REGISTRATION RIGHTS AGREEMENT
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THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into as of the 19th day of November, 1999, by and among Xxxxxx
Companies, Inc., a Missouri corporation (the "Company"), and each of the
holders of the Common Stock (as defined below) set forth on the
signature pages hereto (each a "Shareholder" and, collectively, the
"Shareholders").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Stock Purchase Agreement dated
as of November 19, 1999 (the "Purchase Agreement"), by and among the
Shareholders and the Company, the Shareholders have acquired an
aggregate of Two Million Five Hundred Thousand (2,500,000) shares of the
Company's Common Stock; and
WHEREAS, as a condition to closing the transactions contemplated
by the Purchase Agreement, the parties agreed to execute and deliver
this Agreement setting forth certain rights of the Shareholders with
respect to registration under the Securities Act of 1933, as amended, of
the shares of Common Stock held by the Shareholders.
NOW, THEREFORE, in consideration of these premises, the covenants
and agreements herein contained, and other good and valuable
consideration, the receipt and sufficiency of which hereby are
acknowledged, the parties hereto agree as follows:
ARTICLE 1
Registration of Registrable Securities
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1.1 Certain Definitions. For purposes of this Agreement the
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following terms shall have the following meanings:
(a) "Act" means the U.S. Securities Act of 1933, as
amended, or any successor statute, and the rules and regulations of the
Commission issued under the Act.
(b) "Affiliate" means, with respect to any Person, any
Person directly or indirectly controlling, controlled by, or under
common control with such Person.
(c) "Commission" means the U.S. Securities and Exchange
Commission, or any other Federal agency then administering the Act.
(d) "Common Stock" shall mean shares of the Company's
Common Stock, $.01 per value per share, and any stock or securities
issued with respect to such Common Stock by reason of a stock dividend,
stock split, combination of shares, recapitalization, reclassification,
merger, consolidation, corporate reorganization or otherwise.
(e) "Exchange Act" means the Securities Exchange Act of
1934, as amended, and any successor statute, and the rules and
regulations of the Commission issued under the Exchange Act.
(f) "Holder" means (a) the Shareholder, and (b) any other
person holding Registrable Securities to whom the registration rights
set forth in this Agreement have been transferred pursuant to
Section 1.7.
(g) "Participating Holder" means any Holder of any
Registrable Securities included in a registration.
(h) "Person" means any individual, corporation, partnership,
limited liability company, trust or any other incorporated or
unincorporated entity or organization of any kind.
(i) "Prospectus" means the prospectus included in any
Registration Statement, as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion of
the Registrable Securities covered by any Registration Statement and all
other amendments and supplements to the prospectus, including post-
effective amendments and all materials incorporated by reference in such
prospectus.
(j) "Register," "registered" and "registration" refer to a
registration effected by preparing and filing a Registration Statement
in compliance with the Act and the declaration or ordering of
effectiveness of such Registration Statement;
(k) "Registrable Securities" means shares of Common Stock
issued to the Shareholder pursuant to the Purchase Agreement; provided,
however, that Registrable Securities shall cease to be Registrable
Securities upon any sale pursuant to a Registration Statement or
Section 4(1) of the Act or Rule 144 (or any combination thereof), and
provided, further, that, at such times as the entire block of otherwise
Registrable Securities may be sold by the holder thereof without any
volume limitation, including without limitation by reason of aggregation
or attribution, pursuant to Rule 144 or any successor rule, such block
shall not be deemed to be Registrable Securities.
(l) "Registration Expenses" shall mean all reasonable and
customary expenses of the Company incident to performance of or
compliance with this Agreement, including, without limitation: (i) all
Commission, stock exchange or registration and filing fees; (ii) filings
pursuant to the policy of the National Association of Securities
Dealers, Inc. with respect to the review of corporate financing;
(iii) all fees and expenses incurred in connection with compliance with
state securities or "blue sky" laws (including reasonable fees and
disbursements of counsel in connection with "blue sky" qualification of
any of the Registrable Securities and the preparation of a Blue Sky
Memorandum); (iv) all expenses of any Persons in preparing or assisting
in preparing, word processing, printing and distributing any
Registration Statement, Prospectus, certificates and other documents
relating to the performance of and
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compliance with this Agreement; (v) all fees and expenses incurred in
connection with the listing, if any, of any of the Registrable
Securities on any securities exchange or exchanges or automated
quotation system; (vi) the fees and disbursements of counsel for the
Company and of the independent public accountants of the Company,
including the expenses of any special audit or "comfort" letters
required by or incident to such performance and compliance. Registration
Expenses shall specifically exclude underwriting discounts and
commissions relating to the sale or disposition of Registrable
Securities by the Holders and transfer taxes, if any, relating to the
sale or disposition of Registrable Securities by the Holders; and
(vii) the fees and disbursements of one counsel for the Holders.
