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Exhibit 10.5
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into as of December 16, 1999, by and among Xxxxxx Technologies, Inc., a
Delaware corporation ("Xxxxxx"), and all of the shareholders of Inlogic
Software Inc., a Nova Scotia limited liability company ("Inlogic"), each of
whom are identified on the signature page hereof (collectively, the "Inlogic
Shareholders").
WHEREAS, Xxxxxx, Xxxxxx Canada Corporation, a Nova Scotia unlimited
company ("Canadian Buyer"), and the Inlogic Shareholders have entered into a
Share Purchase Agreement of a date even herewith (the "Share Purchase
Agreement"); and
WHEREAS, pursuant to the Share Purchase Agreement, the Inlogic
Shareholders shall receive either (i) exchangeable shares of Canadian Buyer
(the "Exchangeable Shares") that, upon request of the Inlogic Shareholders, are
immediately convertible into or exchangeable for common shares of Xxxxxx (the
"Common Stock"), or (ii) shares of Common Stock;
WHEREAS, to induce the Inlogic Shareholders to execute and deliver the
Share Purchase Agreement, Xxxxxx has agreed to provide certain registration
rights under the U.S. Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any similar successor statute (collectively, the
"1933 Act"), and applicable state securities laws;
NOW THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledge, Xxxxxx, Canadian Buyer
and the Inlogic Shareholders hereby agree as follows:
1. DEFINITIONS
1.1 As used in this Agreement, the following terms shall have the
following respective meanings:
(a) "Commission" shall mean the U.S. Securities and Exchange
Commission or any other U.S. federal agency at the time
administering the 1933 Act.
(b) "Holder" shall mean each Inlogic Shareholder who holds
Exchangeable Shares or Common Stock issued in exchange for
Exchangeable Shares.
(c) The terms "register", "registered" and "registration" shall
refer to a registration effected by preparing and filing a
registration statement in
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compliance with the 1933 Act and applicable rules and
regulations thereunder, and the declaration or ordering of
the effectiveness of such registration statement.
(d) "Registrable Securities" shall mean (i) the shares of Common
Stock issued pursuant to the Share Purchase Agreement,
including the shares issuable upon exchange of Exchangeable
Shares, and (ii) any Common Stock issued as a dividend or
other distribution with respect to or in exchange for or in
replacement of the shares referenced in (i) above, provided,
however, that Registrable Securities shall not include any
shares of Common Stock that have previously been registered
or that have otherwise been sold to the public.
(e) "Registration Expenses" shall mean all expenses incurred by
Xxxxxx in compliance with Sections 2.1 and 2.2 hereof,
including, without limitation, all registration and filing
fees, printing expenses, fees and disbursements of counsel
for Xxxxxx, blue sky fees and expenses, reasonable fees and
disbursements of one counsel for all the selling Holders, and
Other Shareholders, and the expense of any special audits
incident to or required by any such registration.
(f) "Registration Period" means, with regard to any Inlogic
Shareholder and the shares of Registrable Securities then
held by such Inlogic Shareholder, that period beginning on
the closing date of the transactions contemplated by the
Share Purchase Agreement (the "Closing Date") and ending on
the later of (i) the third anniversary of the Closing Date
and (ii) the date on which such shares of Registrable
Securities may be publicly sold pursuant to Rule 144 of the
Commission under the 1933 Act. It is understood and agreed
that the termination of the Registration Period applicable to
one or more Inlogic Shareholders shall not result in the
termination of the Registration Period applicable to other
Inlogic Shareholders.
(g) "Selling Expenses" shall mean all underwriting discounts,
selling commissions and transfer taxes applicable to the sale
of Registrable Securities.
1.2 Capitalized terms used herein and not otherwise defined shall
have the same meanings as set forth in the Share Purchase Agreement.
