Exhibit 10.2
REGISTRATION RIGHTS AGREEMENT
March 30, 1999
The parties to this agreement are MedSource Technologies, Inc. a Delaware
corporation (the "Company") and each of the stockholders listed on Schedule A to
this agreement and executing a signature page to this agreement (the
"Stockholders").
The Stockholders own or are acquiring shares of the Company's common stock,
par value $.01 per share (the "Common Stock"), shares of the Company's 6% Series
B Cumulative Convertible Redeemable Preferred Stock, par value $.01 per share
(the "Series B Preferred Stock"), and shares of the Company's Series Z
Convertible Nominal Value Redeemable Preferred Stock, par value $.01 per share
(the "Series Z Preferred Stock"). The shares of Series B Preferred Stock and the
Shares of Series Z Preferred Stock are convertible into shares of Common Stock.
The shares of Common Stock currently held by the Stockholders, the shares of
Common Stock underlying the shares of Series B Preferred Stock currently held by
the Stockholders and the shares of Common Stock underlying the shares of Series
Z Preferred Stock currently held by the Stockholders are the only shares of
capital stock of the Company entitled to the rights and benefits, and subject to
the terms and conditions, of this agreement, and are hereinafter collectively
referred to as, the "Shares."
The Company desires to provide to the Stockholders certain rights regarding
the registration of the Shares, all upon the terms and conditions set forth
below.
It is therefore agreed as follows:
1. Certain Definitions. As used in this agreement, the following terms
shall have the meanings provided below:
(a) "Commission" means the United States Securities and Exchange
Commission or any other federal agency at the time administering the
Securities Act.
(b) "Demand Notice" means either an Investor Demand Notice or a
Founders Demand Notice.
(c) "Founders" means the Stockholders other than the Investors.
(d) "Founders Demand Notice" means a written request from Founders
holding at least 50% of the shares of Common Stock held by Founders on the
date hereof as shown on Schedule A to register at least 25% of the
Registrable Securities held by the Founders on the date hereof.
(e) "Holders" means the Stockholders and their respective permitted
transferees who hold Shares.
(f) "Investor Common Shares" means all of the shares of Common Stock
issued or issuable upon conversion of the 300,000 shares of Series B
Preferred Stock and upon conversion of the 65,000 shares of Series Z
Preferred Stock (regardless of whether any or all of such shares remain
outstanding) issued on or substantially contemporaneous with this agreement
(after giving effect to all adjustments made through the time of any such
determination pursuant to the Certificate of Designation with respect to
the Series B Preferred Stock and the Series Z Preferred Stock and, without
duplication, as a result of stock splits, stock combinations, stock
dividends and other similar events affecting Common Stock effective through
the relevant date).
(g) "Investor Demand Notice" means a written request from holders of
at least 50% of the Investor Common Shares to register at least 25% of the
Registrable Securities held by the Investors on the date hereof; except
that every request by Investors to register at least $1,000,000 in value
(based on the then current market price) on Form S-3 or a successor form,
if the use of such form is available to the Company, shall qualify as an
"Investor Demand Notice."
(h) "Investors" means: X. X. Xxxxxxx, III, L.P.; Whitney Strategic
Partners III, L.P.; X. X. Xxxxxxx Mezzanine Fund, L.P.; and their permitted
successors and assigns.
(i) "Other Securities" means, at any time, those shares of Common
Stock, and of any other class or series of capital stock of the Company or
other securities of the Company representing the right to acquire Common
Stock, that the Company is required to, or has determined to, register
pursuant to a registration statement filed by the Company with the
Commission pursuant to this or any other agreement.
(j) "Person" shall mean any individual, partnership, joint venture,
firm, corporation, association, trust or other enterprise or any government
or political subdivision or any agency, department or instrumentality
thereof.
(k) "Registrable Securities" means the Shares and any other securities
issuable in replacement thereof by way of a recapitalization, exchange,
merger, consolidation, reorganization or other transaction; provided,
however, that any share shall cease to be a Registrable Security under this
agreement when (A) a registration statement with respect to such share's
public sale shall have become effective under the Securities Act, (B) it
has been disposed of as permitted by, and in compliance with, Rule 144 (or
successor provision) promulgated under the Securities Act or (C) it shall
have ceased to be outstanding.