(m) "Registration Statement" means any registration
statement of the Company and any other entity required to be a
registrant with respect to such registration statement pursuant to the
requirements of the Act, including any Prospectus, and all amendments
and supplements to any such registration statement, including post-
effective amendments, and all exhibits and all material incorporated by
reference in any such registration statement.
(n) "Rule 144" means Rule 144 under the Act (or any
successor rule that may be adopted by the Commission ).
(o) "Rule 145" means Rule 145 under the Act (or any
successor rule that may be adopted by the Commission ).
(p) "Rule 415" means Rule 415 under the Act (or any
successor rule that may be adopted by the Commission ).
(q) "Rule 424" means Rule 424 under the Act (or any
successor rule that may be adopted by the Commission ).
(r) "Shelf Registration" means a "shelf" registration
statement on an appropriate form pursuant to Rule 415.
(s) "Underwritten Offering" means an offering in which
securities of the Company are sold to an underwriter for reoffering to
the public pursuant to an effective Registration Statement under the
Act.
1.2 Demand Registrations.
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(a) Requests for Registration. At any time on or after
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the date hereof, as set forth in this Section 1.2, the Holders of a
majority of the Registrable Securities may in writing request
registration under the Act of all or part of their Registrable
Securities. Each request for registration shall state that it is being
made pursuant to this Section 1.2 and shall specify the number of
Registrable Securities requested to be registered. Within ten days
after such notice has been given, the Company shall give written notice
to all other Holders, if any, of such requested registration. Each such
Holder shall have the right, by giving written notice to the Company
within 30 days after the Company gives its notice, to elect to have
included in such
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registration such of its Registrable Securities as such Holder may
request in such notice of election. Upon a request for a Demand
Registration, the Company shall use its best efforts to effect as
expeditiously as possible the registration, in accordance with
Section 1.4, of all Registrable Securities which the Company has been
requested to so register. Each registration requested pursuant to this
Section 1.2 is referred to herein as a "Demand Registration." If the
Company notifies the Holders in writing, prior to a request for a Demand
Registration from the Holders, of the Company's intent to register
securities with the Commission, and the Company effects a registration
in accordance with Section 1.3, the Holders' request shall be governed
by Section 1.3 and shall not constitute a Demand Registration.
(b) Limitations on Demand Registrations.
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(i) The Company shall not be required to effect more
than one Demand Registration.
(ii) If the Board of Directors of the Company, acting
in good faith, determines that the registration and distribution of
Registrable Securities (or the use of the Registration Statement or
related Prospectus) resulting from a Demand Registration would:
(A) materially and adversely interfere with
any previously announced business combination transaction involving the
Company pursuant to which the Company would issue, in connection with
such transaction, shares of Common Stock; or
(B) result in the premature disclosure of any
material pending financing, acquisition, corporate reorganization or any
other corporate development involving the Company or any of its
subsidiaries;
then, in either such event, the Company shall promptly give the Holders
written notice of such determination. The Company shall thereupon have
the right to delay the filing or the effectiveness (but not the
preparation) of the Registration Statement for the Demand Registration
for a reasonable period of time, but in no event more than 120 days
after the date that the request for a Demand Registration was made;
provided that in the event of such delay, the Holders of a majority of
the Registrable Securities to be included in such Demand Registration
will be entitled to withdraw such request and, if such request is
withdrawn, such Demand Registration will not count as a Demand
Registration, and responsibility for Registration Expenses incurred by
the parties prior to such delay shall be allocated in accordance with
Section 1.2(e). The Company may not exercise this right to delay a
Demand Registration more than once during any period of twelve
consecutive months.
(c) Underwriting Requirements. In connection with any
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Demand Registration involving an Underwritten Offering, the Company
shall (together with all Holders proposing to distribute their
securities through such Underwritten Offering) enter into an
underwriting agreement in customary form with the representative of the
underwriter or underwriters of recognized national or regional standing
selected for such Underwritten Offering
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by the Holders of a majority of the Registrable Securities proposed to
be sold pursuant to such Demand Registration and reasonably acceptable
to the Company. If a Demand Registration is an Underwritten Offering
and the representative of the underwriters advises the Holders in
writing that marketing factors, including, but not limited to, the price
at which such securities will be sold, require a limitation of the
number of Registrable Securities to be included in the registration and
Underwritten Offering, then, the number of shares of Common Stock that
may be included in an Underwritten Offering shall be allocated among
all Holders in proportion, as nearly as practicable, to the respective
amounts of Registrable Securities requested to be included in the
registration by such Holders. Also, in the event that the underwriter
requires a limitation of 10% or more in the number of Registrable
Securities to be included in the registration and Underwritten Offering
in an offering that would otherwise be pursuant to a Demand
Registration, such registration of shares shall not constitute a Demand
Registration.
