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Exhibit 10.3
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made
as of September 18, 2000, by and between Inrange Technologies Corporation, a
Delaware corporation (the "Company") and General Signal Holdings Company, a
Delaware corporation ("SPX"). Notwithstanding the execution date hereof, this
Agreement shall become effective upon the date of the closing of the Initial
Public Offering (as defined below).
WHEREAS, the Company desires to become a public company in
order to access the public capital markets, facilitate making acquisitions, and
attract employees;
WHEREAS, in order to become a public company, the Company will
effect an initial public offering of Class B Common Stock, after which the
Company's parent, SPX, will own 100% of the issued and outstanding Class A
Common Stock, representing 90.8% of the issued and outstanding Common Stock; and
WHEREAS, as a condition to its agreement to effect the IPO,
SPX requires that the Company grant it registration rights with respect to its
shares of Common Stock.
ACCORDINGLY, the parties hereto agree as follows:
1. Definitions. As used herein, unless the context otherwise
requires, the following terms have the following respective meanings:
"Board" shall mean the Board of Directors of the Company.
"Certificate of Incorporation" means the Amended and Restated
Certificate of Incorporation of the Company, as it may be amended or restated
hereafter from time to time.
"Commission" means the Securities and Exchange Commission or
any other federal agency at the time administering the Securities Act.
"Class A Common Stock" means the Class A Common Stock, par
value $0.01 per share of the Company.
"Class B Common Stock" means the Class B Common Stock, par
value $0.01 per share of the Company.
"Common Stock" means the Class A Common Stock and the Class B
Common Stock, now or hereafter authorized to be issued, and any and all
securities of any kind whatsoever of the Company issued or issuable in respect
of such Common Stock which may be issued on or after the date hereof in respect
of, in exchange for, or upon
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conversion of shares of Common Stock pursuant to a merger, consolidation, stock
split, stock dividend, recapitalization of the Company or otherwise.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, 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. Reference
to a particular section of the Exchange Act shall include a reference to the
comparable section, if any, of any such similar Federal statute.
"Initial Public Offering" means the initial public offering by
the Company of shares of Class B Common Stock as contemplated by a registration
statement on Form S-1, as supplemented and amended from time to time.
"Initiating Holder" means SPX in its capacity as the Holder
which initiates a request for a Demand Registration pursuant to Section 2 or a
registration pursuant to Section 4; provided, however, that if SPX shall have
transferred any of its Registrable Securities, the "Initiating Holder" shall
mean, in the foregoing capacity, either (1) SPX or (2) Holders who in the
aggregate are Holders of greater than 50% of the Registrable Securities.
"Holder" means any Person holding Registrable Securities.
"Law" means any federal, state, local or foreign law, statute,
rule or regulation.
"Litigation" means any action, suit, proceeding,
investigation, inquiry or audit.
"Person" means a corporation, an association, a partnership,
an organization, a business, a trust, an individual, or any other entity or
organization, including a government or political subdivision or an
instrumentality or agency thereof.
"Registrable Securities" means (i) any shares of Common Stock
owned by SPX or any of its affiliates, whether prior or subsequent to the
effectiveness of this Agreement and (ii) any Common Stock issued with respect to
the Common Stock referred to in clause (i) by way of a stock dividend, stock
split or reverse stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or otherwise. For purposes of this
Agreement, a person will be deemed to be a Holder of Registrable Securities
whenever such person has the right to acquire directly or indirectly such
Registrable Securities (upon conversion or exercise of any securities or
otherwise but disregarding any restrictions or limitations upon the exercise of
such right), whether or not such acquisition has actually been effected, and
such person shall not be required to convert or exercise such security (or
otherwise acquire such Registrable Securities) to participate in
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any registered offering hereunder prior to the closing of such offering. As to
any particular Registrable Securities, such securities shall cease to be
Registrable Securities (a) when a registration statement with respect to the
sale of such securities shall have become effective under the Securities Act and
such securities shall have been disposed of in accordance with such registration
statement, (b) when such securities shall have been otherwise transferred, new
certificates for them not bearing a legend restricting further transfer shall
have been delivered by the Company and subsequent public distribution of them
shall not require registration of them under the Securities Act, or (c) when
such securities shall have been sold to the public as permitted by, and in
compliance with Rule 144 of the Securities Act. Any certificate evidencing the
Registrable Securities shall bear a legend stating that the securities have not
been registered under the Securities Act and setting forth or referring to the
restrictions on transferability and sale of the securities.
"Registration Expenses" means all expenses incident to the
registration and disposition of the Registrable Securities pursuant to Section
2, Section 3 or Section 4 hereof, including, without limitation, all
registration, filing and applicable national securities exchange or NASDAQ (as
defined below) fees, all fees and expenses of complying with state securities or
blue sky Laws (including fees and disbursements of counsel to the underwriters
or the Initiating Holder in connection with "blue sky" qualification of the
Registrable Securities and determination of their eligibility for investment
under the Laws of the various jurisdictions), all word processing, duplicating
and printing expenses, all messenger and delivery expenses, the transportation
and other expenses incurred by or on behalf of Company representatives in
connection with presentations to prospective purchasers of the Registrable
Securities, the fees and disbursements of counsel for the Company and of any
independent public accountants who have audited or reviewed financial statements
included in the registration statement, including the expenses of "cold comfort"
letters or any special audits required by, or incident to, such registration,
all fees and disbursements of underwriters (other than underwriting discounts
and commissions) and the fees and expenses of counsel to the Initiating Holder
(the "Holder's Counsel"); provided, however, that Selling Expenses are excluded
from the definition of Registration Expenses.
