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CENTENNIAL SECURITY, INC.
REGISTRATION AGREEMENT
THIS AGREEMENT is made as of July 11, 1995 by and among
Centennial Security, Inc., a Delaware corporation ("the Company"), Centennial
Fund IV, L.P., a Delaware limited partnership ("Centennial"), Chemical Venture
Capital Associates, a California limited partnership ("Chemical"), Xxxxxxx
Venture Partners IV--Direct Fund, L.P., a Delaware limited partnership
("Xxxxxxx"), Larimer & Co., a Delaware corporation ("Larimer"), Masada
Security, Inc., a Delaware corporation ("Masada") and Xxxxxx X. Xxxxxx
("Xxxxxx"), an individual residing in Xxxxxx Township, New Jersey.
As of the date hereof, Centennial, Larimer and Shiver are
holders of all the issued and outstanding Series A Convertible Preferred Stock
(collectively, the "Existing Investors") and parties to a Registration
Agreement with the Company dated as of December 30, 1994 (the "1994
Registration Agreement"). In order to induce Centennial, Chemical, Xxxxxxx,
Xxxxxxx and Masada (collectively, the "New Investors") to enter into the
Purchase Agreement of even date herewith (the "Purchase Agreement"), pursuant
to which they will purchase the Series B Convertible Preferred Stock, the
Company has agreed to terminate the 1994 Registration Agreement and provide,
the New Investors with the registration rights set forth in this Agreement.
The execution and delivery of this Agreement is a condition to the Closing
under the Purchase Agreement. Unless otherwise provided in this Agreement,
capitalized terms used herein shall have the meanings set forth in paragraph 8
hereof.
The parties hereto agree as follows:
1. Demand Registrations.
(a) Requests for Registration.
(i) At any time, the holders of at least 50% of
the Series B Registrable Securities then in existence may request registration
under the Securities Act of all or any portion of their Series B Registrable
Securities on Form S-1 or any similar long-form registration ("Long-Form
Registrations"), and the holders of at least 10% of the Series B Registrable
Securities then in existence may request registration under the Securities Act
of all or any portion of their Series B Registrable Securities on Form S-2 or
S-3 or any similar short-form registration ("Short-Form Registrations") if
available.
(ii) At any time after the Company has completed
an initial public offering of its equity securities under the Securities Act,
the holders of at least 50% of the Series A Registrable Securities then in
existence may request registration under the Securities Act of all or any
portion of their Series A Registrable Securities on any Long-Form Registration,
and the holders
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of at least 25% of the Series A Registrable Securities then in existence may
request registration under the Securities Act of all or any portion of their
Series A Registrable Securities on any Short-Form Registration, if available.
(iii) All registrations requested pursuant to this
paragraph 1(a) are referred to herein as "Demand Registrations". Each request
for a Demand Registration shall specify the approximate number of Series A
Registrable Securities or Series B Registrable Securities requested to be
registered and the anticipated per share price range for such offering. Within
ten days after receipt of any such request, the Company shall give written
notice of such requested registration to all other holders of Registrable
Securities and shall include in such registration all Registrable Securities
with respect to which the Company has received written requests for inclusion
therein within 15 days after the receipt of the Company's notice.
(b) Long-Form Registrations.
(i) The holders of Series B Registrable
Securities shall be entitled to request two Long-Form Registrations in which
the Company shall pay all Registration Expenses ("Company-paid Long-Form
Registrations"); provided that the aggregate offering value of the Series B
Registrable Securities requested to be registered in any Long-Form Registration
must equal at least $5,000,000 in net proceeds.
(ii) The holders of Series A Registrable
Securities shall be entitled to request (A) one Company-paid Long-Form
Registration and (B) one Long-Form Registration in which the holders of Series
A Registrable Securities shall pay their share of the Registration Expenses as
set forth in paragraph 5 hereof; provided that the aggregate offering value of
the Series A Registrable Securities requested to be registered in any Long-Form
Registration must equal at least $5,000,000 in net proceeds.
