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EXHIBIT 10.2
STOCKHOLDER AGREEMENT
THIS STOCKHOLDER AGREEMENT (the "Agreement") is entered into as of the
____ day of June 1998, by and among UNIPHASE CORPORATION, a Delaware corporation
("Uniphase"), KONINKLIJKE PHILIPS ELECTRONICS N.V., a company duly established
under the laws of The Netherlands and having its registered office in Eindhoven,
The Netherlands ("Philips" and individually or collectively with any person to
whom Philips transfers its rights under this Agreement pursuant to Section 2.10
below, "Holder").
RECITALS
WHEREAS, Uniphase, Philips, Philips Optoelectronics B.V. ("OPTO") and
certain subsidiary corporations and other business entities controlled by
Uniphase are parties to that certain Master Purchase Agreement, dated as of May
29, 1998 (the "Purchase Agreement") and the other Sale Agreements (as defined in
the Purchase Agreement), which provide for the acquisition of OPTO and the
Activity (as defined in the Purchase Agreement) by the Uniphase Parties (as
defined in the Purchase Agreement) in exchange for certain shares of Uniphase
Common Stock (as defined in the Purchase Agreement) issued to Philips on or
prior to the date hereof (the "Closing Common Stock").
WHEREAS, pursuant to the Purchase Agreement, a total of 100,000 shares
of Uniphase Preferred Stock (as defined in the Purchase Agreement) were issued
to Philips, and such shares of Uniphase Preferred Stock are convertible into
additional shares of Uniphase Common Stock (the "Earn-Out Common Stock" and
collectively with the Closing Common Stock as the "Common Stock") in accordance
with that Series A Preferred Agreement (as defined in the Purchase Agreement).
WHEREAS, the parties wish to provide herein for certain registration
rights with respect to the Common Stock at the election of a Philips
representative to the Uniphase Board of Directors and certain restrictions that
shall apply to Philips Entities (as defined in the Purchase Agreement) during
any period in which the Philips Entities shall own or be deemed to own 5% or
more of the outstanding shares of Uniphase Common Stock.
NOW THEREFORE, in consideration of the mutual promises,
representations, warranties, covenants and conditions set forth in this
Agreement and in the Purchase Agreement, the parties mutually agree as follows:
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1. GENERAL
1.1. Definitions in Purchase Agreement. Accept as herein
specifically provided, any terms defined in the Purchase Agreement shall have
the same meaning for the purpose of this Agreement.
1.2. Other 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 from time to time.
"HOLDER" means any person owning of record
Registrable Securities that have not been sold to the public or any assignee of
record of such Registrable Securities in accordance with Section 2.10 hereof.
"MARKET VALUE" means, at any date set forth herein,
the product of: (i) the average last reported sale price on the NASDAQ National
Market (or any other national securities exchange upon which the Uniphase Common
Stock shall be registered) of one share of Uniphase Common Stock over the ten
(10) trading days ending immediately prior to such date; and (ii) the number of
shares of Uniphase Common Stock held by a Holder or Holders to be registered on
behalf of such Holder or Holders, as the case may be.
"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 SECURITIES" means (i) any shares of
Closing Common Stock (ii) any shares of Earn-Out Common Stock issued or issuable
upon conversion of the Uniphase Preferred Stock, and (iii) any Uniphase Common
Stock issued as a dividend or other distribution with respect to, or in exchange
for, or in replacement of Uniphase Common Stock. Notwithstanding the foregoing,
Registrable Securities shall not include any securities sold by a person to the
public either pursuant to a registration statement or Rule 144 promulgated under
the Securities Act or sold in a private transaction in which the transferor's
rights under Section 2 of this Agreement are not assigned.
"REGISTRABLE SECURITIES THEN OUTSTANDING" shall be
the number of Registrable Securities as are issued and outstanding as of a
specified date.
"REGISTRATION EXPENSES" shall mean all expenses
(other than Selling Expenses) incurred by Uniphase in complying with Sections
2.2, 2.3 and 2.4 hereof, including, without limitation, all registration, filing
fees and qualifications, printing expenses, fees and disbursements of counsel
for Uniphase, reasonable fees and disbursements of a single special counsel for
the Holders, blue sky fees and expenses and the expense of any special audits
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incident to or required by any such registration (but excluding the compensation
of regular employees of Uniphase which shall be paid in any event by Uniphase).
"SECURITIES ACT" shall mean the Securities Act of
1933, as amended from time to time.
"SELLING EXPENSES" shall mean all underwriting
discounts and selling commissions applicable to the sale.
"FORM S-3" means Form S-3 under the Securities Act as
in effect on the date hereof or any successor registration form under the
Securities Act subsequently adopted by the SEC which permits inclusion or
incorporation of substantial information by reference to other documents filed
by Uniphase with the SEC.
"SEC" or "COMMISSION" means the Securities and
Exchange Commission.