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2. REGISTRATION
2.1 Piggy-Back Registration.
(a) If at any time prior to the expiration of the Registration
Period Xxxxxx shall determine to register with the Commission
a registration statement relating to an offering for its own
account or the account of others under the 1933 Act of any
shares of its Common Stock (other than on Form S-4 or Form
S-8 or their then equivalents relating to equity securities
to be issued solely in connection with any acquisition of any
entity or business or equity securities issuable in
connection with stock option or other employee benefit plans
or a registration on any registration form which does not
permit secondary sales or does not include substantially the
same information as would be required to be included in a
registration statement covering the sale of Registrable
Securities), Xxxxxx shall send to the Holders written notice
of such determination and, if within ten (10) days after
receipt of such notice, any Holder shall so request in
writing (the "Requesting Holders"), Xxxxxx shall include in
such registration statement all or any part of the
Registrable Securities the Requesting Holders request to be
registered, except that if, in connection with any
underwritten public offering, the managing underwriter(s)
thereof shall impose a limitation on the number of shares of
Registrable Securities which may be included in the
registration statement because, in such underwriter(s)'
judgment, marketing or other factors (including the fact that
any other Xxxxxx shareholder has included their shares in the
registration statement (such shareholders are referred to as
the "Other Shareholders")) dictate such limitation is
necessary to facilitate public distribution, then Xxxxxx
shall be obligated to include in such registration statement
only such limited portion of the Registrable Securities with
respect to which the Requesting Holders have requested
inclusion hereunder; provided, that no portion of the equity
securities which Xxxxxx is offering for its own account shall
be excluded. Any exclusion of Registrable Securities shall be
made pro rata among the Requesting Holders and the Other
Holders seeking to include Registrable Securities, in
proportion to the number of Registrable Securities sought to
be included by such Requesting Holders and the Other Holders.
If an offering in connection with which Holders are entitled
to registration under this Section 2.1 is an underwritten
offering, then each Requesting Holder shall offer and sell
such Registrable Securities in the underwritten offering
using the same underwriter or underwriters and on the same
terms and conditions as other shares of Common Stock included
in such underwritten offering.
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(b) Notwithstanding the foregoing, Xxxxxx shall not be obligated
to effect, or to take any action to effect, any such
registration pursuant to this Section 2.1 in any jurisdiction
in which Xxxxxx would be required to execute a general
consent to service of process in effecting such registration,
qualification or compliance, or in which the cost of the
foregoing is unreasonable in light of the number of
Registrable Securities requested to be sold in such
jurisdiction, unless Xxxxxx is already subject to service in
such jurisdiction and except as may be required by the 1933
Act or applicable rules or regulations thereunder; or
All Requesting Holders shall (together with Xxxxxx and the Other
Shareholders distributing their securities through such underwriting) enter
into an underwriting agreement in customary form with the underwriter or
underwriters selected for underwriting by Xxxxxx or the Other Shareholders as
the case may be.
2.2 Registration Procedures.
In the case of each registration effected by Xxxxxx pursuant to
Section 2, Xxxxxx will keep each Holder advised in writing as to the initiation
of each registration and as to the completion thereof. At its expense, Xxxxxx
will:
(a) Furnish such number of prospectuses and other documents
incident thereto as a Holder from time to time may reasonably
request;
(b) In connection with any underwritten offering pursuant to a
registration statement filed pursuant to Section 2.1 hereof,
enter into an underwriting agreement reasonably necessary to
effect the offer and sale of Common Stock, provided such
underwriting agreement contains customary underwriting
provisions; and
(c) Obtain a comfort letter from Daleen's independent public
accountants in customary form and covering such matters of
the type customarily covered by comfort letters and an
opinion from Daleen's counsel in customary form and covering
such matters of the type customarily covered in a public
issuance of securities, in each case addressed to the
Holders.