(iii) A registration shall not count as one of the
permitted Long-Form Registrations until it has become effective (unless such
Long-Form Registration has not become effective due solely to the fault of the
holders requesting such registration), and no Company-paid Long-Form
Registration or any Long-Form Registration pursuant to clause 1(b)(ii)(B) above
shall count as one of the permitted Long-Form Registrations unless the holders
of Registrable Securities are able to register and sell at least 90% of the
Registrable Securities requested to be included in such registration; provided
that in any event the Company shall pay all Registration Expenses in connection
with any registration initiated as a Company-paid Long-Form Registration
whether or not it has become effective and whether or not such registration has
counted as one of the permitted Company-paid Long-Form Registrations. All
Long-Form Registrations shall be underwritten registrations.
(c) Short-Form Registrations. In addition to the
Long-Form Registrations provided pursuant to paragraph 1(b), (i) the holders of
Series B Registrable Securities shall be entitled to request an unlimited
number of Short-Form Registrations in which the Company shall pay all
Registration Expenses, and (ii) the holders of Series A Registrable Securities
shall be entitled to
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request an unlimited number of Short-Form Registrations in five of which the
Company shall pay all Registration Expenses; provided that the aggregate
offering value of the Series B Registrable Securities or Series A Registrable
Securities, as applicable, requested to be registered in any Short-Form
Registration must equal at least $250,000. Demand Registrations shall be
Short-Form Registrations whenever the Company is permitted to use any
applicable short form. After the Company has become subject to the reporting
requirements of the Securities Exchange Act, the Company shall use its best
efforts to make Short-Form Registrations on Form S-3 available for the sale of
Registrable Securities.
(d) Priority on Demand Registrations.
(i) The Company shall not include in any Demand
Registration requested by the holders of Series B Registrable Securities any
securities which are not Registrable Securities without the prior written
consent of the holders of at least 50% of the Series B Registrable Securities
initially requesting such registration. If a Demand Registration is an
underwritten offering and the managing underwriters advise the Company in
writing that in their opinion the number of Series B Registrable Securities
and, if permitted hereunder, other securities requested to be included in such
offering exceeds the number of Series B Registrable Securities and other
securities, if any, which can be sold in an orderly manner in such offering
within a price range acceptable to the holders of a majority of the Series B
Registrable Securities initially requesting registration, the Company shall
include in such registration (i) first, the number of Series B Registrable
Securities requested to be included which in the opinion of such underwriters
can be sold in an orderly manner within the price range of such offering, pro
rata among the respective holders thereof on the basis of the amount of Series
B Registrable Securities owned by each such holder, (ii) second, the number of
Series A Registrable Securities requested to be included which in the opinion
of such underwriters can be sold in an orderly manner within the price range of
such offering, pro rata among the respective holders thereof on the basis of
the amount of Series A Registrable Securities owned by each such holder, and
(iii) third, any other Registrable Securities, if any, requested to be included
which in the opinion of such underwriters can be sold in an orderly manner
within the price range of such offering, pro rata among the respective holders
thereof on the basis of the amount of such Registrable Securities owned by each
such holder.
(ii) The Company shall not include in any Demand
Registration requested by the holders of Series A Registrable Securities any
securities which are not Registrable Securities without the prior written
consent of the holders of at least 75% of the Series A Registrable Securities
initially requesting such registration. If a Demand Registration is an
underwritten offering and the managing underwriters advise the Company in
writing that in their opinion the number of Series A Registrable Securities
and, if permitted hereunder, other securities requested to be included in such
offering exceeds the number of Series A Registrable Securities and other
securities, if any, which can be sold in an orderly manner in such offering
within a price range acceptable to the holders of a majority of the Series A
Registrable Securities initially requesting registration, the Company shall
include in such registration (i) first, the number of Series A Registrable
Securities requested to be included which in the opinion of such underwriters
can be sold in an orderly manner within the price range of such offering, pro
rata among the respective holders thereof on the basis of the amount of
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Series A Registrable Securities owned by each such holder, (ii) second, the
number of Series B Registrable Securities requested to be included which in the
opinion of such underwriters can be sold in an orderly manner within the price
range of such offering, pro rata among the respective holders thereof on the
basis of the amount of Series B Registrable Securities owned by each such
holder, and (iii) third, any other Registrable Securities, if any, requested to
be included which in the opinion of such underwriters can be sold in an orderly
manner within the price range of such offering, pro rata among the respective
holders thereof on the basis of the amount of such Registrable Securities owned
by each such holder.