2. REGISTRATION; RESTRICTIONS ON TRANSFER
2.1. Restrictions on Transfer of Voting Stock
2.1.1. Philips shall not, directly or indirectly,
sell, assign, pledge, hypothecate or otherwise transfer any shares of the
Closing Common Stock (or any right, title or interest therein) for a period of
one year following the date hereof.
2.1.2. Any purported transfer in violation of this
Section 2.1 shall be void.
2.1.3. Each certificate representing Registrable
Securities shall (unless otherwise permitted by the provisions of the Agreement)
be stamped or otherwise imprinted with a legend substantially similar to the
following (in addition to any legend required under applicable state securities
laws, Uniphase's bylaws, or as provided elsewhere in this Agreement):
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933 (THE "ACT") AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED
UNLESS AND UNTIL REGISTERED UNDER THE ACT OR UNLESS UNIPHASE HAS
RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO UNIPHASE AND ITS
COUNSEL THAT SUCH REGISTRATION IS NOT REQUIRED.
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2.1.4. Uniphase shall be obligated to reissue
promptly unlegended certificates at the request of any holder thereof if the
holder shall have obtained an opinion of counsel (which counsel may be counsel
to Uniphase) reasonably acceptable to Uniphase to the effect that the securities
proposed to be disposed of may lawfully be disposed of without registration,
qualification or legend.
2.2. Demand Registrations
2.2.1. Right to Demand Registration. Subject to the
conditions of this Section 2.2, if Uniphase shall receive a written request from
the Holders of Registrable Securities (the "Initiating Holders") that Uniphase
file a registration statement under the Securities Act covering the registration
of Registrable Securities then outstanding having a Market Value of not less
than $10,000,000, then Uniphase shall, within thirty (30) days of the receipt of
such request, give written notice of such request to all Holders, and subject to
the limitations of this Section 2.2, effect, as soon as practicable, the
registration under the Securities Act of all Registrable Securities that the
Holders request to be registered.
2.2.2. Underwriting. If the Initiating Holders
intend to distribute the Registrable Securities covered by their request by
means of a firm commitment underwritten offering, they shall so advise Uniphase
as part of their request made pursuant to this Section 2.2, and Uniphase shall
include such information in the written notice referred to in Section 2.2.1. The
Initiating Holders shall designate any underwriter or underwriters to be
retained in connection with any registration pursuant to this Section 2.2, which
underwriter or underwriters shall be reasonably acceptable to Uniphase. In such
event, the right of any Holder to include its Registrable Securities in such
registration shall be conditioned upon such Holder's participation in such
underwritten offering and the inclusion of such Holder's Registrable Securities
in the underwriting (unless otherwise mutually agreed by a majority in interest
of the Initiating Holders and such Holder) to the extent provided herein. All
Holders proposing to distribute their securities through such underwriting and
Uniphase, shall enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting. Notwithstanding any
other provision of this Section 2.2, if the underwriter in good faith advises
Uniphase that marketing factors require a limitation of the number of securities
to be underwritten (including Registrable Securities) then any securities to be
sold on behalf of Uniphase or any stockholder of Uniphase (other than Holders)
shall be excluded from such registration to the extent required by such
limitation. If a limitation on the number of shares to be included in such
registration shall still be required after giving effect to the limitation in
the preceding sentence, Uniphase shall so advise all Holders of Registrable
Securities which would otherwise be underwritten pursuant hereto, and the number
of shares that may be included in the underwriting shall be allocated to the
Holders of such Registrable Securities on a pro rata basis based on the number
of Registrable Securities held by all such Holders (including the Initiating
Holders). Any Registrable Securities excluded or withdrawn from such
underwriting shall be withdrawn from the registration. In the event that the
reduction in Registrable Securities to be included in such registration reduces
the number of Registrable Securities to be so registered to less than fifty
percent (50%) of the Registrable Securities requested to be so registered
pursuant to this Section 2.2, Uniphase shall be obligated to proceed with the
registration and such
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registration shall not be counted for the purpose of clause (2) or (3) of
Section 2.2.3 below. If any Holder disapproves of the terms of the underwritten
offering, it may elect to withdraw therefrom by prompt written notice to
Uniphase, the underwriter and the Initiating Holders. The Registrable Securities
so withdrawn shall also be withdrawn from registration. Subject to the foregoing
limitations and Section 2.2.4, Uniphase shall have the right to include
securities to be sold on its behalf in any offering registered pursuant to this
Section 2.2.
2.2.3. Uniphase shall not be required to effect a
registration pursuant to this Section 2.2:
1. prior to one (1) year from the date
of this Agreement, provided that a holder may give notice and require that the
Company take steps necessary to ensure that such registration is effective upon
the first anniversary of this Agreement; or'
2. after any holder has demanded three
(3) registrations pursuant to this Section 2.2, and such registrations have been
declared or ordered effective; or
3. after any Holder has demanded one
(1) registration pursuant to this Section 2.2 during the preceding twelve (12)
month period, and such registration has been declared or ordered effective.
