EXHIBIT F
COGENT COMMUNICATIONS GROUP, INC.
FOURTH AMENDED AND RESTATED
REGISTRATION RIGHTS AGREEMENT
-----------------------------
March 30, 2004
To each of the several holders of Series F Preferred Stock (the "Series
F Purchasers"), each sub-series of Series G Preferred Stock (collectively, the
"Series G Purchasers"), Series I Preferred Stock (the "Series I Purchasers") and
Series J Preferred Stock (the "Series J Purchasers," collectively, the Series F,
G, I and J Purchasers shall be known as the "Purchasers"):
Dear Sirs:
This will confirm that as a condition to closing under the Merger
Agreement (the "Merger Agreement") dated March 30, 2004, by and among Cogent
Communications Group, Inc. (the "Company"), the Company's subsidiary DE Merger
Sub, Inc. ("Merger Sub") and Symposium Omega, Inc. ("Symposium Omega"), the
Company covenants and agrees with each of you as follows:
1. Certain Definitions. As used in this Agreement, the following terms
shall have the following respective meanings:
"Commission" shall mean the Securities and Exchange Commission, or any
other federal agency at the time administering the Securities Act.
"Common Stock" shall mean the Common Stock, par value $.001 per share,
of the Company, as constituted as of the date of this Agreement.
"Company" shall mean Cogent Communications Group, Inc.
"Conversion Shares" shall mean shares of Common Stock issued or issuable
upon conversion of the Preferred Stock, and any shares of capital stock received
in respect thereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934 or any
similar federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time.
"Preferred Stock" shall mean the Series F Preferred Stock, the Series G
Preferred Stock, the Series I Preferred Stock and the Series J Preferred Stock.
"Registration Expenses" shall mean the expenses so described in Section
8.
"Restricted Stock" shall mean (i) the Conversion Shares, excluding
Conversion Shares which have been (a) registered under the Securities Act
pursuant to an effective registration statement filed thereunder and disposed of
in accordance with the registration statement covering them or (b) publicly sold
pursuant to Rule 144 under the Securities Act, and (ii) any shares of Common
Stock issued or distributed in respect of the securities described in clause
(i).
"Securities Act" shall mean the Securities Act of 1933 or any similar
federal statute, and the rules and regulations of the Commission thereunder, all
as the same shall be in effect at the time.
"Selling Expenses" shall mean the expenses so described in Section 8.
"Series F Preferred Stock" shall mean the Series F Participating
Convertible Preferred Stock, par value $.001 per share, of the Company,
constituted as of July 31, 2003.
"Series G Preferred Stock" shall mean the Series G Participating
Convertible Preferred Stock of the Company, constituted as of July 31, 2003.
"Series I Preferred Stock" shall mean the Series I Participating
Convertible Preferred Stock of the Company, constituted as of January 5, 2004.
"Series J Preferred Stock" shall mean the Series J Participating
Convertible Preferred Stock of the Company, issued pursuant to the Merger
Agreement, constituted as of the date of this Agreement.
2. Restrictive Legend. Each certificate representing Preferred Stock,
Conversion Shares or Restricted Stock shall, except as otherwise provided in
this Section 2 or in Section 3, be stamped or otherwise imprinted with a legend
substantially in the following form:
"The securities represented by this certificate have not been
registered under the Securities Act of 1933 or applicable state
securities laws. These securities have been acquired for investment
and not with a view to distribution or resale, and may not be sold
mortgaged, pledged, hypothecated or otherwise transferred without an
effective registration statement for such securities under the
Securities Act of 1933 and applicable state securities laws, or the
availability of an exemption from the registration provisions of the
Securities Act of 1933 and applicable state securities laws."
A certificate shall not bear such legend if in the opinion of counsel reasonably
satisfactory to the Company the securities being sold thereby may be publicly
sold without registration under the Securities Act.
3. Notice of Proposed Transfer. Prior to any proposed transfer of any
Preferred Stock, Conversion Shares or Restricted Stock (other than under the
circumstances described in Sections 4, 5 or 6), the holder thereof shall give
written notice to the Company of its intention to effect such transfer. Each
such notice shall describe the manner of the proposed transfer and, if requested
by the Company, shall be accompanied by an opinion of counsel reasonably
satisfactory to the Company to the effect that the proposed transfer may be
effected without registration under the Securities Act, whereupon the holder of
such stock shall be entitled to transfer such stock in accordance with the terms
of its notice; provided, however, that no such opinion of counsel shall be
required for a transfer to one or more partners of the transferor (in the case
of a transferor that is a partnership), to one or more members of the transferor
(in the case of a transferor that is a limited liability company) or to an
affiliated corporation (in the case of a transferor that is a corporation);
provided, further, however, that any transferee other than a partner, member or
affiliate of the transferor shall execute and deliver to the Company a
representation letter in form reasonably satisfactory to the Company's counsel
to the effect that the transferee is acquiring Restricted Stock for its own
account, for investment purposes and without any view to distribution thereof.
Each certificate for Preferred Stock or Conversion Shares transferred as above
provided shall bear the legend set forth in Section 2, except that such
certificate shall not bear such legend if (i) such transfer is in accordance
with the provisions of Rule 144 (or any other rule permitting public sale
without registration under the Securities Act) or (ii) the opinion of counsel
referred to above is to the further effect that the transferee and any
subsequent transferee (other than an affiliate of the Company) would be entitled
to transfer such securities in a public sale without registration under the
Securities Act. The restrictions provided for in this Section 3 shall not apply
to securities which are not required to bear the legend prescribed by Section 2
in accordance with the provisions of that Section.
