Exhibit 4.4
REGISTRATION RIGHTS AGREEMENT
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THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of
, 1999, is by and between xxx.xxx inc., a Delaware corporation (the
"Company"), and Florists' Transworld Delivery, Inc., a Michigan corporation
("FTDI").
RECITALS:
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WHEREAS, the Company has consummated an initial public offering of
its Class A Common Stock;
WHEREAS, pursuant to the Stock Subscription Agreement, the Company
has issued to FTDI shares of Class B Common Stock representing Registrable
Shares;
WHEREAS, the Company has agreed to provide to FTDI certain
registration rights with respect to such Registrable Shares; and
WHEREAS, the Company and FTDI are entering into this Agreement to
set forth the terms and conditions applicable to the grant and exercise of such
registration rights;
NOW, THEREFORE, in consideration of the premises and mutual
covenants contained herein, FTDI and the Company do hereby agree as follows:
AGREEMENTS:
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Section 1. Definitions.
For the purposes of this Agreement the following terms shall have
the following meanings:
"Common Stock" shall mean the Company's Class A common stock, par
value $.01 per share, and Class B common stock, par value $.01 per share, and
any shares of such Common Stock issued or issuable with respect to any Class A
Common Stock or Class B Common Stock by way of stock dividend or stock split or
in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization or otherwise.
"Exchange Act" shall mean the Securities Exchange Act of 1934 and
the rules and regulations promulgated thereunder, as the same may be amended
from time to time.
"Form S-3" means a Registration Statement on Form S-3 as promulgated
by the SEC or any successor form that is substantially similar thereto.
"Governmental Authority" shall mean any nation or government, any
state or other political subdivision thereof, and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Person" shall mean any individual, corporation, partnership, trust,
joint stock company, business trust, unincorporated association, joint venture
or other entity of any nature whatsoever.
"Permitted Interruption" is defined in Section 8(a) hereof.
"Prospectus" means the Prospectus included in any Registration
Statement, as amended or supplemented by any Prospectus supplement, with respect
to the terms of the offering of any portion of the Registrable Shares covered by
such Registration Statement and all other amendments and supplements to the
Prospectus, including post-effective amendments and all material incorporated by
reference in such Prospectus.
"Registrable Shares" means: (i) shares of Common Stock now or
hereafter issued by the Company to FTDI (including without limitation any shares
of Class A Common Stock issued upon conversion of the Class B Common Stock),
(ii) shares of Class B Common Stock issued as, or upon the conversion or
exercise of other securities issued as, a dividend or other distribution with
respect to or in replacement of other Registrable Shares and (iii) any equity
securities of the Company issued or issuable with respect to the securities
referred to in clauses (i) and (ii) by way of a stock dividend or stock split or
in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization. For purposes of this Agreement, a Person
will be deemed to be a holder of Registrable Shares whenever such Person has the
unqualified right to acquire such Registrable Shares (by conversion or
otherwise, but disregarding any legal restrictions upon the exercise of such
right), whether or not such acquisition has actually been effected. As to any
particular Registrable Shares, once issued such Registrable Shares shall cease
to be Registrable Shares when (a) a Registration Statement with respect to the
sale of such Registrable Shares shall have become effective under the Securities
Act and such Registrable Shares shall have been disposed of in accordance with
such Registration Statement, (b) they shall have been distributed to the public
pursuant to Rule 144 (or any successor provision) under the Securities Act after
a public offering, (c) they shall have been transferred pursuant to Rule 144A
(or any successor provision) under the Securities Act or (d) they shall have
ceased to be outstanding.
"Registration Request" is defined in Section 2(a) hereof.
"Registration Statement" means any appropriate Registration Statement
of the Company in a registration that covers the sale of any of the Registrable
Shares pursuant to the provisions of Sections 2, 3 or 4 of this Agreement,
including the Prospectus, amendments and supplements to such Registration
Statement, post-effective amendments, all exhibits and all material incorporated
by reference in such Registration Statement.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933 and the rules
and regulations promulgated thereunder, as the same may be amended from time to
time.
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"Stock Subscription Agreement" shall mean the Common Stock
Subscription Agreement dated as of May _____, 1999 between FTDI and the Company.
