Exhibit A
XXXXX EQUITY, INC.
AP-KEI HOLDINGS, LLC
REGISTRATION RIGHTS AGREEMENT
This Agreement, dated as of October 10, 1996, is between Xxxxx Equity,
Inc., a Florida corporation (the "Company"), and AP-KEI Holdings, LLC, a
Delaware limited liability company (the "Investor").
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the Company and the Investor are entering into a certain Stock
Purchase Agreement dated as of October 10, 1996 (as amended and in effect from
time to time, the "Stock Purchase Agreement") pursuant to which the Company is
issuing and selling to the Investor, and the Investor is purchasing from the
Company, 3,000,000 shares of the Company's Common Stock, $.01 par value per
share (the "Common Stock"); and
WHEREAS, it is a condition to the issuance and sale by the Company, and
the purchase by the Investor, of such shares of Common Stock pursuant to the
Stock Purchase Agreement that the Company and the Investor enter into this
Agreement;
NOW, THEREFORE, in consideration of the mutual covenants herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:
1. Definitions; Certain Rules of Construction. Certain terms are used in this
Agreement with the specific meanings defined below in this Section 1. Except as
otherwise explicitly specified to the contrary or unless the context clearly
requires otherwise, (a) the capitalized term "Section" refers to sections of
this Agreement, (b) the capitalized term "Exhibit" refers to exhibits to this
Agreement, (c) references to a particular Section include all subsections
thereof, (d) the word "including" shall be construed as "including without
limitation," (e) references to a particular statute or regulation include all
rules and regulations thereunder and any successor statute, regulation or rules,
in each case as from time to time in effect, (f) words in the singular or plural
form include the plural and singular form, respectively, and (g) references to a
particular Person include such Person's successors and assigns to the extent not
prohibited by this Agreement.
1.1. "1933 Act" means the Securities Act of 1933.
1.2. "1934 Act" means the Securities Exchange Act of 1934.
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1.3. "Alliance Holders" means the Alliance Holders (as defined in the
Alliance Registration Rights Agreement.
1.4. "Alliance Registration Rights Agreement" means the Registration
Rights Agreement, as amended and in effect from time to time, among the Company
and various investment companies or other investment advisory clients (or their
nominees) of Alliance Capital Management, Inc.
1.5. "Apollo Holder" means (a) any Person that owns, or has the right
to acquire, Apollo Registrable Securities and (b) any assignee thereof in
accordance with Section 2.12.
1.6. "Apollo Holder Indemnitees" is defined in Section 2.8(a).
1.7. "Apollo Registrable Securities" means (a) any share of Common
Stock which (i) is held by the Investor and (ii) is a Permitted Security (as
defined in the Stock Purchase Agreement) and (b) any security issued as (or
issuable upon the conversion or exercise of any warrant, right, or other
security which is issued as) a dividend or other distribution with respect to,
in exchange for, or in replacement of, any share of Common Stock described in
the foregoing clause (a); provided, however, that any share of Common Stock
described in the foregoing clauses (a) or (b) which after the date hereof has
been sold to the public pursuant to a registered public offering shall cease to
be an Apollo Registrable Security. For purposes of this Agreement, the number of
Apollo Registrable Securities at any time outstanding shall be the sum of (A)
the number of shares of Common Stock then outstanding which are Apollo
Registrable Securities plus (ii) the number of shares of Common Stock which are
issuable pursuant to then exercisable or convertible securities and which upon
issuance would be Apollo Registrable Securities.
1.8. "Board of Directors" means the Board of Directors of the Company.
1.9. "Common Stock" is defined in the recitals to this Agreement.
1.10. "Company" is defined in the preamble to this Agreement.
1.11. "Company Indemnitees" is defined in Section 2.8(b).
1.12. "Demanding Stockholder" means, with respect to any offering
involving an underwriting of securities to be sold for the account of the
Company or any of its stockholders (other than a Holder), any stockholder (other
than a Holder) exercising demand registration rights in connection with such
offering.
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1.13. "Form S-3", "Form S-4" and "Form S-8" mean such respective
registration forms in effect on the date hereof (or any successor registration
forms subsequently adopted by the SEC) under the 0000 Xxx.
1.14. "Holders" means each of the Apollo Holders and the Alliance
Holders.
1.15. "Indemnitee" means each of the Company Indemnitees and the Apollo
Holder Indemnitees.
1.16. "Initiating Apollo Holders" is defined in Section 2.1(a).