(l) "Registration Expenses" means all expenses incident to the
Company's performance of or compliance with the provisions of sections 2
and 3 including, without limitation, all registration, filing and National
Association of Securities Dealers, Inc. fees, 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 hereunder), all word processing, duplicating and printing
expenses, messenger and delivery expenses, the fees and disbursements of
counsel for the Company, and the reasonable fees and expenses of one
counsel on behalf of the Holders whose Registrable Securities are included
in the registration statement, with such counsel selected by a
majority-in-interest of the Holders participating in the offering
(according to the number of shares of Common Stock each such Holder is
directly or indirectly
-2-
registering for sale in such registration statement), and the fees and
disbursements of its independent public accountants, including the expenses
of "comfort" letters required by or incident to such performance and
compliance, and any fees and disbursements of underwriters customarily paid
by issuers or sellers of securities; provided, however, that Registration
Expenses shall exclude, and the Holders shall pay, underwriters fees and
underwriting discounts and commissions in respect of the Registrable
Securities being registered hereunder as well as any fees and expenses of
counsel to the Holders of the Registrable Securities hereunder (other than
those of the one counsel referred to above).
(m) "Securities Act" means the Securities Act of 1933, and any
subsequent similar federal statute, and the rules and regulations
promulgated thereunder.
2. Demand Registration.
2.1 Rights to Demand Registration. If, at any time (and from time to time)
after the 180th day following the date on which any registration statement
pursuant to which the Company shall have initially registered (a) shares of
Common Stock, or (b) securities providing the holder thereof the right to
acquire shares of Common Stock, under the Securities Act for sale to the public
shall have been declared effective, the Company shall receive a Demand Notice,
the Company shall promptly give written notice of such proposed registration to
all other Stockholders and shall offer to include in such proposed registration
any Registrable Securities requested to be included in such proposed
registration by the Stockholders who shall respond in writing to the Company's
notice within 10 days after receipt by the Stockholders in question of such
notice (which response shall specify the number of Registrable Securities
proposed to be included in such registration). Subject to section 2.2, the
Company shall promptly use its best efforts to effect such registration under
the Securities Act of the Registrable Securities that the Company has been so
requested to register on such appropriate registration form of the Commission as
shall be selected by the Company.
2.2 Limits on Demand Rights.
(a) The Company shall not be obligated to file and cause to become
effective (i) more than two registration statements pursuant to Investor
Demand Notices; provided, however, that in addition thereto, the Investors
may require the Company to file registration statements on Form S-3 from
time to time, if the use of such Form is available to the Company; (ii)
more than two registration statements pursuant to Founder Demand Notices;
and (iii) any registration statement during the period beginning 30 days
prior to the filing and ending 90 days following the effective date of a
registration statement filed by the Company and relating to an underwritten
offering in which a majority of the shares are being sold by the Company
for its own account.
(b) Unless the Company shall have delayed the commencement of a
registration statement pursuant to section 2.2(a)(ii) above or section
2.2(c) below, the Company may delay the filing or effectiveness of any
registration statement for a period of up to 60 days after the date of
delivery of the Demand Notice pursuant to this section 2 if at the time of
such request the Company is engaged in a firm commitment underwritten
public offering of Company Shares in which the Stockholders may include
Registrable Securities pursuant to section 3,
-3-
provided, however, that, in the event the Company exercises its rights
under this section 2.2(b), the registration shall not be counted as a
demand for registration by any Stockholder for purposes of section
2.2(a)(i) hereof.
(c) If, while a registration request is pending pursuant to this
section 2, the Company has been advised by legal counsel (i) that the
filing of a registration statement would require the disclosure of a
material transaction or other factor that the Company reasonably determines
in good faith would have a material adverse effect on the Company or (ii)
the Company then is unable to comply with Commission requirements
applicable to the requested registration, the Company shall not be required
to effect a registration pursuant to this section 2 until the earlier of
(A) the date upon which such material information is otherwise disclosed to
the public or ceases to be material or the Company is able to so comply
with applicable Commission requirements, as the case may be, and (B) 60
days after the Company makes such good faith determination, provided that
in the event the Company exercises its rights under this section 2.2(c),
the registration shall not be counted as a demand for registration by any
Stockholder for purposes of section 2.2(a)(i) hereof, and provided further
that the Company may not exercise its right under this section 2.2(c) more
than once in any 12-month period.
(d) A requested registration under this section 2 may be rescinded by
written notice to the Company by the Holder or Holders initiating such
request. Such rescinded registration shall not count as a registration
statement initiated pursuant to this section 2 for purposes of section 2.2
above if such request is rescinded by such Holder or Holders not later than
five business days prior to the filing of a registration statement with the
Commission.
