Exhibit 99.2
XXXX.XXX, INC.
REGISTRATION RIGHTS AGREEMENT
February 14, 2001
XXXX.XXX, INC.
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement is made as of February 14, 2001 (the
"Agreement") by and among Xxxx.xxx, Inc., a Delaware corporation ("Xxxx.xxx"),
and each of the investors listed on the signature pages hereof (the
"Investors").
RECITALS
A. Xxxx.xxx desires to sell and issue to the Investors and the
Investors desire to purchase from Xxxx.xxx 10% Senior Convertible Notes (the
"Notes") of Xxxx.xxx and shares of Class A common stock, par value $.01 per
share ("Exchange Shares") pursuant to a Note Exchange Agreement of even date
herewith (the "Note Exchange Agreement").
B. In order to induce the Investors to purchase Notes and Exchange
Shares pursuant to the Note Exchange Agreement, Xxxx.xxx desires to grant to the
holders of Notes (the "Holders") certain registration rights with respect to all
of the shares of Class A common stock, par value $.01 per share, issuable upon
conversion of the Notes (the "Conversion Shares"), all of the Class A common
stock, par value $.01 per share, issuable in payment of interest on the Notes as
provided in the Notes (the "Interest Payment Shares"), and all of the Exchange
Shares all on the terms and conditions set forth herein.
In consideration of the foregoing and the promises and covenants
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
ARTICLE I
CERTAIN DEFINITIONS
As used in this Agreement, the following terms shall have the
following respective meanings:
"Act" means the U.S. Securities Act of 1933, as amended from
time to time.
"Agreement" means this Agreement, as the same may be amended
or supplemented from time to time in accordance with the terms hereof.
"Common Stock" means the shares of Class A common stock, par
value $.01 per share, that Xxxx.xxx is authorized to issue by way of Xxxx.xxx's
Amended and Restated Certificate of Incorporation, and amendments thereto.
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"Conversion Shares" has the meaning set forth in the recitals
above.
"Demand Registration" has the meaning set forth in Section
2.01(a) of this Agreement.
"Exchange Shares" has the meaning set forth in the recitals
above.
"Holders" has the meaning set forth in the preface above.
"Indemnified Party" and "Indemnifying Party" have the meanings
set forth in Section 2.07(c) of this Agreement.
"Interest Payment Shares" has the meaning set forth in the
recitals above.
"Piggyback Registration" has the meaning set forth in Section
2.02 of this Agreement.
"Registrable Securities" means (i) the Conversion Shares, the
Interest Payment Shares and the Exchange Shares, (ii) any Class A common stock
of Xxxx.xxx issued as (or issuable upon the conversion or exercise of any
warrant, right or other security that is issued as) a dividend or other
distribution with respect to, or in exchange for or in replacement of the
securities referenced in clause (i) and this clause (ii), and (iii) any other
shares of capital stock of Xxxx.xxx into or for which the securities referenced
in clauses (i) and (ii) may be converted into or exchanged pursuant to a
recapitalization or reclassification of Xxxx.xxx's capital stock; provided,
however, that Registrable Securities shall not include any securities that (w)
have been registered and sold pursuant to the Act, (x) have been distributed to
the public through a broker, dealer or market maker pursuant to Rule 144 under
the Act, (y) are eligible for public resale under Rule 144(k) under the
Securities Act or in accordance with the law governing any non-U.S. exchange
where the Common Stock is publicly listed or (z) have been sold in a transaction
exempt from registration under the Act so that all transfer restriction and
restrictive legends with respect thereto are removed upon consummation of such
sale.