2.2.4. Exclusivity. If the Initiating Holders do
not advise Uniphase of their intent to distribute the Registrable Securities
covered by their request by means of a firm commitment underwritten offering,
they shall have the right to require that Uniphase not register any additional
shares or allow any other registration statement to become effective, whether on
that registration statement or otherwise (other than a registration on Form X-0,
Xxxx X-0 or any successor to such forms), for a period not to exceed 30 days
after effectiveness of the registration statement on which the Initiating
Holders' shares are being registered. Such right to demand exclusivity shall
preclude any other person from exercising piggy-back registration rights similar
to Section 2.3.
2.3. Piggyback Registrations. Uniphase shall notify all
Holders of Registrable Securities in writing promptly but in any event at least
twenty (20) days prior to the initial filing of any registration statement under
the Securities Act to register any of its securities either for its own account
or the account of any holder or holders of Uniphase equity securities, but
excluding registration statements relating to employee benefit plans or with
respect to corporate mergers, combinations, acquisitions, reorganizations or
other transactions under Rule 145 of the Securities Act) and will afford each
such Holder an opportunity to include in such registration statement (and any
related qualification under blue sky laws or other compliance), and in any
underwritten offering therein all or part of such Registrable Securities held by
such Holder. Each Holder desiring to include in any such registration statement
all or any part of the Registrable Securities held by it shall, within fifteen
(15) days after the above-described notice from Uniphase, so notify Uniphase in
writing. Such notice shall state the intended method of disposition of the
Registrable Securities by such Holder. If a Holder decides not to include all of
its Registrable Securities in any registration statement thereafter filed by
Uniphase, such Holder shall
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nevertheless continue to have the right to include any Registrable Securities in
any subsequent such registration statement or registration statements pursuant
to this Section 2.3.
2.3.1. Underwriting. If the registration statement
under which Uniphase gives written notice under this Section 2.3 is for an
underwritten offering, Uniphase shall so advise the Holders of Registrable
Securities in such written notice. In such event, the right of any such Holder
to be included in a registration pursuant to this Section 2.3 shall be
conditioned upon such Holder's participation in such underwritten offering and
the inclusion of such Holder's Registrable Securities in the underwritten
offering to the extent provided herein. All Holders proposing to distribute
their Registrable Securities through such underwritten offering and Uniphase
shall enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by Uniphase.
Notwithstanding any other provision of the Agreement, if the underwriter
determines that marketing factors require a limitation of the number of shares
to be underwritten, the securities of Uniphase (other than Registrable
Securities) held by officers or directors and by other shareholders (other than
shareholders holding Pari Passu Registration Rights (as hereinafter defined)
(the "Pari Passu Holders"), shall be excluded from such registration to the
extent so required by such limitation, and if a limitation of the number of
shares is still required, then the underwriter may limit the number of
Registrable Securities and securities held by Pari Passu Holders to be included
in the registration, such limitation to be allocated pro rata among the Holders
and the Pari Passu Holders based on the number of Registrable Securities and
securities held by Pari Passu Holders otherwise requested to be included in such
registration. No such reduction shall reduce the securities being offered by
Uniphase for its own account to be included in the registration and
underwriting. If any Holder disapproves of the terms of the underwritten
offering, it may elect to withdraw therefrom by prompt written notice to
Uniphase and the underwriter. The Registrable Securities so withdrawn shall also
be withdrawn from registration.
2.3.2. Right to Terminate Registration. Uniphase
shall have the right to terminate or withdraw any registration initiated by it
under this Section 2.3 prior to the effectiveness of such registration whether
or not any Holder has elected to include securities in such registration. The
Registration Expenses of such withdrawn registration shall be borne by Uniphase
in accordance with Section 2.5 hereof.
2.4. Form S-3 Registration. In case Uniphase shall receive
from any Holder or Holders of Registrable Securities then outstanding, having a
Market Value of not less than $5,000,000, a written request or requests that
Uniphase effect a registration on Form S-3 or any similar short-form
registration statement and any related qualification or compliance with respect
to Registrable Securities, Uniphase will:
2.4.1. promptly give written notice of the proposed
registration, and any related qualification or compliance, to all other Holders
of Registrable Securities; and
2.4.2. as soon as practicable, use its best efforts
to 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
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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 fifteen (15) days
after receipt of such written notice from Uniphase, provided, however, that
Uniphase shall be obligated to file a registration statement no later than one
hundred twenty (120) days after receipt of a request under this Section 2.4.
