EX-10.9
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REGISTRATION RIGHTS AGREEMENT
among
PEAPOD, INC.,
and
KONINKLIJKE AHOLD N.V.
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Dated as of
April 14, 2000
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TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS..................................................1
Section 1.1. Definitions..................................................1
ARTICLE II REGISTRATION RIGHTS..........................................4
Section 2.1. Shelf Registration...........................................4
Section 2.2. Demand Registration..........................................4
Section 2.3. Piggy-Back Registration......................................5
Section 2.4. Reduction of Offering........................................6
ARTICLE III REGISTRATION PROCEDURES......................................8
Section 3.1. Filings; Information.........................................8
Section 3.2. Registration Expenses.......................................13
ARTICLE IV INDEMNIFICATION AND CONTRIBUTION............................13
Section 4.1. Indemnification by the Company..............................13
Section 4.2. Indemnification by Holders of Registrable Securities........14
Section 4.3. Conduct of Indemnification Proceedings......................15
Section 4.4. Contribution................................................16
ARTICLE V MISCELLANEOUS...............................................17
Section 5.1. Participation in Underwritten Registrations.................17
Section 5.2. Distribution................................................17
Section 5.3. SEC Reporting...............................................17
Section 5.4. Restrictions on Sale........................................18
Section 5.5. Notices.....................................................18
Section 5.6. Governing Law...............................................19
Section 5.7. Entire Agreement............................................20
Section 5.8. Modifications and Amendments................................20
Section 5.9. Waivers and Extensions......................................20
Section 5.10. Titles and Headings.........................................20
Section 5.11. Assignment..................................................20
Section 5.12. Severability................................................21
Section 5.13. Counterparts................................................21
Section 5.14. Further Assurances..........................................21
Section 5.15. Remedies Cumulative; Specific Performance...................21
Section 5.16. Other Registration Rights...................................21
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made
as of April 14, 2000, by and among Peapod, Inc., a Delaware corporation (the
"Company"), and Koninklijke Ahold N.V., a public company with limited liability
incorporated under the laws of the Netherlands (the "Purchaser").
NOW, THEREFORE, the parties hereto hereby agree as follows.
ARTICLE I
DEFINITIONS
Section 1.1. Definitions. As used in this Agreement, the following terms
shall have the following meanings:
"Additional Piggy-Back Holder" shall mean XxXxxx Group, L.P.
"Affiliate" shall mean, with respect to any person, any other person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified person and, in the case of a person who is an
individual, shall include (i) members of such specified person's immediate
family (as defined in Instruction 2 of Item 404(a) of Regulation S-K under the
Securities Act) and (ii) trusts, the trustee and all beneficiaries of which are
such specified person or members of such person's immediate family as determined
in accordance with the foregoing clause (i). For the purposes of this
definition, "control," when used with respect to any person means the power to
direct the management and policies of such person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "affiliated," "controlling" and "controlled" have meanings
correlative to the foregoing. Notwithstanding the foregoing, for purposes of
this Agreement, the Purchaser and its Affiliates shall not be deemed Affiliates
of the Company.
"Agreement" shall have the meaning set forth in the Preamble.
"Commission" shall mean the United States Securities and Exchange
Commission.
"Common Stock" shall mean the common stock, par value $.01 per share, of
the Company.
"Company" shall have the meaning set forth in the Preamble.
"Demanding Holder" shall have the meaning set forth in Section 2.2.
"Demand Notice" shall have the meaning set forth in Section 2.2.
"Demand Registration" shall have the meaning set forth in Section 2.2.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"Final Closing" shall have the meaning set forth in the Purchase Agreement.
"Holder" shall mean (i) the Purchaser, as the beneficial owner of
Registrable Securities and (ii) any other person (a) that is the beneficial
owner of Registrable Securities, and (b) to whom the registration rights set
forth herein have been assigned in accordance with Section 5.11; provided, that
a person shall be deemed the beneficial owner of Registrable Securities if that
person has the right to acquire such Registrable Securities, whether or not such
acquisition has been effected and disregarding any legal restrictions upon the
exercise of such right.
"Initiating Holders" shall have the meaning set forth in Section 2.2.
"Minimum Effective Period" shall mean (i) in the case of the Shelf
Registration, as long as Holders hold any of the Registrable Securities, and
(ii) in the case of a Demand Registration, a period of at least one hundred
eighty (180) days beyond the effective date thereof (or, in either case, such
shorter period as is required to complete the distribution of the Registrable
Securities included in such registration statement).
"NASD" shall have the meaning set forth in Section 3.1.
"Notices" shall have the meaning set forth in Section 5.5.
"Outside Date" shall mean the date that is one hundred and twenty (120)
days after the date hereof or, if the Purchaser exercises any Warrants and as a
direct result of such exercise, the Stockholders Meeting (as defined in the
Purchase Agreement) is delayed, one hundred and twenty (120) days plus the
number of days of such delay after the date hereof.
"person" shall mean any individual, partnership, corporation, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof, or other entity.
"Piggy-Back Registration" shall have the meaning set forth in Section 2.3.
"Piggy-Back Holders" shall have the meaning set forth in Section 2.3.
"Preemptive Rights" shall mean the rights of holders of Series B Preferred
Stock to purchase securities pursuant to Section 9 of the Certificate of
Designations relating to the Series B Preferred Stock.
"Purchaser" shall have the meaning set forth in the Preamble.
"Purchase Agreement" shall mean the purchase agreement, dated as of April
14, 2000, by and between the Company and the Purchaser.
"Registrable Securities" shall mean (i) shares of Series B Preferred Stock
and Warrants issued and sold by the Company to the Purchaser pursuant to the
Purchase Agreement, (ii) any securities acquired by the Purchaser pursuant to
the exercise of its Preemptive Rights, (iii) shares of Common Stock or any other
security received or receivable upon conversion or exercise of any Registrable
Securities, (iv) any security received or receivable as a dividend or other
distribution with respect to any Registrable Securities, (v) any security
received in exchange for or in replacement of any Registrable Securities, (vi)
any security issued or issuable with respect to any Registrable Securities as a
result of a change or reclassification of Registrable Securities or any capital
reorganization of the Company, and (vii) any security received or receivable by
a holder in respect of Registrable Securities as a result of a merger or
consolidation of the Company; provided, however, that "Registrable Securities"
shall not include (a) any securities sold to the public pursuant to a
registration statement or Rule 144 under the Securities Act or any similar rule
promulgated by the Commission thereunder, or (b) any securities sold in a
private transaction in which the transferor's rights hereunder are not assigned
in accordance with the requirements of Section 5.11; provided further, that the
Company shall have no obligation to register those Registrable Securities of the
Holder with respect to which the Company delivers to the Holder an opinion of
counsel reasonably satisfactory to such Holder and its counsel to the effect
that the proposed sale or disposition of such Registrable Securities for which
registration was requested does not require registration under the Securities
Act and may be sold pursuant to Rule 144(k) under the Securities Act (or any
successor provision thereto).