1.17. "Investor" is defined in the preamble to this Agreement.
1.18. "Person" means any present or future natural person or any
corporation, association, partnership, limited liability company, limited
liability partnership, joint venture, joint stock or other company, business
trust, trust, organization, business or government or any governmental agency or
political subdivision thereof.
1.19. "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement or
similar document in compliance with the 1933 Act and the automatic
effectiveness, or the declaration or ordering of effectiveness, of such
registration statement or document.
1.20. "Registrable Securities" means, collectively, the Apollo
Registrable Securities and the Alliance Registrable Securities.
1.21. "Rule 144" means Rule 144 promulgated under the 1933 Act.
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1.22. "SEC" means the Securities and Exchange Commission.
1.23. "Stock Purchase Agreement" is defined in the recitals to this
Agreement.
1.24. "Violation" means, with respect to any registration statement
which includes any Apollo Registrable Securities:
(a) any untrue statement or alleged untrue statement of a
material fact contained in such registration statement, including any
preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto;
(b) the 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
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(c) any violation or alleged violation by the Company of the
1933 Act, the 1934 Act, any state securities law or any rule or
regulation promulgated under the 1933 Act, the 1934 Act or any state
securities law in connection with any matter relating to such
registration statement.
2. Registration Rights.
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2.1. Demand Registration.
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(a) At any time after October 10, 1997, if the Company shall
receive a written request from the Apollo Holders of at least 50% of
the Apollo Registrable Securities then outstanding and entitled to
registration rights under this Section 2 (the "Initiating Apollo
Holders") that the Company effect the registration under the 1933 Act
of a number of Apollo Registrable Securities constituting at least
500,000 shares of Common Stock, then the Company shall, within five
days of the receipt thereof, give written notice of such request to all
Holders and shall, subject to the limitations of this Section 2.1, use
its best efforts to effect such a registration as soon as practicable
and in any event to file within 75 days of the receipt of such request
a registration statement under the 1933 Act covering all the
Registrable Securities which the Holders shall in writing request
(within 10 days of receipt of the notice given by the Company pursuant
to this Section 2.1(a)) to be included in such registration and to use
its reasonable best efforts to have such registration statement become
effective within 120 days after receipt of such request.
(b) If the Initiating Apollo Holders intend to distribute the
Registrable Securities covered by their request by means of an
underwriting, they shall so advise the Company as part of their request
made pursuant to this Section 2.1 and the Company shall include such
information in the written notice referred to in Section 2.1(a). In
such event, the right of any Holder to include its Registrable
Securities in such registration shall be conditioned upon such Holder's
participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting (unless otherwise mutually
agreed by a majority in interest of the Initiating Apollo Holders and
such Holder) to the extent provided herein. All Holders proposing to
distribute their securities through such underwriting shall (together
with the Company as provided in Section 2.3(d)) enter into an
underwriting agreement in customary form with the underwriter or
underwriters selected for such underwriting by a majority in interest
of the Initiating Apollo Holders. The Initiating Apollo Holders shall
consult with the Board of Directors regarding the selection of an
underwriter or underwriters, but approval by the Board of Directors of
any underwriter selected by the Initiating Apollo Holders shall not be
required. Notwithstanding any other provision of this Section 2.1, if,
in the case of a registration requested pursuant to Section 2.1(a), the
underwriter advises the Initiating Apollo Holders in writing that
marketing factors require a limitation of the number of shares to be
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underwritten, then the Initiating Apollo Holders shall so advise the
Company and all Holders of Registrable Securities which would otherwise
be underwritten pursuant hereto, and all securities other than
Registrable Securities sought to be included in the underwriting shall
first be excluded. To the extent that further limitation is required,
the number of Registrable Securities that may be included in the
underwriting shall be allocated pro rata among all Holders desiring to
participate in such underwriting (according to the number of
Registrable Securities then held by each such Holder). No Registrable
Securities requested by any Holder to be included in a registration
pursuant to Section 2.1(a) shall be excluded from the underwriting
unless all securities other than Registrable Securities are first
excluded.