2.4.3. Notwithstanding anything herein to the
contrary, Uniphase shall not be obligated to effect any such registration,
qualification or compliance pursuant to this Section 2.4:
1. To the extent Form S-3 (or any
successor or similar form) is not available for such offering by the Holders; or
2. if the Holders propose to sell
Registrable Securities and such other securities (if any) with a Market Value of
less than $2,500,000; or
3. if Uniphase has, within the twelve
(12) month period preceding the date of such request, already effected one (1)
registration on Form S-3 for the Holders pursuant to this Section 2.4.
2.4.4. Underwriting. If the Holders intend to
distribute the Registrable Securities covered by their request by means of a
firm commitment underwriting, they shall so advise Uniphase as a part of their
request made pursuant to this Section 2.4, and Uniphase shall include such
information in the written notice referred to in Section 2.4.1. The Holders
shall designate any underwriter or underwriters to be retained in connection
with any registration pursuant to this Section 2.4, which underwriter or
underwriters shall be reasonably acceptable to Uniphase. In such event, the
right of any Holder to include its Registrable Securities in such registration
shall be conditioned upon such Holder's participation in such underwriting and
the inclusion of such Holder's Registrable Securities in the underwriting
(unless otherwise mutually agreed by a majority in interest of the Initiating
Holders and such Holder) to the extent provided herein. Uniphase and all Holders
proposing to distribute their securities through such underwriting shall enter
into an underwriting agreement in customary form with the underwriter or
underwriters selected for such underwriting.
2.4.5. Subject to the foregoing, Uniphase shall
file a Form S-3 registration statement covering the Registrable Securities and
no other securities as soon as practicable after receipt of the request or
requests of the Holders, but in no event later than 120 days from the receipt of
such request.
2.5. Expenses of Registration. Except as specifically provided
herein, all Registration Expenses incurred in connection with any registration,
qualification or compliance pursuant to Section 2.2, Section 2.3 or Section 2.4
herein shall be borne by Uniphase. All Selling Expenses incurred in connection
with any registrations hereunder, shall be borne by the holders of the
securities so registered pro rata on the basis of the number of shares so
registered. Uniphase shall not, however, be required to pay for expenses of any
registration proceeding
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begun pursuant to Section 2.2, the request of which has been subsequently
withdrawn by the Initiating Holders unless the withdrawal is pursuant to Section
2.7. If the Holders are required to pay the Registration Expenses, such expenses
shall be borne by the holders of securities (including Registrable Securities)
requesting such registration in proportion to the number of shares for which
registration was requested and such Holders shall not forfeit their rights
pursuant to Section 2.2 to demand registration. If Uniphase is required to pay
the Registration Expenses of a withdrawn offering (other than pursuant to
Section 2.7), then the Holders shall forfeit their rights pursuant to Section
2.2 to one demand registration.
2.6. Obligations of Uniphase. Whenever required to effect
the registration of any Registrable Securities, Uniphase shall, at its expense,
as expeditiously as reasonably possible:
2.6.1. Prepare and file with the SEC a registration
statement with respect to such Registrable Securities and use all reasonable
efforts to cause such registration statement to become effective, and keep such
registration statement effective for up to one hundred and twenty (120) days (or
two (2) years, if such registration is pursuant to Section 2.4 hereof) days or,
if earlier, until the Holder or Holders have completed the distribution related
thereto.
2.6.2. 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 Securities Act with respect to the disposition
of all securities covered by such registration statement.
2.6.3. Furnish to the Holders 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
Securities owned by them.
2.6.4. Use all reasonable efforts to register and
qualify the securities covered by such registration statement under such other
securities or Blue Sky laws of such jurisdictions as shall be reasonably
requested by the Holders.
2.6.5. In the event of any underwritten public
offering, enter into and perform its obligations (including reasonable
indemnification) under an underwriting agreement, in usual and customary form,
with the managing underwriter(s) of such offering. Each Holder participating in
such underwriting shall also enter into and perform its obligations under such
an agreement.
2.6.6. 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
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the statements therein not misleading in the light of the circumstances then
existing.
2.6.7. Furnish, at the request of a majority in
interest of the Holders participating in the registration, on the date that such
Registrable Securities are delivered to the underwriters for sale, if such
securities are being sold through underwriters, or, if such securities are not
being sold through underwriters, on the date that the registration statement
with respect to such securities becomes effective, (i) an opinion, dated as of
such date, of the counsel representing Uniphase for the purposes of such
registration, in form and substance as is customarily given to underwriters in
an underwritten public offering and reasonably satisfactory to a majority in
interest of the Holders requesting registration, addressed to the underwriters,
if any, and to the Holders requesting registration of Registrable Securities,
and (ii) a letter dated as of such date, from the independent certified public
accountants of Uniphase, in form and substance as is customarily given by
independent certified public accountants to underwriters in an underwritten
public offering and reasonably satisfactory to a majority in interest of the
Holders requesting registration, addressed to the underwriters, if any, and if
permitted by applicable standards governing such accountants, to the Holders
requesting registration of Registrable Securities.
