1
EXHIBIT 10.1
EXECUTION COPY
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT dated June 9,1999,
among NETPARTNERS INTERNET SOLUTIONS, INC., a Delaware corporation (the
"Company"), and the holders of the Company's Series A Preferred Stock, $.01 par
value (the "Series A Preferred Stock"), listed on Schedule I (the "Series A
Investors") and the investors listed on Schedule II (the "Series B Investors").
The Series A Investors and the Series B Investors are hereinafter collectively
referred to as the "Investors."
The Company has granted the Series A Investors registration and other
rights under that certain Registration Rights Agreement dated May 20, 1998 among
the Company and the Series A Investors (the "Prior Agreement"). Pursuant to that
certain Subscription Agreement of even date herewith, among the Company and the
Series B Investors (the "Subscription Agreement"), the Company issued and sold
to each Series B Investor the number of shares of Series B Preferred Stock, $.01
par value (the "Series B Preferred Stock"), set forth opposite the name of such
Series B Investor on Schedule II. The Series A Preferred Stock and the Series B
Preferred Stock are convertible into shares of Common Stock, $.01 par value (the
"Common Stock"), of the Company. The Company and the Investors deem it to be in
their respective best interests to set forth the rights of the Investors in
connection with public offerings and sales of the Common Stock. Accordingly, the
Company and the Investors agree as follows:
SECTION 1. AMENDMENT OF PRIOR AGREEMENT. Certain of the undersigned
parties, who constitute the requisite parties necessary to amend the Prior
Agreement, hereby agree that effective upon the date hereof, the Prior Agreement
is null and void and superseded in its entirety by the rights and obligations
set forth in this Amended and Restated Registration Rights Agreement, and any
application of the rights contained in the Prior Agreement, including, but not
limited to subsequent registration rights, conflicting rights, modifications,
amendments or waivers (including any notice requirements) set forth in Sections
7, 13 and 19 of the Prior Agreement as to the issuance of the Company's Series B
Preferred Stock under that certain subscription Agreement dated of even date
herewith between the Company and the holders of the Series B Preferred Stock are
hereby waived.
SECTION 2. DEFINITIONS. As used in this Agreement, the following terms
shall have the following meanings:
"COMMISSION" means the Securities and Exchange Commission or any other
Federal agency at the time administering the Securities Act.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended, or
any successor Federal statute, and the rules and regulations of the Commission
promulgated thereunder, all as the same shall be in effect from time to time.
"OTHER SHARES" means at any time those shares of Common Stock which do
not constitute Primary Shares or Registrable Shares.
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"PRIMARY SHARES" means at any time the authorized but unissued shares of
Common Stock or shares of Common Stock held by the Company in its treasury.
"REGISTRABLE SHARES" shall mean (i) shares of Common Stock issued or
issuable pursuant to the conversion of the Restricted 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 (1) above, provided, however,
that Registrable Securities shall not include any shares of Common Stock which
have previously been registered or which have been sold to the public either
pursuant to a registration statement or Rule 144, or which have been sold in a
private transaction in which the transferor's rights under this Agreement are
not assigned.
"REGISTRATION DATE" means the date on which any registration statement
pursuant, to which the Company shall have initially registered shares of Common
Stock under the Securities Act for sale to the public shall have been declared
effective.
"REGISTRATION EXPENSES" shall mean all expenses incurred in effecting
any registration pursuant to 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,
and expenses of any regular or special audits incident to or required by any
such registration, but shall not include Selling Expenses, and the compensation
of regular employees of the Company, which shall be paid in any event by the
Company.
"RESTRICTED SHARES" means the Company's Series A Preferred Stock and
Series B Preferred Stock.
"RULE 144" means Rule 144 promulgated under the Securities Act or any
successor rule thereto.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
successor Federal statute, and the rules and regulations of the Commission
promulgated thereunder, all as the same shall be in effect from time to time.
"SELLING EXPENSES" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the sale of Registrable
Shares and fees and disbursements of counsel for any holder (other than the fees
and disbursements of counsel included in Registration Expenses).
"TRANSFER" means any disposition of any Restricted Shares or of any
interest therein which would constitute a sale thereof within the meaning of the
Securities Act, other than any such disposition pursuant to an effective
registration statement under the Securities Act and complying with all
applicable state securities and "blue sky" laws.
SECTION 3. REQUIRED REGISTRATION.