2.3 Underwriter "Cutbacks" in Demand Registrations. With respect to any
registration pursuant to this section 2 that is being effected by one or more
underwriters such underwriters shall be designated by the Company and approved
by a majority in interest or the Holders selling Registrable Securities and
Other Securities (which approval shall not be unreasonably withheld), and the
Company may include in such registration any Other Securities; provided,
however, that, anything to the contrary in section 2.1 notwithstanding, if any
managing underwriter for the public offering contemplated by such registration
advises the Company in writing that, in such firm's good faith opinion, the
inclusion of all Registrable Securities and Other Securities proposed to be
included in such registration would adversely affect the offering and sale of
all such securities, then the number of Registrable Securities and Other
Securities proposed to be included in such registration shall be reduced pro
rata based upon the number of shares of Common Stock owned by each such Person
and its affiliates (or that each such Person and its affiliates have the right
to acquire) at the time of such registration.
3. Piggyback Registration.
3.1 Right to Include Registrable Securities.
(a) Subject to section 3.1(b), if the Company at any time proposes to
register any of its securities under the Securities Act (as defined below)
by registration on Forms SB-2, X-0, X-0, X-0 (but not Forms S-4 or S-8) or
any successor or similar form(s) (except registrations on such or similar
forms for registration of securities in connection with (i) an employee
benefit
-4-
plan or dividend reinvestment plan or a merger, consolidation or other
business combination, (ii) debt securities that are not convertible into
Common Stock, or (iii) the Company's initial public offering), whether or
not for sale for its own account, it shall, each such time, give written
notice to the Holders of its intention to do so and of the Holders' rights
under this section 3 at least 30 days prior to the filing of a registration
statement with respect to such registration with the Commission. Upon the
written request of any Holder made within 20 days after the receipt of that
notice, which request shall specify the Registrable Securities intended to
be registered and disposed of by such Holder, the Company shall, subject to
the provisions hereof, use its best efforts to include in such registration
statement all Registrable Securities that the Company has been so requested
to register by such Holder.
(b) 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 Holder and upon giving that notice (i) in the case of
a determination not to register, the Company 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 (as defined below) in connection therewith), without
prejudice; and (ii) in the case of a determination to delay registering,
the Company shall be permitted to delay registering any Registrable
Securities for the same period as the delay in registering such other
securities.
(c) The Company shall pay all Registration Expenses in connection with
registration of Registrable Securities requested pursuant to this section
3.1.
3.2 Underwriter "Cutbacks" in Piggyback Registrations. Anything in section
3.1 to the contrary notwithstanding, with respect to any registration pursuant
to which shares are registered pursuant to this section 3 that is being effected
by one or more underwriters, such underwriters shall be designated by the
Company and approved by a majority in interest of the Holders selling
Registrable Securities and Other Securities (which approval shall not be
unreasonably withheld), and if any managing underwriter for the public offering
contemplated by such registration advises the Company in writing that, in such
firm's good faith opinion, the inclusion of all Registrable Securities and Other
Securities proposed to be included in such registration would adversely affect
the offering and sale of all such securities, then all securities proposed to be
sold by the Company for its own account shall be included in such registration
to the extent possible and the number of Registrable Securities and Other
Securities proposed to be included in such registration shall be reduced pro
rata based upon the number of shares of Common Stock owned by each such Person
(other than the Company) and its affiliates (or that each such Person and its
affiliates have the right to acquire) at the time of such registration.
4. Registration Procedures. In connection with the registration of any
Registrable Securities under the Securities Act as provided in sections 2 and 3,
the Company shall as expeditiously as possible:
(i) prepare and file with the Commission the requisite registration
statement to effect such registration and thereafter use its best efforts
to cause such
-5-
registration statement to become and remain effective (subject to clause
(ii) below); provided, however, that the Company may discontinue any
registration of its securities that are not Registrable Securities at any
time prior to the effective date of the registration statement relating
thereto;
(ii) 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, however, that,
the foregoing notwithstanding, the Company shall not be required under this
item (ii) to maintain the effectiveness of any such registration statement
for longer than 180 days, or such longer period beyond such 180 days (up to
an aggregate of 270 days) as may be available without requiring the Company
to file any financial statements as of a later date and for a later period
than the financial statements that may have been required to maintain the
effectiveness of the registration statement for the 180-day period;
(iii) furnish to the Holders 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 the
Holders may reasonably request from time to time;
(iv) use its best efforts (x) 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 Holders
shall reasonably request, (y) to keep such registration or qualification in
effect for so long as such registration statement remains in effect, and
(z) to take any other action that may reasonably be necessary or advisable
to enable the Holders to consummate the disposition in such jurisdictions
of the securities to be sold by the Holders, 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 paragraph (iv), be obligated to be so qualified or to
consent to general service of process in any such jurisdiction;
(v) 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 to consummate the
disposition of such Registrable Securities in accordance with their
intended method of disposition;
(vi)furnish to the Holders' underwriters, if any, (x) an opinion of
counsel for the Company, and (y) a "comfort" letter signed by the
independent public accountants who have certified the Company's financial
statements included or
-6-
incorporated by reference in such registration statement, each 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);
(vii) immediately notify the Holders 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,
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 circumstances under
which they were made, and at the request of the Holders promptly prepare
and furnish to them a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, 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;
(viii) 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 12 months, but not more than 18 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 the same to the Holders; and
(ix) 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.