"Registration Expenses" means all expenses incident to Xxxx.xxx's
performance of or compliance with this Agreement, including, without limitation,
(i) all registration, filing, securities exchange listing, rating agency and
National Association of Securities Dealers fees, (ii) all registration, filing,
qualification and other fees and expenses of complying with securities or blue
sky laws of all jurisdictions in which the securities are to be registered and
any legal fees and expenses incurred in connection with the blue sky
qualification of the Registrable Securities and the determination of their
eligibility for investment under the laws of all such jurisdictions, (iii) all
word processing, duplicating, printing, messenger and delivery expenses, (iv)
the fees and disbursements of counsel for Xxxx.xxx and of its independent public
accountants, including, without limitation, the expenses of any special audits
or "cold comfort" letter required by or incident to such performance and
compliance, (v) in connection with any firm commitment, underwritten offering,
the reasonable fees and disbursements of any one counsel or one accounting firm
retained by the Holders of the Registrable Securities being registered, not to
exceed $15,000 in the aggregate for all of such fees and disbursements, (vi)
premiums and other costs of policies of insurance of Xxxx.xxx against
liabilities arising out of the public offering of the Registrable Securities
being registered to the extent Xxxx.xxx elects to obtain such insurance, and
(vii) any fees and disbursements of underwriters customarily paid by issuers or
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sellers of securities (but excluding underwriting discounts and commissions), if
any, relating to the Registrable Securities.
"SEC" means the U.S. Securities and Exchange Commission.
Other capitalized terms that are used herein that are not defined herein shall
have the respective meanings ascribed to such terms in the Note Exchange
Agreement.
ARTICLE II
REGISTRATION RIGHTS
Xxxx.xxx and the Investors covenant and agree as follows:
Section 2.01 Form S-3 Registration
(a) Demand Registration. Promptly after the Closing Date (and in any
event not later than the time of filing any registration statement covering
shares issuable upon conversion of the Company's outstanding 10% Senior
Convertible Notes under the Note Purchase Agreement dated January 8, 2001),
Xxxx.xxx agrees to prepare and file a shelf registration statement on Form S-3
or other available form for an offering to be made on a continuous basis
pursuant to Rule 415 (the "Registration Statement") covering all of the
Registrable Securities and to use reasonable commercial efforts to cause the
Registration Statement to become effective as soon as practicable thereafter
(the "Demand Registration"); provided, however, (1) Xxxx.xxx may delay the
filing or effectiveness of the Registration Statement under the Act as required
by this Section 2.01, or any sales thereunder, for a period of up to sixty (60)
days if Xxxx.xxx is currently engaged in negotiating a material financing or
acquisition or disposition or other material corporate transaction and the Board
of Directors of Xxxx.xxx determines in good faith that such Demand Registration
would be materially adverse to the interests of Xxxx.xxx in connection with such
financing, acquisition, disposition or other transaction; provided, however,
that Xxxx.xxx may not exercise this right more than twice in any twelve (12)
month period and (2) in no event shall Xxxx.xxx be required to file more than
one registration statement; provided, however, that if, after a Demand
Registration has become effective, the offering of Registrable Securities
pursuant thereto is suspended, blocked by any stop order, injunction or other
order of the SEC or any governmental agency or court, or withdrawn, such Demand
Registration will be deemed not to have been effected pursuant to this Section
2.01. If the Registration Statement in connection with a Demand Registration
shall not become effective on or before 120 days after the Closing Date, then
Xxxx.xxx shall pay to each such holder an amount equal to 1% per month (2% per
month if the Registration Statement has not become effective initially on or
before 240 days after the Closing Date) of the principal amount of the Exchange
Notes held by such holder (pro rated for partial months) from such 120th day or
240th day, as applicable, until the earlier of the date on which the
Registration Statement becomes effective and the second anniversary of the
issuance of the Exchange Notes.
(b) Selection of Underwriters. If a Demand Registration pursuant to
this Section 2.01 involves an firm commitment underwritten offering, the
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underwriter or underwriters (including the managing underwriter or underwriters)
thereof shall be a nationally-recognized investment banking firm selected by a
majority of the Holders requesting the underwritten offering, subject to
Xxxx.xxx's approval (and subject to any contractual commitments that Xxxx.xxx
may then have to any investment banking firm). Such approval will not be
unreasonably withheld.
