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EXHIBIT 4
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and entered
into as of this 29th day of April 1997, by and between Data Processing Resources
Corporation, a California corporation (the "Company"), Xxxxxxxxxxx X.
Lancashire, an individual ("C. Lancashire"), and Xxxxxx X. Lancashire, an
individual ("A. Lancashire"). C. Lancashire and A. Lancashire are collectively
referred to herein as the "Lancashires."
R E C I T A L S
A. The Company, DPRC Acquisition Corp., a California corporation and a
wholly-owned subsidiary of the Company ("Acquisition"), Computec International
Strategic Resources, Inc., a California corporation ("Computec"), the
Lancashires, and the other shareholder of Computec have entered into an
Agreement and Plan of Merger dated of even date herewith (the "Merger
Agreement"), pursuant to which Computec is merging with and into Acquisition.
B. The Company has issued to the Lancashires 679,292 shares of the common
stock of the Company (the "Initial DPRC Shares") in connection with the merger
pursuant to the Merger Agreement and the terms of the Merger Agreement require
the Company to provide the Lancashires certain registration rights with respect
to the Initial DPRC Shares.
C. The Company may also issue to the Lancashires additional shares of the
common stock of the Company (the "Additional DPRC Shares") in connection with
the merger pursuant to the Merger Agreement and the terms of the Merger
Agreement require the Company to provide the Lancashires certain registration
rights with respect to the Additional DPRC Shares.
A G R E E M E N T
In consideration of the foregoing recitals and the mutual covenants and
conditions contained herein, the parties, intending to be legally bound, agree
as follows:
Section 1. Certain Definitions. In addition to the other terms defined
elsewhere in this Agreement, as used in this Agreement, the following terms
shall have the following respective meanings:
a. "ACT" means the Securities Act of 1933, as amended.
b. "COMMISSION" shall mean the Securities and Exchange Commission or
any other federal agency at the time administering the Act.
c. "HOLDER" means the Lancashires and any person beneficially owning
Registerable Securities through permitted assignment thereof in accordance with
Section 9, below.
d. "REGISTERABLE SECURITIES" means the Initial DPRC Shares, the
Additional DPRC Shares and any shares of the Company's common stock issued as a
dividend or other distribution with respect to, or in exchange for or in
replacement of the Initial DPRC
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Shares and the Additional DPRC Shares, excluding any Registerable Securities
sold by a person in a transaction in which his rights under this Agreement are
not assigned; provided further that shares which would otherwise constitute
Registerable Securities shall cease to do so once they have been sold to the
public.
e. The terms "REGISTER," "REGISTERED" and "REGISTRATION" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Act and the declaration or ordering of effectiveness of such
registration statement.
Section 2. Demand Registration. If the Company shall receive from any
Holder or Holders at any time after the first anniversary of the date of this
Agreement, a written request or requests that the Company effect a registration
with the Commission with respect to all or part of the Registrable Securities
owned by such Holder or Holders, the Company will:
a. promptly give written notice of the proposed registration to all
other Holders; and
b. subject to Section 3, below, and Section 8.5 of the Merger
Agreement, as soon as practicable, use its reasonable best efforts to effect
such registration as may be so requested and as would permit or facilitate the
sale and distribution of all or a portion of such Holder's 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 10 days after receipt of
such written notice from the Company. The Company may, if permitted by law,
effect any such registration on Form S-3 or any successor or similar short form
registration statement (or Form S-1 or any other available form if Form S-3 is
not available).
