or omission was
corrected in such final prospectus and Parent has previously furnished
sufficient copies thereof to such Shareholder.
(b) Indemnification by Shareholders. In connection with the
Registration Statement, each participating Shareholder will furnish to
Parent in writing such information, including with respect to the name,
address and the amount of Shares held by such Shareholder, as Parent
reasonably requests for use in such Registration Statement or the related
prospectus and agrees to indemnify and hold harmless Parent, all other
participating holders of Common Stock, if any, or any underwriter, as the
case may be, and any of their respective affiliates, directors, officers
and controlling Persons (within the meaning of the Securities Act) against
any losses, claims, damages, liabilities and expenses resulting from 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 such
Registration Statement or prospectus or any amendment or supplement to
either of them or necessary to make the statements therein (in the case of
a prospectus, in the light of the circumstances then existing) not
misleading, but only to the extent that any such untrue statement or
omission is made in reliance on and in conformity with information with
respect to such Shareholder furnished in writing to Parent by such
Shareholder or its counsel specifically for inclusion therein.
(c) Conduct of Indemnification Proceedings. Any person
entitled to indemnification hereunder agrees to give prompt written notice
to the indemnifying party after the receipt by such indemnified party of
any written notice of the commencement of any action, suit, proceeding or
investigation or threat thereof made in writing for which
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such indemnified party may claim indemnification or contribution pursuant
to this Agreement (provided that failure to give such notification shall
not affect the obligations of the indemnifying person pursuant to this
Section 4 except to the extent the indemnifying party shall have been
actually prejudiced as a result of such failure). In case any such action
shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate therein and, to the extent that it shall
wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel satisfactory to such indemnified
party (who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying 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 under these indemnification provisions for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by
such indemnified party, in connection with the defense thereof other than
reasonable costs of investigation, unless in the reasonable judgment of
any indemnified party a conflict of interest is likely to exist between
such indemnified party and any other of such indemnified parties with
respect to such claim, in which event the indemnifying party shall be
obligated to pay the reasonable fees and expenses of such additional
counsel or counsels. The indemnifying party will not be subject to any
liability for any settlement made without its consent (which will not be
unreasonably withheld).
(d) Contribution. If the indemnification from the indemnifying
party provided for in this Section 4 is unavailable to the indemnified
party hereunder in respect of any losses, claims, damages,
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liabilities or expenses referred to therein, then the indemnifying party,
in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such
losses, claims, damages, liabilities and expenses in such proportion as is
appropriate to reflect the relative fault of the indemnifying party and
indemnified party in connection with the actions which resulted in such
losses, claims, damages, liabilities and expenses, as well as any other
relevant equitable considerations. The relative fault of such indemnifying
party and indemnified party shall be determined by reference to, among
other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged
omission to state a material fact, has been made by, or relates to
information supplied by, such indemnifying party or indemnified party, and
the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such action. The amount paid or payable
by a party as a result of the losses, claims, damages, liabilities and
expenses referred to above shall be deemed to include, subject to the
limitations set forth in paragraph (c) above, any legal and other fees and
expenses reasonably incurred by such indemnified party in connection with
any investigation or proceeding.
The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 4 were determined by
pro rata allocation or by any other method of allocation which does not
take account of the equitable considerations referred to in the
immediately preceding paragraph. Notwithstanding the provisions of this
Section 4, no underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the
public
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exceeds the amount of any damages which such underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission, and no Shareholder shall be required to contribute any
amount in excess of the amount by which the total price at which the Shares of
such Shareholder were offered to the public (net of all underwriting discounts
and commissions) exceeds the amount of any damages which such Shareholder has
otherwise been required to pay by reason of such untrue statement or omission.
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.
5. Participation in Underwritten Registrations. No Shareholder may
participate in any underwritten offering hereunder unless such Shareholder (i)
agrees to sell his Shares on the basis provided in any underwriting arrangements
approved by Parent in its reasonable discretion and (ii) completes and executes
all questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements.