(c) Underwritten Offerings. If requested by the underwriters for any
firm commitment underwritten offering by Holders pursuant to a Demand
Registration under Section 2.01(a), Xxxx.xxx will enter into an underwriting
agreement with such underwriters for such offering, such agreement to be
reasonably satisfactory in substance and form to the underwriters and to contain
such representations and warranties by Xxxx.xxx and such other terms as are
generally prevailing in agreements of such type, including, without limitation,
indemnities and contribution to the effect and to the extent provided in Section
2.07 and 2.08, respectively. The Holders of a majority of the Registrable
Securities participating in such underwritten offering will cooperate with
Xxxx.xxx in the negotiation of the underwriting agreement. The Holders of
Registrable Securities to be distributed by such underwriters shall be parties
to such underwriting agreement and may, at their option, require that any or all
of the representations and warranties by, and the other agreements on the part
of, Xxxx.xxx to and for the benefit of such underwriters shall also be made to
and for the benefit of such Holders of Registrable Securities and that any or
all of the conditions precedent to the obligations of such underwriters under
such underwriting agreement be conditions precedent to the obligations of such
Holders. Any such Holder shall not be required to make any representations or
warranties to or agreements with Xxxx.xxx or the underwriters other than
representations, warranties or agreements regarding such Holder, such Holder's
title to Registrable Securities and such Holder's intended method of
distribution and any other representation required by law.
SECTION 2.02 Piggyback Registration. (a) Right to Piggyback. If
Xxxx.xxx proposes to register any of its securities under the Act in connection
with a firm commitment underwritten offering (other than registrations solely
for the registration of shares in connection with an employee benefit plan or a
merger or consolidation and other than pursuant to Section 2.01) at any time
before all of the Registrable Securities are eligible for public resale by the
Holders pursuant to Rule 144(k) under the Act, whether or not for sale for
Xxxx.xxx's own account, and the registration form to be used may be used for the
registration of Registrable Securities (a "Piggyback Registration"), Xxxx.xxx
will at each such time give prompt written notice to all Holders of its
intention to do so and of such Holders' rights under this Section 2.02. Upon the
written request of any such Holder made within 30 days after the receipt of any
such notice (which request shall specify the Registrable Securities intended to
be disposed of by such Holder and the intended method of distribution thereof),
Xxxx.xxx will use its reasonable commercial efforts to effect the registration
under the Act of all Registrable Securities which Xxxx.xxx has been so requested
to register by the Holders thereof, to the extent required to permit the
disposition (in accordance with such intended methods thereof) of the
Registrable Securities so to be registered, provided that if, at any time after
giving written notice of its intention to register any securities and prior to
the effective date of the registration statement filed in connection with such
registration, Xxxx.xxx shall determine for any reason not to register or to
delay registration of such securities, Xxxx.xxx may, at its election, give
written notice of such determination to each Holder and, thereupon, (i) in the
case of a determination not to register, shall be relieved of its obligation to
register any Registrable Securities in connection with such registration (but
not from its obligation to pay the registration expenses under Section 2.05 in
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connection therewith), without prejudice, however, to the rights of any Holder
entitled to do so to request that such registration be effected as a Demand
Registration under Section 2.01, and (ii) in the case of a determination to
delay registering, shall be permitted to delay registering any Registrable
Securities, for the same period as the delay in registering such other
securities. No registration effected under this Section 2.02 shall relieve
Xxxx.xxx of its obligation to effect any Demand Registration upon request under
Section 2.01.
(b) Priority in Piggyback Registrations. If the managing underwriter of
a Piggyback Registration advises Xxxx.xxx in writing that, in its opinion, the
number of shares of Registrable Securities requested or proposed to be included
in such offering exceeds the number that can be sold in such offering without
materially affecting the offering price of any such securities, Xxxx.xxx shall
include in such registration (i) first, to the extent that securities of
Xxxx.xxx are included in such registration, (A) such securities proposed to be
sold by Xxxx.xxx and (B) the securities of Xxxx.xxx held by persons who have
preferential registration rights to include such securities in such Piggyback
Registration in accordance with the agreements with respect to such registration
rights between Xxxx.xxx and such holders; and (ii) second, to the extent that
such Registrable Securities may be included in such registration without
materially affecting the offering price of the securities referred to in clause
(i), in the opinion of such managing underwriter, the Registrable Securities
requested by the Holders to be included in such Piggyback Registration pursuant
to Section 2.02(a) and any other securities of Xxxx.xxx held by persons other
than the Holders having rights to participate in such Piggyback Registration
that are non-preferential to the Holders of the Registrable Securities, pro rata
among all such holders on the basis of the total number of securities of
Xxxx.xxx, including Registrable Securities, requested by each such holder to be
included therein.