4. Required Registration.
(a) Subject to Section 13(f) of this Agreement, at any time after
the earlier of (i) July 31, 2006 and (ii) the date that is six (6)
months after the first public offering after the date hereof of
securities by the Company, holders of Restricted Stock constituting
more than 50% of the total number of shares of Restricted Stock then
outstanding may request the Company to register under the Securities
Act all or any portion of the shares of Restricted Stock held by such
requesting holder or holders for sale in the manner specified in such
notice. For purposes of this Section 4 and Sections 5, 6, 13(a) and
13(d), the term "Restricted Stock" shall be deemed to include the
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number of shares of Restricted Stock which would be issuable to a
holder of Preferred Stock upon conversion of all shares of Preferred
Stock held by such holder at such time; provided, however, that the
only securities which the Company shall be required to register
pursuant hereto shall be shares of Common Stock; provided, further,
however, that, in any underwritten public offering contemplated by
this Section 4 or Sections 5 and 6, the holders of Preferred Stock
shall be entitled to sell such Preferred Stock to the underwriters for
conversion and sale of the shares of Common Stock issued upon
conversion thereof and holders of a majority of the Preferred Stock
being so registered shall have the right to approve the managing
underwriter(s) selected by the Company in connection with such
underwritten public offering. Notwithstanding anything to the contrary
contained herein, the Company shall not be obligated to effect a
registration (i) during the 180 day period commencing with the
effective date of a registration statement filed by the Company
covering the first firm commitment underwritten public offering after
the date hereof or (ii) if the Company delivers notice to the holders
of the Restricted Stock within thirty (30) days of any registration
request of the Company's intent to file a registration statement for
an underwritten public offering within ninety (90) days.
(b) Following receipt of any notice under this Section 4, the
Company shall immediately notify all holders of Restricted Stock and
Preferred Stock from whom notice has not been received and such
holders shall then be entitled within 30 days thereafter to request
the Company to include in the requested registration all or any
portion of their shares of Restricted Stock. The Company shall use its
best efforts to register under the Securities Act, for public sale in
accordance with the method of disposition described in paragraph (a)
above, the number of shares of Restricted Stock specified in such
notice (and in all notices received by the Company from other holders
within 30 days after the giving of such notice by the Company). The
Company shall be obligated to register Restricted Stock pursuant to
this Section 4 on three occasions only; provided, however, that such
obligation shall be deemed satisfied only when a registration
statement covering all shares of Restricted Stock specified in notices
received as aforesaid for sale in accordance with the method of
disposition specified by the requesting holders shall have become
effective and, if such method of disposition is a firm commitment
underwritten public offering, all such shares shall have been sold
pursuant thereto.
(c) The Company (or at the option of the Company, the holders of
Common Stock) shall be entitled to include in any registration
statement referred to in this Section 4, for sale in accordance with
the method of disposition specified by the requesting holders, shares
of Common Stock to be sold by the Company or such other holders for
its own account, except as and to the extent that, in the opinion of
the managing underwriter (if such method of disposition shall be an
underwritten public offering), such inclusion would adversely affect
the marketing of the Restricted Stock to be sold. Subject to Section
4(a) and except for registration statements on Form X-0, X-0 or any
successor thereto, the Company will not file with the Commission any
other registration statement with respect to its Common Stock, whether
for its own account or that of other stockholders, from the date of
receipt of a notice from requesting holders pursuant to this Section 4
until the completion of the period of distribution of the registration
contemplated thereby.
(d) If, in the opinion of the managing underwriter, the inclusion
of all of the Restricted Stock requested to be registered under this
Section would adversely affect the marketing of such shares, the
Company shall only include the number of shares that, in the
reasonable opinion of such underwriter, can be sold without having an
adverse effect on the marketing of such shares, to be allocated to
each stockholder of the Company on apro rata basis based on the total
number of shares held by such holder and requested to be included in
the registration; provided, however, that the number of shares of
Restricted Stock to be included in such underwriting and registration
shall not be reduced unless all other securities of the Company are
first excluded from the underwriting and registration.
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5. Incidental Registration. Subject to Section 13(f) of this Agreement,
if the Company at any time (other than pursuant to Section 4 or Section 6)
proposes to register any of its securities under the Securities Act for sale to
the public, whether for its own account or for the account of other security
holders or both (except with respect to registration statements on Forms X-0,
X-0 or another form not available for registering the Restricted Stock for sale
to the public), each such time it will give written notice to all holders of
outstanding Restricted Stock of its intention so to do. Upon the written request
of any such holder, received by the Company within 30 days after the giving of
any such notice by the Company, to register any of its Restricted Stock, the
Company will use its best efforts to cause the Restricted Stock as to which
registration shall have been so requested to be included in the securities to be
covered by the registration statement proposed to be filed by the Company, all
to the extent requisite to permit the sale or other disposition by the holder
(in accordance with its written request) of such Restricted Stock so registered.