(d) Expenses of Demand Registration. Except as provided
-------------------------------
in Section 1.2(e), all Registration Expenses incurred in connection with
a Demand Registration shall be borne by the Company. Underwriting
discounts and commissions relating to the sale or disposition of
Registrable Securities by the Holders and transfer taxes, if any,
relating to the sale or disposition of Registrable Securities by the
Holders, all shall be borne by the Holders. The cost of preparing all
documents incorporated by reference or otherwise required to be prepared
in the ordinary course of the Company's business shall be borne by the
Company. Expenses to be borne by the Holders shall be allocated to each
Holder in the same proportion as the amount of Registrable Securities
owned by such Holder which are included in the Demand Registration bears
to the amount of Registrable Securities owned by all Holders which are
included in the Demand Registration.
(e) Withdrawal of Demand Registration. Holders of a
---------------------------------
majority of the Registrable Securities proposed to be registered in a
given Demand Registration may elect to withdraw such Demand Registration
at any time by giving written notice thereof to the Company. Any Demand
Registration so withdrawn shall not constitute a Demand Registration
hereunder. The Registration Expenses incurred in any withdrawn Demand
Registration shall be borne solely by the Holders unless (i) the Holders
agree to forfeit their right to a Demand Registration, in which case all
such Registration Expenses shall be borne by the Company, (ii) the
Demand Registration was withdrawn as a result of the election of the
Company to delay the registration in accordance with Section 1.2(b), in
which case all such Registration Expenses shall be borne by the Company
and, in addition, the Company shall pay all of the fees and
disbursements of counsel to the Holders incurred prior to such delay, or
(iii) the Company continues to pursue such registration with respect to
securities to be sold for the Company's own account or the account of
others, in which case all such Registration Expenses shall be borne by
the Company.
1.3 Piggyback Registrations. If the Company proposes to
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register any of its Common Stock under the Act and the registration form
to be used can be used to register the resale of the Common Stock (other
than a Registration Statement (A) on Form S-8 or any successor form
relating to securities issuable pursuant to any benefit plan; (B) on
Form S-4, or any successor form relating to an exchange offer or
relating to a transaction pursuant to Rule 145, or (C) on Form S-3 or
any successor form with respect to securities registered in connection
with
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dividend reinvestment plans or similar plans only), the Company shall,
each such time, promptly give the Holders written notice of such
determination to effect such a registration not later than 30 days prior
to the anticipated date of initial filing with the Commission of the
Registration Statement. Upon the written request of any of the Holders
given within 20 days after the date that the Company gives its notice,
as part of the registration to which such notice relates, the Company
shall use its best efforts to effect as expeditiously as possible the
registration of all Registrable Securities that the Holders have
requested to be registered.
(a) Underwritten Offerings. If the registration of
----------------------
which the Company gives notice is for an Underwritten Offering, then the
Company shall so advise the Holders as a part of such written notice. In
such event, the right of the Holders to registration pursuant to this
Section shall be conditioned upon the Holders' agreeing to participate
in such Underwritten Offering upon the terms and condition as shall be
negotiated by the Company, and the inclusion of the Registrable
Securities in the Underwritten Offering to the extent provided herein.
The Holders proposing to distribute securities through such Underwritten
Offering shall (together with the Company) enter into an underwriting
agreement in customary form with the underwriter or underwriters
selected for such Underwritten Offering by the Company. Notwithstanding
any other provisions of this Section, if the underwriter determines in
writing, in its sole and absolute discretion, that marketing factors,
including the price at which such securities will be sold, require a
limitation of the number of shares to be underwritten, then the
underwriter may exclude some or all Registrable Securities from such
registration and Underwritten Offering in accordance with the provisions
of this Section. The Company shall so advise the Holders distributing
securities through such Underwritten Offering, and the number of
Registrable Securities that may be included in the registration and
Underwritten Offering on behalf of the Holders shall be allocated among
the Holders in proportion, as nearly as practicable, to the respective
amounts of Registrable Securities which the Holders requested to be
included in the registration. The Company does hereby represent that,
other than as provided in this Agreement, there are no holders of shares
of capital stock of the Company that have any registration rights with
respect to such shares. The Company hereby covenants that it shall not
grant any person registration rights with respect to shares of capital
stock of the Company unless such registration rights are expressly
subordinated to the rights of the Holders hereunder, and it is
understood that in any registration in which the Holders may participate
pursuant to the Agreement that, in the event that the underwriter
requires a limitation in the number of securities to be included in the
registration and Underwritten Offering, the Registrable Securities shall
have priority over any other shares proposed to be included in such
offering other than shares offered for sale by the Company for its
account. If the Holders disapprove of the terms of any such
Underwritten Offering, then the Holders may elect to withdraw therefrom
by giving written notice to the Company and the underwriter. Any
securities so excluded or withdrawn from such Underwritten Offering
shall be withdrawn from such registration.