The Company may require the Holders to furnish the Company such information
regarding the Holders and the distribution of the Holders' Registrable
Securities as the Company may from time to time reasonably request in writing,
based on its reasonable belief that such information is required to be disclosed
in the Registration Statement pursuant to the Securities Act and applicable
State securities laws.
Upon receipt of any notice from the Company of the happening of an event of
the kind described in item (vii) of this section 4, the Holders shall forthwith
discontinue their disposition of Registrable Securities pursuant to the
registration statement relating to such Registrable Securities until the
Holders' receipt of the copies of the supplemented or amended prospectus
contemplated by item (vii) and, if so directed by the Company, the Holders shall
deliver to the Company all copies, other than permanent file copies, then in the
Holders'
-7-
possession, of the prospectus relating to such Registrable Securities current at
the time of receipt of such notice.
5. Underwritten Offerings.
5.1 Piggyback Underwritten Offerings. If the Company proposes to register
any of its securities under the Securities Act as contemplated by section 2 or
section 3 and such securities are to be distributed by or through one or more
underwriters, the Company shall, subject to the provisions of section 2 and
section 3 (including, without limitation, the provisions of sections 2.3 and
3.2), if requested by the Holders, arrange for such underwriters to include all
the Registrable Securities to be offered and sold by the Holders with and among
the securities of the Company to be distributed by such underwriters. The
Holders shall become a party to the underwriting agreement negotiated between
the Company and such underwriters and shall make all representations and
warranties to and shall enter into all agreements with the Company or the
underwriters as shall be reasonably requested of them including all
representations and warranties required by law, customarily given or reasonably
requested of selling shareholders by an underwriter in an underwritten public
offering.
5.2 Holdback Agreements.
(a) If the Company, in connection with an underwritten offering of
securities for its own account, at any time shall register shares of Common
Stock under the Securities Act for sale to the public (other than on Forms
S-4 or S-8 or a shelf registration), the Holders shall not sell pursuant to
an effective registration statement, publicly make any short sale of,
publicly grant any option for the purchase of, or otherwise publicly
dispose of any Shares (other than those Shares included in such
registration pursuant to section 2 or section 3) without the prior written
consent of the managing underwriter for a period required by the
underwriters and designated by the Company, which period shall begin not
more than thirty (30) days prior to the effectiveness of the registration
statement pursuant to which such public offering shall be made and shall
last not more than one hundred eighty (180) days after the effective date
of such registration statement in the case of the Company's initial public
offering, or ninety (90) days after the effective date of such registration
statement in the case of any such other offering. The Company may legend
and impose stop transfer instructions on any certificate evidencing
Registrable Securities relating to the restrictions provided in this
section 5.2.
(b) During the 15-day period prior to the effective date of any
registration statement of Registrable Securities pursuant to an
underwritten public offering and during the 90-day period beginning on that
effective date, the Company shall not (except as part of such registration)
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 in connection with any employee
stock option or other benefit plan).
5.3 Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement under the Securities Act
pursuant to this agreement, the Company shall give the Holders, 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 each
amendment thereof or
-8-
supplement thereto, and give each of them such access to its books and records,
such opportunities to discuss the business of the Company with officers and the
independent public accountants who have certified its financial statements as
shall be necessary, in the opinion of the Holders' and such underwriters'
respective counsel, to conduct a reasonable investigation within the meaning of
the Securities Act.
6. Indemnification.
6.1 Indemnification by the Company. In the event of any registration
statement filed pursuant to section 2 or section 3, the Company shall, and
hereby does, indemnify and hold harmless each of the Holders and each of their
directors, officers, partners, agents, attorneys, representatives and affiliates
and each other individual, group, partnership, corporation, business trust,
joint stock company, trust, unincorporated association, joint venture or other
entity of whatever nature ("Person") who participates as an underwriter in the
offering or sale of such securities and each other Person, if any, who controls
any Holder or any such underwriter within the meaning of the Securities Act
(each of the foregoing, a "Holder Indemnitee"), 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 such
registration statement, 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 shall
reimburse each Holder Indemnitee for any legal or any other fees, costs and
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 omission made in
reliance upon and in conformity with information furnished to the Company by or
on behalf of a Holder or such underwriter, as the case may be, for use in the
preparation thereof; and provided, further, that the Company shall not be liable
to any Holder Indemnitee 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 or any Holder, as
applicable.
6.2 Indemnification by the Holders. If any Registrable Securities are
included in any registration statement, the Holders of such Registrable
Securities so registered shall, and hereby do, severally and not jointly,
indemnify and hold harmless (in the same manner and to the same extent as set
forth in section 6.1 above) the Company, and each director and officer of the
Company, and each other Person, if any, who controls the Company within the
meaning of the Securities Act, with respect to all losses, claims, damages,
expenses or liabilities ("Losses") to which the Company or such control person
becomes subject under the Securities Act, insofar as such Losses arise out of or
are based upon any untrue statement or alleged untrue statement of a
-9-
material fact contained in such registration statement, any preliminary
prospectus, final prospectus or summary prospectus contained therein, or any
amendment or supplement thereto, or an omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, if such statement or alleged statement or
omission or alleged omission was made in reliance upon and in conformity with
written information pertaining to such Holder and furnished to the Company by
such Holder for use in the preparation of such registration statement,
preliminary prospectus, final prospectus, summary prospectus, amendment or
supplement, provided, however, that no Holder shall have any liability under
this section 6.2 for any amount in excess of the net proceeds actually received
by such Holder from the sale of the Registrable Securities included in such
registration statement.
6.3 Notice of Claims, Etc.
(a) Promptly after receipt by an indemnified party of notice of the
commencement of any action or proceeding involving a claim referred to in
sections 6.1 or 6.2, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party, immediately 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 indemnity
obligations, 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 the reasonable judgment of
counsel for such indemnified party, a conflict of interest between such
indemnified and indemnifying parties may exist in respect of such claim (in
which case the indemnified party shall be entitled to retain separate
counsel as provided below), 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 and at
any time, 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 indemnified party in connection with the
defense thereof other than reasonable costs related to the indemnified
party's cooperation with the indemnifying party provided, however, that (i)
if the indemnifying party fails to assume the defense of such claim after a
reasonable time the indemnified party may retain counsel to defend such
claim and the reasonable fees and expenses of such counsel shall be paid by
the indemnifying party, (ii) the indemnified party may, at its own expense,
retain separate counsel to participate in such defense, (iii) the
indemnified party shall have the right to employ separate counsel at the
expense of the indemnifying party and to control its own defense of such
action, claim or proceeding if, in the reasonable opinion of counsel to
such indemnified party, a material conflict or potential material conflict
exists between the indemnified party and the indemnifying party that would
make such separate representation advisable, except that in no event shall
the indemnifying party be required to pay fees and expenses under this
section 6 for more than one separate firm of attorneys in any one legal
action or group of related legal actions.
(b) 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 that 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 to such claim or litigation.
-10-
6.4 Contribution. If indemnification shall for any reason be held by a
court to be unavailable to an indemnified party under section 6.1 or section 6.2
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 section 6.1 or
section 6.2, as applicable, the indemnified party and the indemnifying party
shall contribute to the aggregate losses, claims, 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 on the one hand and the Holders on the other hand
that resulted in such loss, claim, damage or liability, or action in respect
thereof, with respect to the statements or omissions that 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 item (i)
above is not permitted by applicable law, in such proportion as shall be
appropriate to reflect the relative benefits received by the Company on the one
hand and the Holders on the other provided, however, that no Holder shall have
any liability under this section 6.4 for any amount in excess of the net
proceeds actually received by such Holder from the sale of the Registrable
Securities included in such registration statement. No Person guilty of
fraudulent misrepresentation (within the meaning of the Securities Act) shall be
entitled to contribution from any Person who was not guilty of such fraudulent
misrepresentation. 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.
