Exhibit 10.75.1
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT ("Agreement") is made and entered
into as of ______, 2002, by and among Headwaters Incorporated, a Delaware
corporation ("Parent"), and each person identified on Exhibit A hereto (the
"Stockholders") and that are signatories hereto.
RECITALS
A. Parent, Headwaters Olysub Corporation, a Delaware corporation and a
wholly owned subsidiary of Parent ("Merger Sub"), Industrial Services Group,
Inc., a Delaware corporation (the "Company"), and ISG Resources, Inc., a Utah
corporation and a wholly owned subsidiary of the Company (the "Public Sub"),
have entered into an Agreement and Plan of Merger dated as of July __, 2002 (the
"Merger Agreement"), pursuant to which the Company will merge with and into the
Merger Sub (the "Merger") and the Stockholders will have the right to receive
Merger Shares in exchange for securities of the Company. Capitalized terms used
in this Agreement and not otherwise defined shall have the meanings given to
them in the Merger Agreement.
B. Parent has agreed to provide the Stockholders with certain
registration rights as more fully described herein.
AGREEMENT
The parties, intending to be legally bound, agree as follows:
Section 1. General.
1.1 Definitions. As used in this Agreement, the following terms shall
have the following respective meanings:
"Exchange Act" means the Securities Exchange Act of 1934, as amended or
any similar successor federal statute and the rules and regulations thereunder,
as in effect from time to time.
"Register," "Registered," and "Registration" refer to a registration
effected by preparing and filing a registration statement in compliance with the
Securities Act, and the declaration or ordering of effectiveness of such
registration statement or document.
"Registrable Shares" means the Merger Shares and any shares of Parent
Stock issued in respect thereof as a result of any stock split, stock dividend,
share exchange, merger, consolidation or similar recapitalization; provided,
however, that any particular Registrable Shares shall cease to be Registrable
Shares when (i) a registration statement covering such Registrable Shares shall
have become effective under the Securities Act, and such Registrable Shares
shall have been disposed of in accordance with the Registration Statement, or
(ii) such Registrable Shares may be transferred pursuant to Rule 144 under the
Securities Act, as such rule may be amended from time to time, or any successor
rule or regulation ("Rule 144"), in any single calendar quarter.
"Registration Expenses" shall mean (i) all expenses incurred by Parent
in complying with Sections 2.1 and 2.3 hereof, including, without limitation,
all registration, qualification and filing fees, printing expenses, audit and
accountant fees, listing or quotation fees, fees and disbursements of counsel
for Parent, blue sky fees and expenses, and (ii) the reasonable fees and
disbursements of one legal counsel to the Stockholders up to $35,000 in the
aggregate.
"SEC" means the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended or
any similar successor federal statute and the rules and regulations thereunder,
as in effect from time to time..
Section 2. Registration; Restrictions On Transfer.
2.1 Registration. Parent shall use all reasonable efforts (i) to
prepare and file with the SEC a registration statement (the "Registration
Statement") on either Form S-1 or S-3 covering the resale of the Registrable
Shares as soon as reasonably practicable following the Effective Time, and in
any event, no later than thirty (30) days following the Effective Time and (ii)
to cause the Registration Statement to be declared effective as soon as
reasonably practicable following the date of such filing, and in any event, on
or before the six-month anniversary of the Closing Date. Subject to the terms of
this Agreement, Parent shall use all reasonable efforts to cause the
Registration Statement to remain effective until at least the one-year
anniversary of the Closing Date, and for such later period of time as is the
earlier of (i) the eighteen-month anniversary of the Closing Date, as such date
may be extended pursuant to Section 2.7(d) hereof (the "Eighteen-month
Anniversary Date"), and (ii) the date as of which at least 75% of the Merger
Shares have been sold under the Registration Statement or pursuant to Rule 144
(the "Registration Effective Period").
2.2 Expenses Of Registration. All Registration Expenses shall be borne
by Parent. All underwriting discounts, brokerage fees and commissions incurred
by the Stockholders, if any, and all fees and disbursements of counsel to the
Stockholders not included in Registration Expenses shall be borne by the
Stockholders pro rata based on the number of Registrable Shares included in any
such registration.
2.3 Obligations Of Parent. Whenever required to effect the registration
of the Registrable Shares pursuant to Section 2.1, Parent shall, as
expeditiously as reasonably possible, use all reasonable efforts to:
(a) Prepare and file with the SEC a registration statement with respect
to the Registrable Securities and use all reasonable efforts to cause such
registration statement to become effective (provided that before filing a
registration statement or prospectus or any amendments or supplements thereto,
Parent will furnish to one counsel selected by the holders of a majority of the
Registrable Securities covered by such registration statement copies of all such
documents proposed to be filed).