"Securities Act" means the Securities Act of 1933, as amended,
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. References to a
particular section of the Securities Act shall include a reference to the
comparable section, if any, of any such similar Federal statute.
"Selling Expenses" means all underwriting discounts, selling
commissions and transfer taxes applicable to the securities registered by the
Holders.
"Transfer" means, as to any shares of Common Stock, to sell or
in any other way directly or indirectly transfer, assign, pledge, encumber or
otherwise dispose of, and
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the terms "a Transfer," "Transferee" and "Transferred" shall have meanings
correlative to the foregoing.
2. Requested Registration.
(a) Request for Registration. Any Initiating Holder may at any
time following the Initial Public Offering request the Company to effect, and
the Company shall be required to use its best efforts to effect, a registration
under the Securities Act of all, or such portion set forth in the request, of
the Initiating Holder's Registrable Securities pursuant to this Section 2(a)
(each, together with a request made pursuant to Section 4(a), a "Demand
Registration"). In the event that the Company shall receive from an Initiating
Holder a written request that the Company effect a Demand Registration with
respect to such Initiating Holder's Registrable Securities, the Company shall:
(i) promptly, and in any event within 10 days after
receipt of such request, give written notice of the proposed Demand Registration
to all other Holders; and
(ii) promptly use its best efforts to effect such
Demand Registration (including, without limitation, appropriate qualification
under applicable blue sky or other state securities Laws and appropriate
compliance with applicable regulations under the Securities Act and any other
governmental requirements or regulations) as may be so requested and as would
permit or facilitate the sale and distribution of the Registrable Securities as
are specified in such request, together with the Registrable Securities of any
Holders joining in such request as are specified in one or more written requests
received by the Company no later than 15 days prior to the effective date of the
registration statement; provided, however, that the Company shall not be
obligated to take any action to effect any such Demand Registration pursuant to
this Section 2:
(A) During the period beginning on the date
a registration statement is filed by the Company to effect a Demand Registration
and ending on the earlier of (x) the date 90 days immediately following the
effective date of such registration statement and (y) the date such registration
statement is withdrawn;
(B) During the 90-day period following the
receipt by the Initiating Holder of a certificate signed by the President of the
Company stating that the Board has determined in good faith that effecting such
Demand Registration would be materially detrimental to the Company; provided,
however, that, the Company will use its best efforts to limit the duration of
such period to the extent practicable; and provided, further that the requested
registration will not count for purpose of the requests for Demand Registrations
to which the Holders are entitled under this Agreement; and
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provided, further, that the Company may exercise its rights under this Section
2(a)(ii)(B) or under Section 4(b)(ii) collectively only one time in any
twelve-month period;
(C) After the Company has effected four
registrations pursuant to this Section 2(a), all of which registrations have
become effective in accordance with, and otherwise met the requirements for
Demand Registrations set forth in, Section 2(b); or
(D) Unless the amount of Registrable
Securities which has an anticipated aggregate offering price of at least
$5,000,000 (provided that if such Demand Registration covers the balance of the
Registrable Securities owned by the Initiating Holder, then this clause (D)
shall not be applicable).
Subject to the foregoing clauses (A) through
(D), the Company shall file a registration statement covering the Registrable
Securities requested to be registered as soon as practicable after receipt of
the request or requests of an Initiating Holder. No securities other than
Registrable Securities shall be included among the securities covered by such
registration unless the holder or holders of a majority of the Registrable
Securities shall have consented to the inclusion therein of such other
securities.
(b) Effective Registration Statement. A registration shall not
constitute a Demand Registration (i) until it has become effective and remains
continuously effective for a period of not less than 180 days or such shorter
period which will terminate when all Registrable Securities covered by such
registration statement have been sold (but not before the expiration of the
period referred to in Section 4(3) of the Securities Act and Rule 174
thereunder, if applicable), (ii) if, after it has become effective, such
registration is interfered with by any stop order, injunction or other order or
requirement of the Commission or other governmental agency or court for any
reason not attributable to the Holders whose securities are covered by such
registration statement and has not thereafter become effective, or (iii) if the
conditions to closing specified in the underwriting agreement, if any, entered
into in connection with such registration are not satisfied or waived.
(c) Underwriting. If the Initiating Holder so elects, the
offering of such Registrable Securities pursuant to such Demand Registration
shall be in the form of an underwritten offering with underwriters selected by
the Initiating Holder, and the Company shall so advise the Holders (if then
known, as part of the notice given pursuant to Section 2(a)(i)). In such event,
the right of any other Holder to registration pursuant to this Section 2 shall
be conditioned upon such Holder's participation in the underwriting arrangements
required by this Section 2 prior to the earlier of (x) the printing of any
preliminary prospectus relating to such registration or (y) the date requested
by the Company, and the inclusion of such person's Registrable Securities in the
underwriting to the extent requested shall be limited to the extent provided
herein.
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The Company shall (together with all Holders proposing to
distribute their securities through such underwriting) enter into an
underwriting agreement in customary form with the managing underwriter selected
for such underwriting by the Initiating Holder. Notwithstanding any other
provision of this Section 2, if at any time prior to the execution of the
underwriting agreement, the managing underwriter advises the Initiating Holder
in writing that in order to sell the Registrable Securities requested to be
included in the registration statement in the underwritten offering within a
price range acceptable to the Initiating Holder there must be a limitation on
the number of shares to be underwritten, then the Company shall so advise all
Holders, and the number of shares of Registrable Securities that may be included
in the registration and underwriting shall be allocated among all Holders
thereof in proportion, as nearly as practicable, to the respective amounts of
Registrable Securities owned by such Holders (unless otherwise agreed to by the
Holders). No Registrable Securities excluded from the underwriting by reason of
the underwriter's limitation shall be included in such registration. If, as a
result of the proration provisions set forth in the previous sentence, any
Holder is not entitled to include all Registrable Securities previously
requested to be included in such registration, such Holder may elect to withdraw
its request to include Registrable Securities in such registration or may reduce
the number requested to be included; provided that such request must be made in
writing prior to the earlier of (x) the printing of any preliminary prospectus
relating to such registration or (y) the date requested by the Company.
If the managing underwriter advises the Initiating Holder that
the Registrable Securities covered by the registration statement cannot be sold
in an orderly manner in the underwritten offering within a price range
acceptable to the Initiating Holder, then the Initiating Holder shall have the
right to notify the Company in writing that it has determined that the
registration statement be abandoned or withdrawn, in which event the Company
shall abandon or withdraw such registration statement and such registration
statement shall not count for purpose of the requests for Demand Registrations
to which the Holders are entitled under this Agreement.
If any Holder disapproves of the terms of the underwriting,
such person may elect to withdraw therefrom, by written notice to the Company,
the managing underwriter and the Initiating Holder prior to the earlier of (x)
the printing of any preliminary prospectus relating to such registration and (y)
the date requested by the Company, and the Registrable Securities so withdrawn
shall also be withdrawn from registration.
3. Company Registration.
(a) Notice of Registration. If at any time or from time to
time following the Initial Public Offering the Company shall determine to
register any of its securities, either for its own account or the account of a
security holder or holders that has registration rights granted in compliance
with Section 5, other than (1) a registration on
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Form S-8 (or successor form) relating solely to employee benefit plans or (2) a
registration on Form S-4 (or successor form) relating solely to a transaction
pursuant to Rule 145 under the Securities Act, the Company shall:
(i) promptly give to each Holder written notice
thereof at least 10 days before the anticipated filing date; and
(ii) include in such registration (and effect any
related qualification under blue sky Laws and other compliance with applicable
Law), and in any underwriting involved therein, all the Registrable Securities
specified in a written request or requests, made within 20 days after receipt of
such written notice from the Company, by any Holder.
(b) Underwriting. If the registration of which the Company
gives notice is for an underwritten public offering registered under the
Securities Act, the Company shall so advise the Holders as a part of the written
notice given pursuant to Section 3(a)(i). In such event, the right of any Holder
to register securities pursuant to this Section 3 shall be conditioned upon such
Holder's participation in such underwriting prior to the earlier of (x) the
printing of any preliminary prospectus relating to such registration and (y) the
date requested by the Company, and the inclusion of such person's Registrable
Securities in the underwriting to the extent requested shall be limited to the
extent provided herein. All Holders proposing to distribute their securities
through such underwriting shall (together with the Company and any other holders
distributing their securities through such underwriting) enter into an
underwriting agreement in customary form with the managing underwriter selected
for such underwriting by the Company. Notwithstanding any other provision of
this Section 3, if at any time prior to the execution of the underwriting
agreement, the managing underwriter advises the Company in writing that in order
to sell the Registrable Securities requested to be included in the registration
statement in the underwritten offering within a price range acceptable to the
Company there must be a limitation on the number of shares to be underwritten,
then the Company shall so advise all Holders who have requested to include
securities in such underwriting and the Company shall include in such
registration, (i) first, all of the securities the Company proposes to sell for
its own account, (ii) thereafter, the Registrable Securities requested to be
included in such registration pursuant to Section 3(a), allocated, if less can
be included than requested, pro rata among the Holders based on the number of
Registrable Securities owned by such Holder, and (iii) third (but only if all of
the Registrable Securities requested to be included by each Holder thereof in
the registration are included), the other securities requested to be included in
such registration, allocated pro rata based on the number of securities
requested to be included in such registration. If any Holder or other holder
disapproves of the terms of any such underwriting, it may elect to withdraw
therefrom by written notice to the Company and the managing underwriter prior to
the earlier of (x) the printing of any preliminary prospectus relating to such
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registration and (y) the date requested by the Company, and the Registrable
Securities so withdrawn shall also be withdrawn from registration. No
registration effected under this Section 3 shall relieve the Company of its
obligation to effect any registration upon request under Section 2 or Section 4.
(c) Right to Terminate Registration. The Company shall have
the right to terminate or withdraw any registration initiated by it under this
Section 3 prior to the effectiveness of such registration whether or not any
Holder has elected to include securities in such registration.
4. Registration on Form S-3.
(a) If following the Initial Public Offering an Initiating
Holder shall request that the Company file a registration statement on Form S-3
(or any successor form) for a public offering of Registrable Securities, and the
Company is a registrant entitled to use Form S-3 (or any successor form) to
register the Registrable Securities for such an offering, the Company shall use
its best efforts to cause such Registrable Securities to be registered for the
offering on such form and to cause such Registrable Securities to be qualified
in such jurisdictions as the Initiating Holder shall reasonably request;
provided, however, that the Company shall not be required to effect more than
two registrations requested by Holders in any 12-month period. The provisions of
Section 2(c) and 3(a) shall be applicable to each registration initiated under
this Section 4. A registration effected pursuant to this Section 4 shall not be
counted as a Demand Registration for purposes of Section 2. The Company agrees
to use its best efforts to comply with the requirements of Form S-3 at all
times.
(b) Notwithstanding the foregoing, the Company shall not be
obligated to take any action pursuant to this Section 4:
(i) During the period beginning on the date a
registration statement is filed by the Company to effect a Demand Registration
and ending on the earlier of (x) the date 90 days immediately following the
effective date of such registration statement and (y) the date such registration
statement is withdrawn, or
(ii) During the 90-day period following the receipt
by the Initiating Holder of a certificate signed by the President of the Company
stating that the Board has determined in good faith that effecting such Demand
Registration would be materially detrimental to the Company; provided, however,
that, the Company will use its best efforts to limit the duration of such period
to the extent practicable; and provided, further that the requested registration
will not count for purpose of the requests for Demand Registrations to which the
Holders are entitled under this Agreement; and provided, further, that the
Company may exercise its rights under this Section 4(b)(ii) or under Section
2(a)(ii)(B) collectively only one time in any twelve-month period.
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5. Limitations on Subsequent Registration Rights. The Company hereby
represents and warrants that there are no agreements currently in effect, and
there will be no agreements in effect at the time of the Initial Public
Offering, other than this Agreement, granting any holder or prospective holder
of any securities of the Company registration rights with respect to any
securities of the Company. From and after the Initial Public Offering, the
Company shall not enter into any agreement granting any holder or prospective
holder of any securities of the Company registration rights with respect to any
securities of the Company unless approved in writing by a majority of the
Holders.
6. Expenses of Registration. All Registration Expenses for any
registration made pursuant to this Agreement shall be borne by the Company.
Unless otherwise agreed to among the Holders, all Selling Expenses relating to
securities registered on behalf of the Holders shall be borne by the Holders of
such securities pro rata based on the proportion that the number of shares
registered by each Holder bears to the total number of shares included in such
registration.
7. Registration Procedures. Whenever any Holders of Registrable
Securities shall have requested that any Registrable Securities be registered
pursuant to this Agreement, the Company shall use its best efforts to effect the
registration and sale of such Registrable Securities in accordance with the
intended method of disposition thereof, and in connection therewith, at its
expense, the Company shall, as expeditiously as possible:
(a) Prepare and file with the Commission, as promptly as
practicable, a registration statement with respect to such securities and use
its best efforts to cause such registration statement to become and remain
continuously effective for at least 180 days or until the distribution described
in the registration statement has been completed (but not before the expiration
of the period referred to in Section 4(3) of the Securities Act and Rule 174
thereunder, if applicable); provided that before filing a registration statement
or prospectus or any amendments or supplements thereto, the Company shall
furnish copies thereof to the Holder's Counsel and, in an underwritten offering,
to counsel for the underwriters a reasonable period of time prior thereto and
reasonably consider the comments of such counsel. The Company shall not be
deemed to have used its best efforts to cause the registration statement to
remain effective during the applicable period if it voluntarily takes any action
(other than an action required under applicable Laws) that would result in the
Holders participating in such registration not being able to dispose of the
Registrable Securities during their respective contemplated periods of
distribution in accordance with the contemplated methods of disposition. A
registration pursuant to Section 2 or Section 4 shall be effected pursuant to
Rule 415 (or any similar provision then in force) under the Securities Act if
the manner of distribution contemplated by the
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Holders participating in such registration shall include an offering on a
delayed or continuous basis.
(b) Prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement.
(c) As soon as reasonably possible, furnish to the Holders
participating in such registration and to any underwriters of the securities
being registered such number of copies of the registration statement,
preliminary prospectus, final prospectus and such other documents as such Holder
or underwriter may reasonably request in order to facilitate the public offering
of such securities. The Company consents to the use by each Holder participating
in such registration of each prospectus and each amendment thereof and
supplement thereto in connection with the distribution, in accordance with this
Agreement, of the Registrable Securities owned by the Holder. The Company shall
furnish to each Holder participating in such registration drafts of the
registration statement and the prospectus and each amendment thereof or
supplement thereto for its timely review prior to the filing thereof with the
Commission. If any registration statement refers to any Holder participating in
such registration by name or otherwise as the holder of any securities of the
Company but such reference is not required by the Securities Act, then the
Holder shall have the right to require the deletion of such reference. If any
registration statement refers to any Holder by name or otherwise as the holder
of any securities of the Company and if, in its good faith judgment, such Holder
is or might be deemed to be a controlling person of the Company, such Holder
will have the right to require the insertion therein of language, in form and
substance reasonably satisfactory to such Holder and presented to the Company in
writing, to the effect that the holding by such Holder of such securities is not
to be construed as a recommendation by such Holder of the investment quality of
the Company's securities covered thereby and that such holding does not imply
that such Holder will assist in meeting any future financial requirements of the
Company.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities or
blue sky Laws of such jurisdictions as shall be reasonably requested by the
Holders participating in such registration and to continue such registration or
qualification in effect for so long as such registration statement remains in
effect, and do any and all other acts and things which may be reasonably
necessary or advisable to enable any such Holder to consummate the disposition
in such jurisdictions of the Registrable Securities owned by such Holder;
provided that the Company shall not be required in connection therewith or as a
condition thereto to qualify to do business or to file a general consent to
service of process in any
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such states or jurisdictions unless the Company is already qualified to do
business or subject to service in such jurisdiction and except as may be
required by the Securities Act.