6.5 Rule 144. With a view to making available the benefits of certain rules
and regulations of the Commission that may at any time permit the sale of the
Registrable Securities to the public without registration, at all times from and
after 90 days following the effective date of the first registration of the
Company under the Securities Act of an offering of its securities to the public,
the Company shall:
(a) use its best efforts to facilitate the sale of the Registrable
Securities to the public, without registration under the Securities Act,
pursuant to Rule 144 promulgated under the Securities Act, provided that
this shall not require the Company to file reports under the Securities Act
and the Securities Exchange Act of 1934, or any similar federal statute,
and the rules and regulations of the Commission thereunder ("Exchange
Act"), at any time prior to the Company's being otherwise required to file
such reports;
(b) make and keep public information available, as those terms are
understood and defined in Rule 144 promulgated under the Securities Act at
all times after 90 days after the effective date of the first registration
under the Securities Act filed by the Company for an offering of its
securities to the general public;
(c) use its best efforts to then file with the Commission in a timely
manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act; and
(d) deliver to the Holders, upon any Holder's request, a written
statement as to whether it has complied with the requirements of this
section 6, a copy of the most recent annual
-11-
or quarterly report of the Company filed with the Commission or any stock
exchange or self regulatory organization [registered under the Securities
Exchange Act of 1934], and such other reports and documents so filed as a
Holder may reasonably request to avail itself of any rule or regulation of
the Commission allowing it to sell its Registrable Securities without
registration.
7. Representations and Warranties of the Company and the Stockholders. Each
of the Company, on the one hand, and the Stockholders, on the other hand, hereby
severally (and not jointly) represent and warrant to the Company and to each of
the Stockholders as set forth below (all of such representations and warranties
to survive the execution and delivery of this agreement):
(a) Binding Effect. This agreement has been duly executed and
delivered by the Company or the Stockholder, as applicable, and constitutes
the legal, valid and binding obligation of such party enforceable against
such party in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency or other similar laws
affecting the enforcement of creditors' rights generally and by general
principles of equity relating to enforceability.
(b) Power; Authorization; Non-Contravention. Each of the Company and
the Stockholder, as applicable, has all power and authority to execute,
deliver and perform his, her or its obligations under this agreement. The
execution, delivery and performance by each of the Company or the
Stockholder, as applicable, of this agreement and the consummation of the
transactions contemplated hereby, (i) has been duly authorized by all
necessary corporate or limited liability company, and if required,
stockholder action, as applicable, on the part of or on behalf of such
party and (ii) does not violate, contravene the terms of, or exceed the
authority grant under, any agreement, document or instrument of or
applicable to such party.
8. Miscellaneous.
(a) Notices. All notices, instructions and other communications in
connection with this agreement shall be in writing and may be given by
personal delivery or mailed, certified mail, return receipt requested,
postage prepaid or by a nationally recognized overnight courier to the
parties at the address of the Company as follows, and at the address of the
Holders as set forth on the signature page to this agreement (or at such
other address as the Company or the Holders may specify in a notice to each
other):
If to the Company:
MedSource Technologies, Inc.
Two Xxxxxxx Xxxxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Chief Executive Officer
and
Xxxx & Company, LLC
Three Pickwick Plaza
Greenwich, CT 06830
Attention: Xxxxxxx X. Xxxxxxx
-12-
With a copy to:
Xxxxxx X. Xxxxxxx
Xxxxxx Xxxxxx Flattau & Xxxxxx, XX
1211 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000-0000
If to a Stockholder, to the address set forth on the signature page below.
(b) No Waiver. No course of dealing and no delay on the part of any
party hereto in exercising any right, power or remedy conferred by this
agreement shall operate as a waiver thereof or otherwise prejudice such
party's rights, powers and remedies conferred by this agreement or shall
preclude any other or further exercise thereof or the exercise of any other
right, power and remedy.
(c) Binding Effect; Assignability. This agreement shall be binding
upon and, except as otherwise provided herein, shall inure to the benefit
of the respective parties and their permitted successors and assigns. This
agreement shall not be assignable except as otherwise provided herein;
provided, however, that the Holders of the Series B Preferred Stock and the
Series Z Preferred Stock shall have the right to assign and transfer all or
any portion of their rights under this agreement to a purchaser of the
Shares in accordance with the terms of the Purchase Agreement dated as of
the date hereof between the Company, such Holders and the other parties
thereto.
(d) Severability. Any provision of this agreement that is prohibited
or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. To the extent
permitted by applicable law, the parties hereby waive any provision of law
which renders any provisions hereof prohibited or unenforceable in any
respect.