(c) Notwithstanding the foregoing provisions of this Section
2.1, in the event that the Company is requested to file any
registration statement pursuant to this Section 2.1:
(i) the Company shall not be obligated to effect the
filing of such registration statement during the six months
following the effective date of any other registration
statement pertaining to an underwritten public offering of
securities for the account of the Company; and
(ii) if the Company shall furnish to the Holders
requesting such registration statement a certificate signed by
the president of the Company (A) stating that, in the good
faith judgment of a majority of the disinterested members of
the Board of Directors, (1) an undisclosed material event (x)
has occurred and is continuing or (y) is likely to occur
within 90 days and (2) the disclosure of such undisclosed
material event would have a material adverse effect on the
Company or on a proposed material transaction involving the
Company or a substantial portion of its assets and (B)
describing in reasonable detail such undisclosed material
event, then the Company shall have the right to defer such
filing for a period of not more than 120 days after receipt of
the request of the relevant Initiating Apollo Holders;
provided, however, that the Company may not utilize the right
set forth in this Section 2.1(c)(ii) more than once in any
12-month period.
2.2. Company Registration. If (but without any obligation to do so) the
Company proposes to register any Common Stock for its own account (including for
this purpose a registration effected by the Company for stockholders other than
the Holders) under the 1933 Act in connection with the public offering of such
Common Stock solely for cash (other than a registration on Form S-8 or a
registration on Form S-4), the Company shall, at such time, promptly give each
Holder written notice of such registration. Upon the written request of any
Apollo Holder given not later than 10 business days before the anticipated
effective date of such registration (as set forth in such notice by the
Company), the Company shall, subject to the provisions of Section 2.7, use its
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best efforts to cause a registration statement covering all of the Apollo
Registrable Securities that each such Apollo Holder has requested to be
registered to become effective under the 1933 Act. The Company shall be under no
obligation to complete any offering of securities it proposes to make and shall
incur no liability to any Apollo Holder for its failure to do so.
2.3. Obligations of the Company. Whenever required under this Section 2
to use its best efforts to effect the registration of any Apollo Registrable
Securities, the Company shall, as expeditiously as reasonably possible, prepare
and file with the SEC a registration statement with respect to such Apollo
Registrable Securities and use its best efforts to cause such registration
statement to become effective, and, upon the request of the Holders of a
majority of the Registrable Securities registered thereunder, keep such
registration statement effective for up to 180 days or until such earlier date
as such Holders have informed the Company in writing that the distribution of
all Registrable Securities registered thereunder has been completed. In
addition, the Company shall:
(a) prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in
connection with such registration statement, and use its best efforts
to cause each such amendment and supplement to become effective, as may
be necessary to comply with the provisions of the 1933 Act with respect
to the disposition of all securities covered by such registration
statement;
(b) furnish to the Apollo Holders such reasonable number of
copies of a prospectus, including a preliminary prospectus, in
conformity with the requirements of the 1933 Act, and such other
documents as they may reasonably request in order to facilitate the
disposition of Apollo Registrable Securities owned by them;
(c) use its best efforts to register or qualify the securities
covered by such registration statement under such other securities or
blue sky laws of such states and jurisdictions as shall be reasonably
requested by the Apollo Holders, except that the Company shall not be
required in connection therewith or as a condition thereto to qualify
to do business or file a general consent to service of process in any
such state or jurisdiction;
(d) in the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement, in
usual and customary form and including representations and warranties
by the Company relating to the business and properties of the Company,
with the managing underwriter of such offering and take all actions
reasonably requested by the managing underwriter of such offering in
furtherance of the underwriters' selling efforts; provided, however,
that each Apollo Holder participating in such underwriting shall also
enter into and perform its obligations under such an underwriting
agreement, including furnishing any opinion of counsel or entering into
a lock-up agreement reasonably requested by the managing underwriter;
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(e) notify each Apollo Holder of Apollo Registrable Securities
covered by such registration statement, at any time when a prospectus
relating to Apollo Registrable Securities covered by such registration
statement is required to be delivered under the 1933 Act, 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 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 promptly
file such amendments and supplements which may be required pursuant to
Section 2.3(a) on account of such event and use its best efforts to
cause each such amendment and supplement to become effective;
(f) furnish, at the request of any Apollo Holder requesting
registration of Apollo Registrable Securities pursuant to this Section
2, on the date that such Apollo Registrable Securities are delivered to
the underwriters for sale in connection with a registration pursuant to
this Section 2, if such securities are being sold through underwriters,
or, if such securities are not being sold through underwriters, on the
date the registration statement with respect to such securities became
effective, (i) an opinion, dated such date, of the counsel representing
the Company for the purposes of such registration, in form and
substance as is customarily given by company counsel to the
underwriters in an underwritten public offering, addressed to the
underwriters, if any, and to the Apollo Holders requesting registration
of Apollo Registrable Securities and (ii) a letter dated such date,
from the independent certified public accountant of the Company, in
form and substance as is customarily given by independent certified
public accountants to underwriters in an underwritten public offering,
addressed to the underwriters, if any, and to the Apollo Holders
requesting registration of Apollo Registrable Securities; and
(g) apply for listing and use its best efforts to list the
Apollo Registrable Securities being registered on any national
securities exchange on which a class of the Company's equity securities
are listed or, if the Company does not have a class of equity
securities listed on a national securities exchange, apply for
qualification and use its best efforts to qualify the Apollo
Registrable Securities being registered for inclusion on the automated
quotation system of the National Association of Securities Dealers,
Inc.
2.4. Furnish Information. It shall be a condition precedent to the
obligations of the Company to take any action pursuant to this Section 2 in
respect of the Apollo Registrable Securities of any selling Apollo Holder that
such selling Apollo Holder shall furnish to the Company such information
regarding itself, the Apollo Registrable Securities held by it, and the intended
method of disposition of such Apollo Registrable Securities as shall be required
to effect the registration of such Apollo Registrable Securities.
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2.5. Expenses of Demand Registration. All expenses (other than
underwriting discounts and commissions and fees and expenses of professionals
retained by the Apollo Holders) relating to Apollo Registrable Securities
incurred in connection with each registration, filing or qualification pursuant
to Section 2.1(a) and each registration, filing or qualification pursuant to
Section 2.10, including all registration, filing and qualification fees,
printing and accounting fees, fees and disbursements of counsel for the Company,
shall be borne by the Company; provided, however, that the Company shall not be
required to pay for any expenses of any registration proceeding begun pursuant
to Section 2.1(a) if the registration request is subsequently withdrawn at any
time at the request of the Holders of a majority of the Registrable Securities
to be registered other than as a result of a material adverse change in the
condition, business or prospects of the Company that was unknown to the Holders
of a majority of such Registrable Securities at the time of their request (in
which case all participating Holders shall bear such expenses). All underwriting
discounts and commissions relating to Apollo Registrable Securities included in
any registration effected pursuant to Section 2.1(a) or 2.10 will be borne and
paid ratably by the Apollo Holders of such Apollo Registrable Securities, and,
if it participates, the Company. All fees and expenses of professionals retained
by the Apollo Holders in connection with any registration of Apollo Registrable
Securities effected pursuant to Section 2.1(a) or 2.10 will be borne and paid
ratably by the Apollo Holders of such Apollo Registrable Securities.
2.6. Expenses of Company Registration. The Company shall bear and pay
all expenses (other than underwriting discounts and commissions and fees and
expenses of professionals retained by the Apollo Holders) incurred in connection
with any registration, filing or qualification of Apollo Registrable Securities
with respect to any registration pursuant to Section 2.2 for each Apollo Holder,
including all registration, filing and qualification fees, printing and
accounting fees, fees and disbursements of counsel for the Company. All
underwriting discounts and commissions relating to Registrable Securities
included in any registration effected pursuant to Section 2.2 will be borne and
paid ratably by the Apollo Holders of such Apollo Registrable Securities and the
Company. All fees and expenses of professionals retained by the Apollo Holders
in connection with any registration of Apollo Registrable Securities effected
pursuant to Section 2.2 will be borne and paid ratably by the Apollo Holders of
such Apollo Registrable Securities.
2.7. Underwriting Requirements. In connection with any offering
involving an underwriting of securities to be sold for the account of the
Company (including for this purpose an underwriting of securities effected by
the Company for stockholders other than the Holders), the Company shall not be
required under Section 2.2 to include any of the Holders' securities in such
underwriting unless such Holders accept the terms of the underwriting as agreed
upon between the Company and the underwriters selected by it, and then only in
such quantity, if any, as will not, in the opinion of the underwriters,
jeopardize the success of the offering by the Company. If the managing
underwriter for the offering shall advise the Company in writing that the total
number of securities, including Registrable Securities, requested by
stockholders to be included in such offering exceeds the number of securities
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that can be successfully offered, then the Company shall be required to include
in the offering only that number of securities, including Registrable
Securities, which the managing underwriter believes will not jeopardize the
success of the offering. The securities so included in the offering will be
reduced as follows:
(a) first, all securities which any Persons other than the
Company and any Demanding Stockholder seek to include in the offering
shall be reduced pro rata among such Persons in accordance with the
number of registrable securities of the Company; and
(b) if further limitation on the number of securities to be
included in the offering is required, then the number of securities
which the Company and any Demanding Stockholder seek to include in the
offering shall be reduced.
2.8. Indemnification. In the event any Apollo Registrable Securities
are included in a registration statement under this Section 2:
(a) The Company will indemnify and hold harmless each Apollo
Holder, the officers and directors of each Apollo Holder, any
underwriter (as defined in the 0000 Xxx) for such Apollo Holder and
each Person, if any, who controls such Apollo Holder or underwriter
within the meaning of the 1933 Act or the 1934 Act (collectively, the
"Apollo Holder Indemnitees"), against any losses, claims, damages or
liabilities (joint or several) to which they may become subject under
the 1933 Act, the 1934 Act or any other federal or state law, insofar
as such losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon any Violation. The Company will
reimburse each Apollo Holder Indemnitee for any legal or other expenses
reasonably incurred by such Apollo Holder Indemnitee in connection with
investigating or defending any such loss, claim, damage, liability or
action. The indemnity agreement contained in this Section 2.8(a) shall
not apply to amounts paid in settlement of any loss, claim, damage,
liability or action if such settlement is effected without the consent
of the Company (which consent shall not be unreasonably withheld), nor
shall the Company be liable to any Apollo Holder Indemnitee in any such
case for any such loss, claim, damage, liability or action (i) to the
extent that it arises out of or is based upon a Violation which occurs
in reliance upon and in conformity with written information furnished
expressly for use in connection with such registration by or on behalf
of such Apollo Holder Indemnitee or (ii) in the case of a sale directly
by an Apollo Holder of Apollo Registrable Securities (including a sale
of such Apollo Registrable Securities through any underwriter retained
by such Holder engaging in a distribution solely on behalf of such
Apollo Holder), such untrue statement or alleged untrue statement or
omission or alleged omission was contained in a preliminary prospectus
and corrected in a final or amended prospectus, and such Apollo Holder
failed to deliver a copy of the final or amended prospectus at or prior
to the confirmation of the sale of the Apollo Registrable Securities to
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the Person asserting any such loss, claim, damage or liability in any
case in which such delivery is required by the 1933 Act.
(b) Each Apollo Holder which includes any Apollo Registrable
Securities in any registration statement (i) will indemnify and hold
harmless the Company, its directors and officers, each Person, if any,
who controls the Company within the meaning of the 1933 Act, each agent
and any underwriter for the Company, and any other Apollo Holder or
other stockholder selling securities in such registration statement and
any of its directors and officers, and any Person who controls such
Apollo Holder or such other stockholder or such underwriter
(collectively, the "Company Indemnitees"), against any losses, claims,
damages or liabilities (joint or several) to which any Company
Indemnitee may become subject under the 1933 Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereto) arise out of or are based
upon any Violation, in each case to the extent (and only to the extent)
that such Violation occurs in reliance upon and in conformity with
written information furnished by or on behalf of such Apollo Holder
expressly for use in connection with such registration and (ii) will
reimburse any legal or other expenses reasonably incurred by any
Company Indemnitee in connection with investigating or defending any
such loss, claim, damage, liability or action; provided, however, that
the liability of any Apollo Holder hereunder shall be limited to the
amount of proceeds received by such Apollo Holder in the offering
giving rise to the Violation; and provided, further, that the indemnity
agreement contained in this Section 2.8(b) shall not apply to amounts
paid in settlement of any such loss, claim, damage, liability or action
if such settlement is effected without the consent of such Holder
(which consent shall not be unreasonably withheld) nor, in the case of
a sale directly by the Company of its securities (including a sale of
such securities through any underwriter retained by the Company to
engage in a distribution solely on behalf of the Company), shall such
Apollo Holder be liable to the Company in any case in which such untrue
statement or alleged untrue statement or omission or alleged omission
was contained in a preliminary prospectus and corrected in a final or
amended prospectus, and the Company failed to deliver a copy of the
final or amended prospectus at or prior to the confirmation of the sale
of the securities to the Person asserting any such loss, claim, damage
or liability in any case in which such delivery is required by the 1933
Act.
(c) Promptly after receipt by any Indemnitee under this
Section 2.8 of notice of the commencement of any action (including any
governmental action), such Indemnitee will, if a claim in respect
thereof is to be made against any indemnifying party under this Section
2.8, deliver to the indemnifying party a written notice of the
commencement thereof and the indemnifying party shall have the right to
participate in, and, to the extent the indemnifying party so desires,
jointly with any other indemnifying party similarly noticed, to assume
and control the defense thereof with counsel mutually satisfactory to
the parties; provided, however, that such Indemnitee
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shall have the right to retain its own counsel, with the fees and
expenses to be paid by the indemnifying party, if representation of
such Indemnitee by the counsel retained by the indemnifying party would
be inappropriate due to actual or potential differing interests, as
reasonably determined by either party, between such Indemnitee and any
other party represented by such counsel in such proceeding. The failure
to deliver written notice to the indemnifying party within a reasonable
time of the commencement of any such action, if prejudicial to its
ability to defend such action, shall relieve such indemnifying party of
any liability to the Indemnitee under this Section 2.8 to the extent of
such prejudice, but the omission so to deliver written notice to the
indemnifying party will not relieve it of any liability that it may
have to such Indemnitee otherwise than under this Section 2.8.
(d) The obligations of the Company and the Apollo Holders
under this Section 2.8 shall survive the completion of any offering of
Apollo Registrable Securities in a registration statement whether under
this Section 2 or otherwise.
(e) If the indemnification provided for in this Section 2.8 is
unavailable to a party that would have been an Indemnitee under this
Section 2.8 in respect of any losses, claims, damages or liabilities
(or actions or proceedings in respect thereof) referred to herein, then
each party that would have been an indemnifying party hereunder shall,
in lieu of indemnifying such Indemnitee, contribute to the amount paid
or payable by such indemnified party as a result of such losses,
claims, damages or liabilities (or actions or proceedings in respect
thereof) in such proportion as is appropriate to reflect the relative
fault of such indemnifying party, on one hand, and such Indemnitee, on
the other hand, in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof). The relative fault shall be determined
by reference to, among other things, whether the Violation relates to
information supplied by such indemnifying party or such Indemnitee and
the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such Violation. The parties agree
that it would not be just and equitable if contribution pursuant to
this Section 2.8(e) were determined by pro rata allocation or by any
other method of allocation which does not take account of the equitable
considerations referred to in the preceding sentence. The amount paid
or payable by a contributing party as a result of the losses, claims,
damages or liabilities (or actions or proceedings in respect thereof)
referred to above in this Section 2.8(e) shall include any legal or
other expenses reasonably incurred in connection with investigating or
defending any such action or claim. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act
shall be entitled to contribution from any Person who was not guilty of
such fraudulent misrepresentation. The liability of any Apollo Holder
of Apollo Registrable Securities in respect of any contribution
obligation of such Holder (after deduction of all underwriters'
discounts and commissions paid by such Apollo Holder in connection with
the registration in question) arising under this Section 2.8(e) shall
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not in any event exceed an amount equal to the proceeds to such Apollo
Holder from the disposition of the Apollo Registrable Securities
disposed of by such Apollo Holder pursuant to such registration.
2.9. Reports Under Securities Exchange Act of 1934. With a view to
making available to the Apollo Holders the benefits of Rule 144 and any other
rule or regulation of the SEC that may at any time permit an Apollo Holder to
sell securities of the Company to the public without registration, and with a
view to making it possible for Apollo Holders to register the Apollo Registrable
Securities pursuant to a registration on Form S-3, the Company agrees to:
(a) to the extent required by the 1934 Act, use its best
efforts to make and keep public information available, as those terms
are understood and defined in Rule 144, at all times;
(b) use its best efforts to file with the SEC in a timely
manner all reports and other documents required of the Company under
the 1933 Act and the 1934 Act; and
(c) furnish to any Apollo Holder, so long as such Apollo
Holder owns any Apollo Registrable Securities, forthwith upon request
(i) a written statement by the Company as to its compliance with the
reporting requirements of Rule 144, the 1933 Act and the 1934 Act, or
as to its qualification as a registrant whose securities may be resold
pursuant to Form S-3, (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 availing any Apollo Holder of any rule or
regulation of the SEC which permits the selling of any such securities
without registration or pursuant to such form.
2.10. Form S-3 Registration. In case the Company shall receive from any
Apollo Holder a written request that the Company effect a registration on Form
S-3 and any related qualification or compliance with respect to all or a part of
the Apollo Registrable Securities owned by such Holder, the Company will:
(a) promptly give written notice of the proposed registration,
and any related qualification or compliance, to all other Holders; and
(b) use its best efforts to effect, as soon as practicable,
such registration, qualification or compliance as may be so requested
and as would permit or facilitate the sale and distribution of all or
such portion of such Apollo Holder's Apollo Registrable Securities as
are specified in such request, together with all or such portion of the
Registrable Securities of any other Holder joining in such request as
are specified in a written request given within 20 days after receipt
of such written notice from the
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Company; provided, however, that the Company shall not be obligated to
effect any such registration, qualification or compliance, pursuant to
this Section 2.10 if:
(i) Form S-3 is not available for such offering by
the Holders;
(ii) the aggregate net offering price (after
deduction of underwriting discounts and commissions) of the
Apollo Registrable Securities specified in such request is not
at least $3,000,000;
(iii) the Company has already effected a registration
within the previous six-month period; or
(iv) the Company shall furnish to the Holders a
certificate signed by the president of the Company (A) stating
that, in the good faith judgment of a majority of the
disinterested members of the Board of Directors, (1) an
undisclosed material event (x) has occurred and is continuing
or (y) is likely to occur within 90 days and (2) the
disclosure of such undisclosed material event would have a
material adverse effect on the Company or on a proposed
material transaction involving the Company or a substantial
portion of its assets and (B) describing in reasonable detail
such undisclosed material event, in which event the Company
shall have the right to defer the filing of such Form S-3
registration for a period of not more than 120 days after
receipt of the request of the Apollo Holder or Apollo Holders
under this Section 2.10; provided, however, that the Company
shall not utilize this right more than once in any 12- month
period.
2.11. Lock-up Agreements. Each Apollo Holder agrees to enter into
lock-up agreements pursuant to which it will not, for a period of up to 180 days
(as determined by the Company) following the effective date of a registration
statement for a public offering of the Company's securities, offer, sell or
otherwise dispose of any Apollo Registrable Securities (except Apollo
Registrable Securities sold pursuant to such registration statement) without the
prior written consent of the Company and the underwriter.
2.12. Assignment of Registration Rights. The rights to cause the
Company to register Apollo Registrable Securities pursuant to this Section 2 and
all related rights, including rights to the payment of registration expenses and
to indemnification, may be assigned by any Apollo Holder to any permitted
transferee which (a) is a Permitted Assignee (as defined in the Stock Purchase
Agreement) or (b) owns, immediately after giving effect to such transfer, no
less than 500,000 shares and no more than 9.8% of the total number of shares of
Common Stock then outstanding. Any transferee to which rights under this
Agreement are transferred (i) shall, as a condition to such transfer, deliver to
the Company a written instrument by which such transferee agrees to be bound by
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the obligations imposed upon Apollo Holders under this Agreement to the same
extent as if such transferee were an Apollo Holder under this Agreement and (ii)
shall be deemed to be an Apollo Holder hereunder.
3. Legend. Each certificate representing any Apollo Registrable Security shall
bear on its face substantially the following legends:
(a) "THESE SECURITIES ARE SUBJECT TO THE PROVISIONS OF A
CERTAIN REGISTRATION RIGHTS AGREEMENT DATED AS OF OCTOBER __, 1996, AS
AMENDED AND IN EFFECT FROM TIME TO TIME, AMONG THE CORPORATION AND THE
STOCKHOLDER NAMED THEREIN, A COPY OF WHICH IS ON FILE AT THE OFFICES OF
THE CORPORATION."
(b) Any legends required by (i) the Stock Purchase Agreement
or (ii) the laws of any applicable jurisdiction.
4. Specific Performance. The parties recognize that their respective rights
under this Agreement are unique, and, accordingly, each party shall, in addition
to such other remedies as may be available to it at law or in equity, have the
right to enforce its rights hereunder by actions for injunctive relief and
specific performance to the extent permitted by law. This Agreement is not
intended to limit or abridge any rights of either party which may exist apart
from this Agreement.
5. Notices. All notices, demands and other communications required to be given
pursuant to this Agreement shall be in writing and shall be deemed to have been
received if given in writing (including telex, telecopy or similar
teletransmission) addressed as provided below (or to the addressee at such other
address as the addressee shall have specified by notice actually received by the
addressor), and if either (a) actually delivered in fully legible form to such
address (evidenced in the case of a telex by receipt of the correct answer back)
or (b) in the case of a letter, three days shall have elapsed after the same
shall have been deposited in the mails (i) with first-class (air mail if to or
from outside the United States of America) postage prepaid and registered or
certified, with return receipt requested, or (ii) with express delivery postage
prepaid, with receipt required for delivery.
If to the Company, to it at 0000 Xxxxxxxxx Xxxxxx Xxxxx, Xxxxxxxxxxxx,
Xxxxxxx 00000, telecopy number (000) 000-0000, to the attention of Xxxxxx X.