"register," "registered" and "registration" shall refer to a registration
of securities effected by preparing and filing a registration statement in
compliance with the Securities Act and the effectiveness of such registration
statement.
"Securities Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Selling Holder" means a Holder who sells or proposes to sell Registrable
Securities pursuant to any registration statement provided for in this
Agreement.
"Series B Preferred Stock" shall mean the Series B Convertible Preferred
Stock, par value $.01 per share, of the Company.
"Shares" shall mean, collectively, the Common Stock, the Series B Preferred
Stock and the Warrants. Whenever this Agreement refers to a number or percentage
of Shares, such number or percentage shall be calculated as if, immediately
prior to such calculation, all shares of Series B Preferred Stock had been
converted into, and all Warrants had been exercised for, shares of Common Stock
in accordance with their terms, regardless of the existence of any restrictions
on such conversion or exercise.
"Shelf Registration" shall have the meaning set forth in Section 2.1.
"Warrants" shall mean the warrants to purchase Common Stock issued pursuant
to the Purchase Agreement.
ARTICLE II
REGISTRATION RIGHTS
Section 2.1. Shelf Registration. Within forty-five (45) days of delivery of
a written notice by Holders of more than 50% of the Registrable Securities which
notice may be delivered at any time after the earlier to occur of (a) the Final
Closing or (b) the termination of the Purchase Agreement, the Company shall
prepare and file a shelf registration statement (the "Shelf Registration") on
Form S-3, or such other form as the Company may at the time be eligible to use
for the registration of securities under the Securities Act providing for the
sale by the Holders of all of their Registrable Securities then outstanding, and
all Registrable Securities issuable thereafter. The Company may include in the
Shelf Registration shares of Common Stock sold for the account of the Company,
but no other person.
Section 2.2. Demand Registration.
(a) Request for Registration. At any time, and from time to time, the
Holders of more than fifty percent (50%) of any type, class or series of
Registrable Securities then outstanding shall have the right, by written notice
(a "Demand Notice") delivered to the Company, to require the Company to register
("Demand Registration") Registrable Securities having an aggregate offering
price to the public in excess of $5,000,000; provided, however, that (i) (x)
until the earlier to occur of the Outside Date or the date of the consummation
of the Final Closing, the Holders of Registrable Securities shall not have any
right to demand a Demand Registration, (y) in the period commencing on the
Outside Date and ending on the date of the consummation of the Final Closing, if
the Final Closing occurs, the Holders of Registrable Securities shall have the
right to demand four (4) Demand Registrations, and (z) at any time after the
consummation of the Final Closing, the Holders of Registrable Securities shall
have the right to demand an unlimited number of Demand Registrations, and (ii)
the Company shall not be required to effect a Demand Registration if within six
(6) months prior to the date of such Demand Notice a Demand Registration
pursuant to this Section 2.2(a) shall have been declared or ordered effective by
the Commission. The Holders who deliver a Demand Notice (the "Initiating
Holders") shall specify in the Demand Notice the number and type, class or
series of Registrable Securities to be registered and the intended methods of
disposition thereof.
The Company shall give written notice of any Demand Notice within ten (10)
days after the receipt thereof, to each Holder other than the Initiating
Holders. Within twenty (20) days after receipt of such notice, any such Holder
may request in writing that its Registrable Securities be included in such
registration, and the Company shall include in the Demand Registration the
Registrable Securities of all such Holders who request to be so included
(together with the Initiating Holders, the "Demanding Holders"), subject to the
provisions of Section 2.4. Each such request shall specify the number of
Registrable Securities proposed to be sold and the intended method of
disposition thereof.
(b) Effective Registration. A registration will be deemed to have been
effected as a Demand Registration if it has been declared effective by the
Commission and the Company has complied in all material respects with its
obligations under this Agreement with respect thereto; provided that a Demand
Registration will not be deemed to have been effected, and the Company shall
continue to be obligated to effect an additional Demand Registration, if (i)
after such registration has become effective, the offering of Registrable
Securities pursuant to such registration is or becomes the subject of any stop
order, injunction or other order or requirement of the Commission or any other
governmental or administrative agency (for any reason other than the acts or
omissions of the Demanding Holders), (ii) any court prevents or otherwise limits
the sale of Registrable Securities pursuant to such registration (for any reason
other than the acts or omissions of the Demanding Holders), (iii) such
registration does not remain effective for the Minimum Effective Period, (iv) an
event specified in clause (v), (vi) or (vii) of Section 3.1(d) occurs that
results in a delay of an underwritten offering and, as a direct result of such
delay, the managing underwriter(s) determine that the Registrable Securities
cannot be sold at the originally anticipated offering price, or (v) after an
event specified in clause (vi) of Section 3.1(d) occurs, Selling Holders
determine to withdraw a majority of the Registrable Securities previously
included in such registration.
(c) Withdrawal. The Demanding Holders may withdraw all or any part of their
Registrable Securities from a Demand Registration at any time (whether before or
after the filing or effective date of such Demand Registration) and, if all such
Registrable Securities are withdrawn, may withdraw the demand related thereto.
If a registration statement is filed pursuant to a Demand Registration, and
subsequently a sufficient number of Registrable Securities are withdrawn from
the Demand Registration so that such registration statement does not cover at
least the required amount specified by Section 2.2(a), the Company may (or
shall, if requested by the Demanding Holders) withdraw the registration
statement and if such registration statement is withdrawn prior to the
consummation of the Final Closing, it will count as a Demand Registration;
provided that if the Demanding Holders bear the expenses associated with such
withdrawn registration statement, such registration statement will not count as
a Demand Registration and the Company shall continue to be obligated to effect
an additional Demand Registration. If the Demanding Holders determine to bear
such expenses, such expenses shall be borne ratably by the Demanding Holder(s)
whose withdrawal of Registrable Securities resulted in such registration
statement not covering the specified required amounts.
(d) Selection of Underwriter. If the Demanding Holders so elect, the
offering of Registrable Securities pursuant to a Demand Registration shall be in
the form of an underwritten offering. The majority of the Demanding Holders
shall select one or more nationally recognized firms of investment bankers to
act as the book-running managing underwriter or underwriters in connection with
such offering and shall select any additional investment bankers and managers to
be used in connection with the offering; provided that such investment bankers
and managers must be reasonably satisfactory to the Company.
Section 2.3. Piggy-Back Registration. If the Company proposes to file a
registration statement (a "Piggy-Back Registration") under the Securities Act
with respect to an offering or other sale of equity securities by the Company
for its own account or for the account of any holders of any class of its equity
securities (other than (i) a Demand Registration, (ii) a registration statement
on Form S-4 or S-8 (or any substitute form that may be adopted by the
Commission), or (iii) a registration statement filed in connection with an
exchange offer or offering of securities solely to the Company's existing
securityholders), then the Company shall give written notice of such proposed
filing to the Holders as soon as practicable, in any event at least thirty (30)
days before the anticipated filing date, and such notice shall offer each Holder
the opportunity to include in such registration such number of Registrable
Securities as such Holder may request (which request shall specify the
Registrable Securities intended to be disposed of by such Holder and the
intended method of distribution thereof). Such Holders shall have twenty (20)
days after receipt of such notice from the Company to make such request. All
Holders requesting inclusion in the Piggy-Back Registration are referred to
herein as "Piggy-Back Holders".