(e) Restrictions on Demand Registrations. The Company
shall not be obligated to effect any Demand Registration within 180 days after
the effective date of a previous Demand Registration or a previous registration
in which the holders of Registrable Securities were given piggyback rights
pursuant to paragraph 2 and in which there was no reduction in the number of
Registrable Securities requested to be included. The Company may postpone once
for up to six months and once for up to nine months the filing or the
effectiveness of a registration statement for a Demand Registration if the
Company determines that such Demand Registration would reasonably be expected
to have an adverse effect on any proposal or plan by the Company or any of its
Subsidiaries to engage in any financing, acquisition of assets or any merger,
consolidation, tender offer or other similar transaction; provided that in such
event, the holders of Registrable Securities initially requesting such Demand
Registration shall be entitled to withdraw such request and, if such request is
withdrawn, such Demand Registration shall not count as one of the Demand
Registrations permitted to holders of Registrable Securities hereunder and the
Company shall pay all Registration Expenses in connection with such
registration; and provided further that the Company may exercise such right
only once in any 24-month period.
(f) Selection of Underwriters. The holders of a majority
of the Registrable Securities initially requesting registration hereunder shall
have the right to select the investment banker(s) and manager(s) to administer
the offering.
(g) Other Registration Rights. Except as provided in
this Agreement, the Company shall not grant to any Persons the right to request
the Company to register any equity securities of the Company, or any securities
convertible or exchangeable into or exercisable for such securities, without
the prior written consent of the holders of at least 50% of the Registrable
Securities.
2. Piggyback Registrations.
(a) Right to Piggyback. Whenever the Company proposes to
register any of its securities under the Securities Act (other than pursuant to
a Demand Registration) and the registration form to be used may be used for the
registration of Registrable Securities (a "Piggyback Registration"), the
Company shall give prompt written notice (in any event within three business
days after its receipt of notice of any exercise of demand registration rights
other than under this Agreement) to all holders of Registrable Securities of
its intention to effect such a registration and shall include in such
registration all Registrable Securities with respect to which the Company has
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received written requests for inclusion therein within 20 days after the
receipt of the Company's notice.
(b) Piggyback Expenses. The Registration Expenses of the
holders of Registrable Securities shall be paid by the Company in all Piggyback
Registrations.
(c) Priority on Primary Registrations. If a Piggyback
Registration is an underwritten primary registration on behalf of the Company,
and the managing underwriters advise the Company in writing that in their
opinion the number of securities requested to be included in such registration
exceeds the number which can be sold in an orderly manner in such offering
within a price range acceptable to the Company, the Company shall include in
such registration (i) first, the securities the Company proposes to sell, (ii)
second, the Registrable Securities requested to be included in such
registration, pro rata among the holders of such Registrable Securities on the
basis of the number of shares owned by such holder and (iii) third, other
securities requested to be included in such registration.
(d) Priority on Secondary Registrations. If a Piggyback
Registration is an underwritten secondary registration on behalf of holders of
the Company's securities, and the managing underwriters advise the Company in
writing that in their opinion the number of securities requested to be included
in such registration exceeds the number which can be sold in an orderly manner
in such offering within a price range acceptable to the holders initially
requesting such registration, the Company shall include in such registration
(i) first, the securities requested to be included therein by the holders
requesting such registration and the Registrable Securities requested to be
included in such registration, pro rata among the holders of such securities on
the basis of the number of shares so requested to be included therein owned by
each such holder and (ii) second, other securities requested to be included in
such registration.