(b) Expenses of Piggyback Registrations. In the case of
-----------------------------------
any registration effected pursuant to this Section 1.3, all Registration
Expenses incurred in connection therewith shall be borne by the Company,
except that Underwriting discounts and commissions relating to the sale
or disposition of Registrable Securities by the Holders and transfer
taxes, if any, relating to the sale or disposition of Registrable
Securities by the Holders,
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all shall be borne by the Holders. The cost of preparing all documents
incorporated by reference or otherwise required to be prepared in the
ordinary course of the Company's business shall be borne by the Company.
Expenses to be borne by the Holders shall be allocated to each Holder in
same proportion which the Registrable Securities owned by such Holder
which are included in the registration bears to the Registrable
Securities owned by all Holders which are included in the registration.
1.4 Registration Procedures. If and whenever the Company
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shall be required to use its best efforts to effect or cause the
registration of any Registrable Securities under the Act as provided in
this Agreement, the Company shall (and, with respect only to Sections
1.4(i) and 1.4(j), the Holders shall) as expeditiously as reasonably
possible:
(a) prepare and file with the Commission a Registration
Statement with respect to such Registrable Securities on any form for
which the Company then qualifies or that counsel for the Company shall
deem appropriate, and which form shall be available for the sale of the
Registrable Securities in accordance with the methods of distribution
thereof intended by the Holders participating in such registration, and
use its best efforts to cause such Registration Statement to become and
remain effective;
(b) prepare and file with the Commission amendments and
post-effective amendments to such Registration Statement and such
amendments and supplements to the Prospectus used in connection
therewith as may be necessary to maintain the effectiveness of such
registration or as may be required by the rules, regulations or
instructions applicable to the registration form utilized by the Company
or by the Act for a Shelf Registration if requested by the Holders of a
majority of the Registrable Securities to be included in such
registration, or otherwise necessary to keep such Registration Statement
effective to permit the methods of distribution intended by the Holders
participating in such registration for at least 120 days and cause the
Prospectus as so supplemented to be filed pursuant to Rule 424, and to
otherwise comply with the provisions of the Act with respect to the
disposition of all securities covered by such Registration Statement in
the manner reasonably requested by the Holders of a majority of the
Registrable Securities to be included in such registration until the
earlier of (x) such time as all of the Registrable Securities have been
disposed of in accordance with the intended methods of disposition, and
(y) the expiration of six months after the effective date of such
Registration Statement (it being understood that the Company at its
option may determine to maintain such effectiveness for a longer period,
whether pursuant to a Shelf Registration or otherwise); provided,
however, that a reasonable time before filing a Registration Statement
or Prospectus, or any amendments or supplements thereto (other than
reports required to be filed by it under the Exchange Act), the Company
shall furnish to the Participating Holders, the managing underwriter and
their respective counsel for review and comment, copies of all documents
proposed to be filed;
(c) furnish to the Participating Holders and to any
underwriter in connection with an Underwritten Offering such number of
conformed copies of such Registration Statement and of each amendment
and post-effective amendment thereto (in each case including all
exhibits) and such number of copies of any preliminary Prospectus,
Prospectus or Prospectus
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supplement and such other documents as the Participating Holders or
underwriter may reasonably request in order to facilitate the
disposition of the Registrable Securities by the Participating Holders
or underwriters (the Company hereby consenting to the use (subject to
the limitations set forth in Section 1.4(j) hereof) of the Prospectus or
any amendment or supplement thereto in connection with such
disposition);
(d) use its best efforts to register or qualify the sale
of such Registrable Securities covered by such Registration Statement
under such other securities or "blue sky" laws of such jurisdictions as
the Participating Holders shall reasonably request, except that the
Company shall not for any such purpose be required to (i) qualify
generally to do business as a foreign corporation in any jurisdiction
where, but for the requirements of this Section 1.4(d), it would not be
obligated to be so qualified, (ii) subject itself to taxation in any
such jurisdiction, or (iii) to consent to general service of process in
any such jurisdiction;
(e) notify the Participating Holders, at any time when a
Prospectus relating thereto is required to be delivered under the Act
within the appropriate period mentioned in Section 1.4(b) hereof, of the
Company's becoming aware that the Prospectus included in such