Any Holder shall have the right to withdraw its request for inclusion of
its Registrable Securities in any Piggy-Back Registration by giving written
notice to the Company of its request to withdraw prior to the date on which the
registration statement becomes effective. The Company may withdraw a Piggy-Back
Registration at any time prior to the time it becomes effective, provided that
the Company shall reimburse the Piggy-Back Holders for all reasonable
out-of-pocket expenses (including counsel fees and expenses) incurred prior to
such withdrawal.
No Piggy-Back Registration shall relieve the Company of its obligation to
effect any Demand Registration or a Shelf Registration, and no failure to effect
a Piggy-Back Registration or complete the sale of securities in connection
therewith shall relieve the Company of any other obligation under this Agreement
(including, without limitation, the Company's obligations under Sections 3.2 and
4.1).
Section 2.4. Reduction of Offering.
(a) Demand Registration. The Company may include in a Demand Registration
Registrable Securities for the account of the Demanding Holders and shares of
Common Stock for the account of the Company or other stockholders exercising
contractual piggy-back registration rights or other stockholders, on the same
terms and conditions as the Registrable Securities are included therein for the
account of the Demanding Holders; provided, however, that (i) if the managing
underwriter(s) of any underwritten offering that is the subject of such Demand
Registration have informed the Company in writing that in their opinion the
total number of securities that the Demanding Holders, the Company and any other
stockholders intend to include in such offering exceeds the number which can be
sold in such offering within a price range acceptable to the Holders of a
majority of the Registrable Securities requested to be included therein, then
(x) the number of Shares to be offered for the account of any stockholders other
than the Demanding Holders shall be reduced (to zero, if necessary) pro rata in
proportion to the respective number of Shares requested to be registered by such
stockholders, and (y) thereafter, if necessary, the number of Shares to be
offered for the account of the Company shall be reduced (to zero, if necessary),
to the extent necessary to reduce the total number of Shares requested to be
included in such offering to the number of Shares, if any, recommended by such
managing underwriter(s) (and if the number of Shares to be offered for the
account of stockholders other than the Demanding Holders and for the account of
the Company has been reduced to zero, and the number of Shares requested to be
included in such offering by the Demanding Holders exceeds the number of Shares
recommended by such managing underwriter(s), then the number of Shares to be
offered for the account of the Demanding Holders shall be reduced pro rata in
proportion to the respective number of Shares requested to be registered by the
Demanding Holders) and (ii) if the offering that is the subject of such Demand
Registration is not underwritten, only Demanding Holders, and no other party
(including the Company), shall be permitted to include securities in such Demand
Registration unless the Demanding Holders owning a majority of the Shares
included in such Demand Registration consent in writing to the inclusion of such
securities therein.
(b) Piggy-Back Registration.
(i) Notwithstanding anything to the contrary contained herein, if the
managing underwriter(s) of any underwritten offering that is the subject of a
Piggy-Back Registration have informed the Company in writing that in their
opinion the total number of Shares that the Company, the Piggy-Back Holders and
any other persons desiring to participate in such registration intend to include
in such offering exceeds the number which can be sold in such offering without
materially and adversely affecting the marketability of the offering, then (x)
the number of Shares to be offered for the account of all other persons (other
than the Company, the Piggy-Back Holders, the Additional Piggy-Back Holder and
any securityholder(s) for whom such registration constitutes an exercise of
their demand registration rights) that have requested to include Shares in such
registration shall be reduced (to zero, if necessary) pro rata in proportion to
the respective number of Shares requested to be included, (y) thereafter, if
necessary, the number of Shares to be offered for the account of the Company (if
any) shall be reduced (to zero, if necessary), and (z) thereafter, if necessary,
the number of Shares to be offered for the account of Piggy-Back Holders and
Additional Piggy-Back Holder shall be reduced (to zero, if necessary) pro rata
in proportion to the respective number of Shares requested to be included, to
the extent necessary to reduce the total number of Shares requested to be
included in such offering to the number of Shares, if any, that such managing
underwriter(s) believe can be included without materially and adversely
affecting the success of the offering; provided that, if such registration
contemplates an "over-allotment option" on the part of underwriters, to the
extent such over-allotment option is exercised and Holders of the Registrable
Securities were excluded from registering any of the Registrable Securities they
requested be included in such registration pursuant to the cutback provisions of
this Section 2.4(b), then the over-allotment option shall be fulfilled through
the registration and sale of such excluded Registrable Securities.
(ii) If the managing underwriter(s) of any underwritten offering that is
the subject of a Piggy-Back Registration notify the Company that the kind of
securities that the Piggy-Back Holders intend to include is such as to
materially and adversely affect the success of such offering, then (x) the
Company shall afford the Piggy-Back Holders the opportunity to exercise, convert
or exchange such securities for or into Common Stock concurrently with the
consummation of such offering and include such shares of Common Stock in such
offering, in which case such shares of Common Stock shall be included subject to
clause (i) above, and (y) if one or more Piggy-Back Holders do not so exercise,
convert or exchange such securities, such securities to be included in such
offering by such Piggy-Back Holders shall be reduced as described in clause (i)
above or if such reduction would, in the judgment of the managing
underwriter(s), be insufficient to substantially eliminate the adverse effect
that inclusion of such securities requested to be included would have on such
offering, such securities will be excluded from such offering.
ARTICLE III
REGISTRATION PROCEDURES
Section 3.1. Filings; Information. Whenever the Company is required to
effect or cause the registration of Registrable Securities pursuant to Section
2.1 or Section 2.2, the Company will use its reasonable best efforts to effect
the registration of such Registrable Securities in accordance with the intended
method of disposition thereof as quickly as practicable, and in connection with
any such request:
(a) The Company will as expeditiously as possible prepare and file
with the Commission a registration statement on any form for which the
Company then qualifies or which counsel for the Company shall deem
appropriate and which form shall be available for the sale of the
Registrable Securities to be registered thereunder in accordance with the
intended method of distribution thereof, and use its reasonable best
efforts to cause such filed registration statement to become and remain
effective for the Minimum Effective Period; provided, however, that the
Company may postpone the filing of a registration statement, or suspend
sales under an effective shelf registration statement, for a period of not
more than thirty (30) days if the Company furnishes to each Selling Holder
a certificate signed by the Chairman of the Board stating that in the good
faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its stockholders for the Company
to file a registration statement, or permit sales to be made under an
effective shelf registration statement, at such time because (i) it would
interfere with any proposed or pending material transaction or (ii) the
Company would be required to disclose material non-public information that
the Company has a bona fide business purpose for not disclosing; provided,
further, that the Company shall only be entitled to postpone a filing or
suspend sales once in any twelve-month period. If the Company postpones the
filing of a registration statement, or suspends sales under an effective
shelf registration statement, it shall promptly notify the Holders in
writing when the events or circumstances permitting such postponement or
suspension have ended. In the event of any suspension of sales under any
registration statement pursuant to this Section 3.1(a), the Company shall
extend the period during which such registration statement shall be
maintained effective by the number of days in such suspension period.