(e) Selection of Underwriters. If any Piggyback
Registration is an underwritten offering, the selection of investment banker(s)
and manager(s) for the offering must be approved by the holders of a majority
of the Registrable Securities included in such Piggyback Registration. Such
approval shall not be unreasonably withheld.
(f) Other Registrations. If the Company has previously
filed a registration statement with respect to Registrable Securities pursuant
to paragraph 1 or pursuant to this paragraph 2, and if such previous
registration has not been withdrawn or abandoned, the Company shall not file or
cause to be effected any other registration of any of its equity securities or
securities convertible or exchangeable into or exercisable for its equity
securities under the Securities Act (except on Form S-8 or any successor form),
whether on its own behalf or at the request of any holder or holders of such
securities, until a period of at least 180 days has elapsed from the effective
date of such previous registration.
3. Holdback Agreements. (a) Each holder of Registrable
Securities shall not effect any public sale or distribution (including sales
pursuant to Rule 144) of equity securities of the Company, or any securities
convertible into or exchangeable or exercisable for such securities,
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during the seven days prior to and the 90-day period beginning on the effective
date of any underwritten Demand Registration or any underwritten Piggyback
Registration in which Registrable Securities are included (except as part of
such underwritten registration), unless the underwriters managing the
registered public offering otherwise agree.
(b) The Company (i) shall not effect any public sale or
distribution of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, during the seven days prior to
and during the 90-day period beginning on the effective date of any
underwritten Demand Registration or any underwritten Piggyback Registration
(except as part of such underwritten registration or pursuant to registrations
on Form S-8 or any successor form), unless the underwriters managing the
registered public offering otherwise agree, and (ii) shall cause each holder of
at least 3% (on a fully-diluted basis) of its Common Stock, or any securities
convertible into or exchangeable or exercisable for Common Stock, purchased
from the Company at any time after the date of this Agreement (other than in a
registered public offering or a sale pursuant to Rule 144) to agree not to
effect any public sale or distribution (including sales pursuant to Rule 144)
of any such securities during such period (except as part of such underwritten
registration, if otherwise permitted), unless the underwriters managing the
registered public offering otherwise agree.
4. Registration Procedures. Whenever the holders of
Registrable Securities have requested that any Registrable Securities be
registered pursuant to this Agreement, the Company shall use its best efforts
to effect the registration and the sale of such Registrable Securities in
accordance with the intended method of disposition thereof, and pursuant
thereto the Company shall as expeditiously as possible:
(a) prepare and file with the Securities and Exchange
Commission a registration statement with respect to such Registrable Securities
and use its best efforts to cause such registration statement to become
effective (provided that before filing a registration statement or prospectus
or any amendments or supplements thereto, the Company shall furnish to the
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, which documents shall be subject to the review and comment of such
counsel);
(b) notify each holder of Registrable Securities of the
effectiveness of each registration statement filed hereunder and prepare and
file with the Securities and Exchange Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective for a period of not less than 180 days and comply with the provisions
of the Securities Act with respect to the disposition of all securities covered
by such registration statement during such period in accordance with the
intended methods of disposition by the sellers thereof set forth in such
registration statement;
(c) furnish to each seller of Registrable Securities such
number of copies of such registration statement, each amendment and supplement
thereto, the prospectus included in such
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registration statement (including each preliminary prospectus) and such other
documents as such seller may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by such seller;
(d) use its best efforts to register or qualify such
Registrable Securities under such other securities or blue sky laws of such
jurisdictions as any seller reasonably requests and do any and all other acts
and things which may be reasonably necessary or advisable to enable such seller
to consummate the disposition in such jurisdictions of the Registrable
Securities owned by such seller (provided that the Company shall not be
required to (i) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this subparagraph, (ii)
subject itself to taxation in any such jurisdiction or (iii) consent to general
service of process in any such jurisdiction);
(e) notify each seller of such Registrable Securities, 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 contains an untrue statement
of a material fact or omits any fact necessary to make the statements therein
not misleading, and, at the request of any such seller, the Company shall