(c) Selection of Underwriters. Xxxx.xxx shall select the investment
banker(s) and manager(s) for the offering.
(d) Underwritten Piggyback Registrations. If Xxxx.xxx at any time
proposes to register any of its securities under the Act as to which rights
under this Section 2.02 have been exercised and such securities are to be
distributed by or through one or more underwriters, Xxxx.xxx will, if requested
by any Holder as provided in Section 2.02(a) and subject to the provisions of
Section 2.02 (a) and (b), use its reasonable commercial efforts to arrange for
such underwriters to include all the Registrable Securities to be offered and
sold by such Holder among the Securities to be distributed by such underwriters.
Such Holders of the Registrable Securities to be distributed by such
underwriters shall be parties to the underwriting agreement between Xxxx.xxx and
such underwriters and may, at their option, require that any or all of the
representations and warranties by, and the other agreements on the part of,
Xxxx.xxx to and for the benefit of such underwriters shall also be made to and
for the benefit of such Holders and that any or all of the conditions precedent
to the obligations of such underwriters under such underwriting agreement be
conditions precedent to the obligations of such Holders. Any such Holder shall
not be required to make any representations or warranties to or agreements with
Xxxx.xxx or the underwriters other than representations, warranties or
agreements regarding such Holder, such Holder's title to Registrable Securities
and such Holder's intended method of distribution and any other representation
required by law.
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Section 2.03 Obligations of Xxxx.xxx. In furtherance of its obligations
under Section 2.01 or 2.02 to use its commercially reasonable efforts to effect
the registration of the Registrable Securities, Xxxx.xxx shall, as expeditiously
as reasonably possible,
(a) Prepare and file with the SEC a registration statement
with respect to such Registrable Securities and use its commercially reasonable
efforts to cause such registration statement to become effective and keep such
registration statement effective until (i) in the case of a Demand Registration,
the time when all Registrable Securities are eligible for sale by the Holders
pursuant to Rule 144(k) and (ii) in the case of a Piggyback Registration, until
90 days after the effectiveness of such registration statement;
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to comply with the provisions of the Act with
respect to the disposition of all securities covered by such registration until
the earlier of the time periods specified in Section 2.03(a) and such time as
all of such securities have been disposed of in accordance with the intended
methods of disposition by the Holders set forth in such registration statement;
(c) Furnish to the Holders such numbers of copies of such
registration statement and of each amendment and supplement thereto (in each
case including all exhibits) and prospectus, including any preliminary
prospectus, in conformity with the requirements of the Act, and such other
documents as the Holders may reasonably request in order to facilitate the
disposition of the Registrable Securities;
(d) Use its commercially reasonable efforts to register and
qualify the securities covered by such registration statement under such other
securities or blue sky laws of such jurisdictions (domestic or foreign) as each
Holder thereof shall reasonably request, to keep such registration or
qualification in effect for so long as such registration statement remains in
effect, and to take any other action which may be reasonably necessary or
advisable to enable such Holder to consummate the disposition in such
jurisdictions of the securities owned by such Holder, except that Xxxx.xxx shall
not for any such purpose be required to qualify generally to do business as a
foreign corporation in any jurisdiction wherein it would not but for the
requirements of this Section 2.03(d) be obligated to be so qualified, to subject
itself to taxation in any such jurisdiction or to consent to general service of
process in any such jurisdiction;
(e) Use its reasonable commercial efforts to (i) obtain the
withdrawal of any order suspending the effectiveness of such registration
statement or sales thereunder at the earliest possible time and (ii) cause all
Registrable Securities covered by such registration statement to be registered
with or approved by such other governmental agencies or authorities as may be
necessary to enable the Holders thereof to consummate the disposition of such
Registrable Securities;
