Exhibit 10.23
REGISTRATION RIGHTS AGREEMENT
AGREEMENT dated as of October 1, 1999 among Xxxxx International Trust
LLC; Xxxxx Xxxxxxxx; Penn Capital Management c/o Penn Value Income Fund, Xxxxx
Xxxxxxx, Xxxx Xxxxxx, Xxxxxxx X. Xxxxxx, Penn High Yield Fund, Xxxxxx Xxxxx,
Penn Cap Block, AK STEEL, University of Chicago, Penn Capital Strategic High
Yield Mutual Fund, and Tip Xxxxxx Target Select; Sandler Capital Partners IV,
L.P. and Sandler Capital Partners IV FTE, L.P. (collectively the "Selling
Shareholders") and Xxxxx International Networks, Ltd., a Colorado corporation
(the "Company").
ARTICLE I
DEFINITIONS
SECTION 1.1. DEFINITIONS. (a) The following terms, as used herein,
have the following meanings:
"Capital Stock" means, at any time, the Class A Shares, the Class
B Shares and any other shares of authorized capital stock of the Company.
"Class A Shares" means the shares of Class A Common Stock, par
value $0.01 per share, of the Company received upon conversion of the Company's
Series A Convertible Preferred Stock.
"Person" means an individual, corporation, partnership,
association, trust or other entity or organization, including a government or
political subdivision or an agency or instrumentality thereof.
"Public Offering" means the initial completed underwritten public
offering of Class A Shares by the Company pursuant to a registration statement
filed under the Securities Act.
"Registrable Securities" means any Class A Shares owned by the
Selling Shareholder. Class A Shares as to which registration rights have
terminated under Section 5.4 are no longer Registrable Securities.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended,
and the rules and regulations promulgated thereunder.
"Underwriter" means a securities dealer who purchases any
Registrable Securities as principal and not as part of such dealer's
market-making activities.
(b) Each of the following terms is defined in the Section set forth
opposite such term:
Term Section
---- -------
Demand Registration 2.1
Demanding Selling Shareholder 2.3(a)(i)
Indemnified Party 4.3
Indemnifying Party 4.3
Inspectors 3.1 (g)
Piggy-Back Registration 2.2
Records 3.1(g)
ARTICLE II
REGISTRATION RIGHTS
SECTION 2.1. DEMAND REGISTRATION. (a) At any time commencing six
(6) months after the Public Offering, the Selling Shareholders may make a
written request for registration under the Securities Act of all or part of the
Registrable Securities owned by the Selling Shareholders (a "Demand
Registration"), PROVIDED that the Company shall not be obligated to effect (i)
any Demand Registration covering less than 160,000 Registrable Shares, (ii) more
than one Demand Registration pursuant to the provisions of this Section 2.1 in
any twelve-month period and (iii) more than two Demand Registrations during the
term of this Agreement, one of which may be exercised by Xxxxx International
Trust LLC and one of which may be exercised by holders of a majority of the
Registrable Securities at the time owned by the Selling Shareholders other than
Xxxxx (the "Non-Xxxxx Selling Shareholders"). Any request for a Demand
Registration will specify the aggregate number of shares of Registrable
Securities proposed to be sold by the Selling Shareholders making the demand and
will also specify the intended method of disposition thereof. If the demand by
Non-Xxxxx Selling Shareholders is made by less than all of the Non-Xxxxx Selling
Shareholders, the Company shall give notice promptly of such demand to those
Non-Xxxxx Selling Shareholders that have not participated in such demand. If
any such Non-Xxxxx Selling Shareholders notify the Company prior to filing of
any registration statement pursuant to such demand that they wish to include
some or all of their Registrable Shares in such registration, such persons shall
be considered Demanding Selling Shareholders (as defined herein) with respect to
such registration.
(b) A registration will not count as a Demand Registration until it
has become effective. In addition, if more than 50% of the aggregate number of
Registrable Securities requested to be registered pursuant to this Section 2.1
are excluded from the offering in accordance with Section 2.3, such offering
will not count as a Demand Registration.
