REGISTRATION RIGHTS AGREEMENT
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This Registration Rights Agreement (the "Agreement") is entered into as of
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April 25, 2000 by and among Active Software, Inc., a Delaware corporation (the
"Company"), and those holders of the Company's Common Stock whose names are set
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forth on Exhibit A attached hereto (collectively, the "Stockholders").
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RECITALS
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The Company and Premier Software Technologies, Inc., a California
corporation ("Target"), and the Stockholders have entered into an Agreement and
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Plan of Merger dated as of April 25, 2000 (the "Merger Agreement"), which
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provides for the acquisition of Target by the Company through a merger (the
"Merger") of Target with and into the Company and the issuance by the Company to
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the Stockholders of shares of the Company's Common Stock (the "Company Shares")
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and the right to receive the Merger Consideration (as defined in the Merger
Agreement) in consideration of the shares of Target (the "Target Shares")
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exchanged by the Stockholders in the Merger. As a condition to the closing of
the Merger, the Stockholders desire to obtain and the Company has agreed to
grant certain registration rights to the Stockholders with respect to the
Company Shares.
AGREEMENT
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The parties hereby agree as follows:
1. Registration Rights.
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1.1 Definitions. For purposes of this Section 1:
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(a) The terms "register," "registered," and "registration" refer
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to a registration effected by preparing and filing a registration statement or
similar document in compliance with the Securities Act of 1933, as amended (the
"Securities Act"), and the subsequent declaration or ordering of the
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effectiveness of such registration statement or document.
(b) The term "Registrable Securities" means:
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(i) the Company Shares; and
(ii) any other shares of Common Stock of the Company issued
as (or issuable upon the conversion or exercise of any warrant, right or other
security which is issued as) a dividend or other distribution with respect to,
or in connection with a stock split, or in exchange for or in replacement of,
the Company Shares, excluding in all cases, however, any Registrable Securities
sold by a person in a transaction in which his or her rights under this
Agreement are not assigned; provided,
however, that Common Stock or other securities shall only be treated as
Registrable Securities if and so long as they have not been (A) sold to or
through a broker or dealer or underwriter in a public distribution or a public
securities transaction, or (B) sold in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act under
Section 4(1) thereof so that all transfer restrictions, and restrictive legends
with respect thereto, if any, are removed upon the consummation of such sale.
(c) The number of shares of "Registrable Securities then outstanding"
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shall mean the number of shares of Common Stock outstanding which are, and the
number of shares of Common Stock issuable pursuant to the then exercisable or
convertible securities which are, Registrable Securities;
(d) The term "Holder" means any holder of outstanding Registrable
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Securities who, subject to the limitations set forth in Section 1.7 below,
acquired such Registrable Securities in a transaction or series of transactions
not involving any registered public offering;
(e) The term "Form S-3" means such form under the Securities Act as in
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effect on the date hereof or any successor form under the Securities Act; and
(f) The term "SEC" means the Securities and Exchange Commission.
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1.2 Form S-3 Registration. In case the Company shall receive from
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any Holder or Holders of not less than fifty percent (50%) of the Registrable
Securities then outstanding a written request or requests that the Company
effect a registration on Form S-3 and any related qualification or compliance
with respect to all or a part of the Registrable Securities owned by such Holder
or Holders, the Company will:
(a) promptly give written notice of the proposed registration, and any
related qualification or compliance, to all other Holders;
(b) as soon as practicable, effect such registration and all such
qualifications and compliances as may be so requested and as would permit or
facilitate the sale and distribution of all or such portion of such Holder's or
Holders' Registrable Securities as are specified in such request, together with
all or such portion of the Registrable Securities of any other Holder or Holders
joining in such request as are specified in a written request given within 20
days after receipt of such written notice from the Company; provided, however,
that the Company shall not be obligated to effect any such registration,
qualification or compliance, pursuant to this Section 1.2:
(i) if Form S-3 is not available for such offering by the
Holders;
(ii) if the Holders, together with the Holders of any other
securities of the Company entitled to inclusion in such registration, propose to
sell
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Registrable Securities and such other securities (if any) at an aggregate price
to the public (net of any underwriters' discounts or commissions) of less than
$500,000;
(iii) if the Company shall furnish to the Holders a
certificate signed by the President of the Company 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 shareholders for such Form S-3 Registration
to be effected at such time, in which event the Company shall have the right to
defer the filing of the Form S-3 registration statement for a period of not more
than 90 days after receipt of the request of the Holder or Holders under this
Section 1.2; provided, however, that the Company shall not utilize this right
more than twice in any twelve month period;
(iv) if the Company has already effected a registration on
Form S-3 for the Holders; or
(v) in any particular jurisdiction in which the Company
would be required to qualify to do business or to execute a general consent to
service of process in effecting such registration, qualification or compliance
unless the Company is already subject to service in such jurisdiction and except
as may be required by the Securities Act.