Registration Statement, as then in effect, includes an untrue statement
of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading in light of the circumstances then existing, and, at the
request of any Participating Holder, prepare and furnish to such
Participating Holder a reasonable number of copies of an amendment or
supplement to such Registration Statement or related Prospectus as may
be necessary so that, as thereafter delivered to the purchasers of such
Registrable 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 light of the circumstances then existing;
(f) notify the Participating Holders as soon as possible:
(i) when the Prospectus or any Prospectus supplement
or post-effective amendment has been filed, and, with respect to the
Registration Statement or any post-effective amendment, when the same
has become effective;
(ii) of any request by the Commission for amendments
or supplements to the Registration Statement or the Prospectus or for
additional information;
(iii) of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or any
order preventing the use of a related Prospectus, or the initiation (or
any overt threats) of any proceedings for such purposes; and
(iv) of the receipt by the Company of any written
notification of the suspension of the qualification of any of the
Registrable Securities for sale in any jurisdiction or the initiation
(or overt threats) of any proceeding for that purpose;
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(g) use its best efforts to cause all such Registrable
Securities to be listed on The Nasdaq Stock Market or any other national
securities exchange or automated quotation system on which the class of
Registrable Securities being registered is then listed, if such
Registrable Securities are not already so listed;
(h) in the event of the issuance of any stop order
suspending the effectiveness of the Registration Statement or of any
order suspending or preventing the use of any related Prospectus or
suspending the qualification of any Registrable Securities included in
the Registration Statement for sale in any jurisdiction, the Company
shall use all commercially reasonable efforts promptly to obtain its
withdrawal;
(i) the Participating Holders shall furnish the Company
with such information regarding the Participating Holders and pertinent
to the disclosure requirements relating to the registration and the
distribution of such securities as the Company may from time to time
reasonably request in writing; and
(j) the Participating Holders shall, upon receipt of any
notice from the Company of the happening of any event of the kind
described in Section 1.4(e) hereof, forthwith discontinue disposition of
Registrable Securities pursuant to the Prospectus or Registration
Statement covering such Registrable Securities until the Participating
Holders shall have received copies of the supplemented or amended
Prospectus contemplated by Section 1.4(e) hereof, and, if so directed by
the Company, the Participating Holders shall deliver to the Company (at
the Company's expense) all copies, other than permanent file copies then
in the Participating Holders' possession, of the Prospectus covering
such Registrable Securities current at the time of receipt of such
notice.
1.5 Black-Out Period Agreement. In consideration for the
--------------------------
Company agreeing to its obligations under this Agreement, the Holders
agree in connection with any registration of the Company's securities
(other than pursuant to a Registration Statement (A) on Form S-8 or any
successor form relating to securities issuable pursuant to any benefit
plan; (B) on Form S-4, or any successor form relating to an exchange
offer or relating to a transaction pursuant to Rule 145 under the Act;
or (C) on Form S-3 or any successor form with respect to securities
registered in connection with dividend reinvestment plans and similar
plans only) and provided that (A) all officers and directors of the
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Company and all other persons with registration rights enter into
similar agreements, and (B) nothing contained herein shall prohibit any
holder of Registrable Securities from transferring any Common Stock to a
trust established for estate planning purposes so long as the trust
executes a similar undertaking, that, upon the request of the
underwriters managing any underwritten offering of the Company's
securities, not to sell, make any short sale of, loan, grant any option
for the purchase of, or otherwise dispose of any of the Common Stock
(other than those included in the registration) without the prior
written consent of such underwriters for up to 180 days after the
effective date of such registration. The restrictions in this
Section 1.5 shall not prevent a Holder from selling shares of Common
Stock purchased by it in the public markets, provided that such
Purchaser is not in a net short position with respect to publicly
tradeable Common Stock or other derivative securities with respect
thereto at any time during such 180-day period. Notwithstanding
anything to the contrary set forth herein, the terms
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of this Section 1.5 may not be amended or modified, directly or
indirectly, without the express written consent of each holder of
Registrable Securities detrimentally affected by such amendment or
modification and any such amendment or modification made without such
holder's consent shall not be applicable to that holder.