Section 2. Demand Registration
(a) Registration Request. Subject to the provisions of Section 11, at
any time and from time to time after the initial date that is 180 days after the
date hereof, upon the written request to the Company (a "Registration Request")
from FTDI that the Company effect the registration under the Securities Act of
all or part of the Registrable Shares owned by FTDI, the Company will use its
best efforts to effect the registration under the Securities Act of such
Registrable Shares within 30 days after the giving of written notice of such
Registration Request; provided, however, that the Registrable Shares covered by
any such Registration Request shall have a reasonably anticipated aggregate
price to the public of at least $ ; provided further, that if, prior
to the effective date of such registration, circumstances arise that would,
after such date, constitute a Permitted Interruption, the Company shall be
entitled to delay the Registration for a period not to exceed the Permitted
Interruption. The Company will give FTDI not less than ten days prior written
notice of its intention to comply with the provisions of this Section 2(a) and,
in reasonable detail, the date and circumstances relating thereto. No other
securities of the Company except Registrable Shares held by FTDI shall be
included in a registration under this Section 2(a).
(b) Priority in Demand Registration. In a registration pursuant to this
Section 2 involving an underwritten offering, if the managing underwriter of
such underwritten offering shall inform the Company and FTDI by letter of its
belief that the amount of Registrable Shares to be included in such registration
would adversely affect the ability to effect such offering, then the Company
will be required to include in such registration only the amount of securities
that it is so advised should be included in such offering. In such event, the
Company will include in such registration prior to the inclusion of any
securities that are not Registrable Shares the maximum number of Registrable
Shares that in the opinion of such underwriters can be included in such
offering.
(c) Registration Statement Form. Registrations under this Section 2
shall be on such appropriate registration form of the SEC (i) as shall be
selected by the Company and (ii) as shall permit the disposition of the
Registrable Shares being registered in accordance with the intended method or
methods of disposition specified in the Registration Request. The Company agrees
to include in any such Registration Statement all information that, in the
opinion of counsel to the underwriters and the Company, is required to be
included.
(d) Effective Registration Statement. A registration requested pursuant
to this Section 2 shall not be deemed to have been effected (i) unless a
Registration Statement with respect thereto has become effective and FTDI has
sold at least seventy-five percent (75%) of the Registrable Shares included by
them in such Registration Statement or (ii) if after it has become effective,
such registration is interfered with by any stop order, injunction or other
order or requirement of the SEC or other Governmental Authority for any reason
not attributable to FTDI and has not thereafter become effective.
(e) Limitations on Demand Registrations. Notwithstanding anything in
this Section 2 to the contrary, in no event will (i) the Company be required to
effect more than one registration
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pursuant to Section 2(a) within any 360-day period or (ii) FTDI be entitled to
more than five registrations pursuant to Section 2(a), unless in the case of
clauses (ii) above, FTDI agrees to pay all of the costs and expenses of each
such additional registration (unless either (x) a registration so requested is
not effected for a reason not attributable to FTDI or (y) the amount of
Registrable Shares sought to be included by FTDI in such registration is reduced
by more than 25% pursuant to the provisions of Section 2(b)).
(f) Withdrawn Request. FTDI may withdraw a request for registration
under this Section 2 at any time prior to the effective date of the Registration
Statement related to such registration, provided that if it elects to remain
liable for all expenses incurred in conjunction therewith then such withdrawn
Registration Statement shall not be considered to be a demand registration for
the purposes of Section 2(e).
Section 3. Incidental Registration.
(a) Right to Include Registrable Shares. If the Company at any time
proposes or is requested to register any shares of Common Stock under the
Securities Act (except registrations on such form(s) solely for registration of
Common Stock in connection with any employee benefit plan or dividend
reinvestment plan or a merger or consolidation), whether or not for sale for its
own account, it will each such time as soon as practicable give written notice
of its intention to do so to FTDI. Upon the written request (which request
shall specify the total amount of Registrable Shares intended to be disposed of
by FTDI) of FTDI made within 30 days after the receipt of any such notice (15
days if the Company gives telephonic notice with written confirmation to follow
promptly thereafter, stating that (i) such registration will be on Form S-3 and
(ii) such shorter period of time is required because of a planned filing date),
the Company will use its best efforts to effect the registration under the
Securities Act of all Registrable Shares held that the Company has been so
requested to register for sale in the manner initially proposed by the Company.