(f) In connection with any firm commitment underwritten
offering, furnish to each Holder a signed counterpart, addressed to such Holder
(and the underwriters, if any) of
(i) an opinion of counsel for Xxxx.xxx
dated the date of the closing under the underwriting agreement,
reasonably satisfactory in form and substance to such underwriter, and
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(ii) a "comfort" letter, dated the
effective date of such registration statement (and dated the date of
the closing under the underwriting agreement), signed by the
independent public accountants who have certified Xxxx.xxx's financial
statements included in such registration statement,
covering substantially the same matters with respect to such registration
statement (and the prospectus included therein) and, in the case of the
accountants' letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer's counsel
and in accountants' letters delivered to the underwriters in underwritten public
offerings of securities;
(g) Notify in writing each Holder, at any time when a
prospectus relating thereto is required to be delivered under the Act, (a) upon
discovery that, or upon the happening of any event as a result of which, the
prospectus included in such registration statement, as then in effect, includes
an untrue statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were made, and (b)
of any request for any amendment of or supplement to any registration statement
or other document relating to such offering promptly after receipt of such
request from the SEC or any other regulatory body or other body having
jurisdiction and, in either case, at the request of any such Holder promptly
prepare and furnish to such Holder a reasonable number of copies of a supplement
to or an amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such securities, such prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances under which they were made;
(h) Otherwise comply with all applicable federal and state
securities laws and rules and regulations of the SEC, and make available to the
Holders, as soon as reasonably practicable, an earning statement covering the
period of at least twelve months, but not more than eighteen months, beginning
with the first full calendar month after the effective date of such registration
statement, which earning statement shall satisfy the provisions of Section 11(a)
of the Act and Rule 158 under the Act, and will furnish to each Holder draft and
final versions of each registration statement and prospectus used in connection
therewith prior to the filing thereof, and any amendment or supplement to such
registration statement or prospectus and shall not file any thereof to which any
Holder shall have reasonably objected on the grounds that such registration
statement, prospectus, amendment or supplement does not comply in all material
respects with the requirements of the Act or the rules or regulations
thereunder;
(i) Provide and cause to be maintained a transfer agent and
registrar for all Registrable Securities covered by such registration statement
from and after a date not later than the effective date of such registration
statement; and
(j) Use its reasonable commercial efforts to list all
Registrable Securities covered by such registration statement on each securities
exchange and inter-dealer quotation system on which similar securities issued by
Xxxx.xxx are then listed.
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Xxxx.xxx may require each Holder as to which any registration
is being effected to furnish Xxxx.xxx such information regarding such Holder and
the distribution of such securities as Xxxx.xxx may from time to time reasonably
request in writing.
Section 2.04 Furnish Information. It shall be a condition precedent to
the obligations of Xxxx.xxx to take any action pursuant to Article 2 that the
Holders shall furnish to Xxxx.xxx such information regarding such Holders, the
Registrable Securities held by such participating Holders and the intended
method of disposition thereof as Xxxx.xxx or its appointed agents shall
reasonably request and as shall be required in connection with the action to be
taken by Xxxx.xxx.
Section 2.05 Registration Expenses. In the case of any registration
effected pursuant to Section 2.01 or 2.02, Xxxx.xxx shall bear all Registration
Expenses; provided, however, that the Holders shall bear the fees and costs of
its own counsel (other than to the extent provided in the definition of
"Registration Expenses" in connection with a firm commitment, underwritten
offering) and all brokers' discounts and commissions with respect to the
Registrable Securities sold by such Person.
Section 2.06 Use of Prospectus.