1.6 Rule 144 Reporting. With a view toward making available
------------------
to the Holders the benefits of certain rules and regulations of the
Commission that may permit the sale of the Common Stock to the public
without registration, the Company agrees to use its best efforts to:
(a) make and keep current public information available,
within the meaning of Rule 144 or any similar or analogous rule
promulgated under the Act;
(b) file with the Commission, in a timely manner, all
reports and other documents required of the Company under the Act and
the Exchange Act;
(c) use commercially reasonable efforts to take such
action to enable the holders of Registrable Securities to utilize Form
S-3 for the sale of their shares; and
(d) so long as any party hereto owns any Registrable
Securities, furnish to such party forthwith upon request, a written
statement by the Company as to its compliance with the reporting
requirements of Rule 144, the Act and the Exchange Act, or as to its
qualification that it qualifies as a registrant whose shares may be
resold pursuant to Form S-3; a copy of the most recent annual or
quarterly report of the Company; and such other reports and documents as
such party may reasonably request in availing itself of any rule or
regulation of the Commission allowing it to sell any such securities
without registration.
1.7 Transfer of Registration Rights. The registration rights
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of any Shareholder under this Agreement may not be transferred except
(i) to a transferee who is the heir of a Shareholder, the personal
representative of a Shareholder's estate or a revocable trust
voluntarily established by such Shareholder primarily for his benefit,
(ii) by any Shareholder to any Affiliate of such Shareholder to whom any
of the shares owned by the Shareholder are transferred, and (iii) by any
Shareholder to any transferee who acquires at least five thousand
(5,000) Registrable Securities (adjusted to reflect subsequent stock
splits, combinations, stock dividends and recapitalizations); provided,
however, that (i) the Company is given written notice by such
Shareholder at the time of such assignment and transfer stating the name
and address of the transferee and identifying the securities with
respect to which the rights under this Agreement are being assigned and
transferred, and (ii) the transferee executes such documents as the
Company may request evidencing the transferees agreement to be bound by
the restrictions herein.
For the purposes of this Section 1.7, a change in control of an
Affiliate of a Shareholder holding shares entitling such Affiliate to
the registration rights hereunder, such that such Affiliate is
subsequent to such change of control no longer an Affiliate of such
Shareholder, shall be deemed an attempted transfer of the registration
rights hereunder and such former Affiliate of such Shareholder shall not
be entitled to such registration rights.
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1.8 Orderly Disposition of Large Amounts of Shares. Each
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Holder agrees that if he proposes to dispose of more than 100,000 shares
of Common Stock in any three-month period, he will give at least ten
days' notice to the Company prior to such disposition and use reasonable
efforts to coordinate such sales with the Company to facilitate an
orderly disposition without a material adverse effect on the market
price of the Common Stock.
ARTICLE 2
Indemnification
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2.1 General Indemnification. In connection with any
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registration or qualification of the Registrable Securities under this
Agreement, (i) the Company shall indemnify and hold harmless each of the
Holders, including but not limited to each Person, if any, who controls
a Holder within the meaning of Section 15 of the Act, against all
losses, claims, damages, liabilities and expenses (including but not
limited to reasonable expenses incurred in investigating, preparing and
defending against any claim) to which a Holder or such controlling
person may become subject under the Act, the Exchange Act or otherwise,
insofar as the same arise out of or are based upon or are caused by any
untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement or Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or
supplements thereto) furnished pursuant to this Agreement or insofar as
the same arise out of or are based upon or are caused by 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 such losses, claims, damages, liabilities or expenses
are ultimately determined to have arisen out of or were based upon or
were caused by any untrue statement or alleged untrue statement or
omission or alleged omission based upon written information furnished to
the Company by or on behalf of any Holder or any such control person for
inclusion in any Registration Statement or Prospectus (and any
amendments or supplements thereto), and (ii) each Holder, severally and
not jointly, shall indemnify the Company, its affiliates, any person who
signed any Registration Statement, and their respective officers,
directors and control persons against all such losses, claims, damages,
liabilities and expenses (including but not limited to reasonable
expenses incurred in investigating, preparing and defending against any
claim) insofar as the same are ultimately determined to have arisen out
of or were based upon or were caused by any such untrue statement or
alleged untrue statement or any such omission or alleged omission based
upon written information furnished to the Company by or on behalf of
such Holder or any such control person for the inclusion in any
Registration Statement or Prospectus (and any amendments or supplements
thereto).