If the Company thereafter determines for any reason not to register or to delay
registration of the Registrable Shares, the Company may, at its election, give
written notice of such determination to FTDI and (x) in the case of a
determination not to register, shall be relieved of the obligation to register
such Registrable Shares in connection with such registration, without prejudice,
however, subject to any right FTDI may have to request that such registration be
effected as a registration under Section 2(a) and (y) in the case of a
determination to delay registering, shall be permitted to delay registering any
Registrable Shares of FTDI for the same period as the delay in registration of
such other securities. No registration effected under this Section 3(a) shall
relieve the Company of any obligation to effect a registration upon a
Registration Request under Section 2(a).
(b) Priority in Incidental Registration. In a registration pursuant to
this Section 3 (and not involving a Registration Request) involving an
underwritten offering, if the managing underwriter of such underwritten offering
shall inform the Company and FTDI by letter of its belief that the amount of
Registrable Shares to be included in such registration would adversely affect
the ability to effect such offering, then the Company will be required to
include in such registration only the amount of securities that it is so advised
should be included in such offering. In such event: (i) in cases initially
involving the registration for sale of Common Stock for the Company's own
account, securities shall be registered in such offering as follows: (A) first,
the securities the Company proposes to sell, (B) second, the Registrable Shares
requested to be included in such registration that in the opinion of such
underwriters can be sold and (C) third,
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other securities requested to be included in such registration; and (ii) in
cases not initially involving the registration for sale of Common Stock for the
Company's own account, securities shall be registered in such offering as
follows: (A) first, the Registrable Shares requested to be included in such
registration that in such opinion of such underwriters can be sold and (B)
second, other securities requested to be included in such registration.
Section 4. Form S-3 Registration.
In case the Company shall receive from FTDI a written request or
requests that the Company effect a registration on Form S-3 and any related
qualification or compliance with respect to all or a part of the Registrable
Securities owned by FTDI, then the Company will:
(a) Registration. As soon as practicable, effect such registration and
all such qualifications and compliances as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion of
Registrable Securities as are specified in such request, provided, however, that
the Company shall not be obligated to effect any such registration,
qualification or compliance pursuant to this Section 4:
(i) if Form S-3 is not available for such offering by FTDI;
(ii) if FTDI, together with any other holders of securities of the
Company entitled to inclusion in such registration, propose to sell Registrable
Securities and such other securities (if any) at an aggregate price to the
public of less than $1,000,000; or
(iii) notwithstanding Section 8(a), if the Company shall furnish
to FTDI a certificate signed by the President or Chief Executive Officer of the
Company stating that it would be seriously detrimental to the Company and its
stockholders for such Form S-3 registration to be effected at such time, in
which event the Company shall have the right to defer the filing of the Form S-3
Registration Statement no more than once during any twelve month period for a
period of not more than 120 days after receipt of the request of FTDI under this
Section 4 or such earlier time as such a certificate could no longer be given in
good faith.
(b) Not Demand Registration. Form S-3 registrations shall not be deemed
to be demand registrations as described in Section 2 above.
(c) Number of Registrations. Notwithstanding anything to the contrary
herein, the Company is obligated to effect only one registration on Form S-3
within any 360-day period pursuant to this Section 4.
(d) Withdrawn Request. FTDI may withdraw its request for registration
under this Section 4 at any time prior to the effective date of the Registration
Statement related to such registration, provided that if it elects to remain
liable for all expenses incurred in conjunction therewith then such withdrawn
Registration Statement shall not be considered to be a Form S-3 registration for
the purposes of this Section 4.
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Section 5. Registration Procedures.
