EXHIBIT 10(e)(3)
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT is made and entered into as of June
21, 2002 (this "Agreement"), between TII Network Technologies, Inc. (formerly
named TII Industries, Inc.), a Delaware corporation (the "Company") with
headquarters located at 0000 Xxxxx Xxxxxx, Xxxxxxxx, XX, 00000, and LEONARDO,
L.P., a Cayman Islands limited partnership, (the "Investor"). Unless otherwise
provided in this Agreement, capitalized terms used herein have the respective
meanings given to them in Section 1.1 hereof. Capitalized terms used herein and
not defined have the respective meanings given to them in the Exchange Agreement
(as defined below).
WHEREAS, the Company and the Investor are entering into an Exchange
Agreement, of even date herewith (the "Exchange Agreement"), providing for the
exchange of 1,626 shares of the Company's Series C Convertible Preferred Stock,
par value $0.01 per share, held by the Investor for cash and a warrant to
purchase shares of the Company's Common Stock (the "Warrant") and;
WHEREAS, the Company and the Investor intend for any shares of the
Company's Common Stock issued upon the exercise of the Warrant (the "Warrant
Shares") to be covered in a registration statement filed under the Securities
Act.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth herein, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
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1.1 Definitions. As used in this Agreement, and unless the context
requires a different meaning, the following terms have the meanings indicated:
"Agreement" means this Agreement as the same may be amended,
supplemented or modified in accordance with the terms hereof.
"Charter Documents" means the Company's Certificate of Incorporation
and the By-laws of the Company.
"Commission" means the Securities and Exchange Commission.
"Company" has the meaning set forth in the preamble to this Agreement.
"Designated Holder" means the Investor and any transferee of the
Investor to whom Registrable Securities have been transferred in accordance with
Section 7.4 of this Agreement, other than a transferee to whom Registrable
Securities have been transferred pursuant to a Registration Statement under the
Securities Act or Rule 144 under the Securities Act.
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"Effectiveness Period" means the period commencing with the date of
this Agreement and ending on the date that all Registrable Securities have
ceased to be Registrable Securities.
"Exchange Agreement" has the meaning set forth in the recitals to this
Agreement.
"Holders' Counsel" has the meaning set forth in Section 4.1(a).
"Indemnified Party" has the meaning set forth in Section 6.2.
"Indemnifying Party" has the meaning set forth in Section 6.2.
"Inspector" has the meaning set forth in Section 4.1(g).
"Investor" has the meaning set forth in the preamble to this
Agreement.
"Liability" has the meaning set forth in Section 6.1.
"NASD" means the National Association of Securities Dealers, Inc.
"Person" means an individual partnership, corporation, association,
trust, joint venture, unincorporated organization, and any governmental
department or agency or political subdivision thereof.
"Records" has the meaning set forth in Section 4.1(g).
"Registrable Securities" means, subject to Section 2.2, (a) the
Warrant Shares, and (b) any shares of Common Stock issued, in connection with
the Warrant Shares, by way of share dividend or share split or in connection
with a combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise and any shares of Common Stock issuable upon
conversion, exercise or exchange thereof.
"Registration Expenses" has the meaning set forth in Section 4.5.
"Registration Statement" means a Registration Statement filed pursuant
to the Securities Act.
"Securities Act" means the Securities Act of 1933, as amended.
"Shelf Registration Statement" has the meaning set forth in Section
3.1.
"Warrant Shares" has the meaning set forth in the Recitals to this
Agreement.
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ARTICLE II
GENERAL; SECURITIES SUBJECT TO THIS AGREEMENT
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2.1 Grant of Rights. The Company hereby grants registration rights to
the Designated Holders upon the terms and conditions set forth in this
Agreement.