(c) If the offering of such Registrable Securities pursuant to such
Demand Registration is an underwritten offering, the Selling Shareholders making
such demand shall select the book-running managing Underwriter and any
additional investment bankers and
managing Underwriters to be used in connection with the offering, PROVIDED
that such Underwriters and investment bankers must be reasonably satisfactory to
the Company.
SECTION 2.2. PIGGY-BACK REGISTRATION. At any time after the Public
Offering and during the term of this Agreement, if the Company proposes to file
a registration statement under the Securities Act with respect to an offering of
any shares of Capital Stock (i) for the Company's own account (other than a
registration statement on Form S-4 or S-8 (or any substitute form that may be
adopted by the SEC) or (ii) for the account of any of its respective security
holders, then the Company shall give written notice of such proposed filing to
the Selling Shareholders as soon as practicable (but in no event less than 10
days before the anticipated filing date), and such notice shall, subject to
Section 2.3, offer the opportunity to register such number of shares of
Registrable Securities as they may request on the same terms and conditions as
the proposed offering (a "Piggy-Back Registration"). The Selling Shareholders
will have five business days after receipt of any such notice to notify the
Company as to whether they wish to participate in a Piggy-Back Registration and,
if so, the number of Registrable Securities proposed to be included in such
offering. The Company shall use its reasonable efforts to cause the managing
Underwriters of a proposed underwritten offering to permit the Registrable
Securities to be included in a Piggy-Back Registration to be included on the
same terms and conditions as any similar securities of the Company included
therein.
SECTION 2.3. REDUCTION OF OFFERING. (a) Notwithstanding anything
contained in Section 2.1 or 2.2, if the book-running managing Underwriter of an
offering described in Section 2.1 or Section 2.2 states that, in its good faith
judgment either the size of the offering that the Selling Shareholders, the
Company and any other Persons intend to make or the combination of securities
that the Selling Shareholders, the Company and such other Persons intend to
include in such offering are such that the success of the offering is reasonably
likely to be materially and adversely affected by the inclusion of the
Registrable Securities, then:
(i) if the size of the offering is the basis of such
Underwriter's opinion, the aggregate amount of Registrable Securities to be
offered for the account of the Selling Shareholders shall be reduced to the
extent necessary to reduce the total amount of securities to be included in such
offering to the amount recommended by such Underwriter, PROVIDED that (x) in the
case of a Demand Registration, the amount of Registrable Securities to be
offered for the account of the Selling Shareholder or Selling Shareholders
making the demand (the "Demanding Selling Shareholders") shall be reduced only
after the amount of securities to be offered for the account of the Company and
any other Persons that are not Selling Shareholders (other than Adelphia
Communications Corporation, Tuxedo Shirt, Inc., Xxx Xxxxxxxxxx and Xxxx
Xxxxxxxxx, to the extent such shareholders are exercising piggyback registration
rights pursuant to registration rights agreements entered into prior to the date
hereof, who shall, unless otherwise agreed, be subject to proportionate
reduction with the Demanding Selling Shareholder(s) in the manner specified in
2.3(i)(y) below) has been reduced to zero, (y) in the case of a Piggy-Back
Registration, if securities are being offered for the account of Persons other
than the Company (including a Demanding Selling Shareholder), then, unless a
different requirement is imposed pursuant to the provisions of Section 2.3(b),
the proportion by which the aggregate amount of such Registrable Securities
intended to be offered for the account of any Selling Shareholder is reduced
shall not exceed the proportion by which the amount of
such securities intended to be offered for the account of such other Persons is
reduced, and (z) in the case of a Piggy-Back Registration, if securities are
being offered for the account of the Company, the Company shall be entitled to
offer all securities it wishes to offer, and all other securities to be included
in such offering, including securities to be offered by Selling Shareholders and
any other Person that is not a Selling Shareholder, shall be subject to
proportionate reduction based on the percentage of securities desired to be
offered by each such shareholder; and
(ii) if the combination of securities to be offered is the basis
of such Underwriter's opinion, the Registrable Securities to be included in such
offering shall be reduced as described in clause (i) above, except that in the
case of a Piggy-Back Registration, if the actions described in sub-clauses (y)
and (z) of the proviso in such clause (i) would, in the judgment of the managing
Underwriter, be insufficient to substantially eliminate the adverse effect that
inclusion of the Registrable Securities requested to be included would have on
such offering, such Registrable Securities will be excluded from such offering.