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In connection with the Company's obligations pursuant to Sections 2,
3 and 4 hereof, the Company will use its best efforts to effect such
registration and the Company will promptly:
(a) prepare and file with the SEC as soon as practicable after request
for registration hereunder the requisite Registration Statement to effect such
registration and use its best efforts to cause such Registration Statement to
become effective and to remain continuously effective until the earlier to occur
of (i) 180 days following the date on which such Registration Statement is
declared effective or (ii) the termination of the offering being made
thereunder;
(b) prepare and file with the SEC 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 and to comply
with the provisions of the Securities Act with respect to the disposition of all
securities covered by such Registration Statement until such securities have
been sold or such lesser period of time as the Company, any seller of such
securities or any underwriter is required under the Securities Act to deliver a
Prospectus in accordance with the intended methods of disposition by the sellers
of such securities set forth in such Registration Statement or supplement to
such Prospectus;
(c) furnish to FTDI and the managing underwriter, if any, such number of
conformed copies of such Registration Statement and of each such amendment and
supplement thereto (in each case including all exhibits), such number of copies
of the Prospectus contained in such Registration Statement (including each
preliminary Prospectus and any summary Prospectus) and any other Prospectus
filed under Rule 424 under the Securities Act, as may reasonably be requested by
FTDI;
(d) use its best efforts (i) to register or qualify all securities
covered by such Registration Statement under the securities or "blue sky" laws
of such jurisdictions where an exemption is not available as FTDI shall
reasonably request, (ii) to keep such registration or qualification in effect
for so long as such Registration Statement remains in effect and (iii) to take
any other action which may be reasonably necessary or advisable to enable FTDI
to consummate the disposition in such jurisdictions of such securities; provided
that the Company will not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified, subject itself to taxation in
any such jurisdiction or take any action that would subject it to general
service of process in any such jurisdiction;
(e) notify FTDI and the managing underwriter, if any, promptly, and
confirm such advice in writing (i) when a Registration Statement, Prospectus or
any Prospectus supplement or post-effective amendment has been filed, and, with
respect to a Registration Statement or any post-effective amendment, when the
same has become effective, (ii) of any request by the SEC for amendments or
supplements to a Registration Statement or related Prospectus or for additional
information, (iii) of the issuance by the SEC of any stop order suspending the
effectiveness of a Registration Statement or the initiation of any proceedings
for that purpose, (iv) of the receipt by the Company of any notification with
respect to the suspension of the qualification of any of the registered
securities for sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose, (v) of the happening of any event or information
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becoming known that requires the making of any changes in a Registration
Statement or related Prospectus so that such documents will not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading,
(vi) of the Company's reasonable determination that a post-effective amendment
to a Registration Statement would be appropriate and (vii) if at any time the
representations and warranties of the Company made as contemplated by Section 5
cease to be true and correct;
(f) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement, or the lifting of any
suspension of the qualification of any of the registered securities for sale in
any jurisdiction, at the earliest possible moment;
(g) upon the occurrence of any event contemplated by clause (e) (v)
above, prepare a supplement or post-effective amendment to the applicable
Registration Statement or related Prospectus or any document incorporated
therein by reference or file any other required document so that, as thereafter
delivered to the purchasers of the securities being sold thereunder, such
Prospectus will not contain any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein not misleading;
(h) use its best efforts to cause the Registrable Shares covered by the
applicable Registration Statement to be registered with or approved by such
other Governmental Authorities as may be necessary to enable FTDI or the
underwriters, if any, to consummate the disposition of such Registrable Shares;
(i) cause all Registrable Shares covered by the Registration Statement
to be listed on each securities exchange or automated quotation system, if any,
on which any securities of the same class as the Registrable Shares are then
listed if requested by the managing underwriters, if any, or FTDI and entitled
hereunder to be so listed;
(j) cooperate and assist in any filings required to be made with the
National Association of Securities Dealers, Inc. (the "NASD") and in the
performance of any due diligence investigation by any underwriter (including any
"qualified independent underwriter" that is required to be retained in
accordance with the rules and regulations of the NASD);
(k) as soon as practicable prior to the filing of any document that is
to be incorporated by reference into the Registration Statement or the
Prospectus (after initial filing of the Registration Statement) provide copies
of such document to counsel to FTDI and to the managing underwriters, if any,
and make the Company's representatives available for discussion of such document
and consider in good faith making such changes in such document prior to the
filing thereof as counsel for FTDI or the underwriters, if any, may reasonably
request; and
(l) provide and cause to be maintained a transfer agent and registrar
for all Registrable Shares covered by such Registration Statement from and after
a date not later than the effective date of such Registration Statement.
The Company may require FTDI to furnish to the Company such
information regarding FTDI and the distribution of such securities as the
Company may from time to time reasonably request in writing in order to comply
with the Securities Act.