Section 3. Limitations on Registration. The Company shall not be required
to prepare and file a registration statement pursuant to Section 2, above, (a)
which would become effective within six months following the effective date of a
registration statement (other than a registration statement filed on Form S-8 or
any successor form) filed by the Company with the Commission pertaining to an
underwritten public offering of securities, (b) if the Company in good faith
gives written notice to the Holders of the Registerable Securities stating that
in the good faith judgment of a majority of the board of directors it would be
detrimental to the Company or its shareholders for a registration statement to
be filed in the near future, in which case the Company's obligation to use its
best efforts to file a registration statement shall be deferred for a period not
to exceed 135 days; provided, however, that the Company shall not obtain such a
deferral more than one time in any 12 month period, (c) if the Holders, together
with the holders of any other securities of the Company entitled to be included
in such registration, propose to sell Registrable Securities and other
securities of the Company (if any) at any aggregate price to the public of less
than $1 million, (d) if in any given 12-month period, the Company has effected a
registration pursuant to Section 2, above, at the request of a Holder, or (e)
which is effected more than three years after the date of this Agreement. If a
requested registration pursuant to Section 2, above, involves an underwritten
offering, and the managing underwriter shall advise the Company in writing that,
in its opinion, the number of securities
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requested to be included in such registration (including securities of the
Company which are not Registerable Securities) exceeds the maximum dollar
amount or number that can be sold in such offering without materially adversely
affecting the proposed offering price, the timing, the distribution method or
the probability of success of such offering (the "Maximum Number of Demand
Shares"), then the Company shall include in any such registration to the extent
of the Maximum Number of Demand Shares which the Company is so advised can be
sold in such offering (i) first, Registerable Securities requested to be
included in such registration by the Holder or Holders of Registerable
Securities pro rata among such Holders on the basis of the number of
Registerable Securities requested to be included by such Holders, and (ii)
second, to the extent the Maximum Number of Demand Shares has not been reached
under the foregoing clause (i), other securities of the Company proposed to be
included in such registration without exceeding the Maximum Number of Demand
Shares, in accordance with the priorities, if any, then existing among the
Company and the holders of such other securities.
Section 4. Incidental Registration. If, at any time and from time to time
during a period commencing on the first anniversary of the date of this
Agreement and ending on the third anniversary of the date of this Agreement, the
Company shall propose to register in a public offering any of its common stock
(whether for the Company's account or for the account of other shareholders) to
be offered for cash pursuant thereto (other than a registration statement (a) on
Form S-4 or Form S-8 (or any substitute or successor form that may be adopted by
the Commission), (b) filed in connection with any employee stock option or other
benefit plan, (c) for an exchange offer or offering of securities solely to the
Company's existing shareholders, or (d) for a dividend reinvestment plan), it
shall give written notice (the "Company's Notice") to all Holders of
Registerable Securities of its intention to do so at least 30 days prior to the
anticipated filing date. If any Holder of Registerable Securities desires to
dispose of all or part of such Holder's Registerable Securities, it may request
registration thereof in connection with the Company's registration by delivering
to the Company, within 10 days after receipt of the Company's Notice, written
notice of such request (the "Holder's Notice") stating the number of shares of
Registerable Securities to be included. The Company shall use its best efforts
to cause all shares specified in the Holder's Notices to be registered under the
Act so as to permit the sale or other disposition by such Holder or Holders of
the shares so registered, subject however, to the limitations set forth in
Section 5, below.