Each Holder agrees that if Xxxx.xxx notifies the Holder in
writing of the happening of any event as a result of which the prospectus
included in such registration statement contains an untrue statement of a
material fact or omits any fact necessary to make the statements therein not
misleading, the Holder will discontinue immediately its disposition of
securities pursuant to the registration statement until the Holder receives
copies of an amended or supplemented prospectus, and if so directed by Xxxx.xxx,
will deliver to Xxxx.xxx all copies then in Holder's possession of the
prospectus relating to such Registrable Securities current at the time of
receipt of such notice.
Section 2.07 Indemnification. If any Registrable Securities
are included in a registration statement pursuant to Section 2.01 or 2.02, then,
(a) Xxxx.xxx shall indemnify and hold harmless the Holders,
agents for and officers and directors of the Holders, any underwriter of the
Registrable Securities, and each Person, if any, who controls any such Person
within the meaning of the Act, against any losses, claims, damages or
liabilities, joint or several (or actions in respect thereof), to which they may
become subject under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of material fact contained
in such registration statement, including any preliminary prospectus or final
prospectus contained in the registration statement, or any amendments or
supplements to the registration statement, or arise out of or are based upon the
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 by Xxxx.xxx of any rule or regulation promulgated under the Act or
any state securities law or rule or regulation applicable to Xxxx.xxx, and will
reimburse the Holders, the agents for, and officers and directors of the
Holders, any underwriter of the Registrable Securities, or any such controlling
Person for any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such loss, claim, damage, liability or
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action; provided, however, that Xxxx.xxx shall not be liable to any Holder in
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any untrue statement or omission based upon and
in conformity with information furnished to Xxxx.xxx in writing by such Holder.
(b) Each Holder shall indemnify and hold harmless Xxxx.xxx,
each of its directors and each of its officers who have signed such registration
statement against any losses, claims, damages or liabilities to which Xxxx.xxx
or any such director or officer may become subject, under the Act or otherwise,
insofar as such losses, claims, damages or liabilities arise out of or are based
upon any untrue or alleged untrue statement of any material fact contained in
such registration statement, including any preliminary prospectus or final
prospectus contained in the registration statement or any amendments or
supplements to the registration statement, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in such
registration statement, preliminary prospectus, or amendments or supplement
thereto, in reliance upon and in conformity with information furnished by the
Holder in writing expressly for the purpose of inclusion in such registration
statement, preliminary prospectus or amendments or supplements, and the Holders
will reimburse any legal or other expenses actually and reasonably incurred by
Xxxx.xxx or any such director, officer or controlling Person in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, that the Holder's liability under this Section 2.06(b) shall not
exceed the amount of the gross proceeds of the offering of the Holder's
Registrable Securities included therein.
(c) Each party entitled to indemnification (the "Indemnified
Party") shall give notice to the party required to provide indemnification
("Indemnifying Party") promptly after such Indemnified Party has knowledge of
any claim as to which indemnity may be sought, and shall permit the Indemnifying
Party (at its expense) to assume the defense of any such claim or any litigation
resulting therefrom; provided, however, that counsel for the Indemnifying Party,
who shall conduct the defense of such claim or litigation, shall be reasonably
satisfactory to the Indemnified Party, and the Indemnified Party may participate
in such defense at such party's expense; provided, further, that the failure by
any Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Section 2.06, except to the
extent that the failure results in an omission of actual notice to the
Indemnifying Party and such Indemnifying Party is materially damaged as a result
of the 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 the entry of any judgment or enter into any settlement that does not
include as an unconditional term the giving by the claimant or plaintiff to such
Indemnified Party of a release from all liability with respect to such claim or
litigation.
Section 2.08 Contribution. (a) If the indemnification provided for in
Section 2.07 is unavailable to the Indemnified Party in respect of any losses,
claims, damages or liabilities (or actions in respect thereof) referred to
therein, then each such Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
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Indemnified Party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the
relative fault of the Indemnifying Party on the one hand and the Indemnified
Party on the other in connection with the statement or omission which resulted
in such losses, claims, damages or liabilities (or actions in respect thereof),
as well as any other relevant equitable considerations. The relative fault shall
be determined by reference to, among other things, whether the untrue statement
(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
Indemnifying Party or the Indemnified Party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Company and each Holder agree that it would not be
just and equitable if contribution pursuant to this Section 2.08 were determined
by pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to above. The amount paid or
payable by an Indemnified Party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to in this Article 2 shall
be deemed to include any legal or other expenses reasonably incurred by such
Indemnified Party in connection with investigating or defending any such action
or claim.