2.2 Notice of, and Procedures for, Collecting
------------------------------------------
Indemnification. Promptly upon receipt by a party indemnified under
---------------
this Agreement of notice of the commencement of any action against such
indemnified party in respect of which indemnity or reimbursement may be
sought against any indemnifying party under this Agreement, such
indemnified party shall notify the indemnifying party in writing of the
commencement of such action, but the failure so to notify the
indemnifying party shall not relieve it of any liability which it may
have to any indemnified party otherwise than under this Agreement unless
such failure shall materially and
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adversely affect the defense of such action. In case notice of
commencement of any such action shall be given to the indemnifying party
as above provided, the indemnifying party shall be entitled to
participate in and, to the extent it may wish, jointly with any other
indemnifying party similarly notified, to assume the defense of such
action at its own expense, with counsel chosen by it and reasonably
satisfactory to such indemnified party. The indemnified party shall
have the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of such
counsel (other than reasonable expenses incurred in investigating,
preparing and defending against any claim) shall be paid by the
indemnified party unless (a) the indemnifying party agrees to pay the
same, (b) the indemnifying party fails to assume the defense of such
action with counsel reasonably satisfactory to the indemnified party (in
which case the indemnifying party shall not have the right to assume the
defense of such action on behalf of such indemnified party), or (c) the
named parties to any such action (including any impleaded parties) have
been advised by such counsel that representation of such indemnified
party and the indemnifying party by the same counsel would be
inappropriate under applicable standards of professional conduct (in
which case the indemnifying party shall not have the right to assume the
defense of such action on behalf of such indemnified party). In the
event that either of the circumstances described in clauses (b) and (c)
of the sentence immediately preceding shall occur, the indemnified party
shall have the right to select a separate counsel and to assume such
legal defense and otherwise to participate in the defense of any such
action, with the expenses and fees of such separate counsel and other
expenses related to such participation to be reimbursed by the
indemnifying party as incurred. No indemnifying party shall be liable
for any settlement entered into without its consent, which consent shall
not be unreasonably withheld or delayed.
ARTICLE 3
Miscellaneous
-------------
3.1 Notices. All notices, requests and other communications
-------
to any party hereunder shall be in writing and shall be given to such
party at its address or telecopier number set forth on the signature
page hereof, or such other address or telecopier number as such party
may hereinafter specify for the purpose. Each such notice, request or
other communication shall be effective (a) if given by telecopy, when
such telecopy is transmitted to the telecopy number specified in this
Section 3.1 and the transmitting telecopier receives confirmation of
delivery, (b) if given by overnight air courier, on the next business
day after the date of shipment, or (c) if given by any other means, when
delivered at the address referred to in, or specified by such party
pursuant to, this Section 3.1.
3.2 Amendment and Waiver. The provisions of this Agreement
--------------------
may be amended or waived only upon the prior written consent of the
Company and the Holders of a majority of the Registrable Securities.
3.3 Counterparts. This Agreement may be executed in two or
------------
more counterparts, all of which taken together shall constitute one
instrument.
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3.4 Binding on Successors and Assigns. Except as set forth in
---------------------------------
Section 1.7, no party may assign any of its rights or delegate any of
its duties under this Agreement without the prior consent of the other
party. This Agreement shall be binding upon, inure to the benefit of
and be enforceable by and against the parties hereto and their
respective successors and permitted assigns in accordance with the terms
hereof.
3.5 Headings. The headings in the sections and subsections of
--------
this Agreement are inserted for convenience only and in no way alter,
amend, modify, limit or restrict the contractual obligations of the
parties.
3.6 Severability. Whenever possible, each provision of this
------------
Agreement will be interpreted in such manner as to be effective and
valid under applicable law, but if any provision of this Agreement is
held to be prohibited by or invalid under applicable law, such provision
will be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of this Agreement.
3.7 Arbitration. Any and all disputes relating to this
-----------
Agreement and the transactions contemplated hereby (including, without
limitation, that a party hereto is entitled to indemnification and/or
the amount thereof) shall be settled by binding arbitration conducted in
accordance with the Commercial Arbitration Rules of the American
Arbitration Association before a panel of three commercial arbitrators
in St. Louis, Missouri. Each disputing party shall select a single
arbitrator, and the two arbitrators so selected shall select a third
arbitrator. If such arbitrators cannot agree upon a third arbitrator
within 30 days after their appointment, then an arbitrator shall be
appointed by the American Arbitration Association. The arbitrators may
not consolidate arbitration proceedings under this Agreement with other
pending arbitration proceedings without the prior written consent of the
participants. The Commercial Arbitration Rules, as applied to any
arbitration conducted pursuant hereto, may be modified with the mutual
consent of the participants or upon the unanimous agreement of the three
arbitrators. The decision and/or award of a majority of such arbitrators
shall be final and binding upon all parties having an interest in the
dispute. The award of the arbitrators will include a reasoned opinion.
Any participant may enter a judgment upon the award rendered by the
arbitrators in any court having jurisdiction over the dispute.