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FTDI agrees that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 5(e) (ii), (iii), (iv),
(v) or (vi) hereof, it will forthwith discontinue disposition pursuant to such
Registration Statement of any Registrable Shares covered by such Registration
Statement or Prospectus until their receipt of the copies of the supplemented or
amended Prospectus relating to such Registration Statement or Prospectus or
until they are advised in writing by the Company that the use of the applicable
Prospectus may be resumed (and the period of such discontinuance shall be
excluded from the calculation of the period specified in clause (x) of Section
5(a)) and, if so directed by the Company, will deliver to the Company (at the
Company's expense, except as otherwise provided in Section 2(e)) all copies,
other than permanent file copies then in their possession, of the Prospectus
covering such securities in effect at the time of receipt of such notice. FTDI
agrees to furnish the Company with a signed counterpart, addressed to the
Company and the underwriters, if any, of an opinion of counsel for FTDI covering
substantially the same matters with respect to such Registration Statement (and
the Prospectus included therein) as are customarily covered in opinions of
selling stockholder's counsel delivered to the underwriters in underwritten
public offerings of securities (and dated the dates such opinions are
customarily dated) and such other legal matters as the Company or the
underwriters may reasonably request.
Section 6. Underwritten Offerings.
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(a) Demand Underwritten Offerings. In any underwritten offering
pursuant to a registration requested under Section 2, the Company will use its
best efforts to enter into an underwriting agreement for such offering with the
underwriters selected by FTDI, such agreement and underwriters to be reasonably
satisfactory in form and substance to the Company, FTDI and the underwriters and
to contain such representations and warranties by the Company and such other
terms as are generally prevailing in agreements of that type. FTDI shall be a
party to such underwriting agreement and may, at its option, require that any or
all of the representations and warranties by, and the other agreements on the
part of, the Company to and for the benefit of such underwriters shall also be
made to and for the benefit of FTDI and that any or all of the conditions
precedent to the obligations of such underwriters under such underwriting
agreement be conditions precedent to FTDI's obligations. The Company may, at its
option, require that any or all of the representations and warranties by, and
the other agreements on the part of FTDI to and for the benefit of such
underwriters shall also be made to and for the benefit of the Company with due
regard to the amount of Registrable Shares being sold by FTDI and the nature of
such representations, warranties and agreements and the underwriting.
(b) Incidental Underwritten Offerings. If the Company at any time
proposes to register any shares of its Common Stock under the Securities Act as
contemplated by Section 3 and such shares of Common Stock are to be distributed
by or through one or more underwriters, FTDI shall be a party to the
underwriting agreement between the Company and such underwriters and may, at its
option, require that any or all of the representations and warranties by, and
the other agreements on the part of, the Company to and for the benefit of such
underwriters shall also be made to and for the benefit of FTDI and that any or
all of the conditions precedent to the obligations of such underwriters under
such underwriting agreement be conditions precedent to FTDI's obligations. The
Company may, at its option, require that any or all of the representations and
warranties by, and the other agreements on the part of FTDI to and for the
benefit of such underwriters shall also be made to and for the benefit of the
Company
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with due regard to the amount of Registrable Shares being sold by FTDI and the
nature of such representations, warranties and agreements and the underwriting.
Section 7. Preparation; Reasonable Investigation.
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In connection with the preparation and filing of each Registration
Statement under the Securities Act pursuant to this Agreement, the Company will
give FTDI, the underwriters and their respective counsel and accountants the
opportunity (but such Persons shall not have the obligation) to participate in
the preparation of such Registration Statement, each Prospectus included therein
or filed with the SEC, and, to the extent practicable, each amendment thereof or
supplement thereto, and will give each of them such access to its books and
records (to the extent customarily given to the underwriters of the Company's
securities), and such opportunities to discuss the business of the Company with
its officers and the independent public accountants who have certified its
financial statements as shall be necessary, in the opinion of FTDI's and the
underwriters' respective outside counsel, to conduct a reasonable investigation
within the meaning of the Securities Act.
Section 8. Limitations, Conditions and Qualifications to Obligations under
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Registration Covenants.