(b) Notwithstanding anything to the contrary contained herein,
the obligation of each Holder to contribute pursuant to this Section 2.08 is
several and not joint and no selling Holder shall be required to contribute any
amount in excess of the amount by which the total price at which the Registrable
Securities of such selling Holder were offered to the public exceeds the amount
of any damages which such selling Holder has otherwise been required to pay by
reason of such untrue statement (or alleged untrue statement) or omission (or
alleged omission).
(c) No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
Section 2.09 Transfer of Registration Rights. The registration rights
of the Investor under this Article 2 may be assigned and transferred (i) by each
Holder to any Affiliate of the Holder to whom any of the Notes or Conversion
Shares owned by the Holder are transferred, and (ii) by the Holder to any
transferee who acquires a majority of the Registrable Securities (adjusted to
reflect subsequent stock splits, combinations, stock dividends and
recapitalizations) initially issued to such Holder; provided, however, that
Xxxx.xxx is given written notice by the Holder 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 Article 2 are being
assigned and transferred. For the purposes of this Section 2.09, a change in
control of an Affiliate of the Holder 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 the Holder, shall be deemed an
attempted transfer of the registration rights hereunder and such former
Affiliate of the Holder shall not be entitled to such registration rights except
to the extent such transfer would be permitted under clause (ii) above.
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ARTICLE III
MISCELLANEOUS
Section 3.01 Successors and Assigns. Except as otherwise provided
herein, the terms and conditions of this Agreement shall inure to the benefit of
and be binding upon the respective successors and assigns of the parties hereto
(including permitted transferees of any shares of Registrable Securities).
Nothing in this Agreement is intended to confer upon any party other than the
parties hereto or their respective successors and assigns any rights, remedies,
obligations or liability under or by reason of this Agreement, except as
expressly provided in this Agreement.
Section 3.02 Notices.
All notices and other communications required or permitted
hereunder shall be in writing, shall be effective when given, and shall in any
event be deemed to be given upon receipt or, if earlier, (a) five (5) days after
deposit with the U.S. Postal Service or other applicable postal service, if
delivered by first class mail, postage prepaid, (b) upon delivery, if delivered
by hand or transmitted via facsimile (confirmed by letter sent by first class
mail, postage prepaid with the U.S. Postal Service or other applicable postal
service), or (c) one business day after the business day of deposit with Federal
Express or similar reputable, international overnight courier, freight prepaid.
Such notices, demands and other communications shall be sent to Xxxx.xxx at the
address set forth below and to any Holder of Registrable Securities at such
address set forth on Schedule A to the Note Exchange Agreement or at such
address or to the attention of such other person as the recipient party has
specified by prior written notice to the sending party. The address for Xxxx.xxx
is:
Xxxx.xxx, Inc.
00 Xxxxxxxx, Xxxxx 000
Xxx Xxxx, XX 00000
X.X.X.
Attention: Xxxxxx Xxxxxxxx, Chief Executive Officer
Facsimile No.: 000-000-0000
with a copy at the same address to:
Xxxxx X. Xxxxxxxx, Esq.
or at such other address as a party may designate by ten (10) days advance
written notice to the other party pursuant to the provisions above.
Section 3.03 Governing Law; Forum and Consent to Jurisdiction.
(a) Governing Law. This Agreement shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the law of
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the State of New York excluding choice-of-law principles of the law of such
State that would require the application of the laws of a jurisdiction other
than such State.