2.7. Delay in Registration. Uniphase shall have the right
to delay the filing or effectiveness of any registration statement contemplated
by Section 2.2, 2.3 or 2.4 for one or more periods, aggregating not more than
sixty (60) days in any twelve month period, in the event that (i) Uniphase
would, in accordance with the written advice of its legal counsel, be required
to disclose in the prospectus information not otherwise then required by law to
be publicly disclosed and (ii) in the reasonable judgment of the Uniphase's
Board of Directors, there is a reasonable likelihood that such disclosure would
materially and adversely affect any existing or prospective material business
situation, transaction or negotiation or otherwise materially and adversely
affect Uniphase.
2.8. Termination of Registration Rights. A Holder's
registration rights shall expire at such time as all Registrable Securities held
by such Holder can reasonably be expected to be able to be sold under Rule 144
under the Securities Act during any ninety (90) day period.
2.9. Delay of Registration; Furnishing Information
2.9.1. No Holder 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.
2.9.2. It shall be a condition precedent to the
obligations of Uniphase to take any action pursuant to Section 2.2, 2.3 or 2.4
that the selling Holders shall furnish to Uniphase such information regarding
themselves, the Registrable Securities held by them and the intended method of
disposition of such securities as shall be required to effect the registration
of their Registrable Securities.
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2.10. Indemnification. In the event any Registrable
Securities are included in a registration statement under Sections 2.2, 2.3 or
2.4:
2.10.1. To the extent permitted by law, Uniphase
will indemnify and hold harmless each Holder, the partners, members, officers,
directors and legal counsel of each Holder, any underwriter (as defined in the
Securities Act) for such Holder and each person, if any, who controls such
Holder or underwriter within the meaning of the Securities Act or the Exchange
Act, against any losses, claims, damages, 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") by Uniphase: (i) any untrue statement or alleged untrue statement
of a material fact contained in any 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 Uniphase
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 related to any action or inaction required of Uniphase in
connection with the offering covered by such registration statement; and
Uniphase will reimburse each such Holder, partner, member, officer or director,
underwriter or controlling person for 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 Section 2.10.1 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 Uniphase, which consent shall not
be unreasonably withheld, nor shall Uniphase 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, partner, member, officer, director, underwriter or
controlling person of such Holder.
2.10.2. To the extent permitted by law, each Holder
will, if Registrable Securities held by such Holder are included in the
securities as to which such registration qualifications or compliance is being
effected, indemnify and hold harmless Uniphase, each of its directors, its
officers, and legal counsel and each person, if any, who controls Uniphase
within the meaning of the Securities Act, any underwriter, any person who
controls such underwriter, and any other Holder selling securities under such
registration statement or any of such other Holder's partners, members,
directors or officers or any person who controls such other Holder, against any
losses, claims, damages or liabilities (joint or several) to which they may
become subject under the Securities Act, the Exchange Act or other federal or
state law and related to any action or inaction of required of the Holders,
insofar as such losses, claims, damages or liabilities (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 by reason of reliance
upon and in conformity with written information furnished by such Holder under
an instrument duly executed by such Holder and stated to be specifically for use
in connection with such registration; and
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each such Holder will reimburse any legal or other expenses reasonably incurred
by Uniphase or any such director, officer, controlling person, underwriter or
other Holder, or partner, member, officer, director or controlling person of
such other Holder in connection with investigating or defending any such loss,
claim, damage, liability or action if it is judicially determined that there was
such a Violation; provided, however, that the indemnity agreement contained in
this Section 2.10.2 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 such Holder, which consent shall not be unreasonably withheld;
provided further, that in no event shall any indemnity under this Section 2.10
exceed the net proceeds from the offering received by such Holder.
2.10.3. Promptly after receipt by an indemnified
party under this Section 2.10 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
2.10, 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 materially prejudicial to its ability to
defend such action, shall relieve such indemnifying party of any liability to
the indemnified party under this Section 2.10, 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
2.10.
2.10.4. If the indemnification provided for in this
Section 2.10 is held by a court of competent jurisdiction to be unavailable to
an indemnified party with respect to any losses, claims, damages or liabilities
referred to herein, the indemnifying party, in lieu of indemnifying such
indemnified party thereunder, shall, to the extent permitted by applicable law
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability 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, claim, damage or liability, 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 Holder hereunder
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exceed the proceeds from the offering received by such Holder.
2.10.5. The obligations of Uniphase and the Holders
under this Section 2.10 shall survive completion of any offering of Registrable
Securities 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. In the
event any offering of Registrable Securities is underwritten, and the
underwriting agreement provides for indemnification and/or contribution by
Uniphase in favor of the Holders offering securities thereunder or of such
Holders in favor of Uniphase, the indemnification and/or contribution
obligations of Uniphase and the Holders hereunder shall in no event exceed the
respective obligations of the parties set forth in such underwriting agreement.
