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SERENA SOFTWARE INTERNATIONAL
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "AGREEMENT") is made as of
September 25, 1998 by and among SERENA Software International, a California
corporation (the "COMPANY"), and Xxxxxx X. Xxxxxx, as Trustee of the Xxxxxx
Family Trust, Xxxxxx X. Xxxxxx, as Trustee of the Xxxxxx Family Trust, and
Xxxxxxx X. Xxxxx (each a "SHAREHOLDER" and, collectively, the "SHAREHOLDERS").
RECITALS
A. In connection with the issuance of shares of Common Stock issued to
the Shareholders (the "SHARES") of the Company pursuant to that certain
Agreement and Plan of Reorganization of an even date hereof between the Company,
SSI Acquisition Corp., a California corporation and wholly-owned subsidiary of
the Company, Optima Software, Inc., a California corporation ("OPTIMA"), and
certain shareholders of Optima, including the Shareholders and Xxxxxxx X.
Xxxxxx, an individual, (the "MERGER AGREEMENT"), the Company and the
Shareholders desire to enter into this Agreement in order to grant certain
rights to the Shareholders;
B. It is a condition to the closing of the transactions contemplated by
the Merger Agreement that the Company and the Shareholders enter into this
Agreement.
NOW THEREFORE, in consideration of the mutual promises and covenants
contained in this Agreement, the parties hereto agree as follows:
AGREEMENT
1. CERTAIN DEFINITIONS. As used in this Agreement, the following terms
shall have the following respective meanings:
(a) "COMMISSION" shall mean the Securities and Exchange Commission or
any successor agency.
(b) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended.
(c) "REGISTRABLE SECURITIES" shall mean (i) the Shares and (ii)
shares of the Company's Common Stock or other securities issued or issuable with
respect to the Shares upon any stock split, stock dividend, recapitalization, or
similar event; PROVIDED, HOWEVER, that any shares described in clauses (i) or
(ii) above which have been resold to the public pursuant to an effective
registration statement under the Securities Act or pursuant to an exemption from
registration promulgated under the Securities Act, or in a private transaction
in which the registration rights
granted under this Agreement are not assigned shall cease to be Registrable
Securities upon such resale.
(d) The terms "REGISTER," "REGISTERED" and "REGISTRATION" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement by the Commission.
(e) "REGISTRATION EXPENSES" shall mean all expenses incurred by the
Company in complying with this Agreement, including, without limitation, all
registration, qualification and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for the Company, blue sky fees and expenses,
the fees of a single counsel acting on behalf of all of the Shareholders, and
the expense of any special audits incident to or required by any such
registration, but excluding all Selling Expenses.
(f) "SECURITIES ACT" shall mean the Securities Act of 1933, as
amended.
(g) "SELLING EXPENSES" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the Shareholders.
2. COMPANY REGISTRATION.
(a) NOTICE OF REGISTRATION. If the Company shall determine to
register any of its securities, either for its own account or the account of a
security holder or holders exercising their respective demand registration
rights, other than (i) a registration relating solely to employee benefit plans,
or (ii) a registration relating solely to a transaction pursuant to Rule 145
promulgated under the Securities Act, then for each such registration the
Company will:
(i) promptly give to each Shareholder written notice thereof;
and
(ii) include in such registration (and any related
qualification under blue sky laws or other compliance), and in any underwriting
involved therein, all the Registrable Securities specified in a written request
or requests, made within 15 days after receipt of such written notice from the
Company, by any Shareholder or Shareholders; PROVIDED, HOWEVER, that the number
of Registrable Securities to be included in such registration shall be subject
to the managing underwriter cutback provisions described in Section 2(c).
(b) NOTICE OF UNDERWRITING. If the registration of which the Company
gives notice is for an underwritten registered public offering, the Company
shall so advise the Shareholders as a part of the written notice given pursuant
to Section 2(a). In such event, the right of any Shareholder to registration
shall be conditioned upon such underwriting and the inclusion of the Registrable
Securities held by such Shareholder in such underwriting to the extent provided
in this Section. All Shareholders proposing to distribute their Registrable
Securities through such underwriting (together with the Company and the other
shareholders distributing their securities through such underwriting) shall
enter into an underwriting agreement with the Underwriter's Representative for
such offering. The Shareholders shall have no right to participate in the
selection of the underwriters for an offering pursuant to this Section 2.