2.2 Registrable Securities. For the purposes of this Agreement,
Registrable Securities will cease to be Registrable Securities, when (i) a
Registration Statement covering such Registrable Securities has been declared
effective under the Securities Act by the Commission and such Registrable
Securities have been disposed of pursuant to such effective Registration
Statement, (ii) such Registrable Securities are sold to the public pursuant to
Rule 144 under the Securities Act or (iii) such Registrable Securities may be
sold to the public pursuant to Paragraph (k) of Rule 144 under the Securities
Act.
2.3 Holders of Registrable Securities. A Person is deemed to be a
holder of Registrable Securities whenever such Person owns of record Registrable
Securities. If the Company receives conflicting instructions, notices or
elections from two or more Persons with respect to the same Registrable
Securities, the Company may act upon the basis of the instructions, notice or
election received from the registered owner of such Registrable Securities.
ARTICLE III
SHELF REGISTRATION STATEMENT
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3.1 Shelf Registration Statement. If, at any time that the Warrant
Shares are Registrable Securities in accordance with Section 2.2, Form S-3 is
available for the registration of the resale of the Registrable Securities
hereunder and any Registrable Securities are not covered under another effective
Registration Statement, then the Company shall promptly (in no event later than
15 days after such availability of Form S-3) file with the Commission a shelf
registration statement pursuant to Rule 415 of the Securities Act (the "Shelf
Registration Statement") on Form S-3, with respect to the resale, from time to
time, of any Registrable Securities held by a Designated Holder which are not
covered under another effective Registration Statement.
3.2 Effective Shelf Registration Statement. The Company shall use
commercially reasonable efforts to keep any Shelf Registration Statement, filed
in accordance with Section 3.1, continuously effective under the Securities Act
for so long as the Warrant Shares are Registrable Securities in accordance with
Section 2.2; provided, however, that in no event shall the Company be required
to keep such Shelf Registration Statement effective during the period, if any,
that the Company is not eligible to use Form S-3.
ARTICLE IV
REGISTRATION PROCEDURES
4.1 Obligations of the Company. Subject to Section 3.1, the Company
shall effect the registration of the Registrable Securities as promptly as
practicable after
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the date hereof, and, in connection with the Registrable Securities, the Company
shall, as expeditiously as possible:
(a) prepare and file with the Commission a Registration Statement
on Form S-3 (or any successor form thereto), and cause such Registration
Statement to become effective; provided, however, that before filing a
Registration Statement or prospectus or any amendments or supplements thereto,
the Company shall provide counsel selected by the Designated Holder holding a
majority of the Registrable Securities being registered in such registration
("Holders' Counsel") and any other Inspector with an adequate and appropriate
opportunity to review and comment on such Registration Statement and each
prospectus included therein (and each amendment or supplement thereto) to be
filed with the Commission, subject to such documents being under the Company's
control;
(b) prepare and file with the Commission such amendments and
supplements to such Registration Statement and the prospectus used in connection
therewith as may be necessary to keep such Registration Statement effective for
the period specified in Article III;
(c) furnish to each Designated Holder prior to filing a
Registration Statement, at least one copy of such Registration Statement as is
proposed to be filed, and thereafter such number of copies of such Registration
Statement, each amendment and supplement thereto (in each case including all
exhibits thereto), and the prospectus included in such Registration Statement
(including each preliminary prospectus) and any prospectus filed under Rule 424
under the Securities Act as each such Designated Holder may reasonably request
in order to facilitate the disposition of the Registrable Securities owned by
such Designated Holder;
(d) register or qualify such Registrable Securities under such
other securities or "blue sky" laws of such jurisdictions within the United
States as any Designated Holder may reasonably request, and to continue such
registration or qualification in effect in such jurisdiction for as long as
permissible pursuant to the laws of such jurisdiction, or for as long as any
such Designated Holder requests or until all of such Registrable Securities are
sold, whichever is shortest, and do any and all other acts and things which may
be reasonably necessary or advisable to enable any such Designated Holder to
consummate the disposition in such jurisdictions of the Registrable Securities
owned by such Designated Holder; provided, however, that the Company shall not
be required to (x) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this Section 4.1(d), (y)
subject itself to taxation in any such jurisdiction or (z) consent to general
service of process in any such jurisdiction;
(e) notify each Designated Holder: (i) when a prospectus, any
prospectus supplement, a Registration Statement or a post-effective amendment to
a Registration Statement has been filed with the Commission, and, with respect
to a Registration Statement or any post-effective amendment, when the same has
become effective; (ii) of any request by the Commission or any other federal or
state
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governmental authority for amendments or supplements to a Registration Statement
