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EXHIBIT 4.3
Exhibit A to Shareholders Agreement
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT, dated as of March __, 2000 (this
"Agreement"), between XXX.XXX, INC., a Delaware corporation (the "Company"), and
INTERWEST GROUP, INC. , a Colorado corporation ("Interwest").
W I T N E S S E T H:
WHEREAS, in connection with the Shareholder Agreement, dated as of
March __, 2000, among the Company, Internet Communications Corporation, a
Colorado corporation ("ICC"), and Interwest (the "Shareholders Agreement"), and
the Agreement and Plan of Merger, dated as of March __, 2000, among the Company,
Internet Acquisition Corporation, a Colorado corporation, and ICC (the "Merger
Agreement"), the Company has agreed to provide certain registration rights under
the Securities Act of 1933, as amended, and the rules and regulations
thereunder, or any similar successor stature (collectively, the "1933 Act"), and
applicable state securities laws with respect to the Company's common stock,
$0.001 par value (the "Common Stock"), to be issued to Interwest pursuant to the
Merger (as defined in the Merger Agreement);
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company and
Interwest hereby agree as follows:
1. DEFINITIONS.
As used in this Agreement, the following terms shall have the following
meanings:
"Nasdaq" means the Nasdaq National Market.
"1934 Act" means the Securities Exchange Act of 1934, as amended.
"register," "registered," and "registration" refer to a registration
effected by preparing and filing a Registration Statement or Statements in
compliance with the 1933 Act and pursuant to Rule 415 under the 1933 Act or any
successor rule providing for offering securities on a continuous basis ("Rule
415"), and the declaration or ordering of effectiveness of such Registration
Statement by the SEC.
"Registrable Securities" means the Common Stock issued to Interwest
pursuant to the Merger. As to any particular shares of such Common Stock, such
shares shall cease to be Registrable Securities when they have been sold
pursuant to an effective registration statement or in compliance with Rule 144
or are eligible to be sold pursuant to subsection (k) of Rule 144.
"Registration Statement" means a registration statement of the Company
under the 1933 Act, including any amendment thereto, filed by the Company
pursuant to this Agreement and including Registrable Securities.
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"Rule 144" means Rule 144 promulgated under the 1933 Act or any other
similar rule or regulation of the SEC that may at any time permit a holder of
securities to sell securities of the Company to the public without registration
under the 1933 Act.
"Rule 415" means Rule 415 promulgated under the 1933 Act or any other
similar rule or regulation of the SEC that may at any time permit a holder of
securities to sell securities of the Company to the public on a delayed or
continuous basis pursuant to a registration statement under the 1933 Act.
"SEC" means the United States Securities and Exchange Commission.
2. REGISTRATION.
(a) MANDATORY REGISTRATION. In connection with the Merger, the Company
shall prepare and file with the SEC a Registration Statement covering the
issuance and sale of the Common Stock and warrants issued in connection with the
Merger and the resale by Interwest of the Registrable Securities (it being
understood that the S-4 Registration Statement being utilized in the Merger for
the issuance of shares of Common Stock of the Company in connection therewith
may be utilized as such resale Registration Statement to the extent permitted by
the rules and regulations of the SEC). The Registration Statement (and each
amendment or supplement thereto, and each request for acceleration of
effectiveness thereof) shall be provided to (and subject to the approval of
(which approval shall not be unreasonably withheld or denied)) Interwest and its
counsel prior to its filing or other submission. The Company shall use its best
efforts to cause such Registration Statement to become effective no later than
the Effective Time (as defined in the Merger Agreement) and to cause such
Registration Statement (or, if necessary, a substitute Registration Statement)
to remain continuously effective pursuant to Rule 415 until the sooner of (i)
two years after the Effective Time or (ii) the first date upon which there are
no Registrable Securities (the "Registration Period").