In the event that any registration pursuant to this Section 5 shall be, in whole
or in part, an underwritten public offering of Common Stock, if the managing
underwriter determines in good faith that marketing factors require a limitation
of the number of shares to be underwritten, the number of shares that may be
included in the underwriting shall be allocated, first, to the Company; second,
to the holders of Restricted Stock invoking the rights under this Section 5 on
apro rata basis based on the total number of shares of Restricted Stock held by
such holders; and third, to any stockholder of the Company (other than such
holders) on apro rata basis. No such reduction shall reduce the amount of
securities of the selling holders included in the registration below thirty
percent (30%) of the total amount of securities included in such registration.
In no event will shares of any other selling stockholder be included in such
registration that would reduce the number of shares which may be included by
holders of Restricted Stock without the written consent of the holders of not
less than sixty-six and two-thirds percent (662/3%) of the Restricted Stock
proposed to be sold in the offering. If any such holder disapproves of the terms
of any such underwriting, such holder may elect to withdraw therefrom by written
notice to the Company and the underwriter, delivered at least ten (10) business
days prior to the effective date of the registration statement. Any shares of
Restricted Stock excluded or withdrawn from such underwriting shall be excluded
and withdrawn from the registration. For any holder which is a partnership or
corporation, the partners, retired partners and stockholders of such holder, or
the estates and family members of any such partners and retired partners and
anytrusts for the benefit of any of the foregoing person shall be deemed to be a
single holder, and anypro rata reduction with respect to such holder shall be
based upon the aggregate amount of shares carrying registration rights owned by
all entities and individuals included in such holder, as defined in this
sentence. Notwithstanding the foregoing provisions, the Company may withdraw any
registration statement referred to in this Section 5 without thereby incurring
any liability to the holders of Restricted Stock.
6. Registration on Form S-3. Subject to Section 13(f) of this Agreement,
if at any time (i) a holder or holders of Restricted Stock then outstanding
request that the Company file a registration statement on Form S-3 or any
successor thereto for a public offering of all or any portion of the shares of
Restricted Stock held by such requesting holder or holders, and (ii) the Company
is a registrant entitled to use Form S-3 or any successor thereto to register
such shares, then the Company shall use its best efforts to register under the
Securities Act on Form S-3 or any successor thereto for public sale in
accordance with the method of disposition specified in such notice, the number
of shares of Restricted Stock specified in such notice. Whenever the Company is
required by this Section 6 to use its best efforts to effect the registration of
Restricted Stock, each of the procedures and requirements of Section 4
(including but not limited to the requirement that the Company notify all
holders of Restricted Stock from whom notice has not been received and provide
them with the opportunity to participate in the offering) shall apply to such
registration; provided, however, that there shall be no limitation on the number
of registrations on Form S-3 which may be requested and obtained under this
Section 6 and registrations effected pursuant to this Section 6 shall not be
counted as demands for registration or registrations effected pursuant to
Sections 4 or 5, respectively.
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(b) Notwithstanding anything to the contrary set forth in this
Agreement, the Company's obligation under this Agreement to register Restricted
Stock under the Securities Act on registration statements ("Registration
Statements") may, upon the reasonable determination of the Board of Directors
made not more than twice in the aggregate (and not more than once with respect
to a Registration Statement on Form S-1 and not more than once with respect to a
Registration Statement on Form S-3 and including any delay pursuant to the last
sentence of Section 4(a)) during any 12-month period, be suspended in the event
and during such period as unforeseen circumstances (including without limitation
(i) an underwritten primary offering by the Company (which includes no secondary
offering) if the Company is advised in writing by its underwriters that the
registration of the Restricted Stock would have a material adverse effect on the
Company's offering, or (ii) pending negotiations relating to, or consummation
of, a transaction or the occurrence of an event which would require additional
disclosure of material information by the Company in Registration Statements or
such other filings, as to which the Company has a bona fide business purpose for
preserving confidentiality or which renders the Company unable to comply with
the Commission's requirements) exist (such unforeseen circumstances being
hereinafter referred to as a "Suspension Event") which would make it impractical
or unadvisable for the Company to file the Registration Statements or such other
filings or to cause such to become effective. Such suspension shall continue
only for so long as such event is continuing but in no event for a period longer
than (i) one hundred and twenty (120) days, in the case of a Registration
Statement on Form S-1 (or any successor thereto) or (ii) ninety (90) days, in
the case of a Registration Statement on Form S-3 (or any successor thereto). The
Company shall notify the Purchasers of the existence and nature of any
Suspension Event.
7. Registration Procedures. If and whenever the Company is required by
the provisions of Sections 4, 5 or 6 to use its best efforts to effect the
registration of any shares of Restricted Stock under the Securities Act, the
Company will, as expeditiously as possible:
(a) prepare and file with the Commission a registration statement
(which, in the case of an underwritten public offering pursuant to
Section 4, shall be on Form S-1 or other form of general applicability
satisfactory to the managing underwriter selected as therein provided)
with respect to such securities and use its best efforts to cause such
registration statement to become and remain effective for the period
of the distribution contemplated thereby (determined as hereinafter
provided);
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration
statement effective for the period specified in paragraph (a) above
and comply with the provisions of the Securities Act with respect to
the disposition of all Restricted Stock covered by such registration
statement in accordance with the sellers' intended method of
disposition set forth in such registration statement for such period;
(c) furnish to each seller of Restricted Stock and to each
underwriter such number of copies of the registration statement and
each such amendment and supplement thereto (in each case including all
exhibits) and the prospectus included therein (including each
preliminary prospectus) as such persons reasonably may request in
order to facilitate the public sale or other disposition of the
Restricted Stock covered by such registration statement;
(d) use its best efforts to register or qualify the Restricted
Stock covered by such registration statement under the securities or
"blue sky" laws of such jurisdictions as the sellers of Restricted
Stock or, in the case of an underwritten public offering, the managing
underwriter reasonably shall request; provided, however, that the
Company shall not for any such purpose be required to qualify
generally to transact business as a foreign corporation in any
jurisdiction where it is not so qualified or to consent to general
service of process in any such jurisdiction;
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(e) use its best efforts to list the Restricted Stock covered by
such registration statement with any securities exchange on which the
Common Stock of the Company is then listed;
(f) immediately notify each seller of Restricted Stock and each
underwriter under such registration statement, at any time when a
prospectus relating thereto is required to be delivered under the
Securities Act, of the happening of any event of which the Company has
knowledge as a result of which the prospectus contained 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 light of the circumstances then existing,
and promptly prepare and furnish to such seller a reasonable number of
copies of a prospectus supplemented or amended so that, as thereafter
delivered to the purchasers of such Restricted Stock, such prospectus
shall not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading in light of the
circumstances then existing;
(g) if the offering is underwritten and at the request of any
seller of Restricted Stock, use its best efforts to furnish on the
date that Restricted Stock is delivered to the underwriters for sale
pursuant to such registration: (i) an opinion dated such date of
counsel representing the Company for the purposes of such
registration, addressed to the underwriters and to such seller, to
such effect as reasonably may be requested by counsel for the
underwriters, and (ii) a letter dated such date from the independent
public accountants retained by the Company, addressed to the
underwriters and to such seller, stating that they are independent
public accountants within the meaning of the Securities Act and that,
in the opinion of such accountants, the financial statements of the
Company included in the registration statement or the prospectus, or
any amendment or supplement thereof, comply as to form in all material
respects with the applicable accounting requirements of the Securities
Act, and such letter shall additionally cover such other financial
matters (including information as to the period ending no more than
five business days prior to the date of such letter) with respect to
such registration as such underwriters reasonably may request;
(h) make available for inspection by each seller of Restricted
Stock, any underwriter participating in any distribution pursuant to
such registration statement, and any attorney, accountant or other
agent retained by such seller or underwriter, reasonable access to all
financial and other records, pertinent corporate documents and
properties of the Company, as such parties may reasonably request, and
cause the Company's officers, directors and employees to supply all
information reasonably requested by any such seller, underwriter,
attorney, accountant or agent in connection with such registration
statement;
(i) cooperate with the selling holders of Restricted Stock and
the managing underwriters, if any, to facilitate the timely
preparation and delivery of certificates representing Restricted Stock
to be sold, such certificates to be in such denominations and
registered in such names as such holders or the managing underwriters
may request at least two business days prior to any sale of Restricted
Stock; and
(j) permit any holder of Restricted Stock which holder, in
the sole and exclusive judgment, exercised in good faith, of such
holder, might be deemed to be a controlling person of the Company, to
participate in good faith in the preparation of such registration or
comparable statement and to require the insertion therein of
material, furnished to the Company in writing, which in the
reasonable judgment of such holder and its counsel should be included
and to permit any other holder of Restricted Stock participating in
the registration to review such registration or comparable statement
during its preparation.
For purposes of Section 7(a) and 7(b) and of Section 4(c), the period of
distribution of Restricted Stock in a firm commitment underwritten public
offering shall be deemed to extend until each underwriter has completed the
distribution of all securities purchased by it, and the period of distribution
of Restricted Stock in any other registration shall be deemed to extend until
the earlier of the sale of all Restricted Stock covered thereby and 180 days
after the effective date thereof.
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In connection with each registration hereunder, the sellers of
Restricted Stock will furnish to the Company in writing such information
requested by the Company with respect to themselves and the proposed
distribution by them as reasonably shall be necessary in order to assure
compliance with federal and applicable state securities laws and to make the
registration statement correct, accurate and complete in all respects with
respect to such sellers; provided, however, that this requirement shall not be
deemed to limit any disclosure obligation arising out of any seller's
relationship to the Company if one of such seller's agents or affiliates is an
officer, director or control person of the Company. In addition, the sellers
shall, if requested by the Company, execute such other agreements, which are
reasonably satisfactory to them and which shall contain such provisions as may
be customary and reasonable in order to accomplish the registration of the
Restricted Stock.
In connection with each registration pursuant to Sections 4, 5 or 6
covering an underwritten public offering, the Company and each seller agree to
enter into a written agreement with the managing underwriter selected in the
manner herein provided in such form and containing such provisions as are
customary in the securities business for such an arrangement between such
underwriter and companies of the Company's size and investment stature.
8. Expenses. All expenses incurred by the Company in complying with
Sections 4, 5 and 6, including, without limitation, all registration and filing
fees, printing expenses, fees and disbursements of counsel and independent
public accountants for the Company, fees and expenses (including counsel fees)
incurred in connection with complying with state securities or "blue sky" laws,
fees and expenses of one counsel for the selling holders of Restricted Stock in
connection with the registration of Restricted Stock, fees of the National
Association of Securities Dealers, Inc., transfer taxes, fees of transfer agents
and registrars, costs of any insurance which might be obtained, but excluding
any Selling Expenses, are called "Registration Expenses." All underwriting
discounts and selling commissions applicable to the sale of Restricted Stock and
the fees and expenses of more than one counsel for the selling holders of
Restricted Stock in connection with the registration of Restricted Stock are
called "Selling Expenses."
The Company will pay all Registration Expenses incurred in connection
with each of the first five Registration Statements filed pursuant to Sections
4, 5 or 6. All Selling Expenses incurred in connection with each of the first
five Registration Statements filed pursuant to Sections 4, 5 or 6, and all
Selling Expenses and Registration Expenses incurred in connection with each
Registration Statement filed pursuant to Sections 4, 5 or 6 thereafter, shall be
borne by the participating sellers in proportion to the number of shares sold by
each, or by such participating sellers other than the Company (except to the
extent the Company shall be a seller) as they may agree.
9. Indemnification.
(a) To the extent permitted by law, in the event of a
registration of any of the Restricted Stock under the Securities Act
pursuant to Sections 4, 5 or 6, the Company will indemnify and hold
harmless each holder of Restricted Stock, its partners, members,
officers and directors, each underwriter of such Restricted Stock
thereunder and each other person, if any, who controls such seller or
underwriter within the meaning of the Securities Act, against any
losses, claims, damages or liabilities, joint or several, to which
such holder, officer, director, underwriter or controlling person may
become subject under the Securities Act, Exchange Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon (i) any untrue
statement or alleged untrue statement of any material fact contained
in any registration statement under which such Restricted Stock was
registered under the Securities Act pursuant to Sections 4, 5 or 6,
any preliminary prospectus (but only to the extent not corrected in
the final prospectus) or final prospectus contained therein, or any
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amendment or supplement thereof, (ii) any blue sky application or
other document executed by the Company specifically for that purpose
or based upon written information furnished by the Company filed in
any state or other jurisdiction in order to qualify any or all of the
Restricted Stock under the securities laws thereof (any such
application, document or information herein called a "Blue Sky
Application"), (iii) the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, (iv) any violation by the Company
or its agents of any rule or regulation promulgated under the
Securities Act or Exchange Act applicable to the Company or its agents
and relating to action or inaction required of the Company in
connection with such registration, or (v) any failure to register or
qualify the Restricted Stock in any state where the Company or its
agents has affirmatively undertaken or agreed in writing that the
Company (the undertaking of any underwriter chosen by the Company
being attributed to the Company) will undertake such registration or
qualification on the seller's behalf (provided that in such instance
the Company shall not be so liable if it has undertaken its best
efforts to so register or qualify the Restricted Stock) and will
reimburse each such holder, and such partner, member, officer and
director, each such underwriter and each such controlling person for
any legal or other expenses reasonably incurred by them in connection
with investigating or defending any such loss, claim, damage,
liability or action as such expenses are incurred; provided, however,
that the Company will not be liable in any such case if and to the
extent that any such loss, claim, damage or liability arises out of or
is based upon an untrue statement or alleged untrue statement or
omission or alleged omission so made in conformity with information
furnished by any such seller, any such underwriter or any such
controlling person in writing specifically for use in such
registration statement, prospectus or Blue Sky Application.
(b) To the extent permitted by law, in the event of a
registration of any of the Restricted Stock under the Securities Act
pursuant to Sections 4, 5 or 6, each seller of such Restricted Stock
thereunder, severally and not jointly, will indemnify and hold
harmless the Company, each person, if any, who controls the Company
within the meaning of the Securities Act, each officer of the Company
who signs the registration statement, each director of the Company,
each other holder of Restricted Stock, each underwriter and each
person who controls any underwriter within the meaning of the
Securities Act, against all losses, claims, damages or liabilities,
joint or several, to which the Company or such officer, director,
other seller, underwriter or controlling person may become subject
under the Securities Act, Exchange Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the registration statement
under which such Restricted Stock was registered under the Securities
Act pursuant to Sections 4, 5 or 6, any preliminary prospectus (but
only to the extent not corrected in the final prospectus) or final
prospectus contained therein, or any amendment or supplement thereof,
or any Blue Sky Application or arise out of or are based upon the
omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, and will reimburse the Company and each such officer,
director, other seller, underwriter and controlling person for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or
action; provided, however, that such seller will be liable hereunder
in any such case if and only to the extent that any such loss, claim,
damage or liability arises out of or is based upon an untrue statement
or alleged untrue statement or omission or alleged omission made in
reliance upon and in conformity with information pertaining to such
seller, as such, furnished in writing to the Company by such seller
specifically for use in such registration statement, prospectus or
Blue Sky Application; and provided, further, however, that the
liability of each seller hereunder shall be limited to the proportion
of any such loss, claim, damage, liability or expense which is equal
to the proportion that the public offering price of the shares sold by
such seller under such registration statement bears to the total
public offering price of all securities sold thereunder, but not in
any event to exceed the net proceeds received by such seller from the
sale of Restricted Stock covered by such registration statement.