2.11. Assignment of Registration Rights. The rights to
cause Uniphase to register Registrable Securities pursuant to this Section 2 may
be assigned by Philips to a transferee or assignee of Registrable Securities
that (i) is another Philips Entity, or (iii) acquires Registrable Securities
having a Market Value at the time of assignment of $5,000,000 or more; provided,
however, (A) the transferor shall, within a reasonable time after such transfer,
furnish to Uniphase 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 (B) such transferee shall agree to be subject to all
restrictions set forth in this Agreement.
2.12. Amendment of Registration Rights. Any provision of
this Section 2 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 Uniphase and the Holders of
more than fifty percent (50%) of the Registrable Securities. Any amendment or
waiver effected in accordance with this Section 2.12 shall be binding upon each
Holder and Uniphase. By acceptance of any benefits under this Section 2, Holders
of Registrable Securities hereby agree to be bound by the provisions hereunder.
2.13. Limitation on Subsequent Registration Rights. After
the date of this Agreement, Uniphase shall not, without the prior written
consent of the Holders of more than sixty-six and two-thirds percent (66%) of
the then outstanding Registrable Securities, enter into any agreement with any
holder or prospective holder of any securities of Uniphase that would grant such
holder registration rights senior to or on a parity with those granted to the
Holders hereunder, provided that Uniphase may grant subordinate (including
without limitation as to cutback) registration rights to future equity investors
in Uniphase without such consent, provided further that Uniphase may xxxxx xxxx
passu registration rights ("Pari Passu Registration Rights") to holders or
prospective holders of the Uniphase's securities that are effective after the
Holders shall cease to hold more than five percent (5%) of Uniphase Common Stock
(prior to the Issue Date, giving effect to the hypothetical issuance of Uniphase
Common Stock at the Penalty Conversion Ratio (as defined in the Certificate of
Designation), and provided further, that nothing contained herein shall limit
the ability of Uniphase to register (without participation by
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the Holders) any shares of Uniphase Common Stock issuable on conversion or
exchange of any convertible note or other derivative security originally issued
by Uniphase after the date hereof, subject to the foregoing. Any right given by
Uniphase to any holder or prospective holder of Uniphase securities in
connection with the registration of securities shall be conditioned such that it
shall be consistent with the provisions hereof and with the rights of the
Holders provided herein.
2.14. "Market Stand-Off" Agreement. If requested by
Uniphase as the representative of the underwriters of Uniphase Common Stock (or
other securities), neither Uniphase nor any Holder shall sell, assign, pledge,
hypothecate or otherwise transfer or dispose of any shares of Uniphase Common
Stock (or other securities of Uniphase) held by Uniphase or such Holder (other
than those included in an effective registration statement filed prior to such
request), or any right, title or interest therein, for a period specified by the
representative of the underwriters not to exceed one hundred twenty (120) days
following the effective date of a registration statement of Uniphase filed under
the Securities Act, provided that all Holders shall receive the benefit of any
period less than 120 days if such shorter period is offered by the managing
underwriters or underwriter for such offer, to any person required by such
underwriter to be subject to such restriction.
The obligations described in this Section 2.14 shall not apply to a
registration relating solely to employee benefit plans on Form S-1 or Form S-8
or similar forms that may be promulgated in the future, or a registration
relating solely to a Commission Rule 145 transaction on Form S-4 or similar
forms that may be promulgated in the future. Uniphase may impose stop-transfer
instructions with respect to the shares of Common Stock (or other securities)
subject to the foregoing restriction until the end of said one hundred twenty
(120) day period.
2.15. Rule 144 Reporting. With a view to making available
to the Holders the benefits of certain rules and regulations of the SEC which
may permit the sale of the Registrable Securities to the public without
registration, Uniphase agrees to use its best efforts to:
A. Make and keep public information available,
as those terms are understood and defined in SEC Rule 144 or any similar or
analogous rule promulgated under the Securities Act, at all times;
B. Take such action as is necessary to enable
the Holders to utilize Form S-3 for the sale of Registrable Securities;
C. File with the SEC, in a timely manner, all
reports and other documents required of Uniphase under the Exchange Act and the
Securities Act; and
D. So long as a Holder owns any Registrable
Securities, furnish to such Holder forthwith upon request: (i) a written
statement by Uniphase as to its compliance with the reporting requirements of
said Rule 144 of the Securities Act, and of the Exchange Act; (ii) a copy of
each annual and quarterly report of Uniphase; and (iii) such other reports and
documents
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as a Holder may reasonably request in availing itself of any rule or regulation
of the SEC allowing it to sell any such securities without registration.
2.16. Covenant Not to Impair. Uniphase shall not take any
action or fail to take any action which could reasonably impair the ability of
Uniphase to perform its obligations pursuant to this Section 2.