Xxxxxx, Xx., with a copy to each of (a) Ropes & Xxxx, Xxx Xxxxxxxxxxxxx Xxxxx,
Xxxxxx, Xxxxxxxxxxxxx 00000, telecopy number (000) 000-0000, to the attention of
Xxxxxxx X. XxXxxxxx, Esq., and (b) Xxxxxx & XxXxxx, 00 Xxxxx Xxxxx Xxxxxx, Xxxxx
000, Xxxxxxxxxxxx, Xxxxxxx 00000, to the attention of Xxxxxx X. XxXxxx, Xx.,
Esq.
If to the Investor, to it at 1301 Avenue of the Xxxxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, telecopy number (000) 000-0000, to the attention of W.
Xxxxxx Xxxxxxx, with a copy to each of (a) Xxxxxxx Xxxx & Xxxxxxxxx, 000 Xxxx
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00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, to the attention of each of Xxxxxx X.
Xxxxx, Esq. and Xxxxxxx X. Xxxxxxxx, Esq., and (b) Battle Xxxxxx LLP, 00 Xxxx
00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, to the attention of Xxxxxx X. Xxxxxxx,
Esq.
6. Binding Effect; Assignment. This Agreement shall be binding upon, and inure
to the benefit of, the parties and their respective personal representatives,
successors and permitted assigns; provided, however, that the Company shall not
have the right to assign its rights and obligations hereunder, or any interest
herein, without the prior written consent of the holders of a majority of the
Apollo Registrable Securities then outstanding.
7. Course of Dealing; Amendments, Waivers and Consents. No course of dealing
between the parties shall operate as a waiver of any party's rights under this
Agreement. Each party acknowledges that if any party, without being required to
do so by this Agreement, gives any notice or information to, or obtains any
consent from, the other party, such party shall not by implication have amended,
waived or modified any provision of this Agreement, or created any duty to give
any such notice or information or to obtain any such consent on any future
occasion. No delay or omission on the part of any party in exercising any right
under this Agreement shall operate as a waiver of such right or any other right
hereunder or thereunder. A waiver on any one occasion shall not be construed as
a bar to or waiver of any right or remedy on any future occasion. No amendment,
waiver or consent with respect to this Agreement shall be binding unless it is
in writing and signed by each of the Company and the holders of a majority of
the Registrable Securities then outstanding.
8. No Contrary Agreement. The Company shall not enter into any agreement which
conflicts with the Investor's rights under this Agreement; provided, however,
that the Investor hereby acknowledges and agrees that the Company may from time
to time grant registration rights to other stockholders of the Company to the
extent that such registration rights do not conflict with the Investor's rights
under this Agreement.
9. Termination. This Agreement, and the respective rights and obligations of the
parties hereunder, shall terminate on the date upon which all Apollo Holders own
less than 1,178,400 shares of Apollo Registrable Securities.
10. General. If any provision of this Agreement shall be found by any court of
competent jurisdiction to be invalid or unenforceable, the parties hereby waive
such provision to the extent that it is found to be invalid or unenforceable.
Such provision shall, to the maximum extent allowable by law, be modified by
such court so that it becomes enforceable, and, as modified, shall be enforced
as any other provision hereof, all the other provisions hereof continuing in
full force and effect. The headings contained in this Agreement are for
reference purposes only and shall not in any way affect the meaning or
interpretation hereof. This Agreement constitutes the entire understanding of
the parties with respect to the subject matter hereof and supersedes any and all
prior understandings and agreements, whether written or oral, with respect to
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such subject matter. This Agreement may be executed in counterparts, which
together shall constitute one and the same instrument. This Agreement shall be
governed by and construed in accordance with the laws (other than the conflict
of laws rules) of the State of New York.
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IN WITNESS WHEREOF, each of the undersigned has caused this Agreement
to be executed by a duly authorized officer as an agreement under seal as of the
date first above written.
XXXXX EQUITY, INC.
By: s/Xxxxxx X. Xxxxxx, Xx.
-----------------------
Name: Xxxxxx X. Xxxxxx, Xx.
Title: Chairman of the Board
AP-KEI HOLDINGS, LLC
By AP-MM KEI HOLDINGS, LLC,
its Managing Member
By KRONUS PROPERTY, INC.,
its Managing Member
By: s/W. Xxxxxx Xxxxxxx
-------------------
W. Xxxxxx Xxxxxxx
Vice President
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