prepare a supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus
shall not contain an untrue statement of a material fact or omit to state any
fact necessary to make the statements therein not misleading;
(f) cause all such Registrable Securities to be listed on
each securities exchange on which similar securities issued by the Company are
then listed and, if not so listed, to be listed on The Nasdaq Stock Market and,
if listed on The Nasdaq Stock Market, use its best efforts to secure
designation of all such Registrable Securities covered by such registration
statement as a NASDAQ "national market system security" within the meaning of
Rule 11Aa2-1 of the Securities and Exchange Commission or, failing that, to
secure The Nasdaq Stock Market authorization for such Registrable Securities
and, without limiting the generality of the foregoing, to arrange for at least
two market makers to register as such with respect to such Registrable
Securities with The Nasdaq Stock Market;
(g) provide a transfer agent and registrar for all such
Registrable Securities not later than the effective date of such registration
statement;
(h) enter into such customary agreements (including
underwriting agreements in customary form) and take all such other actions as
the holders of a majority of the Registrable Securities being sold or the
underwriters, if any, reasonably request in order to expedite or facilitate the
disposition of such Registrable Securities (including effecting a stock split
or a combination of shares);
(i) make available for inspection by any seller of
Registrable Securities, any underwriter participating in any disposition
pursuant to such registration statement and any attorney, accountant or other
agent retained by any such seller or underwriter, all financial and other
records,
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pertinent corporate documents and properties of the Company, and cause the
Company's officers, directors, employees and independent accountants to supply
all information reasonably requested by any such seller, underwriter, attorney,
accountant or agent in connection with such registration statement;
(j) otherwise use its best efforts to comply with all
applicable rules and regulations of the Securities and Exchange Commission, and
make available to its security holders, as soon as reasonably practicable, an
earnings statement covering the period of at least twelve months beginning with
the first day of the Company's first full calendar quarter after the effective
date of the registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder; and
(k) If any such registration or comparable statement
refers to any holder by name or otherwise as the holder of any securities of
the Company and if its sole and exclusive judgment, such holder is or might be
deemed to be an underwriter or a controlling person of the Company, such holder
shall have the right to require (i) the insertion therein of language, in form
and substance 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 shall assist in meeting any future financial
requirements of the Company, or (ii) in the event that such reference to such
holder by name or otherwise is not required by the Securities Act or any
similar federal statute then in force, the deletion of the reference to such
holder; provided that with respect to this clause (ii) such holder shall
furnish to the Company an opinion of counsel to such effect, which opinion and
counsel shall be reasonably satisfactory to the Company.
(l) 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, the Company shall use its best efforts promptly to
obtain the withdrawal of such order.
(m) use its best efforts to cause such Registrable
Securities covered by such registration statement to be registered with or
approved by such other governmental agencies or authorities as may be necessary
to enable the sellers thereof to consummate the disposition of such Registrable
Securities;
(n) obtain a cold comfort letter from the Company's
independent public accountants in customary form and covering such matters of
the type customarily covered by cold comfort letters as the holders of a
majority of the Registrable Securities being sold reasonably request (provided
that such Registrable Securities constitute at least 10% of the securities
covered by such registration statement);
5. Registration Expenses.
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(a) All expenses incident to the Company's performance of
or compliance with this Agreement, including without limitation all
registration and filing fees, fees and expenses of compliance with securities
or blue sky laws, printing expenses, messenger and delivery expenses, fees and
disbursements of custodians, and fees and disbursements of counsel for the
Company and all independent certified public accountants, underwriters
(excluding discounts and commissions) and other Persons retained by the Company
(all such expenses being herein called "Registration Expenses"), shall be borne
as provided in this Agreement, except that the Company shall, in any event, pay
its internal expenses (including, without limitation, all salaries and expenses
of its officers and employees performing legal or accounting duties), the
expense of any annual audit or quarterly review, the expense of any liability
insurance and the expenses and fees for listing the securities to be registered
on each securities exchange on which similar securities issued by the Company
are then listed or on The Nasdaq Stock Market.