(b) The Company will promptly 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 continuously effective (subject to paragraph (a) and
the penultimate paragraph of this Section 3.1) for the Minimum Effective
Period and comply with the provisions of the Securities Act with respect to
the disposition of all securities covered by such registration statement
during such period in accordance with the intended methods of disposition
by each Selling Holder included in such registration statement.
(c) The Company will, at least fifteen (15) days prior to filing a
registration statement or prospectus or any amendment or supplement
thereto, furnish to each Selling Holder, counsel representing such Selling
Holders, and each underwriter, if any, of the Registrable Securities
covered by such registration statement copies of such registration
statement as proposed to be filed, together with exhibits thereto, which
documents will be subject to review and comment by the foregoing as
promptly as practicable, but in any event within ten (10) days after
delivery, and thereafter furnish to such Selling Holder, counsel and
underwriter, if any, for their review and comment such number of copies of
such registration statement, each amendment and supplement thereto (in each
case, including all exhibits thereto and documents incorporated by
reference therein), the prospectus included in such registration statement
(including each preliminary prospectus) and such other documents or
information as such Selling Holder, counsel or underwriter may reasonably
request in order to facilitate the disposition of the Registrable
Securities owned by such Selling Holder.
(d) After the filing of the registration statement, the Company will
promptly notify each Selling Holder of Registrable Securities covered by
such registration statement, and confirm such notice in writing, (i) when a
prospectus or any prospectus supplement or post- effective amendment has
been filed and, with respect to a registration statement or any post-
effective amendment, when the same has become effective, (ii) of any
request by the Commission or any other Federal or state governmental
authority for amendments or supplements to a registration statement or
related prospectus or for additional information, (iii) of the issuance by
the Commission or any other Federal or state governmental authority of any
stop order suspending the effectiveness of a registration statement or any
order preventing or suspending the use of any prospectus or the initiation
of any proceedings for that purpose, (iv) if, at any time when a prospectus
is required by the Securities Act to be delivered in connection with sales
of the Registrable Securities, the representations and warranties of the
Company contained in any agreement contemplated by Section 3.1(h)
(including any underwriting agreement) cease to be true and correct in any
material respect, (v) of the receipt by the Company of any notification
with respect to the suspension of the qualification or exemption from
qualification of any of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such
purpose, and (vi) of the happening of any event which makes any statement
made in such registration statement or related prospectus or any document
incorporated or deemed to be incorporated therein by reference untrue in
any material respect or which requires the making of any changes in a
registration statement, prospectus or documents incorporated therein by
reference so that, in the case of the registration statement, it will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading, and that, in the case of the prospectus,
it will not contain any untrue statement of a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. After the filing
of the registration statement, the Company will promptly furnish to each
Selling Holder and the managing underwriter, without charge, at least one
signed copy of the registration statement.
(e) The Company will use its reasonable best efforts to (i) register
or qualify the Registrable Securities under such other securities or blue
sky laws of such jurisdictions in the United States as any Selling Holder,
the managing underwriters, if any, or their respective counsel reasonably
(in light of such Selling Holder's intended plan of distribution) request,
and (ii) cause such Registrable Securities to be registered with or
approved by such other governmental agencies or authorities in the United
States as may be necessary by virtue of the business and operations of the
Company and do any and all other acts and things that may be reasonably
necessary or advisable to enable such Selling Holder to consummate the
disposition of the Registrable Securities owned by such Selling Holder;
provided that the Company will not be required to (A) qualify generally to
do business in any jurisdiction where it would not otherwise be required to
qualify but for this paragraph (e) or (B) subject itself to taxation in any
such jurisdiction or (C) consent to general service of process in any such
jurisdiction.
(f) The Company will promptly use its reasonable best efforts to
prevent the entry, or obtain the withdrawal, of any order suspending the
effectiveness of a registration statement, or the lifting of any suspension
of the qualification (or exemption from qualification) of any Registrable
Securities for sale in any jurisdiction.
(g) Upon the occurrence of any event contemplated by clause (vi) of
Section 3.1(d), the Company will (i) promptly prepare a supplement or
post-effective amendment to such registration statement or a supplement to
the related prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable Securities being sold thereunder, such
prospectus will not contain 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, in light of the circumstances under which they were
made, not misleading, and (ii) promptly make available to each Selling
Holder any such supplement or amendment.
(h) The Company will enter into customary agreements (including, if
applicable, an underwriting agreement in customary form) and take such
other actions as are reasonably required in order to expedite or facilitate
the disposition of such Registrable Securities. All of the representations,
warranties and covenants of the Company to or for the benefit of such
underwriters shall also be made to and for the benefit of such Selling
Holders. None of such agreements shall increase the potential liability of
the Selling Holders beyond that otherwise provided in Article IV of this
Agreement.
(i) The Company will make available to each Selling Holder (and will
deliver to their counsel) and each underwriter, if any, copies of all
correspondence between the Commission and the Company, its counsel or
auditors and will also make available for inspection by any Selling Holder,
any underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other professional
retained by any such Selling Holder or underwriter (collectively, the
"Inspectors"), all financial and other records, pertinent corporate
documents and properties of the Company (collectively, the "Records") as
shall be reasonably necessary to enable them to exercise their due
diligence responsibility, and cause the Company's officers and employees to
supply all information reasonably requested by any Inspectors in connection
with such registration statement. Records which the Company determines, in
good faith, to be confidential and which it notifies the Inspectors are
confidential shall not be disclosed by the Inspectors unless (i) the
disclosure of such Records is necessary to avoid or correct a misstatement
or omission in such registration statement or (ii) the disclosure or
release of such Records is requested or required pursuant to oral
questions, interrogatories, requests for information or documents or a
subpoena or other order from a court of competent jurisdiction or other
process; provided that prior to any disclosure or release pursuant to
clause (ii), the Inspectors shall provide the Company, to the extent
possible, with prompt notice of any such request or requirement so that the
Company may seek an appropriate protective order or waive such Inspectors'
obligation not to disclose such Records; and, provided further, that if
failing the entry of a protective order or the waiver by the Company
permitting the disclosure or release of such Records, the Inspectors, upon
advice of counsel, are compelled to disclose such Records, the Inspectors
may disclose that portion of the Records which counsel has advised the
Inspectors that the Inspectors are compelled to disclose. Each Selling
Holder agrees that information obtained by it solely as a result of such
inspections (not including any information obtained from a third party who,
insofar as is known to the Selling Holder after reasonable inquiry, is not
prohibited from providing such information by a contractual, legal or
fiduciary obligation to the Company) shall be deemed confidential and shall
not be used by it as the basis for any market transactions in the
securities of the Company or its Affiliates unless and until such
information is made generally available to the public other than as a
result of disclosure by such Selling Holder in breach of this provision.