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(c) CUT-BACK AND ALLOCATION. Notwithstanding any other provision of
this Section 2, if the managing underwriter determines in good faith that
marketing factors require a limitation of the number of shares to be
underwritten, the managing underwriter may limit the number of Registrable
Securities to be included in the registration and underwriting to the extent of
excluding all Registrable Securities from such registration in the Company's
public offering; PROVIDED, HOWEVER, the Company will use reasonable efforts to
include up to fifty percent (50%) of the Registrable Securities then outstanding
to the extent more than fifty percent (50%) of such Registrable Securities are
requested to be included in the Company's initial public offering. In the event
that less than 50% of the Registrable Securities are requested to be so
included, the Company shall use its reasonable efforts to include all such
Registrable Securities. The Company has not granted Registration Rights to any
other person, and any such rights granted hereafter shall be subject to the
rights contained hereon. In the event such limitation is applied to Registrable
Securities, the Company shall so advise all Shareholders of Registrable
Securities which would otherwise be registered and underwritten pursuant hereto,
and the number of shares of Registrable Securities that may be included in the
registration and underwriting shall be allocated among the Shareholders in
proportion, as nearly as practicable, to the respective amounts of Registrable
Securities held by such Shareholders. If any Shareholder disapproves of the
terms of any such underwriting, such Shareholder may elect to withdraw therefrom
by written notice to the Company and the managing underwriter. Any Registrable
Securities excluded or withdrawn from such underwriting shall be withdrawn from
such registration.
(d) RIGHT TO TERMINATE REGISTRATION. The Company shall have the
right to terminate or withdraw any registration initiated by it under this
Section 2 prior to the effectiveness of such registration whether or not any
Shareholder has elected to include securities in such registration.
3. REGISTRATION ON FORM S-3. The Company shall use its best efforts to
qualify for registration on Form S-3, and to that end, the Company shall comply
with the reporting requirements of the Exchange Act. After the Company has
qualified for the use of Form S-3, each Shareholder shall have the right to
request unlimited registrations on Form S-3 (such requests shall be in writing
and shall state the number of shares of Registrable Securities to be disposed of
and the intended method of disposition of such shares by each such Shareholder;
PROVIDED, HOWEVER, that a Shareholder may not make such a request more than once
every year), subject to the following limitations:
(i) the Company shall not be obligated to cause a registration
on Form S-3 to become effective prior to 90 days following the effective date of
a Company-initiated registration (other than a registration effected solely to
qualify an employee benefit plan or to effect a business combination pursuant to
Rule 145);
(ii) the Company shall not be required to effect a registration
on Form S-3 unless the Shareholder or Shareholders requesting registration
propose to dispose of shares of Registrable Securities having an aggregate
disposition price (before deduction of underwriting discounts and expenses of
sale) of at least $2,000,000;
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(iii) the Company shall not be obligated to effect more than one
registration under this Section 3 during any six month period; and
(iv) the Company shall not be required to maintain and keep any
such registration on Form S-3 effective for a period exceeding forty-five (45)
days from the effective date thereof. The Company shall give notice to all
Shareholders and all holders of registration rights under any other agreement of
the Company granting Form S-3 or similar demand registration rights of the
receipt of a request for registration pursuant to this Section and shall provide
a reasonable opportunity for all such other Shareholders, including holders of
registration rights under any other agreement of the Company granting Form S-3
or similar demand registration rights, to participate in the registration.
Subject to the foregoing, the Company will use its best efforts to effect
promptly the registration of all shares of Registrable Securities on Form S-3 to
the extent requested by the Shareholder or Shareholders thereof for purposes of
disposition.
4. EXPENSES OF REGISTRATION. All Registration Expenses incurred in
connection with any registration, qualification or compliance pursuant to
Section 2 or Section 3 shall be borne by the Company. All Selling Expenses
relating to securities registered by the Shareholders shall be borne by the
Shareholders of such securities pro rata on the basis of the number of shares so
registered.
5. REGISTRATION PROCEDURES.
(a) COMPANY OBLIGATIONS. In the case of each registration,
qualification or compliance effected by the Company pursuant to this Agreement,
the Company will keep each Shareholder advised in writing as to the initiation
of each registration, qualification and compliance and as to the completion
thereof. At its expense, the Company will furnish such number of prospectuses
and other documents incident thereto as a Shareholder from time to time may
reasonably request.
(b) SHAREHOLDER OBLIGATIONS. The Company may require each
Shareholder to furnish to the Company in writing such information regarding such
Shareholder and the distribution of such Registrable Securities as the Company
may from time to time reasonably request in writing and as shall be required in
connection with any registration, qualification or compliance referred to in
this Agreement. Each Shareholder agrees to use its best efforts to cooperate
with the Company in connection with the preparation and filing of a registration
statement covering the Registrable Securities.