3. EXPENSES OF REGISTRATION.
All Registration Expenses incurred in connection with any
registration, qualification or compliance pursuant to Section 2 hereof shall be
borne by Xxxxxx, and all Selling Expenses shall be borne by the holders of the
securities so registered pro rata on the basis of the number of their shares so
registered; provided, however, that Xxxxxx shall not be required to pay any
Registration Expenses if, as a result of
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the withdrawal of a request for registration by Requesting Holders (other than
any refusal to proceed based upon the advice of counsel that the registration
statement, or any prospectus contained therein, contains 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), the registration statement does not become
effective, in which case the Requesting Holders shall bear such Registration
Expenses pro rata on the basis of the number of their shares so included in the
registration request.
4. INDEMNIFICATION.
(a) Xxxxxx will, and hereby does, indemnify each Requesting
Holder, each of its officers, directors and partners, and
each person controlling such Requesting Holder, with respect
to which registration, qualification or compliance has been
effected pursuant to Section 2.1, against all claims, losses,
damages and liabilities (or actions in respect thereof)
arising out of or based on any untrue statement (or alleged
untrue statement) of a material fact contained in any
prospectus, offering circular or other document (including
any related registration statement, notification or the like)
incident to any such registration, qualification or
compliance, or based on 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,
or any violation or alleged violation by Xxxxxx of the 1933
Act, the U.S. Securities Exchange Act of 1934, as amended, or
any state securities law or any rule or regulation thereunder
applicable to Xxxxxx and relating to action or inaction
required of Xxxxxx in connection with any such registration,
qualification or compliance, and will reimburse each such
Holder, each of its officers, directors and partners, and
each person controlling such Holder, for any reasonable legal
and any other expenses reasonably incurred in connection with
investigating and defending any such claim, loss, damage,
liability or action, provided that Xxxxxx will not be liable
in any such case to the extent that any such claim, loss,
damage, liability or expense arises out of or is based on any
untrue statement or omission based upon written information
furnished to Xxxxxx by any Requesting Holder, underwriter or
Other Shareholder.
(b) Each Requesting Holder, severally and not jointly, will, if
Registrable Securities held by him are included in the
securities as to which such registration, qualification or
compliance is being effected, indemnify Xxxxxx, each of its
directors and officers and each underwriter, if any, of
Daleen's securities covered by such a registration statement,
each person who controls Xxxxxx or such underwriter within
the meaning
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of the 1933 Act, the U. S. Securities Exchange Act of 1934,
as amended, or any state securities law, and the rules and
regulations thereunder, each other such Requesting Holder and
Other Shareholder and each of their officers, directors and
partners, and each person controlling such Requesting Holder
or Other Shareholder, against all claims, losses, damages and
liabilities (or actions in respect thereof) arising out of or
based on any untrue statement (or alleged untrue statement)
of a material fact contained in any such registration
statement, prospectus, offering circular or other document,
or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to
make the statements therein not misleading, and will
reimburse Xxxxxx and such Requesting Holders, Other
Shareholders, directors, officers, partners, persons,
underwriters or control persons for any legal or any other
expenses reasonably incurred in connection with investigating
or defending any such claim, loss, damage, liability or
action, in each case to the extent, but only to the extent,
that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) is made in such registration
statement, prospectus, offering circular or other document in
reliance upon and in conformity with written information
furnished to Xxxxxx by such Requesting Holder; provided,
however, that the indemnity agreement contained in this
Section 4(b) shall not apply to amounts paid in settlement of
any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder,
which consent shall not be unreasonably withheld.