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(b) Prepare and file with the SEC such amendments and supplements to
the Registration Statement and the prospectus used in connection with the
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 the
Registration Statement for the Registration Effective Period.
(c) Furnish to the Stockholders such number of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as they may reasonably request in order
to facilitate the disposition of Registrable Shares owned by them.
(d) Use all reasonable efforts to register and qualify the securities
covered by the Registration Statement under such other securities or blue sky
laws of such jurisdictions as shall be reasonably requested by the Stockholders;
provided that Parent 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 such states or jurisdictions.
2.4 Delay Of Registration; Furnishing Information.
(a) None of the Stockholders shall have any right to obtain or seek an
injunction restraining or otherwise delaying any such registration as the result
of any controversy that might arise with respect to the interpretation or
implementation of this Section 2.
(b) It shall be a condition precedent to the obligations of Parent to
take any action pursuant to Section 2.1 that the Stockholders shall furnish to
Parent such information regarding themselves, the Registrable Shares held by
them and the intended method of disposition of such securities as shall be
reasonably required to effect the registration of their Registrable Shares.
2.5 Indemnification. In the event any Registrable Shares are included
in a registration statement under Section 2.1:
(a) To the extent permitted by law, Parent will indemnify and hold
harmless each Stockholder, the partners, officers, directors, employees,
advisors and agents of each Stockholder, any underwriter (as defined in the
Securities Act) for such Stockholder and each person, if any, who controls such
Stockholder or underwriter within the meaning of the Securities Act or the
Exchange Act, against any losses, claims, damages, costs and expenses of
investigation or liabilities (joint or several) (collectively "Losses") to which
they may become subject under the Securities Act, the Exchange Act or other
federal or state law, insofar as such Losses (or actions in respect thereof)
arise out of or are based upon any of the following statements, omissions or
violations (collectively a "Violation") by Parent: (i) any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement, including any preliminary prospectus or final prospectus contained
therein or any amendments or supplements thereto, (ii) the omission or alleged
omission to state therein a material fact required to be stated therein, or
necessary to make the statements therein not misleading, or (iii) any violation
or alleged violation by Parent of the Securities Act, the Exchange Act, any
state securities law or any rule or regulation promulgated under the Securities
Act, the Exchange Act or any state securities law in connection with the
offering covered by the Registration Statement; and Parent will pay as incurred
any legal or other expenses reasonably incurred by such Stockholder or any such
partner, director, officer, employee, advisor, agent, controlling person or
underwriter in connection with investigating or defending any such Losses;
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provided however, that the indemnity agreement contained in this Section 2.5(a)
shall not apply to amounts paid in settlement of any such Loss if such
settlement is effected without the consent of Parent, which consent shall not be
unreasonably withheld, nor shall Parent be liable in any such case for any such
Loss to the extent that it arises out of or is based upon a Violation which
occurs in reliance upon and in conformity with written information furnished
expressly for use in connection with, and which, in fact, is used in connection
with, such registration by such Stockholder, partner, officer, director,
employee, advisor, agent, underwriter or controlling person of such Stockholder,
or arises out of or is based upon any matters as to which Parent is entitled to
indemnification under Section 8.2 of the Merger Agreement.
(b) To the extent permitted by law, each Stockholder (severally and not
jointly with the other Stockholders) will indemnify and hold harmless Parent,
each of its directors, officers, employees, advisors and agents and each person,
if any, who controls Parent within the meaning of the Securities Act or the
Exchange Act, any underwriter and any other Stockholder selling securities under
such registration statement or any of such other Stockholder's partners,
directors, officers, employees, advisors or agents or any person who controls
such Stockholder, against any Losses to which they may become subject under the
Securities Act, the Exchange Act or other federal or state law, insofar as such
Losses (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by such Stockholder under an instrument duly executed by such
Stockholder and stated to be specifically for use in connection with such
registration which information has not been corrected or supplemented by the
Stockholder in writing duly executed by such Stockholder and delivered to Parent
prior to the filing of the Registration Statement and stated to be specifically
for the purposes of removing any misleading information, any untrue statement of
material fact or curing any omission of a material fact necessary to make
statements contained therein not misleading; and each such Stockholder will pay
as incurred any legal or other expenses reasonably incurred by Parent or any
such director, officer, employee, advisor, agent, controlling person,
underwriter or other Stockholder, or partner, officer, director, employee,
advisor or agent or controlling person of such other Stockholder in connection
with investigating or defending any such Loss; provided, however, that the
indemnity agreement contained in this Section 2.5(b) shall not apply to amounts
paid in settlement of any such Loss if such settlement is effected without the
consent of the Stockholder, which consent shall not be unreasonably withheld.