3.8 Entire Agreement; Law Governing. All prior negotiations
-------------------------------
and agreements between the parties hereto are superseded by this
Agreement, and there are no representations, warranties, understandings
or agreements other than those expressly set forth herein, except as
modified in writing concurrently herewith or subsequent hereto. This
Agreement shall be governed by and construed and interpreted according
to the internal laws of the State of New York, determined without
reference to conflicts of law principles.
* * *
- 13 -
IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be executed by their duly authorized representatives as of the day
and year first above written.
THIS CONTRACT CONTAINS A BINDING ARBITRATION PROVISION WHICH MAY
BE ENFORCED BY THE PARTIES.
XXXXXX COMPANIES, INC.
By
---------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Address: 0000 XxXxxxxx Xxxx
Xx. Xxxxx, Xxxxxxxx 00000
Fax No. (000) 000-0000
SHAREHOLDERS:
--------------------------------------------
Xxxx Xxxxxxx
Address: Xx. Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxx xx Xxxxx XX00 0XX
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--------------------------------------------
Xxxxxx Xxx
Address: 00 Xxxxx Xxxx
Xxxxx, Xxxxxx,
Xxxx xx Xxxxx XX00 0XX
--------------------------------------------
Giovanni Belgranno
Address: Xxxxxxxxxx House
Lawn Road
Milford on Sea, Lymington
Hampshire SO41 OQZ
--------------------------------------------
Xxxxx Xxxx
Address: Warders Cottage
Xxxxxx Cross
Brightstone, Isle of Wight
--------------------------------------------
Xxxx Xxxxx
Address: Two Trees
71 Foreland Road
Bembridge, Isle of Wight
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--------------------------------------------
Xxxxx Xxxxxx
Address: Xxxxxxx Xxxx Xxxx
Xxxxx Xxxx Xxxx
Xxxxxxxxxxxxx, Xxxxxxx XX00 0XX
--------------------------------------------
Xxxxxx Xxxxxxxx
Address: 000 Xxxxxx Xxxx
Xxxxxxxxx, Xxxxxxxxxxx
Xxxxxxxxx XX00 0XX
--------------------------------------------
Xxxxxx Xxxxxx
Address: 0 Xxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxx
Xxxxxxxxx, XX00 0XX
--------------------------------------------
Xxxxx Xxxxxxx
Address: 00 Xxxxxxx Xxxx
Xxxxxxx, Xxxxxx
Xxx Xxxxx Xxxxx, 0000
Xxxxxxxxx
- 16 -
--------------------------------------------
Xxxxxxx Xxxxx Xxxxxx
Address: Forehaven
000 Xxxxxxx Xxxx
Xxxxxxxxx, Xxxx xx Xxxxx, XX00 0XX
--------------------------------------------
Xxxxxxxx Xxxxxxxxxx
Address: 00 Xxxxxxxx Xxxx
Xxxxx, Xxxx xx Xxxxx XX00 0XX
--------------------------------------------
Xxxx Xxxx
Address: 00 Xxxxx Xxxx Xxxx
Xxxxxxxxx, Xxxx xx Xxxxx,
XX00 0XX
--------------------------------------------
Xxxxxxx Xxxxxxxxxx
Address: 00 Xxxxx Xxxxx
Xxxxx Xxx, Xxxxxxxxxxx
Xxxxxxxxx, XX00 0XX
- 17 -
--------------------------------------------
Lars Hallkvist
Address: Hallkvist Trading ApS
Helleboek Kloedefabrik
Xxxxx Xxxxxxxx 000X
XX-0000 Xxxxxxxxx
--------------------------------------------
Xxxxx Xxxxxx
Address: Xxxxxx Xxxxxxx
Xxxxxx Xxxx
Xxxxxxx Xxx, Xxxx xx Xxxxx
XX00 0XX
--------------------------------------------
Xxxxxxxxx Xxxxxxxx
Address: Xxxxxxxxxx House
Lawn Road
Milford on Sea, Xxxxxxxxx
Xxxxxxxxx XX00 0XX
--------------------------------------------
Xxxxxxxx Xxxxxxx
Address: Xx. Xxxxxxx Xxxxx
Xxxxxxxxx, Xxxx xx Xxxxx XX00 0XX
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--------------------------------------------
Xxxxxx Xxxx
Address: Warders Cottage
Xxxxxx Cross
Brightstone, Isle of Wight
--------------------------------------------
Xxxxxx Xxx
Address: 00 Xxxxx Xxxx
Xxxxxx, Xxxxx
Xxxx xx Xxxxx XX00 0XX
- 19 -