(c) Each party entitled to indemnification under this Section 4
(the "Indemnified Party") shall give notice to the party
required to provide indemnification (the "Indemnifying
Party") promptly after such Indemnified Party has actual
knowledge of any claim as to which indemnity may be sought,
but the failure of any Indemnified Party to give notice shall
not relieve the Indemnifying Party of its obligation under
this Section 4. The Indemnifying Party will be entitled to
participate in, and to the extent that it may elect by
written notice delivered to the Indemnified Party promptly
after receiving the aforesaid notice from such Indemnified
Party, at its expense to assume, the defense of any such
claim or any litigation resulting therefrom, with counsel
reasonably satisfactory to such Indemnified Party, provided
that the Indemnified Party may participate in such defense at
its expense, notwithstanding the assumption of such defense
by the Indemnifying Party, and provided, further, that if the
defendants in any such action shall include both the
Indemnified Party and the Indemnifying Party and the
Indemnified Party shall have reasonably
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concluded that there may be legal defenses available to it
and/or other Indemnified Parties which are different from or
additional to those available to the Indemnifying Party, the
Indemnified Party or Parties shall have the right to select
separate counsel to assert such legal defenses and to
otherwise participate in the defense of such action on behalf
of such Indemnified Party or Parties and the fees and
expenses of such counsel shall be paid by the Indemnifying
Party. No Indemnifying Party, in the defense of any such
claim or litigation, shall, except with the consent of each
Indemnified Party, consent to entry of any judgment or enter
into any settlement which does not include as an
unconditional term thereof the giving by the claimant or
plaintiff to such Indemnified Party of a release from all
liability in respect to such claim or litigation. Each
Indemnified Party shall furnish such information regarding
itself or the claim in question as an Indemnifying Party may
reasonably request in writing and as shall be reasonably
required in connection with defense of such claim and
litigation resulting therefrom.
5. INFORMATION BY HOLDER.
Each Holder of Registrable Securities, and each Other Shareholder
holding securities included in any registration, shall furnish to Xxxxxx such
information regarding such Holder or Other Shareholder and the distribution
proposed by such Holder or Other Shareholder as Xxxxxx may reasonably request
in writing and as shall be reasonably required in connection with any
registration, qualification or compliance referred to in Section 2.1.
6. RULE 144 REPORTING.
With a view to making available the benefits of certain rules and
regulations of the Commission which may permit the sale of certain restricted
securities to the public without registration, Xxxxxx agrees to:
(a) make and keep public information available as those terms are
understood and defined in Rule 144 under the 1933 Act, at all
times during the Registration Period;
(b) file with the Commission in a timely manner all reports and
other documents required of Xxxxxx under the 1933 Act and the
Securities Exchange Act of 1934, as amended during the
Registration Period; and
(c) so long as a Holder owns any Securities that are "restricted
securities" under the 1933 Act, furnish to the Holder
forthwith upon written request a written statement by Xxxxxx
as to its compliance with the
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reporting requirements of Rule 144, and of the Securities
Exchange Act of 1934, as amended, a copy of the most recent
annual or quarterly report of Xxxxxx, and such other reports
and documents so filed as a Holder may reasonably request in
availing itself of any rule or regulation of the Commission
allowing a Holder to sell any such securities without
registration.
7. TRANSFER OR ASSIGNMENT OF REGISTRATION RIGHTS.
The rights of each Inlogic Shareholder under this Agreement shall be
assignable to a transferee of Registrable Securities; provided, however, that
Xxxxxx is given written notice at the time of such assignment stating the name
and address of the assignee and identifying the Registrable Securities with
respect to which the rights and benefits hereunder are being assigned and such
assignee expressly agrees in writing with Xxxxxx and the other Holders of
Registrable Securities to be bound by and to comply with all applicable
provisions of this Agreement, whereupon such person or entity shall have the
benefits of, and shall be subject to the restrictions contained in, this
Agreement with respect to such securities; provided that the assignee of such
rights is not deemed by the board of directors of Xxxxxx to be a competitor of
Xxxxxx. Any assignment pursuant to this Section 7 shall not relieve, release or
otherwise discharge the Holder effecting such assignment from its obligations
under this Agreement.
8. "MARKET STAND-OFF" AGREEMENT.
Each Inlogic Shareholder, if requested by Xxxxxx and an underwriter of
Common Stock (or other equity securities) of Xxxxxx, not to sell or otherwise
transfer or dispose of any Common Stock (or other equity securities) of Xxxxxx
held by such Inlogic Shareholder during the 180 day period following the
effective date of a registration statement of Xxxxxx (or such shorter period as
may be requested by Xxxxxx and the underwriter) filed under the 1933 Act,
provided that all executive officers and directors of Xxxxxx enter into similar
agreements.