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The obligations of the Company to use its best efforts to cause
Registrable Shares to be registered under the Securities Act are subject to each
of the following limitations, conditions and qualifications:
(a) The Company shall be entitled to postpone for a reasonable period of
time the filing or effectiveness of, or suspend the rights of FTDI to make sales
pursuant to, any Registration Statement otherwise required to be prepared, filed
and made and kept effective by it hereunder (but the duration of such
postponement or suspension may not exceed the earlier to occur of (i) 15 days
after the cessation of the circumstances requiring such postponement or
suspension as described below or (ii) 120 days after the date of the
determination of the Board of Directors referred to below, and the duration of
such postponement or suspension shall be excluded from the calculation of the
period specified in clause (i) of Section 5(a)) if the Board of Directors of the
Company determines in good faith that the filing or effectiveness of, or sales
pursuant to, such Registration Statement would impede, delay or interfere with
any financing, offer or sale of securities, acquisition, corporate
reorganization or other significant transaction involving the Company or any of
its affiliates or require disclosure of material information that the Company
has a bona fide business purpose for preserving as confidential (each a
"Permitted Interruption"). If the Company shall so delay the filing of a
Registration Statement, it shall, as promptly as possible, notify FTDI of such
determination, and FTDI shall have the right (y) in the case of a postponement
of the filing or effectiveness of a Registration Statement, to withdraw the
request for registration by giving written notice to the Company within ten days
after receipt of the Company's notice or (z) in the case of a suspension of the
right to make sales, to receive an extension of the registration period equal to
the number of days of the suspension.
(b) The Company shall not be required hereby to include Registrable
Shares in a Registration Statement if, in the written opinion of outside counsel
to the Company of recognized standing in securities law matters, the beneficial
owners of such Registrable Shares seeking
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registration would be free to sell all of such Registrable Shares within the
current calendar quarter without registration under Rule 144 under the
Securities Act.
(c) The Company's obligations shall be subject to the obligations of
FTDI, which FTDI acknowledges, to furnish all information and materials and to
take any and all actions as may be required under applicable federal and state
securities laws and regulations to permit the Company to comply with all
applicable requirements of the SEC and to obtain any acceleration of the
effective date of such Registration Statement.
(d) The Company shall not be obligated to cause any special audit to be
undertaken in connection with any registration pursuant hereto unless such audit
is requested by the underwriters with respect to such registration.
Section 9. Expenses.
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Except as otherwise provided in Section 2(e), the Company will pay
all reasonable out-of-pocket costs and expenses incurred in connection with each
registration of Registrable Shares pursuant to this Agreement, including,
without limitation, the reasonable fees and disbursements of a single firm of
outside counsel retained by FTDI, any and all filing fees payable to the SEC,
fees with respect to filings required to be made with stock exchanges, The
Nasdaq Stock Market, Inc. or the NASD, printing expenses, fees and disbursements
of counsel and accountants of the Company, including costs associated with
comfort letters, and fees and expenses of other Persons retained by the Company,
but excluding underwriters' expenses (including discounts, commissions or fees
of underwriters and expenses included therein, selling brokers, dealer managers
or similar securities industry professionals relating to the distribution of the
securities being registered or legal expenses of any Person other than the
Company and FTDI). The Company shall, in any event in all cases, pay its
internal expenses (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties), and the
expense of securities law liability insurance fees, if any.
Section 10. Participation in Underwritten Registrations.
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FTDI may not participate in any underwritten registration hereunder
unless FTDI (a) agrees to sell its securities on the basis provided in and in
compliance with any underwriting arrangements approved by the Persons entitled
hereunder to approve such arrangements and to comply with Regulation M under the
Exchange Act, and (b) completes and executes all questionnaires, appropriate and
limited powers of attorney, escrow agreements, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements; provided that all such documents shall be consistent
with the provisions hereof.
Section 11. Rule 144.
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The Company hereby covenants that it will file in a timely manner
all reports required to be filed by it under the Securities Act and the Exchange
Act and the rules and regulations adopted by the SEC thereunder and will take
such further action as FTDI may reasonably request to the extent required from
time to time to enable FTDI to sell Registrable Shares under Rule 144 under the
Securities Act.
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Section 12. Holdback Agreements.
(a) FTDI agrees that, with respect to any Registration Statement filed by
the Company in connection with an underwritten public offering, it shall not
effect any public sale or distribution of equity securities of the Company
during the 30 days prior to or for a period of up to 180 days beginning on the
effective date of such Registration Statement (except as part of such
registration) if and to the extent reasonably requested in writing (with
reasonable prior notice) by the managing underwriter of the underwritten public
offering.
(b) The Company agrees not to effect any primary public sale or
distribution of any equity securities of the Company during the 30 days prior to
and the 180-day period beginning on the effective date of any Registration
Statement in which FTDI is participating in connection with an underwritten
public offering of Registrable Shares if and to the extent reasonably requested
in writing (with reasonable prior notice) by the managing underwriter of the
underwritten public offering.
Section 13. Indemnification.