(e) In the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement that is
customary for the managing underwriter, reasonably satisfactory in form and
substance to the Initiating Holder, with the managing underwriter of such
offering. Each Holder participating in such underwriting shall also enter into
and perform its obligations under such an agreement, provided that such
underwriting agreement shall not provide for indemnification or contribution
obligations on the part of the Holders greater than the obligations set forth in
Section 8.
(f) Promptly notify each Holder participating in such
registration at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, of the discovery or happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, and, as promptly as practicable thereafter, prepare and file with the
Commission an amendment or supplement to the registration statement or the
prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The Company shall further advise each Holder participating in
such registration in writing, promptly after the occurrence of any of the
following, (i) of the filing of the registration statement or any prospectus, or
any amendment thereof or supplement thereto, with the Commission, (ii) the
effectiveness of the registration statement and any post-effective amendment
thereto, (iii) the receipt by the Company of any communication from the
Commission with respect to the registration statement or the prospectus, or any
amendment thereof or supplement thereto, including, without limitation, any stop
order suspending the effectiveness thereof, any comments with respect thereto
and any requests for amendments or supplements, and (iv) the receipt by the
Company of any notification with respect to the suspension of the qualification
of Registrable Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose. The Company shall deliver
promptly to the Holder's Counsel and to each underwriter, if any, participating
in the offering of the Registrable Securities, copies of all correspondence
between the Commission and the Company, its counsel or auditors and all
memoranda relating to (and allow the Holder's Counsel and any underwriters
counsel to participate in) discussions with the Commission or its staff with
respect to such registration statement.
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(g) From and after the date of any registration pursuant to
Section 2, Section 3 or Section 4, use its best efforts to cause the Registrable
Securities being registered to be listed on a national securities exchange or to
be included in the NASDAQ/National Market System or the NASDAQ/Small Cap Market,
if the listing or inclusion of the Common Stock is permitted under the rules of
such national securities exchange or the NASD, as the case may be.
(h) In the event of the issuance of any stop order suspending
the effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any Common Stock included in such registration statement for sale in any
jurisdiction, use its best efforts promptly to obtain the withdrawal of such
order.
(i) Deliver to the Holders participating in such registration
and, in the case of an underwritten public offering, to each underwriter and to
each Holders of Registrable Securities being sold in the registration (A) a
comfort letter from independent public accountants covering the financial
statements included in the registration and covering such matters of the type
customarily covered by cold comfort letters as the Initiating Holder reasonably
requests, and (B) an opinion of the Company's and any other counsel reasonably
requested by the Initiating Holder in customary form and covering such matters
of the type customarily covered by opinions of counsel as the Initiating Holder
reasonably requests.
(j) Make available to the Holders, as soon as reasonably
practicable, an earnings statement covering the period of at least 12 months
beginning with the first full calendar month after the effective date of such
registration statement, which earnings statement will satisfy the provisions of
Section 11(a) of the Securities Act and Rule 158 promulgated thereunder, and
promptly furnish to each seller of Registrable Securities a copy of any
amendment or supplement to such registration statement or prospectus.
(k) Use its best efforts to cause all Registrable Securities
covered by such registration statement to be registered with or approved by such
other federal or state governmental agencies or authorities as may be necessary
in the opinion of counsel to the Company or the Holder's Counsel to consummate
the disposition of such Registrable Securities.
(l) Make available its employees and personnel and otherwise
provide reasonable assistance to the underwriters (including by participating in
meetings, drafting sessions, due diligence sessions and customary road shows,
including electronic road shows and similar methods of marketing the Registrable
Securities electronically) in their marketing of Registrable Securities.
8. Indemnification; Contribution.
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(a) The Company will indemnify, to the fullest extent
permitted by Law, each Holder, each of its officers, directors, employees,
partners (and the partners thereof, collectively, "Partners"), agents,
affiliates and advisors and each person controlling such Holder within the
meaning of Section 15 of the Securities Act, and each underwriter, if any, and
each person who controls any underwriter within the meaning of Section 15 of the
Securities Act, against all expenses, claims, losses, damages or liabilities (or
actions in respect thereof), including any of the foregoing incurred in
settlement of any Litigation, commenced or threatened, arising out of or based
on (i) any untrue statement (or alleged untrue statement) of a material fact
contained in any registration statement, prospectus (including any summary
prospectus or preliminary prospectus), offering circular or other document, or
any amendment or supplement thereto, incident to any such registration, (ii) any
omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances in which they were made, not misleading or (iii) any violation by
the Company of any Law applicable to the Company or relating to action required
of or inaction by the Company in connection with such registration, and the
Company will reimburse each such Holder and each other person entitled to be
indemnified under this Section 8(a) for any legal and any other expenses
reasonably incurred in connection with investigating, preparing or defending any
such claim, loss, damage, liability or action; provided that the Company will
not be liable in any such case to the extent that any such claim, loss, damage,
liability or expense arises out of or is based on any untrue statement or
omission or alleged untrue statement or omission, made in reliance upon and in
conformity with written information furnished to the Company by an instrument
duly executed by such Holder, controlling person or underwriter and stated to be
specifically for use therein.