Section 5. Limitations on Incidental Registration. If the managing
underwriter or underwriters for registration under Section 4, above, advises the
Company and the Holders requesting inclusion in such registration in writing,
that the dollar amount or number of shares of Registrable Securities and other
shares of common stock or securities to be included in the offering exceeds the
maximum dollar amount or number that can be sold in such offering without
adversely affecting the proposed offering price, the timing, the distribution
method or the probability of success of such offering (the "Maximum Number of
Shares"), then the Company shall include in such registration:
a. if the registration is a primary offering for the Company, (i)
first, the shares of common stock or other securities that the Company proposes
to sell which can be sold without exceeding the Maximum Number of Shares; (ii)
second, to the extent the Maximum
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Number of Shares has not been reached under the foregoing clause (i), the
shares of common stock or other securities requested to be included in such
registration by other shareholders with registration rights granted prior to
the date hereof which can be sold without exceeding the Maximum Number of
Shares (allocated pro rata among such other shareholders, as nearly as
practicable, on the basis of the number of shares of common stock or other
securities requested to be included in such offering by such other
shareholders); and (iii) third, to the extent the Maximum Number of Shares has
not been reached under the foregoing clauses (i) and (ii), the Registrable
Securities and shares of common stock or other securities requested to be
included in such registration by the Holders and other shareholders with
registration rights which can be sold without exceeding the Maximum Number of
Shares (allocated pro rata among such Holders and other shareholders, as nearly
as practicable, on the basis of the number of shares of Registrable Securities
and common stock or other securities requested to be included in such offering
by the Holders and such other shareholders); and
b. if the registration is for a secondary offering for any of the
Company's securityholders, (i) first, if the registration was requested by other
shareholders with demand registration rights, then the shares of common stock or
other securities that such other shareholders have requested to be included in
such offering which can be sold without exceeding the Maximum Number of Shares;
(ii) second, to the extent the Maximum Number of Shares has not been reached
under the foregoing clause (i), the shares of common stock or other securities
requested to be included in such registration by other shareholders with
registration rights granted prior to the date hereof which can be sold without
exceeding the Maximum Number of Shares (allocated pro rata among such other
shareholders, as nearly as practicable, on the basis of the number of shares of
common stock or other securities requested to be included in such offering by
such other shareholders); and (iii) third, to the extent the Maximum Number of
Shares has not been reached under the foregoing clauses (i) and (ii), the
Registrable Securities and shares of common stock or other securities requested
to be included in such registration by the Holders and other shareholders with
registration rights which can be sold without exceeding the Maximum Number of
Shares (allocated pro rata among such Holders and other shareholders, as nearly
as practicable, on the basis of the number of shares of Registrable Securities
and common stock or other securities requested to be included in such offering
by the Holders and such other shareholders).
Section 6. Registration Procedures.
a. If and when the Company is required by the provisions of this
Agreement to use its best efforts to effect the registration of shares of
Registerable Securities, the Company shall:
(i) Prepare and file with the Commission a registration
statement with respect to such shares and use its best efforts to cause such
registration statement to become and remain effective for the periods provided
herein;
(ii) Prepare and file with the Commission such supplements to
such registration statement and the prospectuses used in connection therewith as
may be necessary
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to keep such registration statement effective and current for a reasonable
amount of time so that all of such securities can be disposed of in accordance
with the intended methods of disposition by the seller or sellers thereof set
forth in such registration statement;
(iii) Furnish to the Holders such reasonable number of copies
of the registration statement, preliminary prospectus, final prospectus and such
other documents as the Holders may reasonably request to facilitate the public
offering of the Registerable Securities;
(iv) Use its best efforts to register or qualify the shares
covered by such registration statement under such other securities or Blue Sky
or other applicable laws of such jurisdictions as the Holders shall reasonably
request; provided, however, the Company shall not be obligated to qualify to do
business in such jurisdiction or consent to general service of process in such
jurisdiction, or subject itself to taxation in any such jurisdiction;
(v) Notify counsel for the Holders, promptly after it shall
receive notice thereof, of the time when such registration statement has become
effective under the Act or a supplement to any prospectus forming a part of such
registration statement has been filed;
(vi) Notify counsel for the Holders promptly of any request by
the Commission for the amending or supplementing of such registration statement
or prospectus or for additional information;
(vii) Prepare and file with the Commission, promptly upon the
request of the Holders, any amendments or supplements to such registration
statement or prospectus which, in the reasonable opinion of counsel for the
Holders (and reasonably concurred in by counsel for the Company), is required
under the Act or the rules and regulations thereunder in connection with the
distribution of the Registrable Securities;
(viii) Prepare and promptly file with the Commission and
promptly notify counsel for the Holders of the filing of such amendment or
supplement to any such registration statement or prospectus as may be necessary
to correct any statements or omissions if, at the time when a prospectus
relating to the Registrable Securities is required to be delivered under the
Act, any event shall have occurred as the result of which any such prospectus or
any other prospectus as then in effect would include an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances in which they were made,
not misleading;
(ix) Advise counsel for the Holders, promptly after it shall
receive notice or obtain knowledge thereof, of the issuance of any stop order by
the Commission suspending the effectiveness of such registration statement under
the Act or the initiation or threatening of any proceeding for such purpose, and
promptly use its best efforts to prevent the issuance of any stop order or to
obtain its withdrawal if such stop order should be issued;
(x) Use its best efforts to cause all such Registrable
Securities to be listed on each securities exchange or over-the-counter market
on which similar securities
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issued by the Company are then listed and file all required listing
applications and pay all required fees in connection with such listings; and
(xi) Cooperate with Holders in effecting the transfer of any
shares sold pursuant to a registration effected hereunder.