(b) CERTAIN OFFERINGS. If any offering pursuant to the Registration
Statement filed in accordance with Section 2(a) hereof involves an underwritten
offering, Interwest shall have the right to select an investment banker or
bankers and manager or managers to administer the offering, which investment
banker or bankers or manager or managers shall be reasonably satisfactory to the
Company; it being understood that approval of such investment banker or bankers
or manager or managers shall not be unreasonably withheld or delayed by the
Company. Interwest shall pay all underwriting discounts and commissions and
other fees and expenses of such investment banker or bankers and manager or
managers so selected in accordance with this Section 2(b) (other than fees and
expenses relating to registration of Registrable Securities under federal or
state securities laws, which are payable by the Company pursuant to Section 5
hereof) with respect to their Registrable Securities and the fees and expenses
of Interwest's legal counsel.
(d) PIGGY-BACK REGISTRATIONS. If at any time following the two year
anniversary of the Effective Time there are Registrable Securities outstanding
and the Company shall determine to prepare and file with the SEC a registration
statement relating to an offering for its own account or the account of others
under the 1933 Act of any of its equity securities, other than a registration
statement registering securities issued (i) pursuant to compensation plans for
employees, directors, officers, advisers or consultants of the Company and in
accordance with the terms of such plans as in effect as of the date of the
Agreement, (ii) as part of a transaction involving a strategic alliance,
acquisition of stock or assets, merger, collaboration, joint venture,
partnership or other similar arrangement of the Company with another
corporation, partnership, or other business entity which is engaged in a
business similar to or related to the business of the Company, so long as in the
case of this clause (ii) the Board of Directors of the Company by resolution
duly adopted (and a copy of which shall be furnished to the Investor promptly
after
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adoption) determines that such issuance is fair to the holders of each class and
series of capital stock of the Company and to Interwest in respect of its equity
interest in the Company that is represented by the Registrable Securities, or
(iii) if such registration statement is being filed for the account of other
holders of Common Stock who are entitled by right to exclude the Registrable
Securities in such registration statement, the Company shall send written notice
of such determination to Interwest and, if within ten days after receipt of such
notice, Interwest shall so request in writing, the Company shall include in such
Registration Statement all or any part of the Registrable Securities that
Interwest requests to be registered, except that if, in connection with any
underwritten public offering for the account of the Company, the managing
underwriter(s) thereof shall impose a limitation on the number of shares of
Common Stock that may be included in the Registration Statement because, in such
underwriter(s)' judgment, such limitation is necessary to effect an orderly
public distribution, then the Company shall be obligated to include in such
Registration Statement only such limited portion of the Registrable Securities
with respect to which Interwest has requested inclusion hereunder. The Company
shall not exclude any Registrable Securities unless the Company has first
excluded all outstanding securities the holders of which are not entitled by
right to inclusion of securities in such Registration Statement, and any
exclusion of Registrable Securities shall be made pro rata with holders of other
securities having the right to include such securities in the Registration
Statement, based on the number of securities for which registration is requested
except to the extent such pro rata exclusion of such other securities is
prohibited under any written agreement entered into by the Company with the
holder of such other securities prior to the date of this Agreement, in which
case such other securities shall be excluded, if at all, in accordance with the
terms of such agreement. In addition, the Company may, but is not obligated to,
invite Interwest to include all or any part of the Registrable Securities in any
registration statement filed by the Company during the two year period
commencing on the Effective Time, in which case Interwest shall comply with the
relevant requirements of this Agreement with respect to such registration as if
it were a Registration Statement. No right or invitation to registration of
Registrable Securities under this Section 2(c) shall be construed to limit the
registration required under Section 2(a) hereof.