Each Selling Holder further agrees that it will, upon learning that
disclosure of such Records is sought in a court of competent jurisdiction,
give notice to the Company and allow the Company, at its expense, to
undertake appropriate action to prevent disclosure of the Records deemed
confidential.
(j) In the case of an underwritten offering, the Company will furnish
to each Selling Holder and to each underwriter, a signed counterpart,
addressed to such Selling Holder or underwriter, of (i) an opinion or
opinions of outside counsel to the Company, and (ii) a comfort letter or
comfort letters from the Company's independent certified public accountants
(and if necessary, any other independent certified public accountants of
any subsidiary of the Company or of any business acquired by the Company
for which financial statements and/or financial data are, or are required
to be, included in the registration statement), each in customary form and
covering such matters of the type customarily covered by opinions or
comfort letters, as the case may be, as the Selling Holders or the managing
underwriter therefor reasonably requests.
(k) The Company will otherwise use its reasonable best efforts to
comply with all applicable rules and regulations of the Commission, and
make available to its securityholders, as soon as reasonably practicable,
an earnings statement covering a period of 12 months, beginning on the
first day of any fiscal quarter next succeeding the effective date of the
registration statement, which earnings statement shall cover such twelve
month period and shall satisfy the provisions of Section 11(a) of the
Securities Act.
(l) If requested by the Selling Holders owning a majority of the
Shares that constitute Registrable Securities included in such registration
statement, the Company will use its reasonable best efforts (a) to cause
any class of Registrable Securities to be listed on a national securities
exchange (if such securities are not already so listed) and on each
additional national securities exchange on which similar securities issued
by the Company are then listed (if any), if the listing of such Registrable
Securities is then permitted under the rules of such exchange or (b) to
secure designation of all such Registrable Securities covered by such
registration statement as a NASDAQ "national market system security" within
the meaning of Rule 11Aa2-1 of the Commission or, failing that, to secure
NASDAQ authorization for such Registrable Securities and, without limiting
the generality of the foregoing, to arrange for at least two market makers
to register as such with respect to such Registrable Securities with the
National Association of Securities Dealers, Inc. (the "NASD").
(m) In connection with an underwritten offering, the Company will
participate, to the extent reasonably requested by the managing underwriter
for the offering or the Selling Holders, in customary efforts to sell the
securities under the offering, including, without limitation, participating
in "road shows"; provided that the Company shall not be obligated so to
participate in more than one such offering pursuant to a Shelf Registration
or a Demand Registration in any 12-month period.
The Company may require each Selling Holder to promptly furnish in writing
to the Company such information regarding the distribution of the Registrable
Securities by such Selling Holder as the Company may from time to time
reasonably request and such other information as may be legally required in
connection with such registration including, without limitation, all such
information as may be requested by the Commission or the NASD. The Company may
exclude from such registration any Holder who fails to provide such information.
Each Selling Holder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in clauses (iii),
(v) and (vi) of Section 3.1(d), such Selling Holder will forthwith discontinue
disposition of Registrable Securities pursuant to the registration statement
covering such Registrable Securities until such Selling Holder's receipt of the
copies of the supplemented or amended prospectus contemplated by Section 3.1(g),
and, if so directed by the Company, such Selling Holder will deliver to the
Company (at the Company's expense) all copies, other than permanent file copies,
then in such Selling Holder's possession of the most recent prospectus covering
such Registrable Securities at the time of receipt of such notice. In the event
the Company shall give such notice, the Company shall extend the period during
which such registration statement shall be maintained effective by the number of
days during the period from and including the date of the giving of notice
pursuant to clause (iii), (v) or (vi) of Section 3.1(d) to the date when the
Company shall make available to the Selling Holders a prospectus supplemented or
amended to conform with the requirements of Section 3.1(g).
In connection with any Piggy-Back Registration that includes Registrable
Securities, the Company will take the actions contemplated by paragraphs (c),
(d), (e), (f), (g), (i), (j), (k) and (l) above.
Section 3.2. Registration Expenses. In connection with the Shelf
Registration, every Demand Registration and every Piggy-Back Registration that
includes Registrable Securities, the Company shall pay the following
registration expenses incurred in connection with such registration (the
"Registration Expenses"): (i) all registration and filing fees, (ii) fees and
expenses of compliance with securities or blue sky laws and of determination of
eligibility of the Registrable Securities for investment under the laws of such
jurisdiction as the managing underwriters or Holders of a majority of the
Registrable Securities being sold may designate (including reasonable fees and
disbursements of counsel in connection therewith), (iii) printing expenses
(including printing certificates for the Registrable Securities to be sold and
the prospectuses), messenger and delivery expenses, duplication, word
processing, and telephone expenses, (iv) the Company's internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties, the expenses of any annual
audit or quarterly review, the expense of any liability insurance) and all fees
and expenses incident to the performance of or compliance with this Agreement by
the Company, (v) the fees and expenses incurred in connection with the listing
of the Registrable Securities, (vi) fees and disbursements of counsel for the
Company and fees and expenses for independent certified public accountants
retained by the Company (including the expenses of any comfort letters or costs
associated with the delivery by independent certified public accountants of a
comfort letter or comfort letters requested pursuant to Section 3.1(j)),
reasonable fees and disbursements of all underwriters (excluding discounts,
commissions or fees of underwriters, selling brokers, dealer managers or similar
securities industry professionals relating to the distribution of the
Registrable Securities), (vii) the fees and expenses of any special experts
retained by the Company in connection with such registration, (viii) reasonable
fees and expenses of one firm of counsel for the Holders, which counsel shall be
chosen by Holders of a majority of the Shares included in such registration
statement, and (ix) fees and disbursements of any transfer agent for the
Registrable Securities. The Company shall have no obligation to pay any
underwriting fees, discounts or commissions attributable to the sale of
Registrable Securities.