Section 7. Expenses of Registration. Except as provided below, all of the
expenses incurred by the Company in effecting any registration requested
pursuant to Section 2, above, including, without limitation, all registration
and filing fees, printing expenses, expenses of compliance with Blue Sky laws
(including, without limitation, fees and disbursements of underwriters counsel
relating thereto), fees and disbursements of counsel for the Company, and
expenses of any audits incidental to or required by any such registration
("Registration Expenses") shall be borne by the Company; provided, however, that
the participating Holders shall reimburse the Company for up to $10,000 of such
Registration Expenses within 10 days after receipt of an invoice from the
Company describing such Registration Expenses in reasonable detail; and
provided, further, that if other shareholders with registration rights are
included in such registration, the Registration Expenses shall be allocated pro
rata among the participating Holders and each of such other shareholders of the
Company, as nearly as practicable, on the basis of the fair market value of
Registrable Securities, common stock and other securities of the Company
requested by the Holders and such other shareholders of the Company to be
included in such registration, but in no event shall the participating Holders'
share of the expenses exceed $10,000. Except as provided below, all
Registration Expenses incurred by the Company in effecting any registration
requested pursuant to Section 4, above, shall be borne by the Company. In
either event, notwithstanding anything in this Section 7 to the contrary, the
Company shall have no obligation to pay or otherwise bear (a) any underwriting
discounts or brokerage fees or commissions relating to the sale of Registerable
Securities by the Holders, or (b) any Registration Expenses if the payment of
such expenses by the Company is prohibited by the laws of a state in which such
offering is qualified and only to the extent so prohibited, or (c) any expenses
of any compliance with Blue Sky laws which pertains only to an individual
Holder, or (d) any fees and disbursements of counsel for the Holders.
Section 8. Indemnification.
(a) The Company will indemnify, hold harmless and defend each Holder,
its officers, directors, partners, legal counsel and accountants, and each
person who controls a Holder within the meaning of Section 15 of the Act,
against any and all expenses, claims, losses, damages and liabilities (or
actions in respect thereof), including any of the foregoing incurred in
settlement of any litigation, commenced or threatened, arising out of or based
on any untrue statement (or alleged untrue statement) of a material fact
contained in any registration statement, prospectus, offering circular or other
document, or any amendment or supplement thereof, incident to any registration
or qualification of the Registrable Securities, or which arise out of or are
based on any omission (or alleged omission) to state therein a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances in which they were made, not misleading, or any
violation by the Company of any rule or regulation promulgated under the Act or
any state securities laws applicable to the Company and relating
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to action or inaction required of the Company in connection with any such
registration, qualification or compliance, and will reimburse each such
indemnified party for any legal and any other expenses reasonably incurred by
them in connection with investigating, preparing or defending any such claim,
loss, damage, liability or action. The Company also shall indemnify any
underwriter of the Registrable Securities, their officers, directors, partners,
members and agents and each person who controls such underwriters on
substantially the same basis as that of the indemnification of the Holders
provided in this Section 8(a).