(b) In connection with each Demand Registration and each
Piggyback Registration, the Company shall reimburse the holders of Registrable
Securities included in such registration for the reasonable fees and
disbursements of one counsel chosen by the holders of a majority of the
Registrable Securities initially requesting such registration and for the
reasonable fees and disbursements of each additional counsel retained by any
holder of Registrable Securities solely for the purpose of rendering a legal
opinion on behalf of such holder in connection with such underwritten Demand
Registration or Piggyback Registration.
(c) To the extent Registration Expenses are not required
to be paid by the Company, each holder of securities included in any
registration hereunder shall pay those Registration Expenses allocable to the
registration of such holder's securities so included, and any Registration
Expenses not so allocable shall be borne by all sellers of securities included
in such registration in proportion to the aggregate selling price of the
securities to be so registered.
6. Indemnification.
(a) The Company agrees to indemnify, to the extent
permitted by law, each holder of Registrable Securities, its officers and
directors and each Person who controls such holder (within the meaning of the
Securities Act) against all losses, claims, damages, liabilities and expenses
caused by any untrue or alleged untrue statement of material fact contained in
any registration statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto or any omission or alleged omission of
a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as the same are caused by or
contained in any information furnished in writing to the Company by such holder
expressly for use therein or by such holder's failure to deliver a copy of the
registration statement or prospectus or any amendments or supplements thereto
after the Company has furnished such holder with a sufficient number of copies
of the same. In connection with an underwritten offering, the Company shall
indemnify such underwriters, their officers and directors and each Person who
controls such underwriters (within the meaning of the Securities Act) to the
same extent as provided above with respect to the indemnification of the
holders of Registrable Securities.
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(b) In connection with any registration statement in
which a holder of Registrable Securities is participating, each such holder
shall furnish to the Company in writing such information and affidavits as the
Company reasonably requests for use in connection with any such registration
statement or prospectus and, to the extent permitted by law, shall indemnify
the Company, its directors and officers and each Person who controls the
Company (within the meaning of the Securities Act) against any losses, claims,
damages, liabilities and expenses resulting from any untrue or alleged untrue
statement of material fact contained in the registration statement, prospectus
or preliminary prospectus or any amendment thereof or supplement thereto or any
omission or alleged omission of a material fact required to be stated therein
or necessary to make the statements therein not misleading, but only to the
extent that such untrue statement or omission is contained in any information
or affidavit so furnished in writing by such holder; provided that the
obligation to indemnify shall be individual, not joint and several, for each
holder and shall be limited to the net amount of proceeds received by such
holder from the sale of Registrable Securities pursuant to such registration
statement.
(c) Any Person entitled to indemnification hereunder
shall (i) give prompt written notice to the indemnifying party of any claim
with respect to which it seeks indemnification (provided that the failure to
give prompt notice shall not impair any Person's right to indemnification
hereunder to the extent such failure has not prejudiced the indemnifying party)
and (ii) unless in such indemnified party's reasonable judgment a conflict of
interest between such indemnified and indemnifying parties may exist with
respect to such claim, permit such indemnifying party to assume the defense of
such claim with counsel reasonably satisfactory to the indemnified party. If
such defense is assumed, the indemnifying party shall not be subject to any
liability for any settlement made by the indemnified party without its consent
(but such consent shall not be unreasonably withheld). An indemnifying party
who is not entitled to, or elects not to, assume the defense of a claim shall
not be obligated to pay the fees and expenses of more than one counsel for all
parties indemnified by such indemnifying party with respect to such claim,
unless in the reasonable judgment of any indemnified party a conflict of
interest may exist between such indemnified party and any other of such
indemnified parties with respect to such claim.
(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 or any officer, director or controlling
Person of such indemnified party and shall survive the transfer of securities.
The Company also agrees to make such provisions, as are reasonably requested by
any indemnified party, for contribution to such party in the event the
Company's indemnification is unavailable for any reason.