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(c) Promptly after receipt by an indemnified party hereunder of
notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the
indemnifying party hereunder, notify the indemnifying party in writing
thereof, but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to such
indemnified party other than under this Section 9 and shall only
relieve it from any liability which it may have to such indemnified
party under this Section 9 if and to the extent the indemnifying party
is prejudiced by such omission. In case any such action shall be
brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party
shall be entitled to participate in and, to the extent it shall wish,
to assume and undertake 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 and
undertake the defense thereof, the indemnifying party shall not be
liable to such indemnified party under this Section 9 for any legal
expenses subsequently incurred by such indemnified party in connection
with the defense thereof other than reasonable costs of investigation
and of liaison with counsel so selected; provided, however, that, if
the defendants in any such action include both the indemnified party
and the indemnifying party and the indemnified party shall have
reasonably concluded that the interests of the indemnified party
reasonably may be deemed to conflict with the interests of the
indemnifying party, the indemnified party shall have the right to
select a separate counsel and to assume such legal defenses and
otherwise to participate in the defense of such action, with the
expenses and fees of such separate counsel and other expenses related
to such participation to be reimbursed by the indemnifying party as
incurred. No indemnifying party, in the defense of any such claim or
litigation shall, except with the consent of each indemnified party,
consent to entry of any judgment or enter into any settlement which
does not include as an unconditional term thereof the giving by the
claimant or plaintiff to such indemnified party of a release from all
liability in respect of such claim or litigation, and no indemnified
party shall consent to entry of any judgment or settle such claim or
litigation without the prior written consent of the indemnifying
party, which consent shall not be unreasonably withheld.
(d) If the indemnification provided for in this Section 9 is held
by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any losses, claims, damages or
liabilities referred to herein, the indemnifying party, in lieu of
indemnifying such indemnified party thereunder, shall to the extent
permitted by applicable law contribute to the amount paid or payable
by such indemnified party as a result of such loss, claim, damage or
liability 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 violation that resulted in
such loss, claim, damage or liability, as well as any other relevant
equitable considerations. The relative fault of the indemnifying party
and of the indemnified party shall be determined by a court of law by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission; provided, however, that
in no event shall any contribution by a holder of Restricted Stock
hereunder, when combined with amounts paid or payable pursuant to
Section 9(b), exceed the net proceeds from the offering received by
such holder.
(e) The obligations of the Company and holders of Restricted
Stock under this Section 9 shall survive completion of any offering of
Restricted Stock by a registration statement and the termination of
this Agreement.
9
10. Changes in Common Stock, Series F Preferred Stock, Series G
Preferred Stock, Series I Preferred Stock or Series J Preferred Stock. If, and
as often as, there is any change in the Common Stock, Series F Preferred Stock,
Series G Preferred Stock, Series I Preferred Stock or Series J Preferred Stock
by way of a stock split, stock dividend, combination or reclassification, or
through a merger, consolidation, reorganization or recapitalization, or by any
other means, appropriate adjustment shall be made in the provisions hereof so
that the rights and privileges granted hereby shall continue with respect to the
Common Stock, Series F Preferred Stock, Series G Preferred Stock, Series I
Preferred Stock or Series J Preferred Stock as so changed.
11. Rule 144 Reporting. With a view to making available the benefits of
certain rules and regulations of the Commission which may at any time permit the
sale of the Restricted Stock to the public without registration, at all times
after any registration statement covering a public offering of securities of the
Company under the Securities Act shall have become effective, the Company agrees
to:
(a) make and keep public information available, as those terms
are understood and defined in Rule 144 under the Securities Act;
(b) use its best efforts to 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
(c) furnish to each holder of Restricted Stock forthwith upon
request a written statement by the Company as to its compliance with
the reporting requirements of such Rule 144 and of the Securities Act
and the Exchange Act, a copy of the most recent annual or quarterly
report of the Company, and such other reports and documents so filed
by the Company as such holder may reasonably request in availing
itself of any rule or regulation of the Commission allowing such
holder to sell any Restricted Stock without registration.
12. Representations and Warranties of the Company. The Company
represents and warrants to you as follows:
(a) The execution, delivery and performance of this Agreement by
the Company have been duly authorized by all requisite corporate
action and will not violate any provision of law, any order of any
court or other agency of government, the articles of organization or
By-laws of the Company or any provision of any indenture, agreement or
other instrument to which it or any or its properties or assets is
bound, conflict with, result in a breach of or constitute (with due
notice or lapse of time or both) a default under any such indenture,
agreement or other instrument or result in the creation or imposition
of any lien, charge or encumbrance of any nature whatsoever upon any
of the properties or assets of the Company.
(b) This Agreement has been duly executed and delivered by the
Company and constitutes the legal, valid and binding obligation of the
Company, enforceable in accordance with its terms.
13. Miscellaneous.
(a) All covenants and agreements contained in this Agreement by
or on behalf of any of the parties hereto shall bind and inure to the
benefit of the respective successors and assigns of the parties hereto
(including without limitation transferees of any Preferred Stock or
Restricted Stock), whether so expressed or not; provided, however,
that registration rights conferred herein on the holders of Preferred
Stock or Restricted Stock shall only inure to the benefit of a
transferee of Preferred Stock or Restricted Stock if (i) there is
transferred to such transferee at least twenty five percent (25%) of
the shares of Restricted Stock (appropriately adjusted for any
subdivision or combination) originally issued to a Purchaser, (ii)
such transferee is a member, former member, partner, retired partner,
family member or trust for the benefit of any individual holder,
stockholder or affiliate of a party hereto or (iii) such transferee
acquires at least 2,500,000 shares (appropriately adjusted for any
subdivision or combination) of Preferred Stock; provided, further,
however, that the Company is given written notice thereof.
10
(b) All notices, requests, consents and other communications
hereunder shall be in writing and shall be mailed by certified or
registered mail, return receipt requested, postage prepaid, or by
recognized overnight delivery service of international reputation or,
in the case of non-U.S. residents, telexed or sent by recognized
overnight delivery service of international reputation or, addressed
as follows:
If to the Company, to:
Cogent Communications Group, Inc.