3. OBLIGATIONS OF THE COMPANY. In connection with the registration of
the Registrable Securities, the Company shall:
(a) use its best efforts to keep the Registration Statement required to
be filed pursuant to Section 2(a) of this Agreement effective pursuant to Rule
415 at all times during the Registration Period; notify Interwest of the
effectiveness of each Registration Statement on the date such Registration
Statement is declared effective; and the Company represents and warrants to, and
covenants and agrees with, Interwest that each Registration Statement (including
any amendments or supplements thereto and prospectuses contained therein) at the
time it is ordered effective by the SEC and at all times during which it is
required to be effective hereunder (and each such amendment and supplement at
the time it is filed with the SEC and at all times during which it is available
for use in connection with the offer and sale of Registrable Securities) shall
not contain any untrue statement of a material fact or omit to state a material
fact required to be stated therein, or necessary to make the statements therein,
in light of the circumstances in which they were made, not misleading;
(b) prepare and file with the SEC such amendments (including
post-effective amendments) and supplements to each Registration Statement and
the prospectus used in connection with each Registration Statement as may be
necessary to keep the Registration Statement effective at all times required by
this Agreement, and, during such period, comply with the provisions of the 1933
Act with respect to the disposition of all Registrable Securities covered by the
Registration Statement until such time as all of such Registrable Securities
have been disposed of in accordance with the intended methods of disposition
thereof as set forth in the Registration Statement;
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(c) furnish to Interwest and its legal counsel, (i) promptly after the
same is prepared and publicly distributed, filed with the SEC or received by the
Company, one copy of each Registration Statement and any amendment thereto, each
preliminary prospectus and prospectus and each amendment or supplement thereto,
each letter written by or on behalf of the Company to the SEC or the staff of
the SEC and each item of correspondence from the SEC or the staff of the SEC
relating to such Registration Statement (other than any portion thereof that
contains information for which the Company has sought confidential treatment)
and (ii) such number of copies of a prospectus, including a preliminary
prospectus, and all amendments and supplements thereto and such other documents,
as Interwest may reasonably request in order to facilitate the disposition of
Registrable Securities;
(d) use best efforts to (i) register and qualify the Registrable
Securities covered by each Registration Statement under such securities or blue
sky laws of such jurisdictions as Interwest reasonably request, (ii) prepare and
file in those jurisdictions such amendments (including post-effective
amendments) and supplements to such registrations and qualifications as may be
necessary to maintain the effectiveness thereof at all times until the end of
the Registration Period, (iii) take such other actions as may be necessary to
maintain such registrations and qualifications in effect at all times during the
Registration Period and (iv) take all other actions reasonably necessary or
advisable to qualify the Registrable Securities for sale in such jurisdictions;
provided, however, that the Company shall not be required in connection
therewith or as a condition thereto (v) to qualify to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 3(d), (w) to subject itself to general taxation in any such
jurisdiction, (x) to file a general consent to service of process in any such
jurisdiction, (y) to provide any undertakings that cause more than nominal
expense or burden to the Company or (z) to make any change in its Certificate of
Incorporation or by-laws, which in each case the Board of Directors of the
Company determines to be contrary to the best interests of the Company and its
stockholders;
(e) in the event that the Registrable Securities are being offered in
an underwritten offering, enter into and perform its obligations under an
underwriting agreement, in usual and customary form, including, without
limitation, customary indemnification and contribution obligations, with the
underwriters of such offering;
(f) as promptly as practicable after becoming aware of such event or
circumstance, notify Interwest of any event or circumstance of which the Company
has knowledge, as a result of which the prospectus included in a Registration
Statement, as then in effect, includes an untrue statement of a material fact or
omits to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading, and use its best efforts promptly to prepare a supplement
or amendment to such Registration Statement to correct such untrue statement or
omission, file such supplement or amendment with the SEC at such time as shall
permit Interwest to sell Registrable Securities pursuant to the Registration
Statement as promptly as practicable, and deliver a number of copies of such
supplement or amendment to Interwest as Interwest may reasonably request;
(g) as promptly as practicable after becoming aware of such event,
notify Interwest (and, in the event of an underwritten offering, the managing
underwriters) of the issuance by the SEC of any stop order or other suspension
of effectiveness of a Registration Statement at the earliest possible time;
(h) permit a single firm of counsel representing Interwest to review
and comment on each Registration Statement and all amendments and supplements
thereto a reasonable period of time, but in no event later than five business
days prior to their filing with the SEC;
(i) make generally available to its security holders as soon as
practical, but not later than 90 days after the close of the period covered