(c) Subject to the foregoing, the Company shall file a registration
statement on Form S-3 covering the Registrable Securities and other securities
so requested to be registered promptly after receipt of the request or requests
of the Holders. All expenses incurred in connection with a registration
requested pursuant to Section 1.2, including (without limitation) all
registration, filing, qualification, printer and accounting fees shall be borne
by the Company. The Company shall not be required to pay any underwriters' or
brokers' fees, discounts or commissions relating to the Registrable Securities,
or the fees or expenses of separate counsel to the selling Holders.
1.3 Obligations of the Company. Whenever required under this Section
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1 to effect the registration of any Registrable Securities, the Company shall,
as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use its best efforts to cause such
registration statement to become effective, and, upon the request of the Holders
of a majority of the Registrable Securities registered thereunder, keep such
registration statement effective for up to 45 days or such shorter period during
which the Holders complete the distribution described in the registration
statement relating thereto, whichever first occurs.
(b) Prepare and file with the SEC 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
Act with respect to the disposition of all securities covered by such
registration statement for up to 45 days;
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(c) Cause all such Registrable Securities registered pursuant
hereunder to be listed on each securities exchange on which similar securities
issued by the Company are then listed;
(d) Furnish to the Holders participating in the registration such
reasonable number of copies of the registration statement, preliminary
prospectus, final prospectus and such other documents as such Holders may
reasonably request;
(e) Use its reasonable best efforts to register and qualify the
securities covered by such registration statement under such securities or Blue
Sky laws of such jurisdictions as shall be reasonably requested by the Holders,
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 such states or jurisdictions; and
(f) Notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Securities Act of the happening of any event
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 at the request of any such Holder, prepare and furnish to such
Holder a reasonable number of copies of a supplement to or an amendment of such
prospectuses as may be necessary so that, as thereafter delivered to the
purchasers of such shares, such prospectuses shall not include an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein no misleading in
light of the circumstances then existing.
1.4 Furnish Information. It shall be a condition precedent to the
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obligations of the Company to take any action pursuant to this Section 1 with
respect to the Registrable Securities of any selling Holder that such Holder
shall furnish to the Company such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of such securities
as shall be required to effect the registration of such Holder's Registrable
Securities. The Company shall have no obligation with respect to any
registration requested pursuant to Section 1.2 of this Agreement if, as a result
of the application of the preceding sentence, the anticipated aggregate offering
price of the Registrable Securities to be included in the registration does not
equal or exceed the number of shares or the anticipated aggregate offering price
required to originally trigger the Company's obligation to initiate such
registration as specified in subsection 1.2(b)(ii).
1.5 Indemnification. In the event any Registrable Securities are
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included in a registration statement under this Section 1:
(a) To the extent permitted by law, the Company will indemnify and
hold harmless each Holder and each person, if any, who controls such
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Holder within the meaning of the Securities Act or the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), against any losses, claims, damages,
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or liabilities (joint or several) to which they may become subject, under the
Securities Act, the Exchange Act or other federal or state law, insofar as such
losses, claims, damages, or liabilities (or actions in respect thereof) arise
out of or are based upon any of the following statements, omissions or
violations (collectively a "Violation"): (i) any untrue statement or alleged
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untrue statement of a material fact contained in such registration statement,
including any 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 the
Company 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; and the Company will pay, as incurred, any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability, or action; provided, however,
that the indemnity agreement contained in this subsection 1.5(a) shall not apply
to amounts paid in settlement of any such loss, claim, damage, liability, or
action if such settlement is effected without the consent of the Company, which
consent shall not be unreasonably withheld, nor shall the Company be liable in
any such case for any such loss, claim, damage, liability, or action to the
extent that it arises out of or is based upon a Violation which occurs in
reliance upon and in conformity with written information furnished expressly for
use in connection with such registration by such Holder or controlling person.
(b) To the extent permitted by law, each selling Holder will indemnify
and hold harmless the Company, each of its directors, each of its officers who
has signed the registration statement, each person, if any, who controls the
Company within the meaning of the Securities Act or the Exchange Act, any other
Holder selling securities in such registration statement and any controlling
person of any such other Holder, against any losses, claims, damages, or
liabilities (joint or several) to which any of the foregoing persons may become
subject, under the Securities Act, the Exchange Act or other federal or state
law, insofar as such losses, claims, damages, or liabilities (or actions in
respect thereof) arise out of or are based upon any Violation, 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 Holder expressly
for use in connection with such registration; and each such Holder will pay, as
incurred, any legal or other expenses reasonably incurred by any person intended
to be indemnified pursuant to this subsection 1.5(b), in connection with
investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this subsection
1.5(b) shall not apply to amounts paid in settlement of any such loss, claim,
damage, liability or action if such settlement is effected without the consent
of the Holder, which consent shall not be unreasonably withheld; provided that
in no event shall any indemnity under this subsection 1.5(b) exceed the net
proceeds from the offering received by such Holder, unless such liability arises
out of or is based on the willful conduct of such Holder.