ARTICLE IV
INDEMNIFICATION AND CONTRIBUTION
Section 4.1. Indemnification by the Company. The Company agrees to
indemnify, to the fullest extent permitted by law, and hold harmless each
Selling Holder, its partners, officers, directors, employees and agents, and
each person, if any, who controls such Selling Holder within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act, together
with the partners, officers, directors, employees and agents of such controlling
person (collectively, the "Controlling Persons"), from and against any loss,
claim, damage, liability, reasonable attorneys' fee, cost or expense and costs
and expenses (including, without limitation, costs of preparation and attorneys'
fees and disbursements) of investigating and defending any such claim
(collectively, the "Damages"), joint or several, and any action in respect
thereof to which such Selling Holder, its partners, officers, directors,
employees or agents, or any such Controlling Person may become subject under the
Securities Act or otherwise, insofar as such Damages (or proceedings in respect
thereof) arise out of, or are based upon, any untrue statement or alleged untrue
statement of a material fact contained in any registration statement or
prospectus relating to the Registrable Securities or any preliminary prospectus,
or any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as the same are based upon information furnished in writing to
the Company by a Selling Holder or underwriter expressly for use therein, and
shall reimburse each Selling Holder, its partners, officers, directors,
employees and agents, and each such Controlling Person for any legal and other
expenses reasonably incurred by that Selling Holder, its partners, officers,
directors, employees and agents, or any such Controlling Person in investigating
or defending or preparing to defend against any such Damages or proceedings;
provided, however, that the Company shall not be liable to any Selling Holder to
the extent that (a) any such Damages arise out of or are based upon an untrue
statement or omission made in any preliminary prospectus if (i) such offering
does not involve an underwriter, (ii) such Selling Holder was informed by the
Company of such untrue statement or omission and such Selling Holder was
provided copies of the final prospectus by the Company and was informed by the
Company of the correction therein of the untrue statement or omission, but such
Selling Holder failed to send or deliver a copy of the final prospectus with or
prior to the delivery of written confirmation of the sale by such Selling Holder
to the person asserting the claim from which such Damages arise, and (iii) the
final prospectus would have corrected such untrue statement or such omission; or
(b) any such Damages arise out of or are based upon an untrue statement or
omission in any prospectus if (i) such offering does not involve an underwriter,
(ii) such untrue statement or omission is corrected in an amendment or
supplement to such prospectus, and (iii) such Selling Holder was informed by the
Company of such untrue statement or omission and, having previously been
furnished by or on behalf of the Company with copies of such prospectus as so
amended or supplemented sufficiently prior to the sale of Registrable Securities
and informed by the Company of the correction therein of the untrue statement or
omission, such Selling Holder thereafter fails to deliver such prospectus as so
amended or supplemented prior to or concurrently with the sale of a Registrable
Security to the person asserting the claim from which such Damages arise. The
Company also agrees to indemnify any underwriters, selling brokers, dealer
managers and similar securities industry professionals participating in the
distribution of the Registrable Securities, their respective officers and
directors and each person who controls such underwriters on substantially the
same basis as that of the indemnification of the Selling Holders provided in
this Section 4.1.
Section 4.2. Indemnification by Holders of Registrable Securities. Each
Selling Holder agrees, severally but not jointly, to indemnify and hold harmless
the Company, its officers, directors, employees and agents and each person, if
any, who controls the Company within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act, together with the partners, officers,
directors, employees and agents of such controlling person, to the same extent
as the foregoing indemnity from the Company to such Selling Holder, but only
with reference to information related to such Selling Holder, or its plan of
distribution, furnished in writing by such Selling Holder or on such Selling
Holder's behalf expressly for use in any registration statement or prospectus
relating to such Selling Holder's Registrable Securities, or any amendment or
supplement thereto, or any preliminary prospectus. In case any action or
proceeding shall be brought against the Company or its officers, directors,
employees or agents or any such controlling person or its partners, officers,
directors, employees or agents, in respect of which indemnity may be sought
against such Selling Holder, such Selling Holder shall have the rights and
duties given to the Company, and the Company or its officers, directors,
employees or agents, controlling person, or its partners, officers, directors,
employees or agents, shall have the rights and duties given to such Selling
Holder, under Section 4.1. Each Selling Holder also agrees to indemnify and hold
harmless each other Selling Holder and any underwriters of the Registrable
Securities, and their respective officers and directors and each person who
controls each such other Selling Holder or underwriter on substantially the same
basis as that of the indemnification of the Company provided in this Section
4.2. The Company shall be entitled to receive indemnities from underwriters,
selling brokers, dealer managers and similar securities industry professionals
participating in the distribution, to the same extent as provided above, with
respect to information so furnished in writing by such persons specifically for
inclusion in any prospectus or registration statement. In no event shall the
liability of any Selling Holder be greater in amount than the dollar amount of
the net proceeds received by such Selling Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
Section 4.3. Conduct of Indemnification Proceedings. Promptly after receipt
by any person in respect of which indemnity may be sought pursuant to Section
4.1 or 4.2 (an "Indemnified Party") of notice of any claim or the commencement
of any action, the Indemnified Party shall, if a claim in respect thereof is to
be made against the person against whom such indemnity may be sought (an
"Indemnifying Party"), notify the Indemnifying Party in writing of the claim or
the commencement of such action, provided that the failure to notify the
Indemnifying Party shall not relieve it from any liability except to the extent
that the Indemnifying Party is materially prejudiced as a result of such
failure. If any such claim or action shall be brought against an Indemnified
Party, and it shall notify the Indemnifying Party thereof, the Indemnifying
Party shall be entitled to participate therein, and, to the extent that it
wishes, jointly with any other similarly notified Indemnifying Party, to assume
the defense thereof with counsel reasonably satisfactory to the Indemnified
Party; provided, that the Indemnifying Party acknowledges, in a writing in form
and substance reasonably satisfactory to such Indemnified Party, such
Indemnifying Party's liability for all Damages of such Indemnified Party to the
extent specified in, and in accordance with, this Article IV. After notice from
the Indemnifying Party to the Indemnified Party of its election to assume the
defense of such claim or action, the Indemnifying Party shall not be liable to
the Indemnified Party for any legal or other expenses subsequently incurred by
the Indemnified Party in connection with the defense thereof other than
reasonable costs of investigation; provided that the Indemnified Party shall
have the right to employ separate counsel to represent the Indemnified Party and
its controlling persons who may be subject to liability arising out of any claim
in respect of which indemnity may be sought by the Indemnified Party against the
Indemnifying Party, but the fees and expenses of such counsel shall be for the
account of such Indemnified Party unless (i) the Indemnifying Party and the
Indemnified Party shall have mutually agreed to the retention of such counsel or
(ii) in the reasonable judgment of such Indemnified Party, representation of
both parties by the same counsel would be inappropriate due to actual or
potential conflicts of interest between them, it being understood, however, that
the Indemnifying Party shall not, in connection with any one such claim or
action or separate but substantially similar or related claims or actions in the
same jurisdiction arising out of the same general allegations or circumstances,
be liable for the fees and expenses of more than one separate firm of attorneys
(together with appropriate local counsel) at any time for all Indemnified
Parties. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any claim or pending or threatened
proceeding in respect of which the Indemnified Party is or could have been a
party and indemnity could have been sought hereunder by such Indemnified Party,
unless such settlement includes an unconditional release of such Indemnified
Party from all liability arising out of such claim or proceeding. Whether or not
the defense of any claim or action is assumed by the Indemnifying Party, such
Indemnifying Party will not be subject to any liability for any settlement made
without its consent, which consent will not be unreasonably withheld.