(a) If the Company shall be requested by any Investor or group of
Investors holding at least a majority of all Registrable Shares, (i) at any time
after December 31, 1999, or (ii) at any time after the 180th day after the
Registration Date, to effect the registration under the Securities Act of
Registrable Shares, the Company shall promptly give written notice of such
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proposed registration to all holders of Registrable Shares and shall offer to
include in such proposed registration any Registrable Shares requested to be
included in such proposed registration by the holders of Registrable Shares who
shall respond in writing to the Company's notice within 30 days after delivery
of such notice (which response shall specify the number of Registrable Shares
proposed to be included in such registration). The Company shall promptly use
its best efforts to effect such registration under the Securities Act of the
Registrable Shares which the Company has been so requested to register;
provided, however, that the Company shall not be obligated to effect any
registration under the Securities Act except in accordance with the following
provisions:
(b) the Company shall not be obligated to use its best efforts to
file and cause to become effective (i) more than two registration statements
initiated pursuant to clause (a)(i) above, (ii) more than three registration
statements initiated pursuant to this Section 3 and Section 5, or (iii) any
registration statement during any period in which any other registration
statement (other than on Form S-4 or Form S-8 promulgated under the Securities
Act or any successor forms thereto) pursuant to which Primary Shares are to be
or were sold has been filed and not withdrawn or has been declared effective
within the prior 90 days;
(c) the Company may delay the filing or effectiveness of any
registration statement for a period of up to 90 days after the date of a request
for registration pursuant to this Section if at the time of such request the
Company is engaged, or has fixed plans to engage within 60 days of the time of
such request, in a firm commitment underwritten public offering of Primary
Shares in which the holders of Registrable Shares may include Registrable Shares
pursuant to Section 4;
(d) with respect to any registration pursuant to this Section, the
Company may include in such registration any Primary Shares or Other Shares;
provided, however, that if any managing underwriter for the public offering
contemplated by such registration advises the Company in writing that, in such
firm's good faith opinion, the inclusion of all Registrable Shares, Primary
Shares and Other Shares proposed to be included in such registration would
adversely affect the offering and sale (including pricing) of all such
securities, then the number of Registrable Shares, Primary Shares and Other
Shares proposed to be included in such registration shall be included in the
following order:
(i) FIRST, the Registrable Shares held by the Investors, pro rata
based upon the number of Registrable Shares owned by each Investor at the time
of such registration; and
(ii) SECOND, the Primary Shares and the Other Shares;
(e) if, while a registration request is pending pursuant to this
Section 3, the Company has determined in good faith that (i) the filing of a
registration statement would require the disclosure of material information that
the Company has a bona fide business purpose for preserving as confidential or
(ii) the Company then is unable to comply with Commission requirements
applicable to the requested registration, the Company shall not be required to
effect a registration pursuant to this Section 3 until the earlier of (A) the
date upon which such material information is otherwise disclosed to the public
or ceases to be material or the Company is able
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to so comply with applicable Commission requirements, as the case may be, and
(B) 180 days after the Company makes such good-faith determination, provided
that the Company shall not be permitted to delay a requested registration in
reliance on this paragraph (e) more than once in any 12-month period; and
(f) A requested registration under this Section may be rescinded by
written notice to the Company by the Investors initiating such request. Such
rescinded registration shall not count as a registration statement initiated
pursuant to this Section for purposes of paragraph (b) above if (1) such request
is rescinded by such Investors not later than five business days prior to the
proposed filing of a registration statement with the Commission and (2) such
Investors reimburse the Company for all Registration Expenses incurred in
connection with such withdrawn request. A registration rescinded later than five
business days prior to the proposed filing of a registration statement with the
Commission shall count as a registration statement initiated pursuant to
paragraph (b) of this Section and the Investors shall bear the Registration
Expenses. Furthermore, in the event that a withdrawal by the Investors is prior
to 15 days in advance of the proposed filing with the Commission of any
registration on Form S-1, or prior to 5 days in advance of the proposed filing
with the Commission of any registration on Form S-3, such registration shall not
be treated as a counted registration for purposes of Section 3 hereof, and the
Investors will not bear the Registration Expenses for such rescinded
registration.
SECTION 4. PIGGYBACK REGISTRATION. If the Company at any time proposes
for any reason to register Primary Shares or Other Shares under the Securities
Act (other than on Form S-4 or Form S-8 promulgated under the Securities Act or
any successor forms thereto), it shall promptly give written notice to each
Investor of its intention so to register the Primary Shares or Other Shares at
least 20 business days prior to the anticipated filing date of the registration
statement relating thereto. Upon the written request, given within 10 business
days after delivery of any such notice by the Company, of any Investor to
include in such registration Registrable Shares (which request shall specify the
number of Registrable Shares proposed to be included in such registration), the
Company shall use its best efforts to cause all such Registrable Shares to be
included in such registration on the same terms and conditions as the securities
otherwise being sold in such registration; provided, however, that:
(a) if any managing underwriter for the initial public offering of
Primary Shares contemplated by such registration advises the Company in writing
that, in such firm's good faith opinion, the inclusion of any or all Registrable
Shares or Other Shares proposed to be included in such registration would
adversely affect the offering and sale (including pricing) of the Primary Shares
proposed to be registered by the Company, then the number of Primary Shares,
Registrable Shares and Other Shares proposed to be included in such registration
shall be included in the following order:
(i) FIRST, the Primary Shares;
(ii) SECOND, the Registrable Shares held by the Investors, pro
rata based upon the number of Registrable Shares owned by each Investor at the
time of such registration; and
(iii) THIRD, the Other Shares; and
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(b) if at any time after giving written notice of its intention to
register any Primary Shares or Other Shares and prior to the effective date of
such registration, the Company shall determine for any reason not to register or
to delay registration of such securities, the Company may, at its election, give
written notice of such determination to the Investors and, thereupon, (A) in the
case of a determination not to register, the Company shall be relieved of its
obligation to register any Registrable Shares in connection with such
registration and (B) in the case of a determination to delay such registration,
the Company shall be permitted to delay registration of any Registrable Shares
requested to be included in such registration for the same period as the delay
in registering such other securities.