or related prospectus or for additional information; (iii) of the issuance by
the Commission or any other federal or state governmental authority of any stop
order suspending the effectiveness of a Registration Statement or the initiation
or threatening of any proceedings for that purpose; (iv) of the receipt by the
Company of any notification with respect to the suspension of the qualification
or exemption from qualification of any of the Registrable Securities for sale in
any jurisdiction or the initiation or threatening of any proceedings for such
purpose; (v) of the existence of any fact or happening of any event which makes
any statement of a material fact in such Registration Statement or related
prospectus or any document incorporated or deemed to be incorporated therein by
reference untrue or which would require the making of any changes in the
Registration Statement or prospectus in order that, in the case of the
Registration Statement, it 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; and (vi) determination
by counsel of the Company that a post-effective amendment to a Registration
Statement is advisable.
(f) subject to Section 4.3, upon the occurrence of any event
contemplated by Section 4.1(e)(v), as promptly as practicable prepare a
supplement or amendment to such Registration Statement or related prospectus and
furnish to each seller of Registrable Securities a reasonable number of copies
of such supplement to or amendment of such Registration Statement or prospectus
as may be necessary so that, after delivery to the purchasers of such
Registrable Securities, such prospectus shall not contain an 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, in light of the circumstances under
which they were made, not misleading;
(g) make available at reasonable times for inspection by any
seller of Registrable Securities, any managing underwriter participating in any
disposition of such Registrable Securities pursuant to a Registration Statement,
Holders' Counsel and any attorney, accountant or other agent retained by any
managing underwriter (each, an "Inspector" and collectively, the "Inspectors"),
all financial and other records, pertinent corporate documents and properties of
the Company and its subsidiaries (collectively, the "Records") as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's and its subsidiaries' officers,
directors and employees, and the independent public accountants of the Company,
to supply all information reasonably requested by any such Inspector in
connection with such Registration Statement. Records that the Company
determines, in good faith, to be confidential and which it notifies the
Inspectors are confidential shall not be disclosed by the Inspectors (and the
Inspectors shall confirm their agreement in writing in advance to the Company if
the Company shall so request) unless (x) the disclosure of such Records is
necessary, in the Company's judgment, to avoid or correct a misstatement or
omission in the Registration Statement, (y) the release of such Records is
ordered pursuant to a subpoena or other order from a court of competent
jurisdiction after exhaustion of all appeals therefrom or (z) the information in
such Records has been made generally available to the public. Each seller of
Registrable Securities agrees that it shall, upon learning that disclosure of
such Records is sought in a court of competent jurisdiction,
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give notice to the Company and allow the Company, at the Company's expense, to
undertake appropriate action to prevent disclosure of the Records deemed
confidential;
(h) if such sale is pursuant to an underwritten offering and
required under the terms of the underwriting agreement that the Company enters
into in connection therewith, obtain "comfort" letters dated the effective date
of the registration statement and the date of the closing under the underwriting
agreement from the Company's independent public accountants in customary form
and covering such matters of the type customarily covered by "comfort" letters
as Holders' Counsel or the managing underwriter reasonably requests;
(i) furnish, at the request of any Designated Holder on the date
such securities are delivered to the underwriters for sale pursuant to such
registration or, if such securities are not being sold through underwriters, on
the date the Registration Statement with respect to such securities becomes
effective, an opinion, dated such date, of counsel representing the Company for
the purposes of such registration, addressed to the underwriters, if any, and to
the seller making such request, covering such legal matters with respect to the
registration in respect of which such opinion is being given as the
underwriters, if any, and such seller may reasonably request and are customarily
included in such opinions;
(j) comply in all material respects with all applicable rules and
regulations of the Commission, and make generally available to its security
holders, as soon as reasonably practicable but no later than fifteen (15) months
after the effective date of the Registration Statement, an earnings statement
covering a period of twelve (12) months beginning after the effective date of
the Registration Statement, in a manner which satisfies the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder;
(k) cause all such Registrable Securities to be listed on each
securities exchange on which similar securities issued by the Company are then
listed, provided that the applicable listing requirements are satisfied;
(l) cooperate with each seller of Registrable Securities and each
underwriter participating in the disposition of such Registrable Securities and
their respective counsel in connection with any filings required to be made with
the NASD; and
(m) take all other steps reasonably necessary to effect the
registration of the Registrable Securities contemplated hereby.