(a) Indemnification by the Company. In connection with any registration
pursuant hereto in which Registrable Shares are to be disposed of, the Company
shall indemnify and hold harmless, to the full extent permitted by law, FTDI
and, when applicable, its officers, directors, stockholders, partners, agents
and employees and each Person who controls FTDI (within the meaning of the
Securities Act or the Exchange Act) against all losses, claims, damages,
liabilities and expenses caused by any untrue or alleged untrue statement of a
material fact contained in any Registration Statement, Prospectus or preliminary
Prospectus or any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, including, without limitation, any loss, claim, damage, liability or
expense resulting from the failure to keep a Prospectus current, except insofar
as the same (i) are caused by or contained in any information relating to FTDI
furnished in writing to the Company by FTDI expressly for use therein or (ii)
are caused by FTDI's failure to deliver a copy of the current Prospectus
simultaneously with or prior to such sale after the Company has furnished FTDI
with a sufficient number of copies of such Prospectus correcting such material
misstatement or omission or (iii) arise in respect of any offers to sell or
sales made during any period when FTDI is required to discontinue sales under
Section 5(e) (and after FTDI has received the notice contemplated by Section
5(e)). The Company shall also indemnify underwriters, selling brokers, dealer
managers and similar securities industry professionals participating in the
distribution, their officers and directors and each Person who controls such
Persons (within the meaning of the Securities Act) to the same extent as
provided above with respect to the indemnification of FTDI, and shall enter into
an indemnification agreement with such Persons containing such terms, if
requested.
(b) Indemnification by FTDI. In connection with each Registration
Statement effected pursuant hereto in which Registrable Shares are to be
disposed of, FTDI shall indemnify and hold harmless, to the full extent
permitted by law, the Company and its respective directors, officers,
stockholders, partners, agents and employees and each Person who controls the
Company (within the meaning of the Securities Act or the Exchange Act) against
any losses, claims, damages, liabilities and expenses resulting from any untrue
statement of a material fact or
11
any omission of a material fact required to be stated in such Registration
Statement or Prospectus or preliminary Prospectus or necessary to make the
statements therein not misleading, to the extent, but only to the extent, that
such untrue statement or omission relates to FTDI and is contained in any
information furnished in writing by FTDI to the Company expressly for inclusion
in such Registration Statement or Prospectus. In no event shall the liability of
FTDI hereunder be greater in amount than the dollar amount of the proceeds
actually received by FTDI upon the sale of the securities giving rise to such
indemnification obligation.
(c) Conduct of Indemnification Proceedings. Any Person entitled to
indemnification hereunder shall give prompt notice to the indemnifying party of
any claim with respect to which it shall seek indemnification and shall permit
such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party; provided, however, that any
Person entitled to indemnification hereunder shall have the right to employ
separate counsel and to participate in the defense of such claim, but the fees
and expenses of such counsel shall be at the expense of such Person unless (i)
the indemnifying party shall have agreed to pay such fees or expenses, or (ii)
the indemnifying party shall have failed to assume the defense of such claim and
employ counsel reasonably satisfactory to such Person or (iii) in the opinion of
outside counsel to such Person there may be one or more legal defenses available
to such Person which are different from or in addition to those available to the
indemnifying party with respect to such claims (in which case, if the Person
notifies the indemnifying party in writing that such Person elects to employ
separate counsel at the expense of the indemnifying party because of a reason
described in clause (iii) above, the indemnifying party shall not have the right
to assume the defense of such claim on behalf of such Person). No indemnifying
party shall, without the consent of the indemnified party, consent to entry of
any judgment or enter into any settlement of any such action 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. No indemnified party shall consent to entry of any judgment
or enter into any settlement of any such action the defense of which has been
assumed by an indemnifying party (or assumed by the indemnified party because of
a reason described in clause (iii) above) without the consent of such
indemnifying party. 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 firm of counsel (and, if necessary, local counsel) for
all parties indemnified by such indemnifying party with respect to such claim,
unless in the written opinion of outside counsel to an indemnified party a
conflict of interest as to the subject matter exists between such indemnified
party and another indemnified party with respect to such claim, in which event
the indemnifying party shall be obligated to pay the fees and expenses of
additional counsel for such indemnified party.