2.17. No Outstanding Registration Rights. Uniphase hereby
represents and warrants to Philips that, other than the rights granted to
Philips hereunder, no Person has any right to require Uniphase to register any
shares of Uniphase's capital stock held by such Person.
3. COVENANTS OF PHILIPS
3.1. Standstill Provisions. For the Standstill Period (as
defined in Section 3.7 below), Philips shall not (and shall not permit any
Philips Affiliate to), directly or indirectly, acquire from other holders of
Uniphase Common Stock, or other securities convertible into or exchangeable or
exercisable for Uniphase Common Stock, beneficial ownership of any Uniphase
Common Stock, any options, warrants or other securities exercisable for,
convertible into or exchangeable for Uniphase Common Stock, or any other right
to acquire Uniphase Common Stock (except, in any case, by way of stock dividends
or other distributions or offerings made available to holders of any Uniphase
Common Stock or Uniphase Preferred Stock generally), or authorize or make a
tender, exchange or other offer which would result in such an acquisition,
without the written consent of Uniphase; provided that:
3.1.1. Philips (either directly or through a
Philips Affiliate) shall have the right at any time to effect open market
purchases of Uniphase Common Stock to the extent the aggregate number of shares
of Uniphase Common Stock then held by Philips Entities is below five percent
(5%) of the then total number of outstanding shares of Uniphase Common Stock;
and
3.1.2. This Section 3.1 shall not apply to the
acquisition by Philips (or a Philips Affiliate) of the Earn-Out Common Stock.
3.2. Notice of Purchases. Philips shall promptly advise
management of Uniphase as to Philips' (or a Philips Affiliate's) acquisitions of
additional shares of Uniphase Common Stock, or rights thereto, within a
reasonable time period not to exceed thirty (30) days after such acquisition.
All open market purchases of Uniphase Common Stock by Philips (or Philips
Affiliates) shall be made in compliance with applicable laws and regulations.
3.3. No Voting Arrangements. Without Uniphase's prior
written consent, Philips (or Philips Affiliates) shall not deposit any shares of
Uniphase Common Stock in a voting trust or subject any Uniphase Common Stock to
any arrangement or agreement with respect to the voting of such Uniphase Common
Stock.
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3.4. No Proxies. Without Uniphase's prior written consent,
Philips (or Philips Affiliates) shall not solicit proxies with respect to any
Uniphase Common Stock, nor shall Philips (or Philips Affiliates) become a
"participant" in any "election contest" (as such terms are used in Rule 14a-11
promulgated under the Exchange Act) relating to the election of directors of
Uniphase; provided however, that Philips (or Philips Affiliates) shall not be
deemed to be a "participant" by reason of the membership of Philips' designees
on Uniphase's Board of Directors as provided in Section 4.1 below.
3.5. No Partnerships. Philips (or Philips' Affiliates)
shall not join any partnership, limited partnership, syndicate or other group,
or otherwise act in concert with any third person for the purpose of acquiring,
holding, voting or disposing of Uniphase Common Stock.
3.6. Voting of Shares Owned by Xxxxxxxx. During the
Standstill Period and subject to Section 4 hereof, Philips (directly or through
Philips Affiliates) agrees to vote any shares of Uniphase Common Stock held by
Philips (directly or through Philips Affiliates) for management's nominees to
Uniphase's Board of Directors, and, unless Uniphase otherwise consents in
writing, on all other matters to be voted on by the stockholders in the same
manner and in the same proportion as the votes cast by holders of the majority
of the outstanding shares of Uniphase Common Stock voting with respect to the
applicable matter, except that Philips may vote its Uniphase Common Stock as it
determines as to any proposed amendment to the certificate of incorporation of
Uniphase or any other proposal that Philips determines in good faith materially
and adversely affects the rights, preferences and privileges of the Uniphase
Preferred Stock held by the Philips Entities.
3.7. Standstill Period, Termination of Philips' Covenants.
The covenants set forth in Sections 3.1 through 3.6, inclusive, shall remain in
full force and effect until the first to occur of the expiration of five (5)
years from the date hereof or any of the following events (the "Standstill
Period"):
(i) Uniphase shall be in material breach of its
obligations under the Sale Agreements (other than the Lease or the Site Services
Agreement), and such breach shall not have been cured following five (5)
Business Days' written notice from Philips;
(ii) a third party shall acquire "control" of
Uniphase ("control" being defined as the ability presently or prospectively to
direct the management and policies of Uniphase, directly or indirectly, whether
through ownership of voting securities, by contract or otherwise, and being
presumed any time any such third party shall have greater than 30% of the voting
power to elect directors of Uniphase or the power to elect or designate
directors who fill 20% of the board seats of Uniphase); or
(iii) Uniphase shall in any way facilitate the
acquisition by a third party of "control" of Uniphase (whether by entering into
an agreement for the acquisition of control, recommendation by the Board of
Directors of Uniphase of, or failure to reject, a tender offer by a third party,
issuance of common stock, or otherwise, whether or not "control" is
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actually acquired by a third party.