4.2 Seller Information. In connection with any Registration Statement
in which a Designated Holder is participating pursuant to Article III hereof,
each such Designated Holder shall promptly furnish to the Company in writing
such information with respect to such Designated Holder and the Designated
Holders' plan of distribution as the Company may reasonably request or as may be
required by law for use in connection with any such Registration Statement or
preliminary, final or summary
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prospectus or amendment or supplement, or a document incorporated by reference
into any of the foregoing and all information required to be disclosed in order
to make the information previously furnished to the Company by such Designated
Holder not materially misleading or necessary to cause such Registration
Statement not to omit a material fact with respect to such Designated Holder or
plan of distribution necessary in order to make the statements therein not
misleading. Any Designated Holder who fails to provide such information to the
Company shall not be entitled to use the Registration Statement or any
preliminary, final or summary prospectus or amendment or supplement relating
thereto.
4.3 Notice of Use and Notice to Discontinue. In the event (a) of the
happening of any event of the kind described in Section 4.1(e)(ii) (to the
extent the Company is required in the opinion of counsel to take the action
requested thereunder and is taking such action), 4.1(e)(iii) (in connection with
a stop order), 4.1(e)(iv) (to the extent that in the opinion of counsel sales
under the Registration Statement in question are no longer permitted as a result
of such suspension), 4.1(e)(v) or 4.1(e)(vi) hereof or (b) that, in the good
faith judgment of the Company's board of directors after consultation with
Company counsel, it is advisable to suspend the use of a prospectus included in
any Registration Statement for a discrete period of time due to pending material
corporate developments or similar material events that have not yet been
publicly disclosed and as to which the Company after consultation with counsel
believes public disclosure will be prejudicial to the Company (and that such
public disclosure would be required absent such suspension), the Company shall
deliver a certificate in writing, signed by an authorized senior executive
officer of the Company, to the Designated Holders, to the effect of the
foregoing and thereafter the Designated Holders shall discontinue any
disposition of Registrable Securities pursuant to the Registration Statement and
the prospectus included therein, and the Company, subject to the terms of this
Section 4.3, shall thereafter not be required to maintain the effectiveness or
update the Registration Statement or the prospectus included therein. The
Company will use its reasonable best efforts to ensure that the use of the
Registration Statement and the prospectus may be resumed as soon as practicable,
in the case of suspension under Section 4.3(a), and, in the case of a pending
development or event referred to in Section 4.3(b) hereof, as soon as, in the
good faith judgment of the Company, public disclosure of such material corporate
development or similar material event would not have a material adverse effect
on the Company. Notwithstanding the foregoing, the Company shall not under any
circumstances be entitled to: exercise its right under Section 4.3(b) hereof to
suspend the use of a Registration Statement and related prospectus: (a) more
than two (2) times in any twelve month period; and (b) for a period or multiple
periods aggregating to more than 90 days in any twelve month period.
4.4 Registration Expenses. The Company shall pay all expenses arising
from or incident to its performance of, or compliance with, this Agreement,
including, without limitation, (i) Commission, stock exchange and NASD
registration and filing fees, (ii) all fees and expenses incurred in complying
with securities or "blue sky" laws (including reasonable fees, charges and
disbursements of counsel to any underwriter incurred in connection with "blue
sky" qualifications of the Registrable Securities as may be set forth in any
underwriting agreement), (iii) all printing expenses,
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and (iv) the fees, charges and disbursements of counsel to the Company and of
its independent public accountants and any other accounting fees, charges and
expenses incurred by the Company. All of the expenses described in the preceding
sentence of this Section 4.5 are referred to herein as "Registration Expenses."
The Designated Holders of Registrable Securities sold pursuant to a Registration
Statement shall bear the expense of any broker's commission or underwriter's
discount or commission relating to registration and sale of such Designated
Holders' Registrable Securities and shall bear the fees and expenses of their
own counsel and the Inspectors.
ARTICLE V
COVENANTS
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5.1 Rule 144. The Company covenants that from and after the date
hereof it shall use commercially reasonable efforts to (a) file any reports
required to be filed by it under the Securities and Exchange Act of 1934, as
amended, and (b) take such further action as each Designated Holder of
Registrable Securities may reasonably request (including providing any
information necessary to comply with Rule 144 under the Securities Act, all to
the extent required from time to time to enable such Designated Holder to sell
Registrable Securities without registration under the Securities Act within the
limitation of the exemptions provided by (i) Rule 144 under the Securities Act,
or (ii) any similar rule or regulation hereafter adopted by the Commission.
ARTICLE VI
INDEMNIFICATION
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6.1 Indemnification by the Company.
(a) The Company agrees to indemnify and hold harmless each
Designated Holder, its directors, officers, Affiliates and each Person who
controls (within the meaning of Section 15 of the Securities Act) any of the
foregoing from and against any and all losses, claims, damages, liabilities and
expenses (including reasonable costs of investigation) (each, a "Liability" and
collectively, "Liabilities"), (i) arising out of or based upon any untrue, or
allegedly untrue, statement of a material fact contained in any Registration
Statement or preliminary, final or summary prospectus contained therein (as
amended or supplemented if the Company shall have furnished any amendments or
supplements thereto), (ii) arising out of or based upon any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein (in the case of a prospectus, in light
of the circumstances under which they were made) not misleading, or (iii)
arising directly out of the Company's failure to comply with its obligations
under Articles IV and V hereof; provided, however, that (x) the Company will not
be liable insofar as any such Liability arises out of or is based upon any
untrue statement or alleged untrue statement or omission or alleged omission
contained in such Registration Statement or preliminary, final or summary
prospectus or amendment or supplement, or a document incorporated by reference
into any of the foregoing in reliance and in conformity with information
furnished in writing to the
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Company by or on behalf of a Designated Holder expressly for use therein,
including, without limitation, the information furnished to the Company pursuant
to Section 4.2; and (y) the Company will not be liable with respect to any
Liabilities arising out of or based on any untrue statement or alleged untrue
statement of a material fact or any omission or alleged omission to state a
material fact contained in any Registration Statement or preliminary, final or
summary prospectus or amendment or supplement which is corrected in the
Registration Statement, prospectus, amendment or supplement, if the person
asserting any such Liability purchased Registrable Securities from a Designated
Holder but was not sent or given a copy of the corrected Registration Statement,
prospectus, amendment or supplement at or prior to the written confirmation of
the sale of such Registrable Securities to such person if the corrected
Registration Statement, prospectus, amendment or supplement had been delivered
to such Designated Holder at least four (4) Business Days prior to the date of
such written confirmation of such sale.
(b) Each Designated Holder agrees to indemnify and hold harmless
the Company, its directors and officers and each Person who controls (within the
meaning of Section 15 of the Securities Act) the Company to the same extent as
the foregoing indemnity from the Company to the Designated Holders, mutatis
mutandis, but only if such untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity with
information with respect to such Designated Holder furnished in writing to the
Company by such Designated Holder expressly for use in such Registration
Statement or preliminary, final or summary prospectus or amendment or
supplement, or a document incorporated by reference into any of the foregoing,
including, without limitation, the information furnished to the Company pursuant
to Section 4.2; provided, however, that the total amount to be indemnified by
such Designated Holder pursuant to this Section 6.1(b) shall be limited to the
net proceeds received by such Designated Holder in the offering to which the
Registration Statement or prospectus relates.
6.2 Conduct of Indemnification Proceedings. Any Person entitled to
indemnification hereunder (the "Indemnified Party") agrees to give prompt
written notice to the indemnifying party (the "Indemnifying Party") after the
receipt by the Indemnified Party of any written notice of the commencement of
any action, suit, proceeding or investigation or threat thereof made in writing
for which the Indemnified Party intends to claim indemnification or contribution
pursuant to this Agreement; provided, however, that the failure so to notify the
Indemnifying Party shall not relieve the Indemnifying Party of any Liability
that it may have to the Indemnified Party hereunder (except to the extent that
the Indemnifying Party is materially prejudiced by such failure). The
Indemnified Party shall have the right to participate in the defense of any such
action and shall be entitled to select counsel in such defense. It being
understood, however, that the Indemnifying Party shall not be liable for the
fees and expenses of more than one separate firm of attorneys (in addition to
any local counsel) for all Indemnified Parties. No Indemnifying Party shall be
liable for any settlement entered into without its written consent, which
consent shall not be unreasonably withheld. No Indemnifying Party shall, without
the consent of such Indemnified Party, effect any settlement of any pending or
threatened proceeding in respect of which such Indemnified Party is a party and
indemnity has been sought hereunder by such Indemnified Party, unless such
settlement
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includes an unconditional release of such Indemnified Party from all liability
for claims that are the subject matter of such proceeding.
6.3 Contribution. If the indemnification provided for in this Article
VI from the Indemnifying Party is unavailable to an Indemnified Party hereunder
in respect of any Liabilities referred to herein, then the Indemnifying Party,
in lieu of indemnifying such Indemnified Party, shall contribute to the amount
paid or payable by such Indemnified Party as a result of such Liabilities in
such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party and Indemnified Party in connection with the actions which
resulted in such Liabilities, as well as any other relevant equitable
considerations. The relative faults of such Indemnifying Party and Indemnified
Party shall be determined by reference to, among other things, whether any
action in question, including any untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact, has been
made by, or relates to information supplied by, such Indemnifying Party or
Indemnified Party, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action. The amount paid
or payable by a party as a result of the Liabilities referred to above shall be
deemed to include, subject to the limitations set forth in Section 6.1, any
legal or other fees, charges or expenses reasonably incurred by such party in
connection with any investigation or proceeding; provided that the total amount
to be contributed by such Designated Holder shall be limited to the net proceeds
received by such Designated Holder in the offering.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 6.3 were determined by pro rata allocation
or by any other method of allocation which does not take account of the
equitable considerations referred to in the immediately preceding paragraph. No
Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.
ARTICLE VII
MISCELLANEOUS
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7.1 Recapitalizations, Exchanges, etc. The provisions of this
Agreement shall apply, to the full extent set forth herein with respect to the
shares of Common Stock, or other securities of the Company, that may be issued
in respect of, in exchange for, or in substitution of the shares of Common
Stock, and shall be appropriately adjusted for any stock dividends, splits,
reverse splits, combinations, reclassifications, recapitalizations and the like
occurring after the date of this Agreement. If, and as often as, there are any
changes in the shares of Common Stock, by way of any stock dividends, splits,
reverse splits, combinations, or reclassifications, or through merger,
consolidation, reorganization or recapitalization or by any other means
occurring after the date of this Agreement, appropriate adjustment shall be made
to the provisions of this Agreement, as may be required, so that the rights,
privileges, duties and
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obligations hereunder shall continue with respect to the shares of Common Stock
as so changed.
7.2 Remedies. The Designated Holders, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, shall be
entitled to specific performance of their rights under this Agreement. The
Company agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of the provisions of this Agreement
and hereby agrees to waive in any action for specific performance the defense
that a remedy at law would be adequate.
7.3 Notices. All notices, demands and other communications provided
for or permitted hereunder shall be made in the manner provided for under the
Exchange Agreement.
7.4 Successors and Assigns; Third Party Beneficiaries. This Agreement
shall inure to the benefit of and be binding upon the successors and permitted
assigns of the parties hereto as hereinafter provided. The rights of the
Designated Holder contained in Article III hereof shall be, (i) with respect to
any Registrable Security that is transferred to an Affiliate of a Designated
Holder, automatically transferred to such Affiliate and (ii) with respect to any
Registrable Security that is transferred in all cases to a non-Affiliate,
transferred only with the prior written consent of the Company. All of the
obligations of the Company hereunder shall survive any such transfer; provided,
however, that no such transfer referred to in the preceding clauses (i) or (ii)
shall be effective unless the transferee shall expressly agree in writing to
assume the obligations of a Designated Holder hereunder.
7.5 Amendments and Waivers. Except as otherwise provided herein, the
provisions of this Agreement may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given
unless consented to in writing by (i) the Company and (ii) the Designated
Holder.
7.6 Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement. The parties hereto confirm
that any facsimile copy of another party's executed counterpart of this
Agreement (or its signature page thereof) will be deemed to be an executed
original thereof.
7.7 Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
7.8 Severability. If any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal
or unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired, unless the provisions held
invalid, illegal or unenforceable shall substantially impair the benefits of the
remaining provisions hereof.
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7.9 Rules of Construction. Unless the context otherwise requires,
references to sections or subsections refer to sections or subsections of this
Agreement.
7.10 Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto with respect
to the subject matter contained herein. There are no restrictions, promises,
representations, warranties or undertakings with respect to the subject matter
contained herein, other than those set forth or referred to herein. This
Agreement supersedes all prior agreements and understandings among the parties
with respect to such subject matter.
7.11 Further Assurances. Each of the parties shall, and shall cause
their respective Affiliates to, execute such documents and perform such further
acts as may be reasonably required or desirable to carry out or to perform the
provisions of this Agreement.
7.12 Other Agreements. Nothing contained in this Agreement shall be
deemed to be a waiver of, or release from, any obligations any party hereto may
have under, or any restrictions on the transfer of Registrable Securities or
other securities of the Company imposed by, any other agreement including, but
not limited to, the Charter Documents and the Exchange Agreement.
7.13 Termination. This Agreement and the obligations of the parties
hereunder shall terminate upon the end of the Effectiveness Period, except for
liabilities or obligations under Section 4.4, which shall remain in effect in
accordance with its terms, and liabilities or obligations arising under Article
VI which shall remain in effect for three years after the termination of this
Agreement.
7.14 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK THAT APPLY TO CONTRACTS
MADE AND PERFORMED ENTIRELY WITHIN SUCH STATE.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK; SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the undersigned have executed, or have caused to
be executed, this Registration Rights Agreement on the date first written above.
TII NETWORK TECHNOLOGIES, INC.
By:/s/ Xxxxxxx X. Xxxxxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: VP Finance, Treasurer and CFO
INVESTOR:
XXXXXXXX, L.P.
By: Xxxxxx Xxxxxx & Co., L.P. Director of
Xxxxxxxx Capital Management Inc.
General Partner
By:/s/ Xxxxxxx X. Xxxxxx
----------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chief Operating Officer