(e) Modification. No term or provision of this agreement may be
amended, altered, modified, rescinded or terminated except upon the express
written consent of the party against whom the same is sought to be
enforced.
(f) Law Governing. This agreement shall be governed by and construed
in accordance with the law of the state of New York, applicable to
agreements made and to be performed entirely in New York, without regard to
the principals of conflicts of law of such state.
(g) Amendment to Securities Laws. The Company (on the one hand) and
the Stockholders (on the other hand) agree that any amendment to federal
securities laws (and regulations promulgated thereunder (and related
registration forms) and related state securities laws) shall not affect the
substantive registration requirements (and other obligations of the
Company) set forth in this agreement; and, following any such amendment,
the Company shall
-13-
continue to be required to cause the registration of the Registrable
Securities (and pay all Registration Expenses and provide indemnification
pursuant to section 6.1) under the federal securities laws, as amended, in
a manner consistent with carrying out the intent and purposes of (and on
terms as similar as practicable as the terms set forth in) this agreement.
(h) Headings. All headings and captions in this agreement are for
purposes of reference only and shall not be construed to limit or affect
the substance of this agreement.
(i) Entire Agreement. This agreement contains, and is intended as, a
complete statement of all the terms of the arrangements between the parties
with respect to the matters provided for, supersedes any previous
agreements and understandings between the parties with respect to those
matters and cannot be changed or terminated orally.
MEDSOURCE TECHNOLOGIES, INC.
By: /s/ XXXXXXX X. XXXXXXX
---------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Chairman
-14-
Stockholder Signature Page To
Registration Rights Agreement of
MedSource Technologies, Inc.
/s/ XXXXXXX X. XXXX
-----------------------------------
Xxxxxxx X. Xxxx
Address: 00 Xxxxxxxxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000
Fax No.: 000-000-0000
/s/ XXXXX X. XXXX
-----------------------------------
Xxxxx X. Xxxx
Address: 00 Xxxxxxxxx Xxxxx Xxxx
Xxxxxxxxx, XX 00000
Fax No.: 000-000-0000
/s/ XXXXXX X. XXXXXXX
----------------------------
Xxxxxx X. Xxxxxxx, as Trustee under
the Xxxxxxxxx X. Xxxx Trust
Address: c/o Kidd & Company, LLC
Three Pickwick Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Fax no.: 000-000-0000
Stockholder Signature Page To
Registration Rights Agreement of
MedSource Technologies, Inc.
/s/ XXXXXX X. XXXXXXX
----------------------------
Xxxxxx X. Xxxxxxx, as Trustee under
the Xxxx X. Xxxx Trust
Address: c/o Kidd & Company, LLC
Three Pickwick Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Fax no.: 000-000-0000
/s/ XXXXXX X. XXXXXXX
----------------------------
Xxxxxx X. Xxxxxxx, as Trustee under
the Xxxxxx X. Xxxx Trust
Address: c/o Kidd & Company, LLC
Three Pickwick Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Fax no.: 000-000-0000
/s/ XXXXXXX X. XXXX
----------------------------
Xxxxxxx X. Xxxx
Address: 000 Xxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Fax no.:
Stockholder Signature Page To
Registration Rights Agreement of
MedSource Technologies, Inc.
/s/ XXXX X. XXXXXXX
-----------------------------------
Xxxx X. Xxxxxxx
Address: Xxxx X. Xxxxxxx
00 Xxxxxx Xxxx
Xxxxxx Xx.
Xxxxx Xxxxxxx, XX 00000
Fax no.: 000-000-0000
/s/ XXXXXXX X. XXXXXXX
-----------------------------------
Xxxxxxx X. Xxxxxxx
Address: c/o Kidd & Company, LLC
Three Pickwick Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Fax no.: 000-000-0000
/s/ XXXXXX X. XXXXXX
----------------------------
Xxxxxx X. Xxxxxx
Address: c/o Kidd & Company, LLC
Three Pickwick Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Fax no.: 000-000-0000
Stockholder Signature Page To
Registration Rights Agreement of
MedSource Technologies, Inc.
/s/ XXXX X. XXXXXXXX
----------------------------
Xxxx X. Xxxxxxxx
Address: c/o Kidd & Company, LLC
Three Pickwick Xxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Fax no.: 000-000-0000
/s/ XXXX X. XXXXXX
-----------------------------------
Xxxx X. Xxxxxx
Address: 000 Xxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Fax No.: 000-000-0000
/s/ XXXXXXX XXXXXXX
----------------------------
Xxxxxxx Xxxxxxx
Address: c/x Xxxxxx Advisory Group
000 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Fax No.: 000-000-0000
Stockholder Signature Page To
Registration Rights Agreement of
MedSource Technologies, Inc.