SECTION 5. REGISTRATIONS ON FORM S-3. At such time as the Corporation
shall have qualified for the use of Form S-3 promulgated under the Securities
Act or any successor form thereto, the holders of the Registrable Shares then
outstanding shall have the right to request in writing registration on Form S-3,
or such successor form, of Registrable Shares, which request shall (i) specify
the number of Registrable Shares intended to be sold or disposed of and the
holders thereof, (ii) state the intended method of disposition of such
Registrable Shares, and (iii) relate to Registrable Shares having an aggregate
offering price of at least $500,000. A requested registration on Form S-3 or any
successor form in compliance with this Section 5 shall be subject to Sections 3
and 4, including without limitation Section 4(b).
SECTION 6. HOLDBACK AGREEMENT. If the Company at any time shall register
shares of Common Stock under the Securities Act (including any registrations
pursuant to Section 3, 4 or 5) for sale to the public, the Investors shall not
sell, make any short sale of, grant any option for the purchase of, or otherwise
dispose of any Restricted Shares (other than those shares of Common Stock
included in such registration pursuant to Section 3, 4 or 5) without the prior
written consent of the Company for a period designated by the Company in writing
to the Investors, which period shall not last more than 180 days after the
effective date of such registration statement or such longer period as any
managing underwriter for such public offering shall request, provided all
officers, directors and greater than 1% shareholders of the Company have entered
into similar agreements. The Company may legend and impose stop transfer
instructions on any certificate evidencing Registrable Shares relating to the
restrictions provided in this Section 6.
SECTION 7. PREPARATION AND FILING. If and whenever the Company is under
an obligation pursuant to the provisions of this Agreement to use its best
efforts to effect the registration of any Registrable Shares under the
Securities Act, the Company shall, as expeditiously as practicable:
(a) use its best efforts to cause a registration statement that
registers such Registrable Shares to become and remain effective for a period of
90 days or until all of such Registrable Shares have been disposed of (if
earlier);
(b) furnish, at least five business days before filing a
registration statement that registers such Registrable Shares, a prospectus
relating thereto or any amendments or supplements relating to such a
registration statement or prospectus, to one counsel selected by the holders of
a majority of such Registrable Shares (the "Selling Investors' Counsel"), copies
of all such documents proposed to be filed (it being understood that such
five-business-day period
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need not apply to successive drafts of the same document proposed to be filed so
long as such successive drafts are supplied to such counsel in advance of the
proposed filing by a period of time that is customary and reasonable under the
circumstances);
(c) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective for
at least a period of 90 days or until all of such Registrable Shares have been
disposed of (if earlier) and to comply with the provisions of the Securities Act
with respect to the sale or other disposition of such Registrable Shares;
(d) notify in writing the Selling Investors' Counsel promptly (i) of
the receipt by the Company of any notification with respect to any comments by
the Commission with respect to such registration statement or prospectus or any
amendment or supplement thereto or any request by the Commission for the
amending or supplementing thereof or for additional information with respect
thereto, (ii) of the receipt by the Company of any notification with respect to
the issuance by the Commission of any stop order suspending the effectiveness of
such registration statement or prospectus or any amendment or supplement thereto
or the initiation or threatening of any proceeding for that purpose and (iii) of
the receipt by the Company of any notification with respect to the suspension of
the qualification of such Registrable Shares for sale in any jurisdiction or the
initiation or threatening of any proceeding for such purposes;
(e) use its efforts to register or qualify such Registrable Shares
under such other securities or blue sky laws of such jurisdictions as any seller
of Registrable Shares reasonably requests and do any and all other acts and
things which may be reasonably necessary or advisable to enable such seller of
Registrable Shares to consummate the disposition in such jurisdictions of the
Registrable Shares owned by such seller; provided, however, that the Company
will not be required to register or qualify generally to do business, subject
itself to general taxation or consent to general service of process in any
jurisdiction where it would not otherwise be required so to do but for this
paragraph (e);
(f) furnish to each seller of such Registrable Shares such
reasonable number of copies of a summary prospectus or other prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents prepared by the Company in connection
with such registration as such seller of Registrable Shares may reasonably
request in order to facilitate the public sale or other disposition of such
Registrable Shares;
(g) use its best efforts to cause such Registrable Shares to be
registered with or approved by such other governmental agencies or authorities
as may be necessary by virtue of the business and operations of the Company to
enable the seller or sellers thereof to consummate the disposition of such
Registrable Shares;
(h) notify on a timely basis each seller of such Registrable Shares
at any time when a prospectus relating to such Registrable Shares is required to
be delivered under the Securities Act within the appropriate period mentioned in
paragraph (a) of this Section, of 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 a
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material fact required to be stated therein or necessary to make the statements
therein not misleading in light of the circumstances then existing and, at the
request of such seller, prepare and furnish to such seller 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 offerees of such shares, such
prospectus shall not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing;
(i) make available for inspection by any seller of such Registrable
Shares, any underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other agent retained by
any such seller or underwriter (collectively, the "Inspectors"), all pertinent
financial and other records, pertinent corporate documents and properties of the
Company (collectively, the "Records"), as shall be reasonably necessary to
enable them to exercise their due diligence responsibility under the Securities
Act, and cause the Company's officers, directors and employees to supply all
information (together with the Records, the "Information") reasonably requested
by any such Inspector in connection with the preparation and filing of such
registration statement. Any of the Information which the Company determines in
good faith to be confidential, and of which determination the Inspectors are so
notified, shall not be disclosed by the Inspectors unless (i) the disclosure of
such Information is necessary to avoid or correct a misstatement or omission in
the registration statement, (ii) the release of such Information is ordered
pursuant to a subpoena or other order from a court of competent jurisdiction or
(iii) such Information has been made generally available to the public. The
seller of Registrable Shares agrees that it will, upon learning that disclosure
of such Information is sought in a court of competent jurisdiction, give notice
to the Company and allow the Company, at the Company's expense, to undertake
appropriate action to prevent disclosure of the Information deemed confidential;
(j) use its best efforts to obtain from its independent certified
public accountants "cold comfort" letters in customary form and at customary
times and covering matters of the type customarily covered by cold comfort
letters;
(k) use its best efforts to obtain from its counsel an opinion or
opinions in customary form;
(1) provide a transfer agent and registrar (which may be the same
entity and which may be the Company) for such Registrable Shares to the extent
not already provided;
(m) issue to any underwriter to which any seller of Registrable
Shares may sell shares in such offering certificates evidencing such Registrable
Shares;
(n) list such Registrable Shares on any national securities exchange
or national automated quotation system on which any shares of the Common Stock
are listed or, if the Common Stock is not so listed, use its best efforts to
qualify such Registrable Shares for inclusion on the automated quotation system
of the National Association of Securities Dealers, Inc. (the "NASD") or such
national securities exchange as the Company shall reasonably determine;
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(o) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission and make available to its
securityholders, as soon as reasonably practicable, earnings statements (which
need not be audited) covering a period of 12 months beginning within three
months after the effective date of the registration statement, which earnings
statements shall satisfy the provisions of Section 11(a) of the Securities Act;
and
(p) use its best efforts to take all other steps necessary to effect
the registration of such Registrable Shares contemplated hereby.
SECTION 8.
(a) EXPENSES OF REGISTRATION. All Registration Expenses incurred
(including the reasonable fees (not to exceed $15,000) of one counsel to
Investors) in connection with any registration, qualification or compliance
pursuant to Sections 3, 4 and 5 hereof (except as specifically provided
therein), shall be borne by the Company. All Selling Expenses relating To
securities so registered shall be borne by the holders of such Registrable
Shares pro rata on the basis of the number of shares of securities so registered
on their behalf, as shall any other expenses in connection with the registration
required to be borne by the holders of such Registrable Shares.
(b) LIMITATIONS ON SUBSEQUENT REGISTRATION RIGHTS. From and after
the date of this Agreement, the Company shall not, without the prior written
consent of a majority in interest of the Investors, enter into any agreement
with any holder or prospective holder of any securities of the Company giving
such holder or prospective holder any registration rights.
SECTION 9. INDEMNIFICATION.
(a) In connection with any registration of any Registrable Shares
under the Securities Act pursuant to this Agreement, the Company shall indemnify
and hold harmless the seller of such Registrable Shares, each underwriter,
broker or any other person acting on behalf of such seller and each other
person, if any, who controls any of the foregoing persons within the meaning of
the Securities Act against any losses, claims, damages or liabilities, joint or
several, (or actions in respect thereof) to which any of the foregoing persons
may become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in the registration statement under which such
Registrable Shares were registered under the Securities Act, any preliminary
prospectus or final prospectus contained therein or otherwise filed with the
Commission, any amendment or supplement thereto or any document incident to
registration or qualification of any Registrable Shares, 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, with respect to any prospectus, necessary to make the statements
therein in light of the circumstances under which they were made not misleading,
or any violation by the Company of the Securities Act or state securities or
blue sky laws applicable to the Company and relating to action or inaction
required of the Company in connection with such registration or qualification
under such state securities or blue sky laws; and shall reimburse such seller,
such underwriter, such broker or such other person acting on behalf of such
seller and each such controlling person for any legal or other
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expenses reasonably incurred by any of them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or action arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in said registration statement, preliminary prospectus, final prospectus,
amendment, supplement or document incident to registration or qualification of
any Registrable Shares in reliance upon and in conformity with written
information furnished to the Company through an instrument duly executed by or
on behalf of such seller or underwriter specifically for use in the preparation
thereof and provided, further, however, that, as to any underwriter or any
person controlling any underwriter, this indemnity does not apply to any losses,
claims, damages or liabilities arising out of or based upon any untrue statement
or alleged untrue statement or omission or alleged omission in any preliminary
prospectus if a copy of a prospectus was not sent or given by or on behalf of an
underwriter to such person asserting such loss, claim damage, liability or
action at or prior to the written confirmation of the sale of the Registrable
Shares as required by the Securities Act and such untrue statement or omission
had been corrected in such prospectus.
(b) In connection with any registration of Registrable Shares under
the Securities Act pursuant to this Agreement, each seller of Registrable Shares
shall indemnify and hold harmless (in the same manner and to the same extent as
set forth in the preceding paragraph of this Section) the Company, each director
of the Company, each officer of the Company who shall sign such registration
statement, each underwriter, broker or other person acting on behalf of the
Company, each person who controls any of the foregoing persons within the
meaning of the Securities Act and each other seller of Registrable Shares under
such registration statement with respect to any statement or omission from such
registration statement, any preliminary prospectus or final prospectus contained
therein or otherwise filed with the Commission, any amendment or supplement
thereto or any document incident to registration or qualification of any
Registrable Shares, if (other than with respect to such seller's indemnification
of an underwriter) such statement or omission was made in reliance upon and in
conformity with written information furnished to the Company or such underwriter
through an instrument duly executed by or on behalf of such seller specifically
for use in connection with the preparation of such registration statement,
preliminary prospectus, final prospectus, amendment, supplement or document;
provided, however, that the maximum amount of liability in respect of such
indemnification shall be limited, in the case of each seller of Registrable
Shares, to an amount equal to the net proceeds actually received by such seller
from the sale of Registrable Shares effected pursuant to such registration; and
provided, further, however, that, as to any underwriter or any person
controlling any underwriter, this indemnity does not apply to any losses,
claims, damages or liabilities arising out of or based upon any untrue statement
or alleged untrue statement or omission or alleged omission in any preliminary
prospectus if a copy of a prospectus was not sent or given by or on behalf of an
underwriter to such person asserting such loss, claim, damage, liability or
action at or prior to the written confirmation of the sale of the Registrable
Shares as required by the Securities Act and such untrue statement or omission
had been corrected in such prospectus.
(c) Promptly after receipt by an indemnified party of notice of the
commencement of any action involving a claim referred to in the preceding
paragraphs of this Section, such indemnified party will, if a claim in respect
thereof is made against an
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indemnifying party, give written notice to the latter of the commencement of
such action. In case any such action is brought against an indemnified party,
the indemnifying party will be entitled to participate in and to assume the
defense thereof, jointly with any other indemnifying party similarly notified to
the extent that it may wish, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be responsible for any legal or other expenses
subsequently incurred by the latter in connection with the defense thereof,
provided, however, that if any indemnified party shall have reasonably concluded
that there may be one or more legal or equitable defenses available to such
indemnified party which are additional to or conflict with those available to
the indemnifying party, or that such claim or litigation involves or could have
an effect upon matters beyond the scope of the indemnity agreement provided in
this Section, the indemnifying party shall not have the right to assume the
defense of such action on behalf of such indemnified party and such indemnifying
party shall reimburse such indemnified party and any person controlling such
indemnified party for that portion of the fees and expenses of any counsel
retained by the indemnified party which is reasonably related to the matters
covered by the indemnity agreement provided in this Section.
(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, claim, damage, liability or action referred to herein, then
the indemnifying party, in lieu of indemnifying such indemnified party
hereunder, shall contribute to the amounts paid or payable by such indemnified
party as a result of such loss, claim, damage, liability or action in such
proportions 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 which resulted in such loss, claim, damage or
liability 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 or alleged 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.
SECTION 10. UNDERWRITING AGREEMENT. Notwithstanding the provisions of
Sections 6, 7, 8, and 9 to the extent that the Investors selling Registrable
Shares in a proposed registration shall enter into an underwriting or similar
agreement, which agreement contains provisions covering one or more issues
addressed in such Sections, the provisions contained in such Sections addressing
such issue or issues shall be of no force or effect with respect to such
registration. Each Investor that requested the registration of Registrable
Shares in an underwritten public offering pursuant to this Agreement shall
execute (i) an underwriting agreement containing (A) customary representations
and warranties and opinion requirements of such Investor, and (B) other terms
reasonably satisfactory to such Investor, and (ii) customary ancillary
documents, including a power of attorney and a custody agreement.
SECTION 11. SELECTION OF UNDERWRITERS. The Investors acknowledge and
agree that the Company shall select the underwriter for any public offering of
Registrable Shares made pursuant to this Agreement.
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SECTION 12. INFORMATION BY HOLDER. Each holder of Registrable Shares to
be included in any registration shall furnish to the Company such written
information regarding such holder and the distribution proposed by such holder
as the Company may reasonably request in writing and as shall be reasonably
required in connection with any registration, qualification or compliance
referred to in this Agreement.
SECTION 13. EXCHANGE ACT COMPLIANCE. From and after the Registration
Date or such earlier date as a registration statement filed by the Company
pursuant to the Exchange Act relating to any class of the Company's securities
shall have become effective, the Company shall comply with all of the reporting
requirements of the Exchange Act and shall comply with all other public
information reporting requirements of the Commission which are conditions to the
availability of Rule 144 for the sale of shares of Common Stock. The Company
shall cooperate with each Investor in supplying such information as may be
necessary for such Investor to complete and file any information reporting forms
presently or hereafter required by the Commission as a condition to the
availability of Rule 144.
SECTION 14. NO CONFLICT OF RIGHTS. The Company represents and warrants
to the Investors that the registration rights granted to the Investors hereby do
not conflict with any other registration rights granted by the Company. The
Company shall not, after the date hereof, grant any registration rights which
conflict with or impair the registration rights granted hereby.
SECTION 15. TERMINATION. This Agreement shall terminate and be of no
further force or effect when the Investors cease to hold any Registrable Shares.
SECTION 16. SUCCESSORS AND ASSIGNS. This Agreement shall bind and inure
to the benefit of the Company and the Investors and their respective successors
and assigns.
SECTION 17. ASSIGNMENT. Each investor may assign its rights hereunder to
any other person or entity to whom Restricted Shares of such Investor have been
sold or otherwise transferred.
SECTION 18. ENTIRE AGREEMENT. This Agreement contains the entire
agreement among the parties with respect to the subject matter hereof and
supersedes all prior arrangements or understandings with respect hereto.
SECTION 19. NOTICES. All notices, claims, certificates, 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 the Company:
NetPartners Internet Solutions, Inc.
0000 Xxx Xxxx Xxxxx
Xxx Xxxxx, XX 00000
Attention: Chief Executive Officer
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
11.
12
with a copy to:
Xxxxxx Godward LLP
0000 Xxxxxxxxx Xxxxx, Xxxxx 0000
Xxx Xxxxx, XX 00000
Attention: Xxxxxxxxx X. Xxxx, Esq.
Telecopier: (000) 000-0000
Telephone: (000) 000-0000
if to any Investor, to its address set forth on Schedules I or 11;
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:
(i) in the case of personal delivery, on the date of such
delivery,
(ii) in the case of nationally-recognized overnight courier, on
the next business day after the date when sent,
(iii) in the case of telecopy transmission, when received, and
(iv) in the case of mailing, on the third business day following
that on which the piece of mail containing such communication is posted.
SECTION 20. MODIFICATIONS, AMENDMENTS, WAIVERS. The terms and provisions
of this Agreement may not be modified or amended, except (i) pursuant to a
writing signed by the Company and the Investors holding at least a majority of
the Registrable Shares held by all Investors.
SECTION 21. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, and each such counterpart hereof shall be deemed to be an
original instrument, but all such counterparts together shall constitute but one
agreement.
SECTION 22. HEADINGS. The headings of the various sections of this
Agreement have been inserted for convenience of reference only and shall not be
deemed to be a part of this Agreement.
SECTION 23. SEVERABILITY. It is the desire and intent of the parties
that the provisions of this Agreement be enforced to the fullest extent
permissible under the law and public policies applied in each jurisdiction in
which enforcement is sought. Accordingly, if any provision of this Agreement
would be held in any jurisdiction to be invalid, prohibited or unenforceable for
any reason, such provision, as to such jurisdiction, shall be ineffective,
without invalidating the remaining provisions of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.
Notwithstanding the foregoing, if such provision could be more narrowly drawn so
as not to be invalid, prohibited or unenforceable in such jurisdiction, it
shall, as to such jurisdiction, be so narrowly drawn, without invalidating the
remaining
12.
13
provisions of this Agreement or affecting the validity or enforceability of such
provision in any other jurisdiction.
SECTION 24. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware, without giving
effect to the principles governing conflicts of laws.
13.
14
IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Registration Rights Agreement on the date first written above.
NETPARTNERS INTERNET SOLUTIONS, INC.
By: /s/ Xxxx X. Xxxxxxxxxx
------------------------------------------
Xxxx Xxxxxxxxxx
President and Chief Executive Officer
THE XXXXXX XXXXXXX VENTURE
PARTNERS ENTREPRENEUR FUND, L.P.
By: Xxxxxx Xxxxxxx Venture Partners III,
L.L.C. its General Partner
By: Xxxxxx Xxxxxxx Venture Capital III,
Inc. its Institutional Managing Member
/s/ Xxxxxx X. Xxxxxx
----------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
XXXXXX XXXXXXX VENTURE INVESTORS III, L.P.
By: Xxxxxx Xxxxxxx Venture Partners III,
L.L.C. its General Partner
By: Xxxxxx Xxxxxxx Venture Capital III,
Inc. its Institutional Managing Member
/s/ Xxxxxx X. Xxxxxx
----------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
14.
15
IN WITNESS WHEREOF, the parties have executed this Amended and Restated
Registration Rights Agreement on the date first written above.
XXXXXX XXXXXXX VENTURE PARTNERS III, L.P.
By: Xxxxxx Xxxxxxx Venture Partners III,
L.L.C. its General Partner
By: Xxxxxx Xxxxxxx Venture Capital III, Inc.
its Institutional Managing Member
/s/ Xxxxxx X. Xxxxxx
----------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Vice President
15.
16
XXXXXX XXXXXXX VENTURE PARTNERS III, L.P.
By: Xxxxxx Xxxxxxx Venture Partners III,
L.L.C. its General Partner
By: Xxxxxx Xxxxxxx Venture Capital III, Inc.
its Institutional Managing Member
----------------------------------------------
Name:
Title:
XXXXXXX IV, L.P.
----------------------------------------------
Name: Xxxxx Xxxxxxx
Title: Partner
SERIES B INVESTORS
ALPS SYSTEM INTEGRATION CO., LTD
/s/ Xxxxx Xxxxx
----------------------------------------------
Name: Xxxxx Xxxxx
Title: President
16.
17
XXXXXX XXXXXXX VENTURE PARTNERS III, L.P.
By: Xxxxxx Xxxxxxx Venture Partners III,
L.L.C. its General Partner
By: Xxxxxx Xxxxxxx Venture Capital III, Inc.
its Institutional Managing Member
----------------------------------------------
Name:
Title:
XXXXXXX IV, L.P.
/s/ Xxxxx Xxxxxxx
----------------------------------------------
Name: Xxxxx Xxxxxxx
Title: Partner
SERIES B INVESTORS
16.
18
XXXXXXX IV, L.P.
----------------------------------------------
Name: Xxxxx Xxxxxxx
Title: Partner
CROSSPOINT VENTURE PARTNERS
By: /s/ Xxxxxx X. Xxxxxx
------------------------------------------
Xxxxxx Xxxxxx
General Partner
16.
19
XXXXXXX IV, L.P.
----------------------------------------------
Name: Xxxxx Xxxxxxx
Title: Partner
CROSSPOINT VENTURE PARTNERS
By:
------------------------------------------
Xxxxxx Xxxxxx
General Partner
XXXXXXX PHLEGER & XXXXXXXX, LLP
By: /s/ Xxxxxxx X. Xxxx
------------------------------------------
Xxxxxxx X. Xxxx
Partner
16.
20
XXXXXX XXXXXXX VENTURE PARTNERS III, L.P.
By: Xxxxxx Xxxxxxx Venture Partners III,
L.L.C. its General Partner
By: Xxxxxx Xxxxxxx Venture Capital III, Inc.
its Institutional Managing Member
----------------------------------------------
Name: Xxxxx Xxxxxxxxxx
Title: Principal
XXXXXXX IV, L.P.
----------------------------------------------
Name: Xxxxx Xxxxxxx
Title: Partner
SERIES B INVESTORS
/s/ Xxxxxxx Xxxxxxxx
----------------------------------------------
Company: Forval Creative Inc.
Name: Xxxxxxx Xxxxxxxx
Title: President & CEO
16.
21
XXXXXX XXXXXXX VENTURE PARTNERS III, L.P.
By: Xxxxxx Xxxxxxx Venture Partners III,
L.L.C. its General Partner
By: Xxxxxx Xxxxxxx Venture Capital III, Inc.
its Institutional Managing Member
----------------------------------------------
Name:
Title:
XXXXXXX IV, L.P.
Name: Xxxxx Xxxxxxx
Title: Partner
SERIES B INVESTORS
NIPPON INVESTMENT & FINANCE CO., LTD.
/s/ Xxxx Xxx
----------------------------------------------
Company: Nippon Investment & Finance Co., Ltd.
Name: Xxxx Xxx
Title: Director
c/o Nippon Investment & Finance Co., Ltd.
Daiwa Securities Kabutocho Xxxxxxxx
0-0 Xxxxxxxxx, 0-xxxxx, Xxxxxxxxxx
Xxxx-Xx, Xxxxx 000 Xxxxx
With copy to:
Xxx Xxxxxxx, Partner
NIF Ventures USA, Inc.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Phone: (000) 000-0000
16.
22
INVESTMENT ENTERPRISE PARTNERSHIP "NIF 11"
/s/ Xxxx Xxx
----------------------------------------------
Company: Nippon Investment & Finance Co., Ltd.
Name: Xxxx Xxx
Title: Director
c/o Nippon Investment & Finance Co., Ltd.
Daiwa Securities Kabutocho Xxxxxxxx
0-0 Xxxxxxxxx, 0-xxxxx, Xxxxxxxxxx
Xxxx-Xx, Xxxxx 000 Xxxxx
With copy to:
Xxx Xxxxxxx, Partner
NIF Ventures USA, Inc.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Phone: (000) 000-0000
INVESTMENT ENTERPRISE PARTNERSHIP "NIF NEW
TECHNOLOGY FUND `98"
/s/ Xxxx Xxx
----------------------------------------------
Company: Nippon Investment & Finance Co., Ltd.
Name: Xxxx Xxx
Title: Director
c/o Nippon Investment & Finance Co., Ltd.
Daiwa Securities Kabutocho Xxxxxxxx
0-0 Xxxxxxxxx, 0-xxxxx, Xxxxxxxxxx
Xxxx-Xx, Xxxxx 000 Xxxxx
With copy to:
Xxx Xxxxxxx, Partner
NIF Ventures USA, Inc.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Phone: (000) 000-0000
17.
23
INVESTMENT ENTERPRISE PARTNERSHIP "NIF 11"
----------------------------------------------
Company: Nippon Investment & Finance Co., Ltd.
Name: Xxxx Xxx
Title: Director
c/o Nippon Investment & Finance Co., Ltd.
Daiwa Securities Kabutocho Xxxxxxxx
0-0 Xxxxxxxxx, 0-xxxxx, Xxxxxxxxxx
Xxxx-Xx, Xxxxx 000 Xxxxx
With copy to:
Xxx Xxxxxxx, Partner
NIF Ventures USA, Inc.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Phone: (000) 000-0000
INVESTMENT ENTERPRISE PARTNERSHIP "NIF NEW
TECHNOLOGY FUND `98"
----------------------------------------------
Company: Nippon Investment & Finance Co., Ltd.
Name: Xxxx Xxx
Title: Director
c/o Nippon Investment & Finance Co., Ltd.
Daiwa Securities Kabutocho Xxxxxxxx
0-0 Xxxxxxxxx, 0-xxxxx, Xxxxxxxxxx
Xxxx-Xx, Xxxxx 000 Xxxxx
With copy to:
Xxx Xxxxxxx, Partner
NIF Ventures USA, Inc.
000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Phone: (000) 000-0000
/s/ Xxx Xxxxxxx
----------------------------------------------
XXX XXXXXXX
17.
24
SCHEDULE I
SERIES A INVESTORS
SHARES OF SERIES A
NAME PREFERRED STOCK
----------------------------------------------------------- ------------------
Xxxxxx Xxxxxxx Venture Partners III, L.P. 2,708,484
Xxxxxx Xxxxxxx Venture Investors III, L.P. 260,051
The Xxxxxx Xxxxxxx Venture Partners Entrepreneur Fund, L.P. 117,885
0000 Xxxx Xxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: Xxxxxx X. Xxxxxx
Xxxxxxx XX, L.P. 617,284
000 Xxxx Xxxxxxxxx
Xxxxxxxxx Xxxx, XX 00000
25
SCHEDULE II
SERIES B INVESTORS
SHARES OF SERIES B
NAME PREFERRED STOCK
------------------------------------------------------- ------------------
Nippon Investment and Finance Company 133,666
Investment Enterprise Partnership 140,500
Investment Enterprise Partnership - New Technology Fund 392,500
Xxx Xxxxxxx 6,667
Xxxxxxx IV, L.P. 66,666
Xxxxxx Xxxxxxx Venture Partners 333,333
CrossPoint Venture Partners 1,910,000
Forval Creative, Inc. 166,666
ALPS Electric, Inc. 166,666
Xxxxxxx Phleger & Xxxxxxxx/Xxxx Xxxx 16,667
---------
TOTAL 3,333,331