thereby, an earnings statement (in form complying with the provisions of Rule
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under the 0000 Xxx) covering a 12-month period beginning not later than the
first day of the Company's fiscal quarter next following the effective date of
each Registration Statement;
(j) at the request of Interwest, furnish on the date that Registrable
Securities are delivered to an underwriter, if any, for sale in connection with
a Registration Statement (i) a letter, dated such date, from the Company's
independent certified public accountants in form and substance as is customarily
given by independent certified public accountants to underwriters in an
underwritten public offering, addressed to the underwriters; and (ii) an
opinion, dated such date, from counsel representing the Company for purposes of
such Registration Statement, in form and substance as is customarily given in an
underwritten public offering, addressed to the underwriters and Interwest;
(k) make available for inspection by Interwest, any underwriter
participating in any disposition pursuant to a Registration Statement, and any
attorney, accountant or other agent retained by Interwest or any such
underwriter (collectively, the "Inspectors"), all pertinent financial and other
records, pertinent corporate documents and properties of the Company
(collectively, the "Records"), as shall be reasonably necessary to enable
Interwest to exercise its due diligence responsibility, and cause the Company's
officers, directors and employees to supply all information which any Inspector
may reasonably request for purposes of such due diligence; provided, however,
that each Inspector shall hold in confidence and shall not make any disclosure
of any Record or other information which the Company determines in good faith to
be confidential, and of which determination the Inspectors are so notified,
unless (i) the disclosure of such Records is necessary to avoid or correct a
misstatement or omission in any Registration Statement, (ii) the release of such
Records is ordered pursuant to a subpoena or other order from a court or
government body of competent jurisdiction or (iii) the information in such
Records has been made generally available to the public other than by disclosure
in violation of this or any other agreement. The Company shall not be required
to disclose any confidential information in such Records to any Inspector until
and unless such Inspector shall have entered into confidentiality agreements (in
form and substance satisfactory to the Company) with the Company with respect
thereto, substantially in the form of this Section 3(k). Interwest agrees that
it shall, upon learning that disclosure of such Records is sought in or by a
court or governmental body of competent jurisdiction or through other means,
give prompt notice to the Company and allow the Company, at the Company's own
expense, to undertake appropriate action to prevent disclosure of, or to obtain
a protective order for, the Records deemed confidential. The Company shall hold
in confidence and shall not make any disclosure of information concerning
Interwest provided to the Company pursuant to Section 4(e) hereof unless (w)
disclosure of such information is necessary to comply with federal or state
securities laws, (x) the disclosure of such information is necessary to avoid or
correct a misstatement or omission in any Registration Statement, (y) the
release of such information is ordered pursuant to a subpoena or other order
from a court or governmental body of competent jurisdiction or (z) such
information has been made generally available to the public other than by
disclosure in violation of this or, to the knowledge of the Company, any other
agreement. The Company agrees that it shall, upon learning that disclosure of
such information concerning Interwest is sought in or by a court or governmental
body of competent jurisdiction or through other means, give prompt notice to
Interwest and allow Interwest, at Interwest's own expense, to undertake
appropriate action to prevent disclosure of, or to obtain a protective order
for, such information;
(l) use its best efforts to cause all the Registrable Securities
covered by a Registration Statement to be listed on Nasdaq or such other
principal securities market on which securities of the same class or series
issued by the Company are then listed or traded;
(m) provide a transfer agent and registrar, which may be a single
entity, for the Registrable Securities not later than the effective date of each
Registration Statement;
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(n) cooperate with Interwest and the managing underwriter or
underwriters, if any, to facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legends) representing Registrable
Securities to be offered pursuant to a Registration Statement and enable such
certificates to be in such denominations or amounts, as the case may be, as the
managing underwriter or underwriters, if any, or Interwest may reasonably
request and registered in such names as the managing underwriter or
underwriters, if any, or Interwest may request;
(o) during the period the Company is required to maintain effectiveness
of a Registration Statement pursuant to Section 3(a), the Company shall not bid
for or purchase any Common Stock or any right to purchase Common Stock or
attempt to induce any person to purchase any such security or right if such bid,
purchase or attempt would in any way limit the right of Interwest to sell
Registrable Securities by reason of the limitations set forth in Regulation M
under the 1934 Act; and
(p) take all other reasonable actions necessary to expedite and
facilitate disposition by Interwest of the Registrable Securities pursuant to a
Registration Statement, and otherwise comply with all applicable rules and
regulations of the SEC, including, without limitation, compliance with all
applicable reporting requirements under the 1934 Act.