(b) If a Piggy-Back Registration opportunity occurs as a result of
the exercise of a demand right by a holder (including a Demanding
Selling Shareholder) of shares of the Company similar to the right set
forth in Section 2.1, whether or not the offering is an underwritten
offering, the Company shall have the right to require that the Selling
Shareholders (or any one or more of them) reduce the number of
Registrable Shares of the Selling Shareholders (or any one or more of
them) included in such Piggy-Back Registration, or to cause no such
Registrable Shares to be included in such Piggy-Back Registration.
SECTION 2.4. REGISTRATION EXPENSES. In connection with any Demand
Registration or Piggy-Back Registration, the Company shall pay the following
expenses incurred in connection with such registration: (i) all SEC, stock
exchange and National Association of Securities Dealers, Inc. registration and
filing fees, (ii) fees and expenses of compliance with securities or blue sky
laws (including reasonable fees and disbursements of counsel in connection with
blue sky filings regarding the sale of the Registrable Securities), (iii)
printing expenses, (iv) fees and expenses incurred in connection with the
listing of the Registrable Securities on the NASDAQ National Market System (or,
if no shares of Capital Stock are listed for trading on such system, such other
principal exchange or market where shares of Capital Stock are listed or
otherwise admitted for trading), (v) fees and expenses of counsel and
independent certified public accountants for the Company (including fees and
expenses associated with the delivery of special audits or comfort letters),
(vi) the reasonable fees and expenses of any additional experts retained by the
Company in connection with such registration and (vii) internal expenses of the
Company (including salaries and expenses of officers and employees). The
Selling Shareholders shall pay any underwriting fees, discounts or commissions
attributable to the sale of Registrable Securities, and shall pay their own
counsel fees and expenses.
ARTICLE III
REGISTRATION PROCEDURES
SECTION 3.1. FILINGS; INFORMATION. Whenever the Selling Shareholders
request that any Registrable Securities be registered pursuant to Article II
hereof, the Company will use its reasonable efforts to effect the registration
and sale of such Registrable Securities in accordance with the requested method
of disposition thereof as promptly as reasonably practicable, and in connection
with any such request:
(a) The Company will expeditiously prepare and file with the SEC a
registration statement on any form for which the Company then qualifies and
which the Company shall deem appropriate and available for the sale of the
Registrable Securities to be registered thereunder in accordance with the
intended method of distribution thereof, and use its reasonable efforts to cause
such filed registration statement to become and remain effective for a period of
not more than nine months (or such shorter period which will terminate when all
Registrable Securities covered by such registration statement have been sold
(but not before the expiration of the period referred to in Section 4(3) of the
Securities Act and Rule 174 thereunder, if applicable)) after the date of the
original filing or such other period as is necessary to comply with the
provisions of the Securities Act, PROVIDED that if the Company shall furnish to
the Selling Shareholders a certificate signed by the Company's Chairman,
President or any Vice President stating that in his or her good faith judgment
it would be detrimental or otherwise disadvantageous to the Company or its
shareholders for such a registration statement to be filed expeditiously, the
Company shall have a period of 120 days in any twelve (12) month period (which
may be extended by the Company, with the consent of the requesting Selling
Shareholders, on the same basis for an additional period of 90 days) within
which to file such registration statement measured from the date of the
Company's receipt of the Selling Shareholders' request for registration in
accordance with Section 2.1.
(b) The Company will, if requested, prior to filing such registration
statement or any amendment or supplement thereto, furnish to the Selling
Shareholder and each applicable managing Underwriter, if any, copies thereof,
and thereafter furnish to the Selling Shareholders and each such Underwriter, if
any, such number of copies of such registration statement, amendment and
supplement thereto (in each case including all exhibits thereto and documents
incorporated by reference therein) and the prospectus included in such
registration statement (including each preliminary prospectus) as the Selling
Shareholders or each such Underwriter may reasonably request in order to
facilitate the sale of the Registrable Securities.
(c) After the filing of the registration statement, the Company will
promptly notify the Selling Shareholders of any stop order issued or, to the
Company's knowledge, threatened to be issued by the SEC and take all reasonable
actions required to prevent the entry of such stop order or to remove it if
entered.