Section 4.4. Contribution. If the indemnification provided for in this
Article IV is unavailable to the Indemnified Parties in respect of any Damages
referred to herein, then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Damages (i) as between the Company and the
Selling Holders, on the one hand, and the underwriters, on the other, in such
proportion as is appropriate to reflect the relative benefits received by the
Company and the Selling Holders, on the one hand, and the underwriters, on the
other, from the offering of the Registrable Securities, or if such allocation is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits but also the relative fault of the Company and
the Selling Holders, on the one hand, and of the underwriters, on the other, in
connection with the statements or omissions which resulted in such Damages, as
well as any other relevant equitable considerations, and (ii) as between the
Company, on the one hand, and each Selling Holder, on the other, in such
proportion as is appropriate to reflect the relative fault of the Company and of
each Selling Holder in connection with such statements or omissions, as well as
any other relevant equitable considerations. The relative benefits received by
the Company and the Selling Holders, on the one hand, and the underwriters, on
the other, shall be deemed to be in the same proportion as the total proceeds
from the offering (net of underwriting discounts and commissions but before
deducting expenses) received by the Company and the Selling Holders bear to the
total underwriting discounts and commissions received by the underwriters, in
each case, as set forth in the table on the cover page of the prospectus. The
relative fault of the Company and the Selling Holders, on the one hand, and of
the underwriters, on the other, shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company and the Selling Holders or by the underwriters. The
relative fault of the Company, on the one hand, and of each Selling Holder, on
the other, shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by such party,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Selling Holders agree that it would not be just and
equitable if contribution pursuant to this Section 4.4 were determined by pro
rata allocation (even if the Selling Holders were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an Indemnified Party as a result of the Damages
referred to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such Indemnified Party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 4.4, no underwriter shall be required to contribute any amount in excess
of the amount by which the total price at which the Registrable Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any Damages which such underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission, and no Selling Holder shall be required to contribute any
amount in excess of the amount by which the total price at which the Registrable
Securities of such Selling Holder were offered to the public (less underwriting
discounts and commissions) exceeds the amount of any Damages which such Selling
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. Each Selling Holder's obligation to contribute
pursuant to this Section 4.4 is several and not joint.
The indemnity, contribution and expense reimbursement obligations contained
in this Article IV are in addition to any liability any Indemnifying Party may
otherwise have to an Indemnified Party or otherwise. The provisions of this
Article IV shall survive, notwithstanding any transfer of the Registrable
Securities by any Holder or any termination of this Agreement.
ARTICLE V
MISCELLANEOUS
Section 5.1. Participation in Underwritten Registrations. No person may
participate in any underwritten registration hereunder unless such person (a)
agrees to sell such person's securities on the basis provided in any
underwriting arrangements approved by the persons entitled hereunder to approve
such arrangements, and (b) timely completes and executes all questionnaires,
indemnities, underwriting agreements and other documents reasonably required
under the terms of such underwriting arrangements and this Agreement; provided
that (i) no Selling Holder shall be required to make any representations or
warranties except those which are customary for a selling holder of securities,
and (ii) the liability of each Selling Holder to any underwriter under such
underwriting agreement will be limited to liability arising from material
misstatements or omissions in the relevant registration statement or the
relevant prospectus regarding such Selling Holder and its intended method of
distribution that were based upon information furnished in writing by such
Selling Holder to the Company expressly for use therein and any such liability
shall not exceed an amount equal to the amount of net proceeds such Selling
Holder derives from such registration.
Section 5.2. Distribution. During such time as any Selling Holder may be
engaged in a distribution (within the meaning of Regulation M promulgated under
the Exchange Act) of the Registrable Securities, such Selling Holder shall
comply with Regulation M and pursuant thereto it shall, among other things; (i)
not engage in any stabilization activity in connection with the securities of
the Company in contravention of such regulation.
Section 5.3. SEC Reporting.
(a) Rules 144 and 144A. The Company shall timely file any reports required
to be filed by it under the Securities Act and the Exchange Act and, if at any
time the Company is not required to file such reports, the Company will, upon
the request of any Holder or prospective purchaser from such Holder, make
available such information necessary to permit sales pursuant to Rule 144A, and
shall take such further action as any Holder may reasonably request, all to the
extent required from time to time to enable Holders to sell Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by (a) Rule 144 or Rule 144A under the Securities
Act, as such Rules may be amended from time to time, or (b) any similar rule or
regulation hereafter adopted by the Commission. Upon the request of any Holder,
the Company will deliver to such Holder a written statement as to whether it has
complied with such requirements.
(b) S-3 Eligibility. The Company shall use its best efforts to maintain its
eligibility to use Form S-3 under the Securities Act.
Section 5.4. Restrictions on Sale.
(a) By the Company. The Company agrees, and shall use its best efforts to
cause its Affiliates to agree, (i) not to effect any public sale or distribution
of any equity securities, or any securities convertible into or exchangeable or
exercisable for such securities, during the 7 days prior to, and during the
90-day period beginning on, the effective date of any registration statement
(except as part of such registration statement) filed by the Company, in the
case of an underwritten offering, if, and to the extent, reasonably requested by
the managing underwriter or underwriters, and (ii) to use its best efforts to
ensure that any agreement entered into after the date hereof pursuant to which
the Company issues or agrees to issue any privately placed securities (other
than to officers or employees) shall contain a provision under which holders of
such securities agree not to effect any sale or distribution of any such
securities during the periods described in (i) above, in each case, including a
sale pursuant to Rule 144 or Rule 144A under the Securities Act (except as part
of any such registration, if permitted); provided, however, that the provisions
of this paragraph shall not prevent (x) the conversion or exchange of any
securities pursuant to their terms into or for other securities or (y) the
issuance of any securities to employees of the Company or pursuant to any
employee plan.
(b) By the Holders. Each Holder agrees, and shall use its best efforts to
cause its Affiliates to agree, not to effect any public sale or distribution of
any equity securities, or any securities convertible into or exchangeable or
exercisable for such securities, during the 7 days prior to, and during the
90-day period beginning on, the effective date of any registration statement
(except as part of such registration statement) filed by the Company, in the
case of an underwritten offering if, and to the extent, reasonably requested by
the managing underwriter(s); provided that all executive officers and directors
of the Company agree to similar restrictions, which the Company will use its
reasonable best efforts to enforce and provided further that the Company informs
such Holder of the expected effective date at least fifteen (15) days prior
thereto. Notwithstanding the provisions of the preceding sentence, a Holder may
sell any or all of its Registrable Securities in a private sale.
Section 5.5. Notices. All notices, demands, requests, consents, approvals
or other communications (collectively, "Notices") required or permitted to be
given hereunder or which are given with respect to this Agreement shall be in
writing and shall be personally served, delivered by a reputable air courier
service with tracking capability, with charges prepaid, or transmitted by hand
delivery or facsimile, addressed as set forth below, or to such other address as
such party shall have specified most recently by written notice. Notice shall be
deemed given on the date of service or transmission if personally served or
transmitted by facsimile. Notice otherwise sent as provided herein shall be
deemed given on the next business day following delivery of such notice to a
reputable air courier service.