(b) Each Holder will, if Registrable Securities held by such
Holder are included in the securities as to which such registration is being
effected, indemnify the Company, each of its directors and officers, each
underwriter, if any, of the Company's securities covered by such a registration
statement, each person who controls the Company or such underwriter within the
meaning of Section 15 of the Securities Act, and each other Holder, each of its
officers, directors, employees, Partners, agents, affiliates and advisors and
each person controlling such Holder within the meaning of Section 15 of the
Securities Act, against all expenses, claims, losses, damages and liabilities
(or actions in respect thereof) arising out of or based on any untrue statement
(or alleged untrue statement) of a material fact contained in any such
registration statement, prospectus (including any summary prospectus or
preliminary prospectus), offering circular or other document, or any amendment
or supplement thereto, or any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances in which they were made, not misleading,
and will reimburse the Company and each other person entitled to be indemnified
under this Section 8(b), for any legal or any other expenses reasonably incurred
in connection with investigating or defending any such claim, loss, damage,
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14
liability or action, in each case to the extent, but only to the extent, that
such untrue statement (or alleged untrue statement) or omission (or alleged
omission) is made in such registration statement, prospectus, offering circular
or other document in reliance upon and in conformity with written information
furnished to the Company by an instrument duly executed by such Holder and
stated to be specifically for use therein. Notwithstanding the foregoing, the
liability of each Holder under this Section 8(b) shall be limited in an amount
equal to the public offering price (net of expenses and underwriting discounts
and commissions) of the securities sold by such Holder in the offering giving
rise to such liability.
(c) Each party entitled to indemnification under this Section
8 (the "Indemnified Party") (i) shall give written notice to the party required
to provide indemnification (the "Indemnifying Party") promptly after such
Indemnified Party has actual knowledge of any claim as to which indemnity may be
sought and (ii) shall permit the Indemnifying Party to assume the defense of any
such claim or any Litigation resulting therefrom; provided that counsel for the
Indemnifying Party who shall conduct the defense of such claim or Litigation
shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld), and the Indemnified Party may participate in such
defense at such party's expense; provided, further, that the failure of any
Indemnified Party to give notice as provided herein shall not relieve the
Indemnifying Party of its obligations under this Section 8 unless the failure to
give such notice is materially prejudicial to an Indemnifying Party's ability to
defend such action; and provided, further, that the Indemnifying Party shall not
assume the defense for matters as to which the Indemnified Party reasonably
believes there may be a conflict of interest or separate and different defenses.
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 to such claim or Litigation or as to
which the Indemnified Party has to admit to any fault or culpability. No
Indemnified Party, in the defense of any such claim or Litigation, shall, except
with the consent of each Indemnifying Party, consent to entry of any judgment or
enter into any settlement unless such Indemnified Party does not intend to seek
indemnification with respect to such claim or Litigation against such
Indemnifying Party hereunder.
(d) The indemnification provided for under this Agreement
shall remain in full force and effect regardless of any investigation made by or
on behalf of the Indemnified Party and shall survive the Transfer of securities.
(e) If the indemnification provided for in this Section 8 from
the Indemnifying Party is unavailable to an Indemnified Party hereunder in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then the Indemnifying
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15
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 losses,
claims, damages, liabilities or expenses (i) in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party, on the one
hand, and the Indemnified Party, on the other, in connection with the actions
which resulted in such losses, claims, damages, liabilities or expenses, as well
as any other relevant equitable considerations, or (ii) if the allocation
provided by clause (i) above is not permitted by applicable Law or if the
allocation provided in this clause (ii) provides a greater amount to the
Indemnified Party than clause (i) above, in such proportion as shall be
appropriate to reflect not only the relative fault but also the relative
benefits received by the Indemnifying Party and the Indemnified Party from the
offering of the securities covered by such registration statements as well as
any other equitable considerations. The relative faults of such Indemnifying
Party and Indemnified Party shall be determined by reference to, among other
things, whether any action in question, including any untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a material
fact, has been made by, or relates to information supplied by, such Indemnifying
Party or Indemnified Party, and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such action. The amount
paid or payable by a party as a result of the losses, claims, damages,
liabilities and expenses referred to above shall be deemed to include any fees,
charges or expenses (including fees, disbursements and other charges of legal
counsel) reasonably incurred by such party in connection with any investigation
or proceeding.
The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 8(e) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 8(e), a Holder shall
not be required to contribute any amount in excess of the amount by which the
net proceeds received by such Holder in the offering to which such registration
statement relates exceeds the amount of any damages that such Holder has
otherwise been required to pay. 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. No person shall be obligated to contribute
hereunder any amounts in payment for any settlement of any action or claim
effected without such person's consent, which consent shall not be unreasonably
withheld or delayed.