0000 00xx Xxxxxx, X.X.
Xxxxxxxxxx, XX 00000,
Attention: Xxxxxx Xxxxx
with copies to:
Xxxxxx & Xxxxxxx, LLP
000 Xxxxxxxx Xx., X.X., Xxxxx 0000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxx XxXxxxxxx
If to any other party hereto, to their respective addresses set forth on
Schedule I hereto;
If to any subsequent holder of Preferred Stock or Restricted Stock, to
it at such address as may have been furnished to the Company in writing by such
holder;
or, in any case, at such other address or addresses as shall have been
furnished in writing to the Company (in the case of a holder of Preferred Stock
or Restricted Stock) or to the holders of Preferred Stock or Restricted Stock
(in the case of the Company) in accordance with the provisions of this
paragraph.
(c) This Agreement shall be construed and enforced in accordance
with and governed by the laws of the State of New York, without
reference to its conflict of laws provisions.
(d) This Agreement may not be amended or modified, and no
provision hereof may be waived, without the written consent of the
Company and the holders of at least two-thirds of the outstanding
shares of Restricted Stock. Notwithstanding the foregoing, no such
amendment or modification shall be effective if and to the extent that
such amendment or modification either (a) creates any additional
affirmative obligations to be complied with by any or all of the
Purchasers or (b) grants to any one or more Purchasers any rights more
favorable than any rights granted to all other Purchasers or otherwise
treats any one or more Purchasers differently than all other
Purchasers.
(e) This Agreement may be executed in two or more counterparts,
each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.
(f) If requested in writing by the underwriters for the first
underwritten public offering of securities of the Company after the
date hereof, each holder of Restricted Stock who is a party to this
Agreement shall agree not to sell publicly any shares of Restricted
Stock or any other shares of Common Stock (other than shares of
Restricted Stock or other shares of Common Stock being registered in
such offering or any shares purchased in the open market after the
Company's public offering), without the consent of such underwriters,
for a period of not more than 180 days following the consummation of
such public offering; provided, however, that all holders of at least
one percent (1%) of the then outstanding Common Stock and all officers
and directors of the Company shall also have agreed not to sell
publicly their Common Stock under the circumstances and pursuant to
the terms set forth in this Section 13(f).
11
(g) If any provision of this Agreement shall be held to be
illegal, invalid or unenforceable, such illegality, invalidity or
unenforceability shall attach only to such provision and shall not in
any manner affect or render illegal, invalid or unenforceable any
other provision of this Agreement, and this Agreement shall be carried
out as if any such illegal, invalid or unenforceable provision were
not contained herein.
(h) Upon and after the Closing (as defined in the Merger
Agreement), this Agreement shall amend and restate in its entirety the
Third Amended and Restated Registration Rights Agreement, dated July
31, 2003, by and among the Company and the other parties thereto (the
"Prior Registration Rights Agreement"), the parties hereto constitute
the Company and the holders of at least two-thirds of the outstanding
shares of Restricted Stock (as defined in the Prior Registration
Rights Agreement) immediately prior to the execution of this
Agreement.
(i) After the date of this Agreement, the Company shall not,
without the prior written consent of the holders of at least
two-thirds of the Restricted Stock then outstanding, enter into any
agreement with any holder or prospective holder of any securities of
the Company that would grant such holder registration rightspari passu
or senior to those granted to the holders hereunder, other than a
registration related to stock issued upon conversion of debt
securities assumed by the Company in connection with its acquisition
of Allied Riser Communications Corporation.
(j) All registration rights granted under Sections 4, 5, and 6
shall terminate and be of no further force and effect upon the earlier
of (i) three (3) years after the date the Company first effects a
registration pursuant to Section 4 or (ii) five (5) years from the
date hereof. In addition, the registration rights of a holder of
Restricted Stock shall expire if all Restricted Stock held by and
issuable to such holder (and its affiliates) may be sold under Rule
144 during any ninety (90) day period.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
12
Please indicate your acceptance of the foregoing by signing and
returning the enclosed counterpart of this letter, whereupon this Agreement
shall be a binding agreement between the Company and you.
Very truly yours,
COGENT COMMUNICATIONS GROUP, INC.
By: /s/ XXXXX XXXXXXXXX
---------------------------------------
By: Xxxxx Xxxxxxxxx
Its: President and Chief Executive Officer
13
BNP EUROPE TELECOM & MEDIA FUND II, LP
By:
/s/ XXXXXX XXXXXXXXX AND XXXXXXXX XXXXXXXXX
--------------------------------------------------------------------------
Name: Xxxxxx Xxxxxxxxx and Xxxxxxxx Xxxxxxxxx
Title: Authorized Signatories
By:
General Business, Finance and Investment Ltd., its General Partner
By: Commerce Advisory Services Ltd, as Director and Partnership Secretary
NATIO VIE DEVELOPPEMENT 3, FCPR
By:
/s/ XXXX-XXXXXXX XXXXXXXX
--------------------------------------------------------------------------
Name: Xxxx-Xxxxxxx Xxxxxxxx
Title: Authorized Signatory
14
OAK INVESTMENT PARTNERS IX, LIMITED PARTNERSHIP
By:
Oak Associates IX, LLC, its General Partner
By:
/s/ XXXXXX XXXXXXXXXX
--------------------------------------------------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Managing Member
OAK IX AFFILIATES FUND, LIMITED PARTNERSHIP
By:
Oak IX Affiliates, LLC, its General Partner
By:
/s/ XXXXXX XXXXXXXXXX
--------------------------------------------------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Managing Member
OAK IX AFFILIATES FUND-A, LIMITED PARTNERSHIP
By:
Oak Associates IX, LLC, its General Partner
By:
/s/ XXXXXX XXXXXXXXXX
--------------------------------------------------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: Managing Member
15
JERUSALEM VENTURE PARTNERS III, L.P.