(d) The Company will use reasonable efforts to register or otherwise
qualify the Registrable Securities for offer and sale under such other
securities or blue sky laws of such jurisdictions in the United States as the
Selling Shareholders reasonably request, and to do any and all other acts and
things that may be necessary or advisable to consummate the requested
disposition of the Registrable Securities, PROVIDED that the Company will not be
required to (i) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this paragraph (d), (ii)
subject itself to taxation in any such jurisdiction or (iii) consent to general
service of process in any such jurisdiction.
(e) The Company will as promptly as practicable notify the Selling
Shareholders, at any time when a prospectus relating to the sale of the
Registrable Securities is required by law to be delivered in connection with
sales by an Underwriter or dealer, of the occurrence of any event requiring the
preparation of a supplement or amendment to such prospectus so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus will not contain an untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading and promptly make available to the Selling Shareholders and
to the Underwriters any such supplement or amendment. The Selling Shareholders
agree that, upon receipt of any notice from the Company of the occurrence of any
event of the kind described in the preceding sentence, the Selling Shareholders
will forthwith discontinue the offer and sale of Registrable Securities pursuant
to the registration statement covering such Registrable Securities until receipt
by the Selling Shareholders and the Underwriters of the copies of such
supplemented or amended prospectus. In the event the Company shall give such
notice, the Company shall extend the period during which such registration
statement shall be maintained effective as provided in Section 3.1(a) hereof by
the number of days during the period from and including the date of the giving
of such notice to the date when the Company shall make available to the Selling
Shareholders such supplemented or amended prospectus.
(f) The Company will enter into customary agreements (including an
underwriting agreement having representations and closing documents consistent
with underwriting agreements heretofore entered into by the Company) and take
such other actions as are reasonably required in order to expedite or facilitate
the sale of such Registrable Securities.
(g) The Company will make available for inspection by the Selling
Shareholders, any Underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other professional
retained by the Selling Shareholders or Underwriter (collectively, the
"Inspectors"), all financial and other records, pertinent corporate documents
and properties of the Company (collectively, the "Records") as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors and employees to
supply all information reasonably requested by
any Inspectors in connection with such registration statement. Records which
the Company determines, in good faith, to be confidential and which it notifies
the Inspectors are confidential shall not be disclosed by the Inspectors unless
(i) the disclosure of such Records is necessary to avoid or correct a
misstatement or omission in such registration statement or (ii) the release of
such Records is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction. The Selling Shareholders agree that they will, upon
learning that disclosure of such Records is sought in a court of competent
jurisdiction, give notice to the Company and allow the Company, at its expense,
to undertake appropriate action to prevent disclosure of the Records deemed
confidential.
(h) The Company will otherwise use its reasonable efforts to comply
with all applicable rules and regulations of the SEC, and make available to its
security holders, as soon as reasonably practicable, an earnings statement
covering a period of 12 months, beginning within three months after the
effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act and the rules and
regulations of the SEC thereunder.
(i) The Company will use its reasonable efforts to cause all such
Registrable Securities to be listed on each securities exchange or trading
system on which similar securities issued by the Company are then listed.
The Company may require the Selling Shareholders to furnish in writing
to the Company such information regarding the Selling Shareholders, the plan of
distribution of the Registrable Securities and other information as the Company
may from time to time reasonably request or as may be legally required in
connection with such registration.
ARTICLE IV
INDEMNIFICATION AND CONTRIBUTION
SECTION 4.1. INDEMNIFICATION BY THE COMPANY. The Company agrees to
indemnify and hold harmless, to the extent permitted by law, each Selling
Shareholder, its officers and directors, and each Person, if any, who controls
such Selling Shareholder within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act from and against any and all
losses, claims, damages and liabilities caused by any untrue statement or
alleged untrue statement of a material fact contained in any registration
statement or prospectus relating to the Registrable Securities (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) or any preliminary prospectus, or 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 or liabilities are caused by (i) any such untrue
statement or omission or alleged untrue statement or omission based upon
information furnished in writing to the Company by or on behalf of such Selling
Shareholder expressly for use therein or (ii) the Selling Shareholder's failure
to comply with a prospectus delivery requirement imposed on it under applicable
law, if
any, including any failure to deliver, after deliver of a preliminary
prospectus, a prospectus containing corrected, modified or amended disclosure
with respect to any material fact.