9. Other Indemnification. Indemnification and contribution similar to
that specified in Section 8 (with appropriate modifications) will be given by
the Company and the Holders participating in a registered offering with respect
to any required registration or other qualification of securities under any
federal, state or blue sky Law or regulation of any governmental authority other
than the Securities Act. The indemnification agreements contained in Section 8
and this Section 9 will be in addition to, and will not
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16
be superseded by, any other rights to indemnification or contribution which any
indemnified party may have pursuant to Law or contract.
10. Indemnification Payments. The indemnification and contribution
required by Section 8 will be made by periodic payments of the amount thereof
during the course of the investigation or defense, as and when bills are
received or expense, loss, damage or liability is incurred; provided, however,
that if an Indemnified Party is adjudged to be not entitled to such payments in
a final non-appealable judgment of a court of competent jurisdiction, it shall
promptly return such payments to the Indemnifying Party.
11. Information by Holder and Company. The Holder or Holders of
Registrable Securities included in any registration shall furnish to the Company
such information regarding such Holder or Holders, the Registrable Securities
held by them and the distribution proposed by such Holder or Holders as the
Company may reasonably request in writing and as shall be required in connection
with any registration being effected pursuant to Section 2, Section 3 or Section
4. The Company shall make available for inspection by each Holder participating
in the registration, each underwriter of Registrable Securities owned by such
Holder and their respective accountants, counsel and other representatives all
financial and other records, pertinent corporate documents and properties of the
Company as shall be reasonably necessary to enable them to exercise their due
diligence responsibilities in connection with each registration of Registrable
Securities owned by such Holder, and shall cause the Company's officers,
directors and employees to supply all information reasonably requested by any
such person in connection with such registration; provided that records and
documents which the Company determines, in good faith, after consultation with
counsel for the Company and the Holder's Counsel or counsel for the underwriter,
as the case may be, to be confidential and which it notifies such persons are
confidential shall not be disclosed to them, except in each case to the extent
that (i) the disclosure of such records or documents or the information
contained therein is reasonably necessary to avoid or correct a misstatement or
omission in the registration statement or is otherwise required by applicable
securities Laws, (ii) the release of such records or documents is ordered
pursuant to a subpoena or other order from a court of competent jurisdiction,
(iii) the Holder's Counsel reasonably determines that such disclosure is
required in order to satisfy a due diligence obligation, in which case such
information shall be released pursuant to a customary confidentiality agreement,
or (iv) the information in such records or documents has been made generally
available to the public or is required to be filed with, or made available as
supplemental information to, the Commission. Each Holder shall, upon learning
that disclosure of any such records or documents is sought in a court of
competent jurisdiction, give notice to the Company, and allow the Company, at
the Company's expense, to undertake appropriate action and to prevent disclosure
of any such records or documents deemed confidential.
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17
12. 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 Securities to the public without registration after such
time as a public market exists for the Common Stock, the Company agrees to use
its best efforts to:
(a) make and keep public information available, as those terms
are understood and defined in Rule 144 under the Securities Act, at all times
after the effective date that the Company becomes subject to the reporting
requirements of the Securities Act or the Exchange Act;
(b) 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 (at any time after it has become subject to such reporting
requirements); and
(c) so long as any Holder owns any Registrable Securities, to
furnish to such Holder forthwith upon request a written statement by the Company
as to its compliance with the reporting requirements of said Rule 144 (at any
time after 90 days after the effective date of the Initial Public Offering for
an offering of its securities to the general public), and of the Securities Act
and the Exchange Act (at any time after it has become subject to such reporting
requirements), a copy of the most recent annual or quarterly report of the
Company, and such other reports and documents of the Company and other
information in the possession of or reasonably obtainable 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 such securities without
registration.
13. Certificates without Legends. In connection with the offering of
any Registrable Securities registered pursuant to this Agreement, the Company
will promptly after the sale of such Registrable Securities (a) facilitate the
timely preparation and delivery to the Holders and the underwriters, if any,
participating in such offering of certificates, without a legend relating to
restrictions on Transfer under the Securities Act, representing ownership of
such Registrable Securities being sold in such denominations and registered in
such names as requested by such Holders or such underwriters and (b) instruct
any transfer agent and registrar of such Registrable Securities to release any
stop transfer orders with respect to any such Registrable Securities.
14. Standoff Agreement. The Company hereby agrees that if it shall
previously have received a request for registration pursuant to Section 2 or
Section 4 hereof, and if such previous registration shall not have been
withdrawn or abandoned, (i) the Company shall not effect any public or private
offer, sale or distribution of its securities, file any registration statement
with respect to its equity securities under the Securities Act, or effect any
registration of any of its equity securities under the Securities Act (other
than a registration on Form S-8 or any successor or similar form which is then
in effect), whether or not for sale for its own account, until a period of 90
days (or such shorter
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18
period as the Initiating Holder shall be advised by the managing underwriter)
shall have elapsed from the effective date of such previous registration, and
the Company shall so provide in any registration rights agreements hereafter
entered into with respect to any of its securities; and (ii) the Company shall
use its best efforts to cause each holder of its equity securities purchased
from the Company at any time after the date of this Agreement in any transaction
other than a sale registered under the Securities Act to agree not to effect any
public sale or distribution of any such securities during such period, including
a sale pursuant to Rule 144 under the Securities Act.