4. OBLIGATIONS OF INTERWEST. In connection with the registration of the
Registrable Securities, Interwest shall have the following obligations:
(a) It shall be a condition precedent to the obligations of the Company
to complete any registration pursuant to this Agreement with respect to the
Registrable Securities that Interwest shall furnish to the Company such
information regarding itself, the Registrable Securities and the intended method
of disposition of the Registrable Securities as shall be reasonably required to
effect the registration of the Registrable Securities and shall execute such
documents in connection with such registration as the Company may reasonably
request. At least five business days prior to the first anticipated filing date
of a Registration Statement, the Company shall notify Interwest of the
information the Company requires from Interwest (the "Requested Information").
If at least two business days prior to the filing date the Company has not
received the Requested Information, then the Company may file the Registration
Statement without including the Registrable Securities but shall not be relieved
of its obligation to file a Registration Statement with the SEC relating to the
Registrable Securities promptly after Interwest provides the Requested
Information; provided, however, that (i) all expenses of the Company relating to
the preparation, amendment and filing of each Registration Statement to include
the Registrable Securities shall be paid by Interwest and (ii) the Company shall
not be considered in breach of any of its obligations to timely file a
Registration Statement under this Agreement to the extent a delay in filing or
obtaining the effectiveness of such Registration Statement is due to the failure
of Interwest to timely provide the Requested Information.
(b) Interwest agrees to cooperate with the Company as reasonably
requested by the Company in connection with the preparation and filing of each
Registration Statement hereunder;
(c) In the event Interwest determines to engage the services of an
underwriter, Interwest agrees to enter into and perform its obligations under an
underwriting agreement, in usual and customary form, including, without
limitation, customary indemnification and contribution obligations, with the
managing underwriter of such offering and take such other actions as are
reasonably required in order to expedite or facilitate the disposition of the
Registrable Securities;
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(d) Interwest agrees that, upon receipt of written notice from the
Company of the happening of any event of the kind described in Section 3(f) or
3(g), Interwest will immediately discontinue disposition of Registrable
Securities pursuant to any Registration Statement covering such Registrable
Securities until Interwest's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 3(f) or 3(g) and, if so directed by
the Company, Interwest shall deliver to the Company (at the expense of the
Company) or destroy (and deliver to the Company a certificate of destruction)
all copies (other than permanent file copies) in Interwest's possession of the
prospectus covering such Registrable Securities current at the time of receipt
of such notice;
(e) Interwest may not participate in any underwritten registration
hereunder unless Interwest (i) completes and executes all questionnaires, powers
of attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements and (ii) agrees to
pay all underwriting discounts and commissions and other fees and expenses of
investment bankers and any manager or managers of such underwriting and legal
expenses of the underwriters applicable with respect to the Registrable
Securities;
(f) Interwest agrees to take all reasonable actions necessary to comply
with the prospectus delivery requirements of the 1933 Act applicable to its
sales of Registrable Securities; and
(g) Interwest acknowledges and agrees that it will comply with the
restrictions on transfer of Registrable Securities contained in Section 5(i) of
the Shareholders Agreement.