SECTION 4.2. INDEMNIFICATION BY THE SELLING SHAREHOLDER. Each
Selling Shareholder agrees to indemnify and hold harmless the Company, its
officers and directors, and each Person, if any, who controls the Company within
the meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the extent as the foregoing indemnity from the Company to such
Selling Shareholder, but only with reference to information relating to such
Selling Shareholder or the plan of distribution furnished in writing by or on
behalf of such Selling Shareholder expressly for use in any registration
statement or prospectus relating to the Registrable Securities, or any amendment
or supplement thereto, or any preliminary prospectus. Each Selling Shareholder
also agrees to indemnify and hold harmless any Underwriters of the Registrable
Securities, their officers and directors and each Person who controls such
Underwriters on substantially the same basis as that of the indemnification of
the Company provided in this Section 4.2.
SECTION 4.3. CONDUCT OF INDEMNIFICATION PROCEEDINGS. In case any
proceeding (including any governmental investigation) shall be instituted
involving any Person in respect of which indemnity may be sought pursuant to
Section 4.1 or Section 4.2, such Person (the "Indemnified Party") shall promptly
notify the Person against whom such indemnity may be sought (the "Indemnifying
Party") in writing and the Indemnifying Party, upon the request of the
Indemnified Party, shall assume the defense of such proceeding and retain
counsel reasonably satisfactory to such Indemnified Party to represent such
Indemnified Party and any others the Indemnifying Party may designate in such
proceeding and shall pay the fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any Indemnified Party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such Indemnified Party unless (i) the Indemnifying Party
and the Indemnified Party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the Indemnified Party and the Indemnifying Party
and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. It is understood
that the Indemnifying Party shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm of attorneys ( in addition to any local
counsel) at any time for all such Indemnified Parties, and that all such
reasonable fees and expenses shall be reimbursed as they are incurred. In the
case of any such separate firm for the Indemnified Parties, such firm shall be
designated in writing by the Indemnified Parties and shall be reasonably
satisfactory to the Indemnifying Party. The Indemnifying Party shall not be
liable for any settlement of any proceeding effected without its prior written
consent, but if settled withsuch consent, or if there be a final judgment for
the plaintiff, the Indemnifying Party shall indemnify and hold harmless such
Indemnified Parties from and against any loss or liability (to the extent stated
above) by reason of such settlement or judgment. Notwithstanding the foregoing
sentence, if at any time an Indemnified Party shall have requested an
Indemnifying Party to reimburse the Indemnified Party for fees and expenses of
counsel as contemplated by the third sentence of this paragraph, the
Indemnifying Party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 business days after receipt by such
Indemnifying Party of the aforesaid request and (ii) such Indemnifying Party
shall not have reimbursed the Indemnified Party in accordance with such request
prior to the date of such settlement. No Indemnifying Party shall without the
prior written consent of the Indemnified Party, effect any settlement of any
pending or threatened proceeding in respect of which any Indemnified Party is or
could have been a party and indemnity could have sought hereunder by such
Indemnified Party, unless such settlement includes an unconditional release of
such Indemnified Party from all liability arising out of such proceedings.
SECTION 4.4. CONTRIBUTION. (a) If the indemnification provided for
in this Article IV is unavailable to the Indemnified Parties in respect of any
losses, claims, damages or liabilities referred to herein, then each such
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
such losses, claims, damages or liabilities (i) as between the Company and the
Selling Shareholders on the one hand and the Underwriters on the other, in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Selling Shareholders on the one hand and the Underwriters on the
other from the offering of the Registrable Securities, or if such allocation is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits but also the relative fault of the Company and
the Selling Shareholders on the one hand and of the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations and (ii) as between the Company on the one hand and the Selling
Shareholders on the other, in such proportion as is appropriate to reflect the
relative fault of the Company and of the Selling Shareholders in connection with
such statements or omissions, as well as any other relevant equitable
considerations.