(b) Submission to Jurisdiction; Service of Process. (i) Xxxx.xxx and
the Holders agree that any action or proceeding brought by the Holders in
connection with this Agreement may be brought (and any action or proceeding
brought by Xxxx.xxx against the Holders in connection herewith shall exclusively
be brought) in the courts of the State of New York sitting in the Borough of
Manhattan or of the United States of America for the Southern District of New
York and, by execution and delivery of this Agreement, Xxxx.xxx and the Holders
hereby irrevocably waive any objection, including, without limitation, any
objection to the laying of venue or based on the grounds of forum non
conveniens, which it may now or hereafter have to the bringing of any such
action or proceeding by Xxxx.xxx or the Holders in such non-exclusive
jurisdictions.
(ii) Xxxx.xxx hereby irrevocably appoint CT Corporation System (the
"Process Agent"), with an office on the date hereof at 0000 Xxxxxxxx, Xxx Xxxx,
XX 00000, Xxxxxx Xxxxxx of America, as their agent to receive on their behalf
service of copies of the summons and complaint and any other process that may be
served in any such action or proceeding. Xxxx.xxx irrevocably consents to the
service of process of any of the aforesaid courts in any such action or
proceeding by the mailing of copies thereof by registered mail, postage prepaid,
to it at its address set forth in this Agreement or to the Process Agent at its
address specified above.
Section 3.04 Waivers; Amendments. The waiver by the undersigned of any
of the provisions of this Agreement shall not operate or be construed as a
waiver of any subsequent breach. This Agreement may be amended, and any
provision of this Agreement may be waived, only by a written amendment executed
by (i) in the case of any amendment affecting the rights or obligations of
Xxxx.xxx, Xxxx.xxx and (ii) in the case of any amendment affecting the rights or
obligations of the Holder, Holders of a majority of the Registrable Securities
then outstanding (including Conversion Shares issuable upon conversion of then
outstanding Notes and Interest Payment Shares issuable in payment of interest on
the Notes).
Section 3.05 Headings. The section headings contained in this Agreement
are for reference purposes only and shall not affect the construction and
interpretation of this Agreement.
Section 3.06 Severability. Whenever possible, each provision of this
Agreement shall 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 shall be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
Section 3.07 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original but all of which
shall constitute one and the same instrument. This Agreement may contain more
than one counterpart of the signature page and may be executed by the affixing
of the signatures of each of the parties hereto to one of these counterpart
signature pages. All of the counterpart signature pages shall be read as though
one, and they shall have the same force and effect as though all of the signers
had signed a single signature page.
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Section 3.08 Aggregation of Stock. All shares of Registrable Securities
held or acquired by affiliated entities or persons shall be aggregated together
for the purpose of determining the availability of any rights under this
Agreement.
Section 3.09 Construction. The parties hereto have participated jointly
in the negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties hereto and no presumption or burden of
proof shall arise favoring or disfavoring any party hereto by virtue of the
authorship of any of the provisions of this Agreement.
Section 3.10 Entire Agreement. This Agreement contains the entire
agreement of the parties hereto. The parties hereto are not bound by any oral
statements that are made outside of this Agreement.
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WHEREAS, the parties hereto have executed this Agreement as of
the date first above written.
XXXX.XXX, INC.
By: /s/ Xxxxxx Xxxxxxxx
---------------------------------------
Xxxxxx Xxxxxxxx
Chief Executive Officer
INVESTORS:
FIR TREE VALUE FUND, L.P.
By: /s/ Xxxx Xxxxxxxxxx
-------------------------------
Name: Xxxx Xxxxxxxxxx
Title: General Partner
FIR TREE INSTITUTIONAL VALUE FUND, L.P.
By: /s/ Xxxx Xxxxxxxxxx
-------------------------------
Name: Xxxx Xxxxxxxxxx
Title: General Partner
FIR TREE VALUE PARTNERS, LDC.
By: /s/ Xxxx Xxxxxxxxxx
-------------------------------
Name: Xxxx Xxxxxxxxxx
Title: General Partner
FIR TREE RECOVERY MASTER FUND, L.P.
By: /s/ Xxxx Xxxxxxxxxx
-------------------------------
Name: Xxxx Xxxxxxxxxx
Title: General Partner
15