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(c) Promptly after receipt by an indemnified party under this Section
1.5 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 1.5, deliver to the
indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; 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 prejudicial to its ability to defend such
action, shall relieve such indemnifying party of any liability to the
indemnified party under this Section 1.5, 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 1.5.
(d) If the indemnification provided in this Section 1.5 is held by a
court of competent jurisdiction to be unavailable to an indemnified party with
respect to any loss, liability, claim, damage or expense referred to therein,
then the indemnifying party, in lieu of indemnifying such indemnified party
hereunder, shall contribute to the amount paid or payable by such indemnified
party as a result of such loss, liability, claim, damage or expense 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 statements or omissions that resulted in such loss, liability, claim,
damage or expense as well as any other relevant equitable considerations. The
relative fault of the indemnifying party and of the indemnified party shall be
determined 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.
(e) The obligations of the Company and Holders under this Section 1.5
shall survive the completion of any offering of Registrable Securities in a
registration statement under this Section 1, and otherwise.
1.6 Reports Under Securities Exchange Act of 1934. With a view to
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making available to the Holders the benefits of Rule 144 promulgated under the
Securities Act and any other rule or regulation of the SEC that may at any time
permit a Holder to sell securities of the Company to the public without
registration, the Company agrees to use its best efforts to:
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(a) make and keep public information available, as those terms
are understood and defined in SEC Rule 144, at all times;
(b) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and
(c) furnish to any Holder, so long as the Holder owns any Registrable
Securities, forthwith upon request (i) a written statement by the Company that
it has complied with the reporting requirements of SEC Rule 144, the Securities
Act and the Exchange Act, (ii) a copy of the most recent annual or quarterly
report of the Company and such other reports and documents so filed by the
Company, and (iii) such other information as may be reasonably requested in
availing any Holder of any rule or regulation of the SEC which permits the
selling of any such securities without registration.
1.7 Assignment of Registration Rights. The rights to cause the
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Company to register Registrable Securities pursuant to this Section 1 may be
assigned by a Holder to a transferee or assignee of all of such Holder's
Registrable Securities, provided the Company is, within a reasonable time after
such transfer, furnished with written notice of the name and address of such
transferee or assignee and the securities with respect to which such
registration rights are being assigned; and provided, further, that such
assignment shall be effective only if immediately following such transfer the
further disposition of such securities by the transferee or assignee is
restricted under the Securities Act. The foregoing share limitation shall not
apply, however, to transfers by a Holder to any wholly-owned subsidiary or
constituent Stockholders (if a corporation), partner of the Stockholder (if a
partnership), or any spouse, son or daughter of the Stockholder (if an
individual), or to trustees of a trust the beneficiaries of which include the
Stockholder and any spouse, son or daughter of the Stockholder, provided that
all such transferees or assignees agree in writing to appoint a single
representative as their attorney in fact for the purpose of receiving any
notices and exercising their rights under this Section 1.
1.8 Termination of Registration Rights. The rights granted under
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this Section 1 shall terminate upon the earlier of (a) two years following the
date of this Agreement, or (b) with respect to any Holder, at such time as such
Holder may sell all of such Holder's Registrable Securities in any single three
month period pursuant to Rule 144 (or such successor rule as may be adopted).
2. Miscellaneous.
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2.1 Amendments and Waivers. Any term of this Agreement may be
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amended or waived with the written consent of the Company and the Holders of at
least a majority of the outstanding Registrable Securities. Any amendment or
waiver effected in accordance with this Section 2.1 shall be binding upon the
parties and their respective successors and assigns. In addition, the Company
may waive performance of any obligation owing to it, as to some or all of the
Holders of Registrable Securities, or agree
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to accept alternatives to such performance, without obtaining the consent of any
Holder of Registrable Securities. Each Holder acknowledges that by the operation
of Section 2.1 hereof, the Holders of a majority of the outstanding Registrable
Securities, acting in conjunction with the Company, will have the right and
power to diminish or eliminate all rights pursuant to this Agreement.
2.2 Successors and Assigns. Subject to the provisions of Section
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1.7, the terms and conditions of this Agreement shall inure to the benefit of
and be binding upon the respective successors and assigns of the parties.
Nothing in this Agreement, express or implied, is intended to confer upon any
party other than the parties hereto or their respective successors and assigns
any rights, remedies, obligations, or liabilities under or by reason of this
Agreement, except as expressly provided in this Agreement.