(b) The relative benefits received by the Company and the Selling
Shareholders on the one hand and the Underwriters on the other shall be deemed
to be in the same proportion as the total proceeds from the offering (net of
Underwriting discounts and commissions but before deducting expenses) received
by the Company and the Selling Shareholders bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover page of the prospectus. The relative fault of
the Company and the Selling Shareholders on the one hand and of the Underwriters
on the other shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company and the Selling Shareholders or by the Underwriters. The relative fault
of the Company on the one hand and of the Selling Shareholder son the other
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by such party, and
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
(c) The Company and the Selling Shareholders agree that it would not
be just and equitable if contribution pursuant to this Section 4.4 were
determined by pro rata allocation (even if the Underwriters were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in the
immediately preceding paragraph. The amount paid or payable by an Indemnified
Party as the result of the losses, claims, damages or liabilities referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expense reasonably incurred by
such Indemnified Party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Article IV, no
Underwriter shall be required to contribute any amount in excess of the amount
by which the total price at which the Registrable Securities underwritten by it
and distributed to the public were offered to the public exceeds the amount of
any damages which such Underwriter has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission, and
the Selling Shareholders shall not be required to contribute any amount in
excess of the amount by which the total price at which the Registrable
Securities were offered to the public exceeds the amount of any damages which
the Selling Shareholders have otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
ARTICLE V
MISCELLANEOUS
SECTION 5.1. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS. The
Selling Shareholders may not participate in any underwritten registered offering
pursuant to a Piggy-Back Registration unless it (a) agrees to sell its
securities on the basis provided in any underwriting arrangements approved by
the Person entitled to approve such arrangements and (b) completes and executes
all questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents reasonably required under the terms of such underwriting
arrangements and this Agreement.
SECTION 5.2 RESTRICTIONS ON PUBLIC SALE BY THE SELLING SHAREHOLDER.
To the extend not inconsistent with applicable law, if any Registrable
Securities are included in a Demand Registration or a Piggy-Back Registration,
the Selling Shareholders will agree not to effect any public sale or
distribution of the issue being registered or a similar security of the Company,
or any securities convertible into or exchangeable or exercisable for such
securities, including a sale pursuant to Rule 144, during the 14 days prior to,
and during the 180-day period beginning on, the effective date of such
registration), if and to the extent requested by the managing Underwriter or
Underwriters in the case of an underwritten offering.
SECTION 5.3 SUCCESSORS AND ASSIGNS. The Selling Shareholders may
transfer the rights and obligations under this Agreement only upon the written
consent of the Company.
SECTION 5.4 TERMINATION. The registration rights granted under this
Agreement will terminate on the earlier of (i) the third anniversary of the
closing of the sale of Class A Shares pursuant to the Public Offering and (ii)
with respect to any Selling Shareholder, on the date as of which all of the
shares owned by such Selling Shareholder may be sold without volume restriction
under Rule 144 of the Securities Act. For purposes of this Section 5.4, if a
Selling Shareholder holds securities for one or more accounts which are not
beneficially owned by the same Person, the determination to be made under clause
(ii) shall be made separately for each such account.
SECTION 5.5. NOTICES. All notices, requests, demands, and other
communications required or permitted to be given under this Agreement shall be
in writing and shall be deemed to have been duly given if (i) mailed, registered
or certified mail, return receipt requested, postage prepaid, (ii) delivered by
hand, (iii) sent by facsimile transmission, or (iv) delivered by courier, to the
following addresses, or at such other address as a party may designate by notice
given in accordance with this Section:
(a) If to the Company: Xxxxx International Networks, Ltd.
0000 X. Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxx X. Xxxxx
(b) If to the Selling Shareholders: Xxxxx International Trust LLC
0000 X. Xxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxx
Xxxxx Xxxxxxxx
0000 Xxxxx Xxxxxx
Xxxxxxx, XX 00000
Penn Capital Management
c/o Penn Value Income Fund
Xxxxx Xxxxxxx
Xxxx Xxxxxx
Xxxxxxx X. Xxxxxx
Penn High Yield Fund
Xxxxxx Xxxxx
Penn Cap Block
AK STEEL
University of Chicago
Penn Capital Strategic High
Yield Mutual Fund
Tip Xxxxxx Target Select
00 Xxxxxxxxxxx-Xxxxxx Xxxx
Xxxxx 0000
Xxxxxx Xxxx, XX 00000
Sandler Capital Partners IV, L.P. and
Sandler Capital Partners IV FTE, L.P.