3.8. Confidential Information. Uniphase from time to time
may disclose to the Philips certain technical and nontechnical business
information which Uniphase advises Philips to be confidential. Notwithstanding
any other provision of this Agreement, Philips shall not disclose such
information to third parties (other than information developed or received
independently by Philips) until the earliest of (i) the date upon which such
information becomes public knowledge through no fault of the Philips, (ii) the
date upon which Uniphase discloses such information to a third party on an
unrestricted basis, (iii) the date such information is required to be disclosed
by law or by a court of competent jurisdiction or a regulatory agency, or (iv)
the fifth anniversary of the date of disclosure. In the event that Philips or
any of its representatives is requested or required to disclose confidential
information by law or by a court or regulatory agency, Philips will provide
Uniphase with prompt notice of such request or requirement so that Uniphase may
seek a protective order. Philips further acknowledges and understands that any
information so obtained which may be considered "inside" non-public information
will not be utilized by the Philips in connection with purchases and/or sales of
Uniphase's securities except in compliance with applicable state and federal
securities laws.
4. PHILIPS BOARD REPRESENTATION
From and after the date hereof and until the later of the
date on which no shares of Uniphase Preferred Stock remain outstanding or the
date on which Philips ceases to hold more than five (5%) of the outstanding
Uniphase Common Stock, Philips shall be entitled to nominate a non-executive
director on the Board of Directors of Uniphase, and Uniphase shall use its
reasonable best efforts (including, without limitation, the solicitation of
proxies) to cause such Philips' nominee to be elected as a member of the Board
of Directors (including creation of a vacancy and filling it with such nominee
at the Closing). Such director shall have equal rights in relation to the other
directors and Uniphase shall use its best effort to have such director
participate as a member of all committees of the Board of Directors other than
the compensation committee.
5. MISCELLANEOUS
5.1. Governing Law. This Agreement shall be governed by
and construed under the laws of the State of New York as applied to agreements
among New York residents entered into and to be performed entirely within New
York.
5.2. Survival. The representations, warranties, covenants,
and agreements made herein shall survive any investigation made by any Holder
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 Uniphase pursuant hereto in connection with the transactions
contemplated hereby shall be deemed to be representations and
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warranties by Uniphase hereunder solely as of the date of such certificate or
instrument unless otherwise expressly stated herein.
5.3. 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, and to the extent permitted by law be binding upon, each person
who shall be a holder of Registrable Securities from time to time; provided,
however, that prior to the receipt by Uniphase of adequate written notice of the
transfer of any Registrable Securities specifying the full name and address of
the transferee, Uniphase 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.
5.4. Entire Agreement. This Agreement, the Exhibits and
Schedules hereto, and the other documents delivered pursuant hereto 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.
5.5. Amendment and Waiver
5.5.1. Except as otherwise expressly provided, this
Agreement may be amended or modified only upon the written consent of Uniphase
and the holders of more than fifty percent (50%) of the Registrable Securities.
5.5.2. Except as otherwise expressly provided, the
obligations of Uniphase and the rights of the Holders under this Agreement may
be waived only with the written consent of the holders of more than fifty
percent (50%) of the Registrable Securities.
5.6. Delays or Omissions. It is agreed that no delay or
omission to exercise any right, power, or remedy accruing to any Holder, upon
any breach, default, or noncompliance of Uniphase under this Agreement shall
impair any such right, power, or remedy, nor shall it be construed to be a
waiver of any such breach, default, or noncompliance, or any acquiescence
therein, or of any similar breach, default, or noncompliance thereafter
occurring. It is further agreed that any waiver, permit, consent, or approval of
any kind or character on any Holder's part of any breach, default, or
noncompliance under the Agreement or any waiver on such Holder's part of any
provisions or conditions of this Agreement must be in writing and shall be
effective only to the extent specifically set forth in such writing. All
remedies, either under this Agreement, by law, or otherwise afforded to Holders,
shall be cumulative and not alternative.
5.7. Incorporation by Reference. Sections 13.3, 13.5, 13.9
and 13.10 of the Purchase Agreement are hereby incorporated by this reference.
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5.8. 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.
IN WITNESS WHEREOF, the parties hereto have executed this Stockholder
Agreement as of the date set forth in the first paragraph hereof.
UNIPHASE: PHILIPS:
UNIPHASE CORPORATION KONINKLIJKE PHILIPS ELECTRONICS N.V.
By: /s/ XXX X. XXXXXX By: /s/ XXXXXX XXXXXXXXX
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Xxx X. Xxxxxx, Senior Vice President Title:
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