The obligation to indemnify contained in this subsection (b) shall be individual
to each Stockholder and shall be limited to the net proceeds received by such
Stockholder from the sale of Registrable Shares.
(c) Promptly after receipt by an indemnified party under this Section
2.5 of notice of the commencement of any action (including any governmental
action), such indemnified party will, if a claim in respect thereof is to be
made against any indemnifying party under this Section 2.5, deliver to the
indemnifying party a written notice of the commencement thereof and the
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indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel reasonably
satisfactory to the indemnified party; provided, however, that an indemnified
party shall have the right to retain its own counsel, with the fees and expenses
to be paid by the indemnifying party, if representation of such indemnified
party by the counsel retained by the indemnifying party would be inappropriate
due to actual or potential differing interests between such indemnified party
and any other party represented by such counsel in such proceeding. The failure
to deliver written notice to the indemnifying party within a reasonable time of
the commencement of any such action, if materially prejudicial to its ability to
defend such action, shall relieve such indemnifying party of any liability to
the indemnified party under this Section 2.5, but the omission so to deliver
written notice to the indemnifying party will not relieve it of any liability
that it may have to any indemnified party otherwise than under this Section 2.5.
(d) If the indemnification provided for in this Section 2.5 is held by
a court of competent jurisdiction to be unavailable to an indemnified party with
respect to any Losses referred to herein, the indemnifying party, in lieu of
indemnifying such indemnified party thereunder, shall, on a several (not joint)
basis, to the extent permitted by applicable law contribute to the amount paid
or payable by such indemnified party as a result of such Loss in such proportion
as is appropriate to reflect the relative fault of the indemnifying party on the
one hand and of the indemnified party on the other in connection with the
Violation(s) that resulted in such Loss, as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by a court of law by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission; provided, that in no event shall any contribution by a
Stockholder hereunder exceed the net proceeds from the offering received by such
Stockholder.
(e) The obligations of Parent and Stockholders under this Section 2.5
shall survive completion of any offering of Registrable Shares in a registration
statement and the termination of this Agreement. 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.
2.6 Rule 144 Reporting. With a view to making available to the
Stockholders the benefits of certain rules and regulations of the SEC which may
permit the sale of the Registrable Shares to the public without registration,
Parent agrees to:
(a) Make and keep public information available, as those terms are
understood and defined in Rule 144 or any similar or analogous rule promulgated
under the Securities Act, at all times after the effective date of the first
registration filed by Parent for an offering of its securities to the general
public;
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(b) File with the SEC, in a timely manner, all reports and other
documents required of Parent under the Exchange Act; and
(c) So long as a Stockholder owns any Registrable Shares, furnish to
such Stockholder forthwith upon request: a written statement by Parent as to its
compliance with the reporting requirements of said Rule 144 of the Securities
Act, and of the Exchange Act; a copy of the most recent annual or quarterly
report of Parent; and such other reports and documents as a Stockholder may
reasonably request in availing itself of any rule or regulation of the SEC
allowing it to sell any such securities without registration.
2.7 Suspension of Offering.
(a) In addition to any suspension rights under paragraphs (b) and (c)
below, Parent may, upon the happening of any event, that, in the good faith
judgment of Parent's board of directors, renders it advisable to suspend use of
the prospectus relating to the Registration Statement, for no more than ninety
(90) days in the aggregate in any twelve (12) month period of time due to
pending corporate or business developments, public filings with the SEC or
similar events, suspend use of the prospectus relating to the Registration
Statement on written notice to the Stockholders, in which case each Stockholder
shall discontinue disposition of Registrable Shares covered by the Registration
Statement or prospectus until copies of a supplemented or amended prospectus are
distributed to the Stockholders or until the Stockholders are advised in writing
by Parent that the use of the applicable prospectus may be resumed (any such
period of suspension being referred to herein as a "Corporate Development
Suspension Period").
(b) Each holder of Registrable Securities agrees not to effect any
public sale or distribution (including sales pursuant to Rule 144) of equity
securities of Parent during the thirty (30) days prior to and the 90-day period
following the sale by Parent of any of its equity or equity-linked securities
without the prior written consent of Parent (any such period of suspension being
referred to herein as a "Standstill Period").