2.3 Governing Law. This Agreement and all acts and transactions
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pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
California, without giving effect to principles of conflicts of law.
2.4 Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.
2.5 Titles and Subtitles. The titles and subtitles used in this
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Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
2.6 Notices. Any notice required or permitted by this Agreement shall
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be in writing and shall be deemed sufficient upon receipt, when delivered
personally or by courier, overnight delivery service or confirmed facsimile, or
48 hours after being deposited in the regular mail as certified or registered
mail (airmail if sent internationally) with postage prepaid, if such notice is
addressed to the party to be notified at such party's address or facsimile
number as set forth below (or as subsequently modified by written notice):
(a) if to the Company:
Active Software, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxx Xxxxx, XX 00000
Fax: (000) 000-0000
Main: (000) 000-0000
Attention: Chief Financial Officer
with a copy to:
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Venture Law Group
A Professional Corporation
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
Fax: (000) 000-0000
Main: (000) 000-0000
Attention: Xxxx X. Xxxxxxxx
(b) if to Stockholder:
At such Stockholder's address as set forth on the signature
page hereto.
2.7 Severability. If one or more provisions of this Agreement are
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held to be unenforceable under applicable law, the parties agree to renegotiate
such provision in good faith, in order to maintain the economic position enjoyed
by each party as close as possible to that under the provision rendered
unenforceable. In the event that the parties cannot reach a mutually agreeable
and enforceable replacement for such provision, then (i) such provision shall be
excluded from this Agreement, (ii) the balance of the Agreement shall be
interpreted as if such provision were so excluded and (iii) the balance of the
Agreement shall be enforceable in accordance with its terms.
2.8 Entire Agreement. This Agreement is the product of all of the
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parties hereto, and constitutes the entire agreement between such parties
pertaining to the subject matter hereof, and merges all prior negotiations and
drafts of the parties with regard to the transactions contemplated herein. Any
and all other written or oral agreements existing between the parties hereto
regarding such transactions are expressly canceled.
2.9 Advice of Legal Counsel. Each party acknowledges and represents
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that, in executing this Agreement, it has had the opportunity to seek advice as
to its legal rights from legal counsel and that the person signing on its behalf
has read and understood all of the terms and provisions of this Agreement. This
Agreement shall not be construed against any party by reason of the drafting or
preparation thereof.
2.10 Rights of Holders. Each Holder of Registrable Securities shall
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have the absolute right to exercise or refrain from exercising any right or
rights that such Holder may have by reason of this Agreement, including, without
limitation, the right to consent to the waiver or modification of any obligation
under this Agreement, and such Holder shall not incur any liability to any other
Holder of any securities of the Company as a result of exercising or refraining
from exercising any such right or rights.
2.11 Delays or Omissions. No delay or omission to exercise any
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right, power or remedy accruing to any party to this Agreement, upon any breach
or default of the other party, shall impair any such right, power or remedy of
such non-breaching party nor shall it be construed to be a waiver of any such
breach or default, or an acquiescence
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therein, or of or in any similar breach or default thereafter occurring; nor
shall any waiver of any single breach or default be deemed a waiver of any other
breach or default theretofore or thereafter occurring. Any waiver, permit,
consent or approval of any kind or character on the part of any party of any
breach or default under this Agreement, or any waiver on the part of any party
of any provisions or conditions of this Agreement, must be made in writing and
shall be effective only to the extent specifically set forth in such writing.
All remedies, either under this Agreement, or by law or otherwise afforded to
any Holder, shall be cumulative and not alternative.
2.12 Secondary Public Offering. In the event that the Company
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undertakes a secondary public offering in which shares of the Company are
offered by parties other than the Company, the Company will use its best efforts
to seek the consent of existing holders of registration rights as necessary to
permit the sale and distribution of a portion of Holder's or Holders'
Registrable Securities, provided that if any Holder shall participate in such
registration, all provisions of Sections 1.2, 1.3, 1.4, 1.5 and 2.6 of this
Agreement shall be in effect with regard to such registration and the Holder's
participation therein. Nothing in this paragraph shall affect the Company's
right to withdraw any such registration at any time.
2.13 Third Parties. Nothing in this Agreement, express or implied,
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is intended to confer upon any party, other than the parties hereto, and their
respective successors and assigns, any rights, remedies, obligations or
liabilities under or by reason of this Agreement, except as expressly provided
herein.
[Signature Page Follows]
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The parties have executed this Agreement as of the date first above
written.
COMPANY:
ACTIVE SOFTWARE, INC.
By: /s/ XXX X. XXXX
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Title: CFO
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Address: _________________
_________________
STOCKHOLDER:
/s/ XXXXXX. X. XXXXXX
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Name:
Address:_________________
_________________
/s/ XXXXXXXX VAN DEN XXXX
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Name:
Address: ________________
________________