15. Notice. All notices and other communications hereunder shall be in
writing and, unless any notice, instruction, direction or demand under the terms
of this Agreement required to be in writing will be duly given upon delivery, if
delivered by hand, facsimile transmission, intercompany mail, or mail, to the
following addresses:
If to SPX:
SPX Corporation
000 Xxxxxxx Xxxxx Xxxxx
X.X. Xxx 0000
Xxxxxxxx, Xxxxxxxx 00000
Attn:Xxxxxxxxxxx X. Xxxxxxx, Esq.
If to the Company:
Inrange Technologies Corporation
00000 Xxxxxxxxx Xxxxx
Xx. Xxxxxx, Xxx Xxxxxx 00000
Attn:Xxxxxxx X. Xxxx, Esq.
16. Assignment; Third Party Beneficiaries. This Agreement shall be
binding upon and inure to the benefit of and be enforceable by the parties
hereto and their respective successors and permitted assigns. This Agreement may
not be assigned by the Company. A Holder may, at its election, at any time or
from time to time, assign its rights under this Agreement, in whole or in part,
to any purchaser of shares of Common Stock held by it.
17. Remedies. The parties hereto agree that money damages or other
remedy at Law would not be sufficient or adequate remedy for any breach or
violation of, or a default under, this Agreement by them and that, in addition
to all other remedies available to them, each of them shall be entitled to an
injunction restraining such breach, violation or default or threatened breach,
violation or default and to any other equitable relief, including, without
limitation, specific performance, without bond or other security being
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19
required. In any action or proceeding brought to enforce any provision of this
Agreement (including the indemnification provisions thereof), the successful
party shall be entitled to recover reasonable attorneys' fees in addition to its
costs and expenses and any other available remedy.
18. No Inconsistent Agreements. The Company will not, on or after the
date of this Agreement, enter into any agreement with respect to its securities
which is inconsistent with the rights granted to the Holders in this Agreement
or otherwise conflicts with the provisions hereof. The Company has not
previously entered into any agreement with respect to its securities granting
any registration rights to any Person other than the registration rights granted
pursuant to this Agreement. The rights granted to the Holders hereunder do not
in any way conflict with and are not inconsistent with any other agreements to
which the Company is a party or by which it is bound. The Company further agrees
that if any other registration rights agreement entered into after the date of
this Agreement with respect to any of its securities contains terms which are
more favorable to, or less restrictive on, the other party thereto than the
terms and conditions contained in this Agreement are (insofar as they are
applicable) to the Holders, then the terms and conditions of this Agreement
shall immediately be deemed to have been amended without further action by the
Company or the Holders so that the Holders shall be entitled to the benefit of
any such more favorable or less restrictive terms or conditions.
19. Descriptive Headings. The descriptive headings of the several
sections and paragraphs of this Agreement are inserted for reference only and
shall not control or otherwise affect the meaning hereof.
20. Governing Law. This Agreement shall be construed in accordance with
and governed by the substantive internal laws of the State of Delaware.
21. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.
22. Invalidity of Provision. The invalidity or unenforceability of any
provision of this Agreement in any jurisdiction shall not affect the validity or
enforceability of the remainder of this Agreement in that jurisdiction or the
validity or enforceability of this Agreement, including that provision, in any
other jurisdiction. If any restriction or provision of this Agreement is held
unreasonable, unlawful or unenforceable in any respect, such restriction or
provision shall be interpreted, revised or applied in a manner that renders it
lawful and enforceable to the fullest extent possible under Law.
23. Further Assurances. Each party hereto shall do and perform or cause
to be done and performed all further acts and things and shall execute and
deliver all other
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20
agreements, certificates, instruments, and documents as any other party hereto
reasonably may request in order to carry out the intent and accomplish the
purposes of this Agreement and the consummation of the transactions contemplated
hereby.
24. Entire Agreement. This Agreement constitutes the entire agreement,
and supersedes all prior agreements and understandings, oral and written,
between the parties hereto with respect to the subject matter hereof.
25. Merger, Consolidation, Exchange, Etc. In the event, directly or
indirectly, (i) the Company shall merge with or into, or consolidate with, or
consummate a share exchange with, any other person, or (ii) any person shall
merge with or into, or consolidate, the Company and the Company shall be the
surviving corporation of such merger or consolidation, and, in connection with
such merger or consolidation, all or part of the Registrable Securities shall be
changed into or exchanged for stock or other securities of any other person,
then, in each such case, proper provision shall be made so that such other
person shall be bound by the provisions of this Agreement and the term "Company"
shall thereafter be deemed to refer to such other person.
26. Amendment. This agreement may only be amended by a written
agreement executed by the Company and the Holders of a majority of the
outstanding Registrable Securities; provided, however, that no such amendment
shall treat Holders differently unless any Holders who are adversely affected by
such different treatment shall agree in writing to such amendment.
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21
IN WITNESS WHEREOF, the parties have caused this Agreement to
be executed and delivered by their respective officers thereunto duly
authorized.
INRANGE TECHNOLOGIES CORPORATION
By: /s/ Xxxxxxx X. Xxxx
________________________________
Name: Xxxxxxx X. Xxxx
Title: Vice President and
General Counsel
GENERAL SIGNAL HOLDING CORPORATION
By: /s/ Xxxxxxxxxxx X. Xxxxxxx
________________________________
Name: Xxxxxxxxxxx X. Xxxxxxx
Title: Vice President
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