X. X. XXXXXXX III, L.P.
By: X. X. Xxxxxxx Equity
Partners III, LLC,
its General Partner
By: /s/ XXXXXXX X. XXXXX
--------------------------------
Name: Xxxxxxx X. Xxxxx
Title: A Managing Member
Address:
c/o X. X. Xxxxxxx & Co.
000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xx. Xxxxxx X. X'Xxxxx
Fax no.: (000) 000-0000
With a copy to
Xxxxxxxx Xxxxx Singer & Xxxxxxxxx, LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Fax no.: 000-000-0000
Stockholder Signature Page To
Registration Rights Agreement of
MedSource Technologies, Inc.
WHITNEY STRATEGIC PARTNERS III, L.P.
By: X. X. Xxxxxxx Equity
Partners III, LLC,
its General Partner
By: /s/ XXXXXXX X. XXXXX
--------------------------------
Name: Xxxxxxx X. Xxxxx
Title: A Managing Member
Address:
c/o X. X. Xxxxxxx & Co.
000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xx. Xxxxxx X. X'Xxxxx
Fax no.: (000) 000-0000
With a copy to
Xxxxxxxx Xxxxx Singer & Xxxxxxxxx, LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Fax no.: 000-000-0000
Stockholder Signature Page To
Registration Rights Agreement of
MedSource Technologies, Inc.
X. X. XXXXXXX MEZZANINE FUND, L.P.
By: Xxxxxxx XX, L.L.C.
By: /s/ XXXXXXX X. XXXXX
--------------------------------
Name: Xxxxxxx X. Xxxxx
Title: A Managing Member
Address:
c/o X. X. Xxxxxxx & Co.
000 Xxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xx. Xxxxxx X. X'Xxxxx
Fax no.: (000) 000-0000
With a copy to
Xxxxxxxx Xxxxx Singer & Xxxxxxxxx, LLP
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx, Esq.
Fax no.: 000-000-0000
Stockholder Signature Page To
Registration Rights Agreement of
MedSource Technologies, Inc.
GERMAN AMERICAN CAPITAL CORPORATION
By: /s/ XXXX XXXXX
--------------------------------
Name: Xxxx Xxxxx
Title: Vice President
By: /s/
--------------------------------
Name:
Title: Vice President
Address:
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xx. X. Xxxxxxxxx Stuart
Telecopier: 000-000-0000
With a copy to
White & Case, LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Fax no.: 000-000-0000
SCHEDULE A
[To Registration Rights Agreement]
STOCKHOLDERS AND SHARES CURRENTLY OWNED
Number of Common Stock
Name of Stockholder Shares Equivalents
------------------- --------- ------------
Common Stockholders:
Xxxxxxx X. Xxxx 81,475 81,475
Xxxxx X. Xxxx 81,475 81,475
Xxxxxx X. Xxxxxxx, as Trustee under the
Xxxxxxxxx X. Xxxx Grantor Trust 27,159 27,159
Xxxxxx X. Xxxxxxx, as Trustee under the
Xxxx X. Xxxx Trust 27,159 27,159
Xxxxxx X. Xxxxxxx, as Trustee under the
Xxxxxx X. Xxxx Trust 27,159 27,159
Xxxxxxx Xxxx 3,621 3,621
Xxxx X. Xxxxxxx 3,621 3,621
Xxxxxxx X. Xxxxxxx 45,265 45,265
Xxxxxx X. Xxxxxx 45,265 45,265
Xxxx X. Xxxxxxxx 19,916 19,916
Xxxx X. Xxxxxx 32,184 32,184
Xxxxxxx Xxxxxxx 8,000 8,000
------- -------
Subtotal 402,300 402,300
Series B Preferred Stockholders:
X. X. Xxxxxxx III, L.P. 292,941.18 292,941.18
Whitney Strategic Partners III, L.P. 7,058.82 7,058.82
---------- ----------
Subtotal 300,000 300,000
Series Z Preferred Stockholders:
X. X. Xxxxxxx Mezzanine Fund, L.P. 48,750 48,750
Deutsche Bank Securities Inc. 16,250 16,250
------- -------
Subtotal 65,000 65,000
Total Shares 767,300 767,300
======= =======