(c) In the event of: (i) any request by the SEC or any other federal or
state governmental authority during the period of effectiveness of the
Registration Statement for amendments or supplements to a Registration Statement
or related prospectus or for additional information, (ii) the issuance by the
SEC or any other federal or state governmental authority of any stop order
suspending the effectiveness of a Registration Statement or the initiation of
any proceedings for that purpose, (iii) the receipt by Parent of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Shares for sale in any jurisdiction
or the initiation of any proceeding for such purpose or (iv) any event or
circumstance which necessitates the making of any changes in the Registration
Statement or prospectus, or any document incorporated or deemed to be
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 any
omission to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, and in the case of the prospectus,
it will not contain any untrue statement of a material fact or any omission to
state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, then Parent shall deliver a certificate in writing to the
Stockholders (the "Disclosure Suspension Notice") to the effect of the
foregoing, and, upon receipt of such Suspension Notice, the Stockholders will
refrain from selling any Registrable Shares pursuant to the Registration
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Statement (a "Disclosure Suspension") until the Stockholders' receipt of copies
of a supplemented or amended prospectus prepared and filed by Parent, or until
it is advised in writing by Parent that the current prospectus may be used, and
has received copies of any additional or supplemental filings that are
incorporated or deemed incorporated by reference in any such prospectus (any
such period of suspension being referred to herein as a "Corporate Disclosure
Suspension Period"). In the event of any Disclosure Suspension, Parent will use
its reasonable best efforts to cause the use of the prospectus so suspended to
be resumed as soon as possible after delivery of a Disclosure Suspension Notice
to the Stockholders.
(d) In the event the Eighteen-month Anniversary Date (but for the
operation of this Section 2.7(d)) would occur during a Corporate Development
Suspension Period, a Standstill Suspensions Period or a Corporate Disclosure
Suspension Period (each a "Suspension Period"), such Eighteen-month Anniversary
Date shall not be such date but shall instead shall be deemed to occur on that
date which is the thirtieth (30th) calendar day following the termination of
such Suspension Period.
Section 3. Miscellaneous.
3.1 Governing Law. This Agreement shall be governed by and construed
under the laws of the State of Utah.
3.2 Survival. The agreements made herein shall survive any
investigation made by any Stockholder and the closing of the transactions
contemplated hereby. All statements as to factual matters contained in any
certificate or other instrument delivered by or on behalf of Parent or any
Stockholder pursuant hereto in connection with the transactions contemplated
hereby shall be deemed to be representations and warranties by such person
hereunder solely as of the date of such certificate or instrument.
3.3 Successors And Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit of, and be binding
upon, the successors, assigns, heirs, executors, and administrators of the
parties hereto and shall inure to the benefit of and be enforceable by each
person who shall be a holder of Registrable Shares from time to time; provided,
however, that prior to the receipt by Parent of adequate written notice of the
transfer of any Registrable Shares specifying the full name and address of the
transferee, Parent may deem and treat the person listed as the holder of such
shares in its records as the absolute owner and holder of such shares for all
purposes, including the payment of dividends or any redemption price. The
obligations contained in this Agreement shall be assumed by any successor in
interest of Parent.
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3.4 Entire Agreement. This Agreement and the Exhibits hereto, together
with the Merger Agreement, constitute the full and entire understanding and
agreement between the parties with regard to the subjects hereof and no party
shall be liable or bound to any other in any manner by any representations,
warranties, covenants and agreements except as specifically set forth herein and
therein.
3.5 Severability. In case any provision of the Agreement shall be
invalid, illegal, or unenforceable, the validity, legality, and enforceability
of the remaining provisions shall not in any way be affected or impaired
thereby.
3.6 Amendment And Waiver. Any provision of this Agreement may be
amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of Parent and Stockholders owning of record at least a majority
of the Registrable Shares then outstanding. Any amendment or waiver effected in
accordance with this Section 3.6 shall be binding upon the Stockholders and
Parent. By acceptance of any benefits under this Agreement, the Stockholders
hereby agree to be bound by the provisions hereunder.
3.7 Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (a) upon personal delivery to the
party to be notified, (b) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient; if not, then on the next business
day, (c) five (5) days after having been sent by registered or certified mail,
return receipt requested, postage prepaid, or (d) one (1) day after deposit with
a nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the party
to be notified at the address as set forth on the signature pages hereof or
Exhibit A hereto or at such other address as such party may designate by ten
(10) days' advance written notice to the other parties hereto.
3.8 Attorneys' Fees. In the event that any dispute among the parties to
this Agreement should result in litigation, the prevailing party in such dispute
shall be entitled to recover from the losing party all fees, costs and expenses
of enforcing any right of such prevailing party under or with respect to this
Agreement, including without limitation, such reasonable fees and expenses of
attorneys and accountants, which shall include, without limitation, all fees,
costs and expenses of appeals.
3.9 Titles And Subtitles. The titles of the sections and subsections of
this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
3.10 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
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This Registration Rights Agreement has been executed and delivered as
of the date first stated above.
HEADWATERS INCORPORATED
By:
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Name:
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Title:
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[STOCKHOLDER]
By:
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Name:
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Title:
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[STOCKHOLDER]
By:
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Name:
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Title:
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EXHIBIT A
Stockholder Names and Addresses
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