If to the Company, to it at:
Peapod, Inc.
0000 Xxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxxxx, Chairman
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Sidley & Austin
Bank One Plaza
00 Xxxxx Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxxxx X. Xxxxx
Facsimile: (000) 000-0000
if to the Purchaser:
Koninklijke Ahold N.V.
Xxxxxx Xxxxxxxx 0
0000 XX Xxxxxxx, Xxx Xxxxxxxxxxx
Attention: Ton van Tielraden, Esq.
Facsimile: (00-00) 000-0000
and a copy (which shall not constitute notice) to:
White & Case LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq./Xxxx X. Xxxxx, Esq.
Facsimile: (000) 000-0000
If to any other Holder, to it at the address(es) or facsimile number(s) set
forth in the notice referred to in Section 5.11 with respect to such
Holder.
Section 5.6. Governing Law. This Agreement and the rights and obligations
of the parties hereunder shall be governed by, and construed in accordance with,
the laws of the State of New York, and each party hereto submits to the
non-exclusive jurisdiction of the state and federal courts within the County of
New York in the State of New York. Any legal action or proceeding with respect
to this Agreement may be brought in the courts of the State of New York or of
the United States of America for the Southern District of New York and, by
execution and delivery of this Agreement, each party hereto hereby accepts for
itself and in respect of its property, generally and unconditionally, the
jurisdiction of the aforesaid courts. Each party hereto further irrevocably
consents to the service of process out of any of the aforementioned courts in
any action or proceeding by the mailing of copies thereof by registered or
certified mail, postage prepaid, to such party at its address set forth in
Section 5.5, such service to become effective seven days after such mailing.
Nothing herein shall affect the right of either party to serve process in any of
the matters permitted by law or to commence legal proceedings or otherwise
proceed against the other party in any other jurisdiction. Each party hereto
hereby irrevocably waives any objection which it may now or hereafter have to
the laying of venue of any of the aforesaid actions or proceedings arising out
of or in connection with this Agreement brought in the courts referred to above
and hereby further irrevocably waives and agrees not to plead or claim in any
such court that any such action or proceeding brought in any such court has been
brought in an inconvenient forum.
Section 5.7. Entire Agreement. This Agreement (including all agreements
entered into pursuant hereto and all certificates and instruments delivered
pursuant hereto and thereto) constitutes the entire agreement of the parties
with respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements, representations, understandings, negotiations and
discussions between the parties, whether oral or written, with respect to the
subject matter hereof, including, without limitation, the Letter Agreement.
Section 5.8. Modifications and Amendments. No amendment, modification or
termination of this Agreement shall be binding upon any other party unless
executed in writing by (a) the Company and (b) by the Holders of a majority of
the Shares held by all Holders that constitute Registrable Securities.
Section 5.9. Waivers and Extensions. Any party to this Agreement may waive
any right, breach or default which such party has the right to waive, provided
that such waiver will not be effective against the waiving party unless it is in
writing, is signed by such party, and specifically refers to this Agreement.
Waivers may be made in advance or after the right waived has arisen or the
breach or default waived has occurred. Any waiver may be conditional. No waiver
of any breach of any agreement or provision herein contained shall be deemed a
waiver of any preceding or succeeding breach thereof nor of any other agreement
or provision herein contained. No waiver or extension of time for performance of
any obligations or acts shall be deemed a waiver or extension of the time for
performance of any other obligations or acts.
Section 5.10. Titles and Headings. Titles and headings of sections of this
Agreement are for convenience only and shall not affect the construction of any
provision of this Agreement.
Section 5.11. Assignment. This Agreement and the rights, duties and
obligations hereunder may not be assigned or delegated by the Company. This
Agreement and the rights, duties and obligations hereunder may be assigned or
delegated by any Holder to a transferee or assignee of Registrable Securities;
provided, however, that the Company shall not be obligated to recognize any such
assignment or delegation, and such transferee or assignee shall not become a
Holder, unless (a) the Company has received written notice of the name and
address of such transferee or assignee and of the Registrable Securities with
respect to which such assignment and/or delegation has been made, and (b) such
transferee or assignee agrees to be bound by this Agreement as if such
transferee or assignee was an original Purchaser. This Agreement and the
provisions hereof shall be binding upon and shall inure to the benefit of each
of the parties and their respective successors and permitted assigns.
Section 5.12. Severability. This Agreement shall be deemed severable, and
the invalidity or unenforceability of any term or provision hereof shall not
affect the validity or enforceability of this Agreement or of any other term or
provision hereof. Furthermore, in lieu of any such invalid or unenforceable term
or provision, the parties hereto intend that there shall be added as a part of
this Agreement a provision as similar in terms to such invalid or unenforceable
provision as may be possible and be valid and enforceable.
Section 5.13. Counterparts. This Agreement may be executed in multiple
counterparts, each of which shall be deemed an original, and all of which taken
together shall constitute one and the same instrument.
Section 5.14. Further Assurances. Each party hereto, upon the request of
any other party hereto, shall take all such further acts and execute,
acknowledge and deliver all such further instruments and documents as may be
necessary or desirable to carry out the transactions contemplated by this
Agreement.
Section 5.15. Remedies Cumulative; Specific Performance. The remedies
provided herein shall be cumulative and shall not preclude the assertion by any
party hereto of any other rights or the seeking of any remedies against the
other party hereto. In the event of a breach or a threatened breach by any party
to this Agreement of its obligations under this Agreement, any party injured or
to be injured by such breach will be entitled to specific performance of its
rights under this Agreement or to injunctive relief, in addition to being
entitled to exercise all rights provided in this Agreement and granted by law.
The parties agree that the provisions of this Agreement shall be specifically
enforceable, it being agreed by the parties that the remedy at law, including
monetary damages, for breach of any such provision will be inadequate
compensation for any loss and that any defense or objection in any action for
specific performance or injunctive relief that a remedy at law would be adequate
is waived.
Section 5.16. Other Registration Rights. Without the written consent of the
Holders of a majority of the Shares held by all Holders that constitute
Registrable Securities, the Company shall not grant to any person the right to
request the Company to register any securities of the Company under the
Securities Act unless the rights so granted are subject to the prior rights of
the Holders of Registrable Securities set forth herein, and are not otherwise in
conflict or inconsistent with the provisions of, this Agreement.
* * *
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
PEAPOD, INC.
a Delaware corporation
By: ______________________________
Name: ______________________________
Title: ______________________________
KONINKLIJKE AHOLD N.V.
By: _____________________________
Name:
Title:
Nominee (if different than name of Purchaser): _______________
Securities to be Purchased at first Closing
_______ shares of Series B Preferred Stock
_______ Warrants
Securities to be Purchased at second Closing
_______ shares of Series B Preferred Stock
_______ Warrants
Securities to be Purchased at third Closing
_______ shares of Series B Preferred Stock
_______ Warrants