The indemnity agreement contained in this Section 8(a) shall not apply to
amounts paid in settlement of any such loss, claim, damage or liability or any
action in respect thereof if such settlement is effected without the consent of
the Company, nor shall the Company be liable to any Holder or its officers,
directors, partners, members or agents in any such case for any loss, claim,
damage, liability or any action in respect thereof to the extent that it arises
solely from or is based solely upon and is in conformity with written
information relating to such Holder furnished expressly for use in connection
with such registration by such Holder or its agents, nor shall the Company be
liable to any Holder for any such loss, claim, damage or liability or any action
in respect thereof to the extent it arises solely from or is based solely upon
(i) any untrue statement or alleged untrue statement of a material fact
contained in any registration statement or prospectus relating to the
Registrable Securities delivered by such Holder after the Company had provided
written notice to such Holder that such registration statement or prospectus
contained such untrue statement or alleged untrue statement of a material fact,
(ii) any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not misleading
after the Company had provided written notice to such Holder that such
registration statement or prospectus contained such omission or alleged
omission, or (iii) the failure of such Holder to deliver any preliminary or
final prospectus, or any amendments or supplements thereto, required under
applicable securities laws, including the Act, to be so delivered, provided that
a sufficient number of copies thereof had been timely provided by the Company to
such Holder.
(b) Each Holder will, if Registrable Securities held by such Holder
are included in the securities as to which such registration, qualification or
compliance is being effected, indemnify the Company, and each of its officers,
directors, legal counsel and accountants, and each person who controls the
Company within the meaning of Section 15 of the Act, against all claims, losses,
damages and liabilities (or actions in respect thereof) arising out of or based
on any untrue statement (or alleged untrue statement) of a material fact
contained in any such registration statement, prospectus, offering circular or
other document, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or any violation by the Holder of any rule or regulation
promulgated under the Act or any state securities laws applicable to the Holder
and relating to action or inaction required by the Holder in connection with any
such registration, qualification or compliance, and will reimburse each such
indemnified person for any legal or any other expenses reasonably incurred in
connection with investigating or defending any such claim, loss, damage,
liability or action, in each case to the extent, but only to the extent, that
such untrue statement (or alleged omission) is made in such registration
statement, prospectus, offering circular or other document in reliance upon and
in conformity with written information furnished
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to the Company by an instrument duly executed by or on behalf of such Holder
and stated to be specifically for use therein. Each Holder shall also
indemnify and hold harmless any underwriter of the Registrable Securities,
their officers, directors, partners, members and agents and each person who
controls such underwriters on substantially the same basis as that of the
indemnification of the Company provided in this Section 8(b).
(c) Each person to be indemnified pursuant to this Section 8 (the
"Indemnified Party") will, promptly after its receipt of written notice of the
commencement of any action against such Indemnified Party in respect of which
indemnity may be sought from an indemnifying person under this Section 8 (the
"Indemnifying Party") notify the Indemnifying Party in writing of the
commencement thereof, provided, however, that the failure of any person to give
notice as provided herein shall not relieve the Indemnifying Party of its
obligations under this Agreement except to the extent that such Indemnifying
Party is actually materially and adversely prejudiced by such failure to give
notice. If any such action shall be brought against any Indemnified Party and
it shall notify an Indemnifying Party of the commencement thereof, the
Indemnifying Party will be entitled to participate therein and, to the extent it
may desire, jointly with any other Indemnifying Party similarly notified, to
assume the defense thereof with counsel 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 will not be
liable to such Indemnified Party under this Section 8 for any legal or other
expenses subsequently incurred by such Indemnified Party in connection with the
defense thereof other than reasonable costs of investigation unless (a) the
Indemnified Party shall have employed counsel in an action in which the
Indemnified Party and Indemnifying Party are both defendants and there is a
conflict of interest between such parties that would prevent counsel from
adequately representing both parties, (b) the Indemnifying Party shall not have
employed counsel satisfactory within the exercise of reasonable judgment of the
Indemnified Party to represent the Indemnified Party within a reasonable time
after the notice of the commencement of the action, or (c) the Indemnifying
Party has authorized the employment of counsel for the Indemnified Party at the
expense of the Indemnifying Party. The undertaking contained in this Section
8(c) shall be in addition to any liabilities which the Indemnifying Party may
have pursuant to law.