6. Rule 144. For a period of one year following the date of the
completion of the IPO (as defined in the Purchase Agreement) (or such shorter
period as may permit the sale of Shares under Rule 144 under the Securities Act
without regard to the requirement of "current public information"), Parent
covenants that it will file the reports required to be filed by it under the
Securities Act and the Securities Exchange Act of 1934, as amended, and the
rules and regulations adopted by the Securities and Exchange Commission ("SEC")
thereunder (or, if Parent is not required to file such reports, it
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will, upon the request of any Shareholder make publicly available other
information so long as necessary to permit sales under Rule 144 under the
Securities Act), and it will take such further action as any Shareholder may
reasonably request, all to the extent required from time to time to enable such
Shareholder to sell Shares without registration under the Securities Act within
the limitation of the exemptions provided by (i) Rule 144 under the Securities
Act, as such Rule may be amended from time to time, or (ii) any similar rule or
regulation hereafter adopted by the SEC. Upon the request of any Shareholder,
Parent will deliver to such Shareholder a written statement as to whether it has
complied with such requirements.
7. Future Demand Rights. In the event that after the date hereof
Parent shall in connection with the acquisition of the assets, stock, business,
operations, revenues or properties of any Person (as defined in the Purchase
Agreement) agree in writing upon the written request of any Person (a "Seller")
to effect the registration under the Securities Act of shares of Parent Common
Stock delivered to such Seller as all or a part of the consideration paid by
Parent therefor and having an aggregate fair market value at the time of such
agreement equal to not less than $10 million, then Parent shall upon request of
each Shareholder then beneficially owning Shares representing not less than 1%
of the then outstanding shares of Parent Common Stock, or of such Shareholders
as a group, as the case may be, effect the registration under the Securities Act
of Shares then beneficially owned by them on the same terms, in the same
proportionate amounts and subject to the same limitations, conditions,
frequency, expiration and rights of Parent in connection therewith as are
applicable to any such Seller; provided, however, that Parent shall not be
required to effect the registration of
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any Shares that a Shareholder is not then authorized to sell under the terms of
the Purchase Agreement.
8. Remedies. Each Shareholder, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement.
9. Parties in Interest; No Third Party Beneficiaries.
(a) This Agreement shall be binding upon, inure to the benefit of,
and be enforceable by, the parties hereto and their respective successors and
permitted assigns. This Agreement and the rights and obligations of Parent and
the Shareholders hereunder may not be assigned by any of the parties hereto
without the prior written consent of the other parties.
(b) This Agreement is not intended, nor shall it be construed, to
confer any rights or remedies under or by reason of this Agreement upon any
person except the parties hereto and their heirs, successors and permitted
assigns.
10. Entire Agreement. This Agreement embodies the entire agreement
and understanding of the parties hereto in respect of the subject matter hereof.
This Agreement supersedes all prior agreements, arrangements and understandings
of the parties with respect to such subject matter.
11. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
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12. Headings. The section headings contained in this Agreement are
for convenience only and shall not control or affect in any way the meaning or
interpretation of the provisions of this Agreement.
13. Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware without giving effect to
the conflicts of law principles of such jurisdiction.
14. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed to have been
duly given at the time of delivery if personally delivered or telecopied (with
confirmation of receipt), the next day, if delivered by nationally-recognized
overnight express service, or five (5) days, if sent by registered or certified
mail (postage prepaid, return receipt requested) to the parties at the following
addresses:
(a) If to Parent to:
Asset Alliance Corporation
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, X.X. 00000
Telephone Number: (000) 000-0000
Facsimile Number: (000) 000-0000
Attn: Xxxxxx Xxxxx
with copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Xxx Xxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Telephone Number: (000) 000-0000
Facsimile Number: (000) 000-0000
Attn: Xxxxxx X. XxXxxx
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(b) If to Shareholders, to the addresses provided to Parent at the
closing of the Purchase Agreement
or to such other address as the person to whom notice is to be given may have
previously furnished to the other in writing in the manner set forth above,
provided that notice of a change of address shall be deemed given only upon
receipt.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement, on the day and year first above written.
ASSET ALLIANCE CORPORATION
By: /s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
Executive Vice President
JMG CAPITAL MANAGEMENT, INC.
By: /s/ Xxxxxxxx X. Xxxxxx
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Name: Xxxxxxxx X. Xxxxxx
Title: President
PACIFIC CAPITAL MANAGEMENT, INC.
By: /s/ Xxxxx Xxxxxxx
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Name: Xxxxx Xxxxxxx
Title: President
/s/ Xxxxxxxx X. Xxxxxx
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Xxxxxxxx X. Xxxxxx
/s/ Xxxxx Xxxxxxx
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Xxxxx Xxxxxxx
/s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