7. Participation in Underwritten Registrations. No
Person may participate in any registration hereunder which is underwritten
unless such Person (i) agrees to sell such Person's securities on the basis
provided in any underwriting arrangements approved by the Person or Persons
entitled hereunder to approve such arrangements and (ii) completes and executes
all questionnaires, powers of attorney, indemnities, underwriting agreements
and other documents required under the terms of such underwriting arrangements;
provided that no holder of Registrable Securities included in any underwritten
registration shall be required to make any representations or warranties to the
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Company or the underwriters (other than representations and warranties
regarding such holder and such holder's intended method of distribution) or to
undertake any indemnification obligations to the Company or the underwriters
with respect thereto, except as otherwise provided in paragraph 6 hereof.
8. Definitions.
(a) "1994 Purchase Agreement" means the Series A
Preferred Stock Purchase Agreement, dated as of December 30, 1994, by and among
the Company, Centennial, Larimer and Xxxxxx X. Xxxxxx, as amended as of March
1, 1995, and not as subsequently amended.
(b) "Masada Purchase Agreement" means the Stock Purchase
Agreement, dated as of June 10, 1994, by and among the Company and Masada, as
amended as of June 23, 1995, and not as subsequently amended.
(c) "Registrable Securities" means Series A Registrable
Securities and Series B Registrable Securities. As to any particular
Registrable Securities, such securities shall cease to be Series A or Series B
Registrable Securities when they have been distributed to the public pursuant
to a offering registered under the Securities Act or sold to the public through
a broker, dealer or market maker in compliance with Rule 144 under the
Securities Act (or any similar rule then in force). For purposes of this
Agreement, a Person shall be deemed to be a holder of Registrable Securities
whenever such Person has the right to acquire such Registrable Securities (upon
conversion or exercise in connection with a transfer of securities or
otherwise, but disregarding any restrictions or limitations upon the exercise
of such right), whether or not such acquisition has actually been effected.
(d) "Required Holders" has the meaning set forth in the
Purchase Agreement.
(e) "Series A Registrable Securities" means (i) any Class
A Common issued upon the conversion of any Series A Convertible Preferred Stock
issued pursuant to the 1994 Purchase Agreement and (ii) any Class A Common
issued or issuable with respect to the securities referred to in clause (i)
above by way of a stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization.
(f) "Series B Registrable Securities" means (i) any Class
A Common issued upon the conversion of any Series B Convertible Preferred Stock
or the exercise of any Contingent Warrants issued pursuant to the Purchase
Agreement and (ii) any Class A Common issued or issuable with respect to the
securities referred to in clause (i) above by way of a stock dividend or stock
split or in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization.
(g) Unless otherwise stated, other capitalized terms
contained herein have the meanings set forth in the Purchase Agreement.
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9. Miscellaneous.
(a) No Inconsistent Agreements. The Company shall not
hereafter enter into any agreement with respect to its securities which is
inconsistent with or violates the rights granted to the holders of Registrable
Securities in this Agreement.
(b) Adjustments Affecting Registrable Securities. The
Company shall not take any action, or permit any change to occur, with respect
to its securities which would materially and adversely affect the ability of
the holders of Registrable Securities to include such Registrable Securities in
a registration undertaken pursuant to this Agreement or which would materially
and adversely affect the marketability of such Registrable Securities in any
such registration (including, without limitation, effecting a stock split or a
combination of shares).
(c) Remedies. Any Person having rights under any
provision of this Agreement shall be entitled to enforce such rights
specifically to recover damages caused by reason of any breach of any provision
of this Agreement and to exercise all other rights granted by law. The parties
hereto agree and acknowledge that money damages may not be an adequate remedy
for any breach of the provisions of this Agreement and that any party may in
its sole discretion apply to any court of law or equity of competent
jurisdiction (without posting any bond or other security) for specific
performance and for other injunctive relief in order to enforce or prevent
violation of the provisions of this Agreement.