(d) Contribution. If for any reason the indemnification provided for
herein is unavailable to an indemnified party or is insufficient to hold it
harmless as contemplated hereby, then the indemnifying party shall contribute to
the amount paid or payable by the indemnified party as a result of such loss,
claim, damage or liability in such proportion as is appropriate to reflect not
only the relative benefits received by the indemnified party and the
indemnifying party, but also the relative fault of the indemnified party and the
indemnifying party, as well as any other relevant equitable considerations;
provided that in no event shall the liability of FTDI for such contribution and
indemnification exceed, in the aggregate, the dollar amount of the proceeds
received by FTDI upon the sale of securities giving rise to such indemnification
and contribution obligation.
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Section 14. Miscellaneous.
(a) No Inconsistent Agreements. The Company will not hereafter enter
into any agreement with respect to its securities that is inconsistent with the
rights granted to FTDI in this Agreement.
(b) Remedies. Any Person having rights under any provision of this
Agreement will 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.
(c) Waivers and Amendments. This Agreement may be amended or modified
in whole or in part only by a writing that makes reference to this Agreement and
is executed by FTDI and the Company. The obligations of any party hereunder may
be waived (either generally or in a particular instance and either retroactively
or prospectively) only with the written consent of the party claimed to have
given the waiver; provided, however, that any waiver by any party of any
violation of, breach of, or default under any provision of this Agreement or any
other agreement provided for herein shall not be construed as, or constitute, a
continuing waiver of such provision, or waiver of any other violation of, breach
of or default under any other provision of this Agreement or any other agreement
provided for herein.
(d) Entire Agreement. This Agreement, the Stock Subscription
Agreement and the other agreements and instruments expressly provided for herein
and therein, together set forth the entire understanding of the parties hereto
and supersede in their entirety all prior contracts, agreements, arrangements,
communications, discussions, representations and warranties, whether oral or
written, among the parties.
(e) Severability. Whenever possible, each provision of this
Agreement will 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 will be ineffective only to
the extent of such prohibition or invalidity, without invalidating the remainder
of this Agreement.
(f) Governing Law. This Agreement shall in all respects be governed
by and construed in accordance with the internal substantive laws of the State
of Delaware without giving effect to the principles of conflicts of law thereof.
(g) Notices. All notices or other communications required or
permitted to be given hereunder shall be in writing and shall be delivered by
hand or sent, postage prepaid, by registered, certified or express mail or
reputable overnight courier service and shall be deemed given when so delivered
by hand, or if mailed, three days after mailing (one business day in the case of
express mail or overnight courier service), as follows:
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i. if to the Company,
xxx.xxx inc.
0000 Xxxxxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Attention: President
ii. if to FTDI,
Florists' Transworld Delivery, Inc.
0000 Xxxxxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Attention: President
(h) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original and all of which
together will constitute one and the same instrument.
(i) Successors and Assigns. Subject to the provisions of this clause
(i), this Agreement shall be binding upon and shall inure to the benefit of, and
shall be binding upon, the successors and permitted assigns of FTDI.
Notwithstanding anything herein to the contrary, the registration rights of FTDI
under Section 2 hereof shall inure to the benefit of and be binding upon its
successors and assigns; provided, however that (a) no party may be assigned any
of the foregoing rights until the Company is given written notice by FTDI at the
time of such assignment stating the name and address of the assignee and
identifying the securities of the Company as to which the particular rights in
question are being assigned; and (b) any such assignee shall receive such
assigned rights subject to all the terms and conditions of this Agreement.
Notwithstanding anything to the contrary contained herein, no assignment of
rights hereunder shall increase the obligations of the Company hereunder and, in
any event, the Company shall not be obligated to effect more than one
registration pursuant to Section 2 in any 12-month period.
(j) Third Parties. This Agreement is for the sole benefit of the
parties hereto and, except as provided in Section 13, nothing expressed or
implied in this Agreement is intended, or shall be construed, to confer upon or
give any Person or entity other than the parties hereto any rights or remedies
under or by reason of this Agreement.
(k) Headings. The headings in this Agreement are solely for
convenience of reference and shall not be given any effect in the construction
or interpretation of this Agreement.
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IN WITNESS WHEREOF, the parties have duly executed, or have caused
their duly authorized officer or representative to execute, this Agreement as of
the date first above written.
xxx.xxx inc., a Delaware corporation
By:
------------------------------------------
Its:
-----------------------------------------
Florists' Transworld Delivery, Inc., a Michigan
corporation
By:
------------------------------------------
Its:
-----------------------------------------
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