6. TERMINATION OF REGISTRATION RIGHTS. The registration rights granted
pursuant to this Agreement shall terminate as to any Shareholder upon the
earlier to occur of (i) four (4) years after the Company's initial public
offering, or (ii) at such time after the Company's initial public offering as
all of the Registrable Securities then held by such Shareholder may be sold
within any three (3) month period pursuant to Rule 144.
7. INDEMNIFICATION.
(a) The Company will indemnify each Shareholder and such
Shareholder's legal counsel and independent accountants, and each person
controlling such Shareholder within the
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meaning of Section 135 of the Securities Act, with respect to which
registration, qualification or compliance has been effected pursuant to this
Agreement, and each underwriter, if any, and each person who controls any
underwriter within the meaning of Section 13 of the Securities Act, against all
expenses, claims, losses, damages and liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation, commenced or threatened, arising out of or based on any untrue
statement (or alleged untrue statement) of a material fact contained in any
registration statement, prospectus, offering circular or other document, or any
amendment or supplement thereto, 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, in light of the circumstances in which they were made,
not misleading, or any violation by the Company of any rule or regulation
promulgated under the Securities Act applicable to the Company and relating to
action or inaction required of the Company in connection with any such
registration, qualification or compliance, and will reimburse each such
Shareholder and such Shareholder's legal counsel and independent accountants,
and each person controlling such Shareholder, each such underwriter and each
person who controls any such underwriter, for any legal and any other expenses
reasonably incurred in connection with investigating, preparing or defending any
such claim, loss, damage, liability or action, provided that the Company 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 or alleged untrue statement or omission, made in eliance upon and in
conformity with written information furnished to the Company by an instrument
duly executed by such Shareholder or underwriter and stated to be specifically
for use therein; and provided, further, that the Company will not be liable to
any such person or entity with respect to any such untrue statement or omission
or alleged untrue statement or omission made in any preliminary prospectus that
is corrected in the final prospectus filed with the Commission pursuant to Rule
424(b) promulgated under the Securities Act (or any amendment or supplement to
such prospectus) if the person asserting any such loss, claim, damage or
liability purchased securities but was not sent or given a copy of the
prospectus (as amended or supplemented) at or prior to the written confirmation
of the sale of such securities to such person in any case where such delivery of
the prospectus (as amended or supplemented) is required by the Securities Act,
unless such failure to deliver the prospectus (as amended or supplemented) was a
result of the Company's failure to provide such prospectus (as amended or
supplemented).
(b) Each Shareholder will, if Registrable Securities held by such
Shareholder are included in the securities as to which such registration,
qualification or compliance is being effected, indemnify the Company, each of
its directors and officers and its legal counsel and independent accountants,
each underwriter, if any, of the Company's securities covered by such a
registration statement, each person who controls the Company or such underwriter
within the meaning of Section 13 of the Securities Act, and each other such
Shareholder and each person controlling such Shareholder within the meaning of
Section 13 of the Securities Act, 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 the Company, such Shareholders, such directors,
officers, legal counsel, independent accountants, underwriters or control
persons for any legal or any other
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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 the Company by an instrument
duly executed by such Shareholder and stated to be specifically for use therein;
PROVIDED, HOWEVER, that the obligations of such Shareholders hereunder shall be
limited to an amount equal to the gross proceeds before expenses and commissions
to each such Shareholder of Registrable Securities sold as contemplated herein.
(c) Each party entitled to indemnification under this Section (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, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or litigation, shall be
approved by the Indemnified Party (whose approval shall not be unreasonably
withheld), and the Indemnified Party may participate in such defense at such
party's expense, and provided further that the failure of any Indemnified Party
to give notice as provided herein shall not relieve the Indemnifying Party of
its obligations under this Agreement, except to the extent, but only to the
extent, that the Indemnifying Party's ability to defend against such claim or
litigation is impaired as a result of such failure to give notice. 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.
(d) If the indemnification provided for in this Section is held by a
court of competent jurisdiction to be unavailable to an indemnified party with
respect to any loss, liability, claim, damage or expense referred to herein,
then the indemnifying party, in lieu of indemnifying such indemnified party
hereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage or expense in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party on the one hand and of the indemnified party on the other in connection
with the statements or omissions that resulted in such loss, liability, claim,
damage or expense, as well as any other relevant equitable considerations. The
relative fault of the indemnifying party and of the indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission to state a material fact
relates to information supplied by the indemnifying party or by the indemnified
party and the parties' relative intent, knowledge, access to information, and
opportunity to correct or prevent such statement or omission.