(d) Amendments and Waivers. Except as otherwise provided
herein, the provisions of this Agreement may be amended or waived upon, but
only upon, the prior written consent of the Company and the Required Holders;
provided that (a) any amendment or waiver affecting the rights specifically
granted to the holders of Series A Registrable Securities as such or the
definition of "Series A Registrable Securities" hereunder shall require, in
addition, the prior written consent of the holders of at least 90% of the
Series A Registrable Securities then in existence; and (b) any amendment or
waiver affecting the rights specifically granted to the holders of Series B
Registrable Securities as such or the definition of "Series B Registrable
Securities" hereunder shall require, in addition, the prior written consent of
the holders of at least 75% of the Series B Registrable Securities then in
existence.
(e) Successors and Assigns. All covenants and agreements
in this Agreement by or on behalf of any of the parties hereto shall bind and
inure to the benefit of the respective successors and assigns of the parties
hereto whether so expressed or not. In addition, whether or not any express
assignment has been made, the provisions of this Agreement which are for the
benefit of purchasers or holders of Registrable Securities are also for the
benefit of, and enforceable by, any subsequent holder of Registrable Securities.
(f) Severability. Whenever possible, each provision of
this Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision shall be
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ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of this Agreement.
(g) Counterparts. This Agreement may be executed
simultaneously in separate counterparts, any one of which need not contain the
signatures of more than one party, but all such counterparts taken together
shall constitute one and the same Agreement.
(h) Descriptive Headings; Interpretations. The
descriptive captions and headings of this Agreement are inserted for
convenience only and do not constitute a section of this Agreement. The use of
the word "including" in this Agreement shall be by way of example rather than
by limitation.
(i) Governing Law. The corporate law of Delaware shall
govern all issues concerning the relative rights of the Company and its
stockholders. All other issues concerning the construction, validity,
interpretation and enforcement of this Agreement shall be governed by the
internal laws of the State of Delaware.
(j) Notices. All notices, demands or other
communications to be given or delivered under or by reason of the provisions of
this Agreement shall be in writing and shall be deemed to have been given when
delivered personally to the recipient, sent to the recipient by reputable
express courier service (charges prepaid) or mailed to the recipient by
certified or registered mail, return receipt requested and postage prepaid.
Such notices, demands and other communications shall be sent to each Investor
at the address set forth on the attached Notices Schedule and to the Company at
the address indicated below:
Centennial Security, Inc.
000 Xxxx Xxxxxx
Xxxxxxx, Xxx Xxxxxx 00000
Attn: Xxxxxx X. Xxxxxx
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.
(k) Termination of the Existing Registration Agreement.
By execution of this Agreement, the parties hereby agree that any and all
rights existing under any agreement providing any of the parties with
registration rights for any of the Company's securities, including, without
limitation, the 1994 Registration Agreement, are hereby terminated effective as
of the date hereof. The parties further acknowledge and agree that this
Agreement sets forth the only terms by which any of the parties hereto will
have any registration rights.
* * * * *
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
CENTENNIAL SECURITY, INC.
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------------------
Its: President
---------------------------------------------
CENTENNIAL FUND IV, L.P.
By: Centennial Holdings IV, L.P.
its General Partner
By: /s/ Xxxxx X. Xxxx, Xx.
--------------------------------------------
Xxxxx X. Xxxx, Xx.
General Partner
CHEMICAL VENTURE CAPITAL ASSOCIATES
By: Chemical Venture Partners
Its: General Partner
By: /s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Its: General Partner
----------------------------------------
XXXXXXX VENTURE PARTNERS IV -- DIRECT FUND, L.P.
By: Back Bay Partners XII L.P.
By: Xxxxxxx Venture Partners, Inc.
By: /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------------------
authorized officer
[SIGNATURE PAGE XXXXXXXXX]
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XXXXXXX & XX.
Xx: /s/ Xxxxx X. Xxxx, Xx.
--------------------------------------------
Its: Executive Vice President
--------------------------------------------
MASADA SECURITY, INC.
By: /s/ Xxxxx X. Xxxxxx
--------------------------------------------
Its: Vice President
--------------------------------------------
/s/ Xxxxxx X. Xxxxxx
-------------------------------------------------
Xxxxxx X. Xxxxxx
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