By:
Jerusalem Partners III, L.P., its General Partner
By: Jerusalem Venture Partners Corporation, its General Partner
By:
/s/ XXXX XXXXXXXX
--------------------------------------------------------------------------
Name: Xxxx Xxxxxxxx
JERUSALEM VENTURE PARTNERS III (ISRAEL), L.P.
By:
Jerusalem Venture Partners III (Israel) Management Company Ltd.,
its General Partner
By: Jerusalem Venture Partners Corporation, its General Partner
By:
/s/ XXXX XXXXXXXX
--------------------------------------------------------------------------
Name: Xxxx Xxxxxxxx
JERUSALEM VENTURE PARTNERS ENTREPRENEURS FUND III, L.P.
By:
Jerusalem Partners III, L.P., its General Partner
By: Jerusalem Venture Partners Corporation, its General Partner
By:
/s/ XXXX XXXXXXXX
--------------------------------------------------------------------------
Name: Xxxx Xxxxxxxx
00
XXXXXXXXX VENTURE PARTNERS IV, L.P.
By:
Jerusalem Partners IV, L.P., its General Partner
By: JVP Corp IV, its General Partner
By:
/s/ XXXX XXXXXXXX
--------------------------------------------------------------------------
Name: Xxxx Xxxxxxxx
JERUSALEM VENTURE PARTNERS IV (Israel), L.P.
By:
Jerusalem Partners IV--Venture Capital, L.P., its General Partner
By: JVP Corp IV, its General Partner
By:
/s/ XXXX XXXXXXXX
--------------------------------------------------------------------------
Name: Xxxx Xxxxxxxx
JERUSALEM VENTURE PARTNERS IV-A, L.P.
By:
Jerusalem Partners IV, L.P., its General Partner
By: JVP Corp IV, its General Partner
By:
/s/ XXXX XXXXXXXX
--------------------------------------------------------------------------
Name: Xxxx Xxxxxxxx
JERUSALEM VENTURE PARTNERS ENTREPRENEURS FUND IV, L.P.
By:
Jerusalem Partners IV, L.P., its General Partner
By: JVP Corp IV, its General Partner
By:
/s/ XXXX XXXXXXXX
--------------------------------------------------------------------------
Name: Xxxx Xxxxxxxx
17
WORLDVIEW TECHNOLOGY PARTNERS III, L.P.
WORLDVIEW TECHNOLOGY INTERNATIONAL III, L.P.
WORLDVIEW STRATEGIC PARTNERS III, L.P.
WORLDVIEW III CARRIER FUND, L.P.
By:
Worldview Capital III, L.P., its General Partner
By: Worldview Equity I, L.L.C., its General Partner
By:
/s/ XXXXX XXXXXX
--------------------------------------------------------------------------
Name: Xxxxx Xxxxxx
WORLDVIEW TECHNOLOGY PARTNERS IV, L.P.
WORLDVIEW TECHNOLOGY INTERNATIONAL IV, L.P.
WORLDVIEW STRATEGIC PARTNERS IV, L.P.
By:
Worldview Capital IV, L.P., its General Partner
By: Worldview Equity I, L.L.C., its General Partner
By:
/s/ XXXXX XXXXXX
--------------------------------------------------------------------------
Name: Xxxxx Xxxxxx
18
BROADVIEW CAPITAL PARTNERS L.P.
By:
Broadview Capital Partners Management LLC, its General Partner
By:
/s/ XXXXXX X. XXXXXX
---------------------------------------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
BROADVIEW CAPITAL PARTNERS QUALIFIED PURCHASER FUND L.P.
By:
Broadview Capital Partners Management LLC, its General Partner
By:
/s/ XXXXXX X. XXXXXX
--------------------------------------------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Managing Director
19
BOULDER VENTURES IV, L.P.
By:
/s/ XXXXXX X. XXXXX
--------------------------------------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: General Partner
BOULDER VENTURES IV (ANNEX), L.P.
By:
/s/ XXXXXX X. XXXXX
--------------------------------------------------------------------------
Name: Xxxxxx X. Xxxxx
Title: General Partner
20
NAS PARTNERS I L.L.C.
By:
Nassau Capital LLC, its General Partner
By:
/s/ XXXXXXX X. HACK
--------------------------------------------------------------------------
Name: Xxxxxxx X. Hack
Title: Sr. Managing Partner
NASSAU CAPITAL PARTNERS IV L.P.
By:
Nassau Capital LLC, its General Partner
By:
/s/ XXXXXXX X. HACK
--------------------------------------------------------------------------
Name: Xxxxxxx X. Hack
Title: Sr. Managing Partner
21
By: /s/ XXXXX XXXXXXXXX
--------------------------------------------------------------------------
Xxxxx Xxxxxxxxx
22