Such agreement shall be in writing in a form satisfactory to Xxxxxx
and such underwriter. The Company may impose stop-transfer instructions with
respect to the shares (or securities) subject to the foregoing restriction
until the end of such ninety-day period.
9. AMENDMENT OF REGISTRATION RIGHTS.
Provisions of this Agreement may be amended and the observance thereof
may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of Xxxxxx, and
the Holders. Any
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amendment or waiver effected in accordance with this Section 9 shall be binding
upon Xxxxxx, Canadian Buyer and the Inlogic Shareholders.
10. MISCELLANEOUS.
10.1 Notices.
All notices, claims, requests, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered or if sent by nationally-recognized overnight courier, by
telecopy, or by registered or certified mail, return receipt requested and
postage prepaid, addressed as follows:
If to Xxxxxx: Xxxxxx Technologies, Inc.
000 Xxxxx Xxxxx Xxxx
Xxxx Xxxxx, Xxxxxxx 00000
If to the Inlogic Shareholders: Xxxxxxxx Xxxxx
819 - 000 Xxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx
X0X 0X0
or to such other address as the party to whom notice is to be given may have
furnished to the other parties in writing in accordance herewith. Any such
notice or communication shall be deemed to have been received (a) in the case
of personal delivery, on the date of such delivery, (b) in the case of
nationally-recognized overnight courier, on the next business day after the
date when sent, (c) in the case of telecopy transmission, when received, and
(d) in the case of mailing, on the fifth business day following that on which
the piece of mail containing such communication is posted.
10.2 Failure of any party to exercise any right or remedy under
this Agreement or otherwise, or delay by a party in exercising such right or
remedy, shall not operate as a waiver thereof.
10.3 This Agreement shall be enforced, governed by and construed
in accordance with the laws of the State of Florida without giving effect to
any choice or conflict of law provision or rule (whether of the State of
Florida or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of Florida. In the event that any
provision of this Agreement is invalid or unenforceable under any applicable
statute or rule of law, then such provision shall be deemed inoperative to the
extent that it may conflict therewith and shall be deemed modified to conform
with such statute or rule of law. Any provision hereof which may prove invalid
or unenforceable under any law shall not affect the validity or enforceability
of any other provision hereof.
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10.4 This Agreement constitutes the entire agreement among the
parties hereto with respect to the subject matter hereof and thereof. There are
no restrictions, promises, warranties or undertakings, other than those set
forth or referred to herein and therein. This Agreement supersedes all prior
agreements and understandings among the parties hereto with respect to the
subject matter hereof and thereof.
10.5 Subject to the requirements of Section 7 hereof, this
Agreement shall inure to the benefit of and be binding upon the successors and
assigns of each of the parties hereto.
10.6 The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
10.7 This Agreement may be executed in two or more identical
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same agreement. This Agreement, once executed by a
party, may be delivered to the other party hereto by facsimile transmission of
a copy of this Agreement bearing the signature of the party so delivering this
Agreement.
10.8 Each party shall do and perform, or cause to be done and
performed, all such further acts and things, and shall execute and deliver all
such other agreements, certificates, instruments and documents, as the other
party may reasonably request in order to carry out the intent and accomplish
the purposes of this Agreement and the consummation of the transactions
contemplated hereby.
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IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be duly executed as of day and year first above written.
XXXXXX TECHNOLOGIES, INC.
By:
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Name:
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Title:
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INLOGIC SHAREHOLDERS
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Xxxxxxxx Xxxxx
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Xxxx Xxxxx
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Xxxxxxxx Xxxxxxx
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Xxxxxxx Xxxxx
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Xxxx Xxx
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Xxxxxxx Xxxxxx
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Xxxxxxx Xxxxx
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Nahla Rashad
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Xxxxxx Xxxxxx
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1303949 ONTARIO INC.
By:
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Name:
Title:
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THE VENGROWTH INVESTMENT
FUND INC.
By:
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Name:
Title:
