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EXHIBIT 4.5
AMENDED AND RESTATED REGISTRATION
AND INFORMATIONAL RIGHTS AGREEMENT
This Amended and Restated Registration and Informational Rights
Agreement (the "Agreement") is made and entered into as of June 28, 1999, by and
between UNIVERSAL ACCESS, INC., a Delaware corporation (the "Company") and the
persons executing this Agreement in the space provided on the signature page
hereto (each, a "Holder" and collectively, the "Holders").
WITNESSETH:
A. Each of the Holders and the Company entered into an Amended and
Restated Registration and Informational Rights Agreements (the "Original
Registration Rights Agreements"), dated February 8, 1999, in connection with the
Holders' purchase of the Company's Series A Cumulative Convertible Preferred
Stock (the "Series A Preferred Shares").
B. The Company and the Holders desire to amend and restate the Original
Registration Rights Agreements in their entirety.
NOW THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the parties hereto agree that the Original Registration
Rights Agreements are amended and restated in their entirety to read as follows:
1. (a) Piggyback Registration. If the Company files a registration
statement (other than a registration statement on Form X-0, Xxxx X-0 or on any
other form which does not include substantially the same information as would be
required to be included in a registration statement covering the sale of
Registrable Securities (as hereinafter defined)) with the Securities and
Exchange Commission (the "Commission") while any Registrable Securities are
outstanding, the Company shall give each Holder at least 30 days' prior written
notice of the filing of such registration statement. If requested by a Holder in
writing within 20 days after receipt of any such notice, the Company shall
register all or, at such Holder's option, any portion of such Holder's
Registrable Securities concurrently with the registration of such other
securities, all to the extent requisite to permit the public offering and sale
of the Registrable Securities through the facilities of all appropriate
securities exchanges, if any, on which the Company's Common Stock is being sold
or on the over-the-counter market, and will use its best efforts through its
officers, directors, auditors, and counsel to cause such registration statement
to become effective as promptly as practicable.
As used herein, "Registrable Securities" shall mean (i) the shares of
Common Stock acquired or to be acquired by a Holder pursuant to the conversion
of the Series A Preferred Shares or any warrants (the "Warrants") to acquire
Series A Preferred Shares which have not been previously sold pursuant to a
registration statement or Rule 144 promulgated under the Securities Act of 1933,
as amended (the "Securities Act"), and (ii) any Common Stock issued (or issuable
upon the conversion or exercise of any warrant, right or other security which is
issued) by way of a stock split, stock
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dividend, recapitalization, merger or other distribution with respect to, or in
exchange for, or in replacement of, the Series A Preferred Shares, excluding in
all cases, however, any Registrable Securities sold by a person in a transaction
in which its rights under this Section 1 are not assigned.
(b) S-3 Registration Rights. If, and only if, the Company is eligible
to file a Registration Statement on Form S-3 (or any equivalent successor form)
and the Company shall receive from Holders of at least 20% of the then
outstanding Registrable Securities a written request or requests that the
Company prepare and file a Registration Statement on Form S-3 (or any equivalent
successor form) and any related qualification or compliance with respect to all
or a part of the Registrable Securities owned by such Holder or Holders, the
Company will (i) promptly give written notice of the proposed registration, and
any related qualification or compliance, to all other Holders, and (ii) as soon
as practicable, use its best efforts to effect such registration and all such
qualifications and compliances as may be so requested and as would permit or
facilitate the sale and distribution of all or such portion of such Holder's or
Holders' Registrable Securities as are specified in such request, together with
all or such portion of the Registrable Securities of any other Holder or Holders
joining in such request as are specified in a written request given within 15
days after receipt of such written notice from the Company; provided, however,
that the Company shall not be obligated to effect any such registration,
qualification or compliance, pursuant to this Section 1(b) if the Holders,
together with the holders of any other securities of the Company entitled to
inclusion in such registration, propose to sell Registrable Securities and such
other securities (if any) at an aggregate price to the public of less than One
Million Dollars ($1,000,000).
Subject to the foregoing, the Company shall file and use its best
efforts to prepare and file a registration statement covering the Registrable
Securities and other securities so requested to be registered, and to cause the
registration statement to become effective, as soon as practicable after receipt
of the request or requests of the Holders.
(c) Underwriting. If a registration pursuant to Section 1 is for a
registered public offering involving an underwriting, the Company shall so
advise the Holders as part of the notice given pursuant hereto. The Company
shall (together with all Holders proposing to distribute their securities
through such underwriting), if requested by the underwriter, enter into an
underwriting agreement in customary form with a managing underwriter selected
for such underwriting by the Company. The underwriting agreement shall also
satisfy the conditions described in Section 1(m) below. Notwithstanding any
other provision of this Section 1, if the managing underwriter advises the
Company in writing that market factors require exclusion of shares to be sold by
selling stockholders, or a limitation of the number of shares to be so sold,
then the Company shall so advise all Holders of Registrable Securities and the
number of shares of Registrable Securities that may be included in the
registration and the underwriting shall be allocated among all Holders thereof
and including any holders of Common Stock (the "Additional Registrable
Securities") acquired upon conversion of Series B Cumulative Convertible
Preferred Stock and Series D Cumulative Convertible Preferred Stock entitled to
participate in the registration (the "Additional Holders") (except those Holders
or Additional Holders who have indicated to the Company their decision not to
distribute any of their Registrable Securities or Additional Registrable
Securities
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through such underwriting) in proportion, as nearly as practicable, to the
respective amounts of Registrable Securities or Additional Registrable
Securities held by such Holders or Additional Holders at the time of filing the
registration statement. No Registrable Securities or Additional Registrable
Securities excluded from the underwriting by reason of the underwriter market
limitation shall be included in such registration.
Notwithstanding anything to the contrary herein, (a) no reduction
shall be made with respect to securities offered by the Company for its own
account in connection with the Company's initial registered public offering, (b)
in any subsequent offering, the securities registered by the Holders owning
Series A Preferred Shares for their own account pursuant to such offering,
together with securities registered by any Series A Holder may not be reduced
below twenty percent (20%) of all of the shares included in such offering, and
(c) in any offering undertaken pursuant to Section 1 hereof, no reduction in the
securities to be registered by any Holder shall occur until all other
securities, other than those offered by the Company or by the Series A Holders,
have been excluded from such offering. If any Holder of Registrable Securities
disapproves of the terms of the underwriting, such person may elect to withdraw
therefrom by written notice to the Company, the managing underwriter and the
other Holders. In such event, the Registrable Securities and/or other securities
held by such Holder affected shall be withdrawn from registration. However, if
such withdrawal is made, the registration will be deemed to have been completed
with respect to the withdrawing Holder for purposes of determining whether the
Company has satisfied its registration obligations under this Section 1.
If the managing underwriter of any underwritten offering pursuant to
Section 1(a) shall advise the Company in writing that, in its opinion, the
distribution of all or a portion of the Registrable Securities requested to be
included in the registration concurrently with the securities being registered
by the Company would materially adversely affect the distribution of such
securities by the Company for its own account, then the Holders shall delay the
offer and sale of the Registrable Securities (or the portions thereof so
designated by such managing underwriter) for such period, not to exceed 90 days
(the "Delay Period"), as the managing underwriter shall request, provided that
no such delay shall be required as to any Registrable Securities if any
securities of the Company are included in such registration statement and
eligible for sale during the Delay Period for the account of any person other
than the Company and the Holders unless the securities included in such
registration statement and eligible for sale during the Delay Period for such
other person shall have been reduced pro rata to the reduction of the
Registrable Securities which were requested to be included and eligible for sale
during the Delay Period in such registration.
(d) Definition of Expenses.
(i) "Registration Expenses" shall mean all expenses incurred by the
Company in complying with Section 1 hereof, including, without limitation, all
registration, filing and qualification fees, underwriters expense allowances,
printing expenses, fees and disbursements of counsel for the Company, blue sky
fees and expenses (but excluding the compensation of regular employees of the
Company which shall be paid in any event by the Company).
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(ii) "Selling Expenses" shall mean all underwriting discounts and
selling commissions applicable to the sale of the Registrable Securities in the
registration and all fees and disbursements of any special counsel (other than
the Company's regular counsel) for any Holder (but excluding the compensation of
regular employees of the Company which shall be paid in any event by the
Company).
(e) Expenses of Registration. All Registration Expenses incurred in
connection with any registration, qualification or compliance pursuant to
Sections 1(a) and 1(b) shall be borne by the Company. Selling Expenses incurred
in connection with any registration pursuant to Section 1, shall be borne by the
Holders of the securities so registered, pro rata on the basis of the number of
shares so registered (provided that each Holder shall bear the full amount of
the fees and disbursements of any counsel retained by it).
(f) In the event of a registration pursuant to the provisions of this
Section 1, the Company shall use its best efforts to cause the Registrable
Securities so registered to be registered or qualified for sale under the
securities or blue sky laws of such jurisdictions as the Holders may reasonably
request; provided, however, that the Company shall not be required to qualify to
do business in any state by reason of this Section 1(f) in which it is not
otherwise required to qualify to do business.
(g) In the event of a registration pursuant to the provisions of this
Section 1, the Company shall prepare and file with the Commission a registration
statement with respect to the Registrable Securities requested to be registered
and use its best efforts to cause such registration statement to become
effective, and shall keep effective any registration or qualification
contemplated by this Section 1 and shall from time to time amend or supplement
each applicable registration statement, preliminary prospectus, final
prospectus, application, document and communication for such period of time as
shall be required to permit the Holders to complete the offer and sale of the
Registrable Securities covered thereby. The Company shall in no event be
required to keep any such registration or qualification in effect for a period
in excess of 24 months from the date on which the Holders are first free to sell
all such Registrable Securities; provided, however, that, if the Company is
required to keep any such registration or qualification in effect with respect
to securities other than the Registrable Securities beyond such period, the
Company shall keep such registration or qualification in effect as it relates to
the Registrable Securities for so long as such registration or qualification
remains or is required to remain in effect in respect of such other securities.
(h) In the event of a registration pursuant to the provisions of this
Section 1, the Company shall promptly furnish to the Holders such number of
copies of the registration statement and of each amendment and supplement
thereto (in each case, including all exhibits), such reasonable number of copies
of each prospectus contained in such registration statement and each supplement
or amendment thereto (including each preliminary prospectus), all of which shall
conform to the requirements of the Securities Act and the rules and regulations
thereunder, and such other documents, as the Holders may reasonably request to
facilitate the disposition of the Registrable Securities included in such
registration.
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(i) In the event of a registration pursuant to the provisions of this
Section 1, the Company shall promptly furnish the Holders with an opinion of its
counsel to the effect that (i) the registration statement has become effective
under the Securities Act and no order suspending the effectiveness of the
registration statement, preventing or suspending the use of the registration
statement, any preliminary prospectus, any final prospectus, or any amendment or
supplement thereto has been issued, nor has the Commission or any securities or
blue sky authority of any jurisdiction instituted or threatened to institute any
proceedings with respect to such an order, (ii) the registration statement and
each prospectus forming a part thereof (including each preliminary prospectus),
and any amendment or supplement thereto, comply as to form with the Securities
Act and the rules and regulations thereunder, and (iii) such counsel has no
knowledge of any material misstatement or omission in such registration
statement or any prospectus, as amended or supplemented. The opinions described
in clauses (ii) and (iii) of the preceding sentence shall be delivered only if
the registration is made pursuant to an underwritten public offering and the
underwriter requires similar opinions to be delivered by Company counsel as a
closing condition. In such an underwritten offering, if required by the
underwriter, the opinion also shall state the jurisdictions in which the
Registrable Securities have been registered or qualified for sale pursuant to
the provisions of Section 1(f).
(j) The Company agrees that until all the Registrable Securities have
been sold under a registration statement or pursuant to Rule 144 under the
Securities Act, the Company agrees to:
(i) use its best efforts to 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 90 days after the effective date of
the first registration statement filed by the Company;
(ii) at any time when the Company is eligible to file a registration
statement on Form S-3 (or any successor form), take such action, including the
voluntary registration of its Common Stock under Section 12 of the Exchange Act
of 1934, as amended (the "Exchange Act"), as is necessary to enable the Holders
to utilize Form S-3 for the sale of their Registrable Securities, such action to
be taken as soon as practicable after the end of the fiscal year in which the
first registration statement filed by the Company for the offering of its
securities to the general public is declared effective or such earlier date as
may be required by any stock exchange or quotation system upon which the Common
Stock may be traded;
(iii) 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; and
(iv) furnish to any Holder, so long as the Holder owns any
Registrable Securities, promptly upon request: (i) a written statement by the
Company that it has used its best efforts to make and keep public information
available, as those terms are understood and defined in Rule 144 (at any time
after 90 days after the effective date of the first registration statement filed
by the Company), complied in all material respects with the reporting
requirements of the Exchange Act
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(at any time after it has become subject to such reporting requirements), or
that it qualifies as a registrant whose securities may be resold pursuant to
Form S-3 (at any time after it so qualifies); (ii) a copy of the most recent
annual or quarterly report of the Company and such other reports and documents
so filed by the Company; and (iii) such other information as may be reasonably
requested in order to permit any Holder to avail itself of any rule or
regulation of the Commission or any state securities authority which permits the
selling of any such securities without registration or pursuant to such form.
(k) The Company shall notify the Holders promptly when such
registration statement has become effective or a supplement to any prospectus
forming a part of such registration statement has been filed.
(l) The Company shall promptly notify the Holders at any time when a
prospectus relating thereto is required to be delivered under the Securities Act
of the happening of any event as a result of which the prospectus included in
such registration statement, as then in effect, would include an untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein not misleading in the
light of the circumstances then existing, and at the reasonable request of the
Holders prepare and furnish to it such 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 Registrable Securities or 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.
(m) If requested by the underwriter for any underwritten offering of
Registrable Securities on behalf of the Holders, the Company and the Holders
will enter into an underwriting agreement with such underwriter for such
offering, which shall be reasonably satisfactory in substance and form to the
Company, and the Company's counsel, the Holders and the underwriter, and such
agreement shall contain such representations and warranties by the Company and
the Holders and such other terms and provisions as are customarily contained in
an underwriting agreement with respect to secondary distributions solely by
selling stockholders, including, without limitation, indemnities substantially
to the effect and to the extent (but in no event greater than those) provided in
Section 2 hereof.
2. Indemnification. (a) Subject to the conditions set forth below, the
Company agrees to indemnify and hold harmless each Holder, its officers,
directors, partners, employees, agents, and counsel, and each person, if any,
who controls any such person within the meaning of Section 15 of the Act or
Section 20(a) of the Securities Exchange Act, from and against any and all loss,
liability, charge, claim, damage, and expense whatsoever (which shall include,
for all purposes of this Section 2, but not be limited to, attorneys' fees and
any and all reasonable expenses whatsoever incurred in investigating, preparing,
or defending against any litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in settlement of any claim or
litigation), as and when incurred, arising out of, based upon, or in connection
with (i) any untrue statement or
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alleged untrue statement of a material fact contained (A) in any registration
statement, preliminary prospectus, or final prospectus (as from time to time
amended and supplemented), or any amendment or supplement thereto, relating to
the sale of any of the Registrable Securities or (B) in any application or other
document or communication (in this Section 2 collectively called an
"application") executed by or on behalf of the Company or based upon written
information furnished by or on behalf of the Company filed in any jurisdiction
in order to register or qualify any of the Registrable Securities under the
securities or blue sky laws thereof or filed with the Commission or any
securities exchange; or any omission or alleged omission to state a material
fact required to be stated therein or necessary to make the statements made
therein not misleading, unless such statement or omission was made in reliance
upon and in conformity with written information furnished to the Company with
respect to such Holder by or on behalf of such person expressly for inclusion in
any registration statement, preliminary prospectus, or final prospectus, or any
amendment or supplement thereto, or in any application, as the case may be, or
(ii) any breach of any representation, warranty, covenant, or agreement of the
Company contained in this Agreement. The foregoing agreement to indemnify shall
be in addition to any liability the Company may otherwise have, including
liabilities arising under this Agreement.
(a) If any action is brought against a Holder or any of its officers,
directors, partners, employees, agents, or counsel, or any controlling persons
of such person (an "indemnified party") in respect of which indemnity may be
sought against the Company pursuant to the foregoing paragraph, such indemnified
party or parties shall promptly notify the Company in writing of the institution
of such action (the failure to notify the Company within a reasonable time of
the commencement of any such action, to the extent prejudicial to the Company's
ability to defend such action, shall relieve the Company of liability to the
indemnified party pursuant to this Section 2(a), but the failure so to notify
shall not relieve the Company from any liability other than pursuant to this
Section 2(a)) and the Company shall promptly assume the defense of such action,
including the employment of counsel (reasonably satisfactory to such indemnified
party or parties), provided that the indemnified party shall have the right to
employ its or their own counsel in any such case, but the fees and expenses of
such counsel shall be at the expense of such indemnified party or parties unless
the employment of such counsel shall have been authorized in writing by the
Company in connection with the defense of such action or the Company shall not
have promptly employed counsel reasonably satisfactory to such indemnified party
or parties shall have reasonably concluded that there may be one or more legal
defenses available to it or them or to other indemnified parties which are
different from or additional to those available to the Company, in any of which
events such fees and expenses shall be borne by the Company and the Company
shall not have the right to direct the defense of such action on behalf of the
indemnified party or parties. Anything in this Section 2 to the contrary
notwithstanding, the Company shall not be liable for any settlement of any such
claim or action effected without its written consent, which shall not be
unreasonably withheld. The Company shall not, without the prior written consent
of each indemnified party that is not released as described in this sentence,
settle or compromise any action, or permit a default or consent to the entry of
judgment in or otherwise seek to terminate any pending or threatened action, in
respective of which indemnity may be sought hereunder (whether or not any
indemnified party is a party thereto), unless such settlement, compromise,
consent, or termination includes an
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unconditional release of each indemnified party from all liability in respect of
such action. The Company agrees promptly to notify the Holder of the
commencement of any litigation or proceedings against the Company or any of it
officers or directors in connection with the sale of any Registrable Securities
or any preliminary prospectus, prospectus, registration statement, or amendment
or supplement thereto, or any application relating to any sale of any
Registrable Securities.
(b) Each Holder agrees to indemnify and hold harmless the Company,
each director of the Company, each officer of the Company who shall have signed
any registration statement covering Registrable Securities held by such Holder,
each other person, if any, who controls the Company within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act, and its or their
respective counsel, to the same extent as the foregoing indemnify from the
Company to the Holder in Section 2(a), but only with respect to statements or
omissions, if any, made in any registration statement, preliminary prospectus,
or final prospectus (as from time to time amended and supplemented), or any
amendment or supplement thereto, or in any application, in reliance upon and in
conformity with written information furnished to the Company with respect to the
Holder by or on behalf of the Holder, expressly for inclusion in any such
registration statement, preliminary prospectus, or final prospectus, or any
amendment or supplement thereto, or in any application, as the case may be. If
any action shall be brought against the Company or any other person so
indemnified based on any such registration statement, preliminary prospectus, or
final prospectus or any amendment or supplement thereto, or in any application,
and in respect of which indemnity may be sought against the Holder pursuant to
this Section 2(b), the Holder shall have the rights and duties given to the
Company, and the Company and each other person so indemnified shall have the
rights and duties given to the indemnified parties, by the provisions of Section
2(a). Notwithstanding the foregoing, the liability of each Holder under this
Section 2 shall be limited to an amount equal to the proceeds to such Holder of
Registrable Securities sold as contemplated herein.
(c) To provide for just and equitable contribution, if (i) an
indemnified party makes a claim for indemnification pursuant to Section 2(a) or
2(b) (subject to the limitations thereof) but it is found in a final judicial
determination, not subject to further appeal, that such indemnification may not
be enforced in such case, even though this Agreement expressly provides for
indemnification in such cases, or (ii) any indemnified or indemnifying party
seeks contribution under the Securities Act, the Exchange Act or otherwise, then
the Company (including for this purpose any contribution made by or on behalf of
any director of the Company, any officer of the Company who signed any such
registration statement, any controlling person of the Company, and its or their
respective counsel), as one entity, and each Holder as a second entity, shall
contribute to the losses, liabilities, claims, damages, and expenses whatsoever
to which any of them may be subject, (after contribution from others) on the
basis of relevant equitable considerations such as the relative fault of the
Company and such Holder in connection with the facts which resulted in such
losses, liabilities, claims, damages, and expenses. The relative fault, in the
case of an untrue statement, alleged untrue statement, omission, or alleged
omission shall be determined by, among other things, whether such statement,
alleged statement, omission, or alleged omission relates to
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information supplied by the Company or by such Holder, and the parties' relative
intent, knowledge, access to information, and opportunity to correct or prevent
such statement, alleged statement, omission, or alleged omission.
The Company and the Holders agree that it would be unjust and
inequitable if the respective obligations of the Company and the Holders for
contribution were determined by pro rata or per capita allocation of the
aggregate losses, liabilities, claims, damages, and expenses (even if the
Holders and the other indemnified parties were treated as one entity for such
purpose) or by any other method of allocation that does not reflect the
equitable considerations referred to in this Section 2(c). Notwithstanding
anything to the contrary contained herein, the liability of each Holder under
this Section 2(c) shall be limited to an amount equal to the proceeds to such
Holder of Registrable Securities as contemplated herein. No person guilty of a
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who is not
guilty of such fraudulent misrepresentation. For purposes of this Section 2(c),
each person, if any, who controls any Holder within the meaning of Section 15 of
the Securities Act or Section 20(a) of the Exchange Act and each officer,
director, partner, employee, agent, and counsel of any Holder or control person
shall have the same rights to contribution as such Holder or control person and
each person, if any, who controls the Company within the meaning of Section 15
of the Securities Act or Section 20(a) of the Exchange Act, each officer of the
Company who shall have signed any such registration statement, each director of
the Company, and its or their respective counsel shall have the same rights to
contribution as the Company, subject in each case to the provisions of this
Section 2(c). Anything in this Section 2(c) to the contrary notwithstanding, no
party shall be liable for contribution with respect to the settlement of any
claim or action effected without its written consent. This Section 2(c) is
intended to supersede any right to contribution under the Securities Act, the
Exchange Act or otherwise.
3. Assignment of Registration Rights. The rights to cause the Company to
register Registrable Securities pursuant to this Section 1 may be assigned by a
Holder to a transferee or assignee of such securities: (i) if such transferee or
assignee was a Holder of Registrable Securities hereunder prior to such
transfer, (ii) if such transfer is made in connection with the transfer of all
Registrable Securities held by the transferor, (iii) if such transferee or
assignee acquires at least 600,000 shares (as adjusted for any stock splits,
combination, recapitalization or exchange) of the then outstanding Registrable
Securities; or (iv) in connection with a distribution by such Holder, to any
partner, former partner, member, former member, stockholder or former
stockholder, or the estate of any such person, provided the Company is, within a
reasonable time after such transfer, furnished with written notice of the name
and address of such transferee or assignee and the securities with respect to
which such registration rights are being assigned; provided, however, that such
assignment shall be effective only if immediately following such transfer the
transferee is bound by the terms and conditions of this Agreement and such
transfer of any Registrable Securities is lawful under all applicable securities
laws.
4. Limitations on Subsequent Registration Rights. From and after the
date of this Agreement, the Company shall not, without the prior written consent
of the Holders of at least a
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majority of the Series A Preferred Shares then outstanding, enter into any
agreement with any holder or prospective holder of any securities of the Company
which would: (i) allow such holder or prospective holder to include such
securities in any registration filed by the Company, unless under the terms of
such agreement, such holder or prospective holder may include such securities in
any such registration only to the extent that this inclusion of such holder
securities will not reduce the amount of the Registrable Securities of Holders
which is included; (ii) permit such holder or prospective holder to require the
Company to initiate any registration of any securities of the Company; or (iii)
otherwise be in conflict with the terms hereof.
5. Market Stand-off Agreement. Each Holder agrees that, in connection
with the Company's initial underwritten public offering of Common Stock, upon
request of the Company or the underwriters managing such underwritten offering
of Common Stock, not to sell, make any short sale of, loan, grant any option for
the purchase of, or otherwise dispose of any Common Stock (other than Common
Stock included in the registration) without the prior written consent of the
Company or such underwriters, as the case may be, for such period of time (not
to exceed one hundred eighty (180) days) from the effective date of such
registration as may be requested by the underwriters and as is agreed to by each
beneficial owner of 1% or more of the outstanding Common Stock and each officer
and director of the Company.
In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the Registrable Securities of each
Holder (and the shares of securities of every other person subject to the
foregoing restriction) until the end of such period.
6. Information Rights
(a) Financial Information. The Company will provide financial
information to (i) each Holder of Series A Preferred Shares and (ii) any
previous Holder of Series A Preferred Shares who after converting the Series A
Preferred Shares owns 5% or more of the Company's Common Stock into which the
Series A Preferred Shares are convertible or have been converted. The financial
information requirements are (i) unaudited quarterly financial statements
delivered within 60 days of the end of the quarter; (ii) annual audited
financial statements (commencing with the fiscal year ending December 31, 1998)
delivered within 120 days of the end of the fiscal year; (iii) as soon as
practicable (and in any event within ten (10) days), copies of any reports or
communications delivered to any class of the Company's security holders; (iv)
within 20 days after the end of each month, an unaudited balance sheet,
statement of operations and of cash flows and comparison to prior year results
and budget for and as of the end of such month; (v) as soon as practicable, but
in any event 30 days prior to the end of each fiscal year, a budget and business
plan for the next fiscal year, prepared on a monthly basis, including balance
sheets and sources and applications of funds statements for such months and, as
soon as prepared, any other budgets or revised budgets prepared by the Company;
and (vi) within 30 days after the end of each fiscal quarter, a report on
operational highlights with respect to such quarter.
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(b) Termination of Information Covenants. The covenants set forth in
this Section 6 shall terminate and be of no further force or effect immediately
upon the closing of a Qualified Public Offering.
7. Miscellaneous.
(a) Remedies. In the event of a breach by the Company of its
obligations under this Agreement, the Holder, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement.
(b) Agreements and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, unless such amendment, modification or supplement is in writing
and signed by the parties hereto.
(c) Notices. Except as otherwise specified herein. any notice. demand
or request required or permitted to be given pursuant to the terms of this
Agreement, and any information delivered pursuant to Section 6. shall be in
writing and shall be deemed given (i) when delivered personally or by verifiable
facsimile transmission (with a hard copy to follow) on or before 5:00 p.m.,
central time, on a business day or, if the day is not a business day, on the
next succeeding business day, (ii) on the next business day after timely
delivery to an overnight courier and (iii) on the third business day after
deposit in the U.S. mail (certified or registered mail, return receipt
requested, postage prepaid), addressed as follows:
If to the Company:
Universal Access, Inc.
000 Xxxxx Xxxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Phone: 000-000-0000
Fax: 000-000-0000
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With a copy to:
Xxxxxxx & Xxxxxxxx Ltd.
000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxxx X. Xxxxxxxxx, Esq.
Phone: 000-000-0000
Fax: 000-000-0000
and if to a Holder. to:
Broadmark Capital Corp.
3030 U.S. Bank Centre
0000 Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xx. Xxxxxx Xxxxxxxx
Phone: 000-000-0000
Fax: 000-000-0000
(d) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including, without limitation, transferees or assignees of the Registrable
Shares subject to Section 3.
(e) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(f) Headings. The headings in this Agreement are for convenience of
references only and shall not limit or otherwise affect the meaning hereof.
(g) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware without reference to its
conflicts of law provisions.
(h) Severability. In the event that any one or more of the provisions
contained herein, or the application hereof in any circumstance is held invalid,
illegal or unenforceable, the validity, legality and enforceability of any such
provisions contained herein shall not be affected or impaired thereby.
(i) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of this
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agreement and understanding of the parties hereto in respect of the subject
matter contained herein. There are not restrictions, promises, warranties or
undertakings, other than those set forth or referred to herein, concerning the
registration rights granted by the Company pursuant to this Agreement.
(j) Future Purchasers. The Company shall not grant to holders of any
of its equity securities registration rights superior to those granted to the
Holders hereunder unless the Company (i) obtains the prior written consent of
the holders of a majority of the Registrable Securities or (ii) grants equal
rights to the Holders. The Company shall not grant registration rights with
respect to the Common Stock outstanding at the closing of the Preferred Shares.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date first written above.
UNIVERSAL ACCESS, INC.
By: /s/ XXXXXXX XXXXX
------------------------------
Name: Xxxxxxx Xxxxx
Title: President and CEO
HOLDERS:
________________________________________
________________________________________
________________________________________
________________________________________
*Signed pursuant to power of attorney dated June 28, 1999 granted to Xxxxxxx
Xxxxx, as President of Universal Access, Inc.
________________________________
Xxxxxxx Xxxxx, President
Universal Access, Inc.
606650-1
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