000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxxxxx
Notices delivered personally or by courier shall be effective upon delivery
to the intended recipient. Notices transmitted by facsimile transmission shall
be deemed to have been given when confirmation of transmission is received.
Notices delivered by registered or certified mail shall be deemed to have been
given on the delivery date set forth on the receipt of registered or certified
mail, or three (3) business days after deposit in the mail, whichever is
earlier.
SECTION 5.6. COUNTERPARTS. This Agreement may be executed in
multiple counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same agreement.
SECTION 5.7. ENTIRE AGREEMENT, NO WAIVER. This Agreement and the
documents and instruments referred to herein constitute the entire agreements
between the parties hereto pertaining to the subject matter hereof and supersede
all prior and contemporaneous agreements and understandings of the parties, and
there are no warranties, representations or other agreements among the parties
in connection with the subject matter hereof except as specifically set forth
herein. No supplement, modification or waiver or termination of this Agreement
shall be binding unless executed in writing by the parties hereto, except that
any of the terms or provisions of this Agreement may be waived in writing at any
time by the party against whom it is asserted and delivered by that party to
each of the other parties. No waiver of any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of any other provisions thereof
(whether or not similar), nor shall such waiver constitute a continuing waiver.
SECTION 5.8. HEADINGS. The title or headings of the various sections
and paragraphs hereof are intended solely for convenience of reference and are
not intended and shall not be deemed for any purpose whatsoever to modify or
explain or place any construction upon any of the provisions of this Agreement.
SECTION 5.9. USE OF THE PLURAL, ETC. Throughout this Agreement,
wherever the context so requires the singular shall include the plural, and the
masculine gender shall include the feminine and neuter genders, and vice versa.
SECTION 5.10. GOVERNING LAW. The parties agree that this Agreement
has been executed and delivered in the State of Colorado and shall be construed,
enforced and governed by the laws thereof, without giving effect to the
principles of conflicts of law of such State.
SECTION 5.11. NO THIRD PARTY BENEFICIARIES. This Agreement shall not
confer any rights, claims or remedies upon anyone not a party to this Agreement
or the permitted successors and assigns of such a party.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of
the date set forth above.
XXXXX INTERNATIONAL NETWORKS, LTD.,
a Colorado corporation
By: /s/ Xxx X. Xxxxx
--------------------------------------
Xxx X. Xxxxx
Group Vice President
THE SELLING SHAREHOLDERS:
Xxxxx International Trust LLC
By: Xxxxx Investments LLC, as Managing Member
By: Xxxxx International, Ltd.,
as Managing Member
By: /s/ Xxxxxxx X. Xxxxx
--------------------------------
Xxxxxxx X. Xxxxx
Group Vice President
Xxxxx Xxxxxxxx
/s/ Xxxxx Xxxxxxxx
-----------------------------------------
Penn Capital Management
c/o Penn Value Income Fund
Xxxxx Xxxxxxx
Xxxx Xxxxxx
Xxxxxxx X. Xxxxxx
Penn High Yield Fund
Xxxxxx Xxxxx
Penn Cap Block
AK STEEL
University of Chicago
Penn Capital Strategic High Yield Mutual Fund
Tip Xxxxxx Target Select
By: /s/ Xxxx X. Xxxxx
--------------------------------------------
Title: Vice President
-----------------------------------------
Sandler Capital Partners IV, L.P.
By: Sandler Investment Partners, L.P.,
a General Partner
By: Sandler Capital Management,
a General Partner
By: MJDM Corp.,
a General Partner
By: /s/ Xxxxxx X. Xxxxxxxxx
--------------------------------------------
Xxxxxx X. Xxxxxxxxx
President
Sandler Capital Partners IV FTE, L.P.
By: Sandler Investment Partners, L.P.,
a General Partner
By: Sandler Capital Management,
a General Partner
By: MJDM Corp.,
a General Partner
By: /s/ Xxxxxx X. Xxxxxxxxx
--------------------------------------------
Xxxxxx X. Xxxxxxxxx
President