(d) If the indemnification provided for in this Section 8 is held by
a court of competent jurisdiction to be unavailable to an Indemnified Party with
respect to any loss, liability, claim, damage or expense referred to therein,
then the Indemnifying Party, in lieu of indemnifying such Indemnified Party
thereunder, shall contribute to the amount paid or payable by such Indemnified
Party as a result of such loss, liability, claim, damage or expense in such
proportion as is appropriate to reflect the relative fault of the Indemnifying
Party on the one hand and of the Indemnified Party on the other in connection
with the statements, actions or omissions which resulted in such loss,
liability, claim, damage or expense as well as any other relevant equitable
considerations. The relative fault of the Indemnifying Party and of the
Indemnified Party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
Indemnifying Party or by the Indemnified Party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
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Section 9. Transfer of Registration Rights. The rights to cause the
Company to register securities granted to a Holder under Sections 2 and 4,
above, may be transferred or assigned by such Holder to a transferee or assignee
in connection with any transfer or assignment of Registerable Securities in
compliance with Section 8.5 of the Merger Agreement, provided that: (a) such
transfer or assignment may otherwise be effected in accordance with applicable
securities laws, (b) prompt written notice of such transfer or assignment is
given to the Company, and (c) such transferee or assignee expressly agrees in
writing delivered to the Company to be bound by the provisions of this
Agreement.
Section 10. Standoff or Lock-Up Agreement. Each Holder of Registerable
Securities agrees in connection with any firmly underwritten public offering of
the Company's common stock that, upon request of the Company or the underwriters
managing any underwritten offering of the Company's securities, such Holder
shall not sell, make any short sale of, loan, grant any option for the purchase
of, or otherwise dispose of any Registerable Securities (other than those
included in the registration) without the prior written consent of the Company
or such underwriters, as the case may be, during the 14 days prior to, and
during the 120-day period beginning on, the effective date of the registration
statement relating to such offering (except as part of such registration
statement). In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the Registerable Securities until the
end of such period.
Section 12. Amendment. Any modification, amendment, or waiver of this
Agreement or any provision hereof shall be effective only if in writing and
executed by the Holders of at least a majority of the Registrable Securities and
the Company.
Section 13. Governing Law. This Agreement shall be governed in all
respects by the laws of the State of California without regard to its conflicts
of laws principles.
Section 14. Successors and Assigns. Except as otherwise expressly
provided herein, the provisions hereof shall inure to the benefit of, and be
binding upon, the successors, permitted assigns, heirs, executors and
administrators of the parties.
Section 15. Notices. All notices and other communications required or
permitted hereunder shall be made in accordance with the Merger Agreement.
Section 16. Severability. If any provision of this Agreement shall be
judicially determined to be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining provisions of this Agreement shall
not in any way be affected or impaired thereby.
Section 17. Entire Agreement. This Agreement constitutes the full and
entire understanding and agreement between the parties with regard to the
subject matter hereof.
Section 18. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
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Section 19. Termination of Registration Rights. The rights of any Holder
to request registration or inclusion in any registration pursuant to Section 2
or 4, above, shall terminate on the date that all Registrable Securities held by
such Holder may be sold under Commission Rule 144 during any 90-day period.
IN WITNESS WHEREOF, each of the parties has executed this Agreement as of
the date first set forth above.
THE "LANCASHIRES": THE "COMPANY":
DATA PROCESSING
RESOURCES CORPORATION,
/s/ XXXXXXXXXXX X. LANCASHIRE a California corporation
-----------------------------
XXXXXXXXXXX X. LANCASHIRE
By: /s/ XXXXXXX X. XXXXXXX
/s/ XXXXXX X. LANCASHIRE ------------------------------
--------------------------- Its: Senior Vice President and
XXXXXX X. LANCASHIRE -------------------------
CFO
-------------------------
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