(e) Notwithstanding the foregoing, to the extent that the provisions
on indemnification and contribution contained in the underwriting agreement
entered into in connection with the underwritten public offering are in conflict
with the foregoing provisions, the provisions in the underwriting agreement
shall control.
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(f) The obligations of the Company and Shareholders under this
Section shall survive the completion of any offering of Registrable Securities
in a registration statement under Section 2 or Section 3, and otherwise.
8. RULE 144 REPORTING. With a view to making available the benefits of
certain rules and regulations of the Commission which may at any time permit the
sale of the Shares to the public without registration, after such time as a
public market exists for the Common Stock of the Company, the Company agrees to
use its best efforts to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144 promulgated under the Securities Act, at all
times after the effective date of the first registration under the Securities
Act filed by the Company for an offering of its securities to the general
public;
(b) file with the Commission in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act
(at any time after it has become subject to such reporting requirements);
(c) furnish to Shareholders upon request a written statement as to
its compliance with the reporting requirements of Rule 144 (at any time after 90
days after the effective date of the first registration statement filed by the
Company for an offering of its securities to the general public), and of the
Securities Act and the Exchange Act (at any time after it has become subject to
such reporting requirements), a copy of the most recent annual or quarterly
report of the Company, and such other reports and documents of the Company as a
Shareholder may reasonably request in availing itself of any rule or regulation
of the Commission allowing such Shareholder to sell any such securities without
registration.
9. RESTRICTIONS ON TRANSFER. Provided that the Company is given prior
notice of such assignment, the rights granted hereunder to cause the Company to
register securities may be assigned to a transferee or assignee who acquires at
least 50,000 shares of Registrable Securities (appropriately adjusted for stock
splits, recapitalizations and the like effected after the date hereof). In the
event that rights granted hereunder are assigned in accordance with this
Section 9, such assignee shall be deemed to be a "Shareholder" as that term is
used in this Agreement
10. GOVERNING LAW. This Agreement shall be governed by and interpreted in
accordance with the laws of the State of California, without regard to choice of
law provisions. The parties hereto agree to submit to the jurisdiction of the
federal and state courts of the State of California with respect to the breach
or interpretation of this Agreement or the enforcement of any and all rights,
duties, liabilities, obligations, powers and other relations between the parties
arising under this Agreement.
11. ENTIRE AGREEMENT. This Agreement constitutes the full and entire
understanding among the parties regarding the subject matter herein. Except as
otherwise expressly provided herein, the provisions hereof shall inure to the
benefit of, and be binding upon, the successors, assigns, heirs, executors and
administrators of the parties hereto.
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12. NOTICES, ETC. All notices and other communications required or
permitted hereunder shall be in writing and shall be mailed by registered or
certified mail, postage prepaid, or otherwise delivered by hand or by messenger,
addressed (a) if to a Shareholder, to such address as such Shareholder shall
have furnished to the Company in writing, or (b) if to the Company, to its
principal executive offices and addressed to the attention of the Chief
Financial Officer, or to such other address as the Company shall have furnished
to such Shareholder.
Each such notice or other communication shall for all purposes of this
Agreement be treated as effective or having been given when delivered if
delivered personally or by facsimile, or, if sent by mail, at the earlier of its
receipt or 72 hours after the same has been deposited in a regularly maintained
receptacle for the deposit of the United States mail, addressed and mailed as
aforesaid.
13. AMENDMENT. Any provision of this Agreement may be amended, waived or
modified only upon the written consent of (i) the Company, (ii) holders of a
majority of the outstanding Registrable Securities and shares of the Company's
Common Stock or other securities issued or issuable with respect to the Shares
upon any stock split, stock dividend, recapitalization or similar event issued
upon conversion thereof (excluding for all purposes in such computation any such
securities resold to the public or otherwise without rights hereunder) and (iii)
Xxxxxxx X. Xxxxx, so long as she shall continue to hold Registrable Securities.
Any Shareholder may waive any of his or her rights or the Company's obligations
hereunder without obtaining the consent of any other person.
14. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be an original and all of which together shall
constitute one instrument.
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IN WITNESS WHEREOF, the undersigned have executed this Registration Rights
Agreement as of the date set forth above.
"COMPANY" SERENA SOFTWARE INTERNATIONAL
a California corporation
By: /s/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
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Title: President and Chief Executive Officer
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"SHAREHOLDERS" /s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx,
as Trustee of the Xxxxxx Family Trust
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx,
as Trustee of the Xxxxxx Family Trust
/s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx
[SERENA SOFTWARE INTERNATIONAL REGISTRATION RIGHTS AGREEMENT]
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