5. EXPENSES OF REGISTRATION. Subject to the proviso in Section 4(a),
all reasonable expenses, other than underwriting discounts and commissions and
other fees and expenses of investment bankers and other than brokerage
commissions, incurred in connection with registrations, filings or
qualifications pursuant to Sections 2 and 3, including, without limitation, all
registration, listing and qualifications fees, printers and accounting fees and
the fees and disbursements of counsel for the Company shall be borne by the
Company: provided, however, that Interwest shall bear the fees and out-of-pocket
expenses of its legal counsel.
6. INDEMNIFICATION. In the event any Registrable Securities are
included in a Registration Statement under this Agreement:
(a) To the extent permitted by law, the Company will indemnify and hold
harmless Interwest, its partners, affiliates, employees, duly authorized agents,
directors and officers, each person who controls Interwest within the meaning of
the 1933 Act or the 1934 Act, any underwriter (as defined in the 1933 Act), the
directors and officers of such underwriter, and each person, if any, who
controls any such underwriter within the meaning of the 1933 Act or the 1934 Act
(each, an "Indemnified Person"), against any losses, claims, damages,
liabilities or expenses (joint or several) incurred (collectively, "Claims") to
which any of them may become subject under the 1933 Act, the 1934 Act or
otherwise, insofar as such Claims (or actions or proceedings, whether commenced
or threatened, in respect thereof) arise out of or are based upon any of the
following statements or omissions in or violations with respect to a
Registration Statement, or any post-effective amendment thereof, or any
prospectus included therein: (i) any untrue statement or alleged untrue
statement of a material fact contained in such Registration Statement or any
post-effective amendment thereof or 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, (ii) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary prospectus if used
prior to the effective date of such Registration Statement, or contained in the
final prospectus (as amended or supplemented, if the Company files any amendment
thereof or supplement thereto with the SEC) or the omission or alleged omission
to state therein any material fact necessary to make the statements made
therein, in light of the
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circumstances under which the statements therein were made, not misleading or
(iii) any violation or alleged violation by the Company of the 1933 Act, the
1934 Act, any state securities law or any rule or regulation under the 1933 Act,
the 1934 Act or any state securities law (the matters in the foregoing clauses
(i) through (iii) being, collectively, "Violations"). Subject to the
restrictions set forth in Section 6(d) with respect to the number of legal
counsel, the Company shall reimburse Interwest and the other Indemnified
Persons, promptly as such expenses are incurred and are due and payable, for any
legal fees or other reasonable expenses incurred by them in connection with
investigating or defending any such Claim. Notwithstanding anything to the
contrary contained herein, the indemnification agreement contained in this
Section 6(a): (x) shall not apply to a Claim arising out of or based upon a
Violation that occurs in reliance upon and in conformity with information
furnished in writing to the Company by any Indemnified Person or underwriter for
such Indemnified Person expressly for use in connection with the preparation of
a Registration Statement, a prospectus or any such amendment thereof or
supplement thereto, if such prospectus was timely made available by the Company
pursuant to Section 3(c) hereof; (y) with respect to any preliminary prospectus
shall not inure to the benefit of any Indemnified Person if the untrue statement
or omission of material fact contained in the preliminary prospectus was
corrected in the prospectus, as then amended or supplemented, if such prospectus
was timely made available by the Company pursuant to Section 3(c) hereof; and
(z) shall not apply to amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of the Company, which
consent shall not be unreasonably withheld. Such indemnity shall remain in full
force and effect regardless of any investigation made by or on behalf of the
Indemnified Person.
(b) In connection with any Registration Statement, Interwest agrees to
indemnify and hold harmless, to the same extent and in the same manner set forth
in Section 6(a), the Company, each of its directors, each of its officers who
signs the Registration Statement, each person, if any, who controls the Company
within the meaning of the 1933 Act or the 1934 Act, any underwriter and any
other stockholder selling securities pursuant to such Registration Statement or
any of its directors or officers or any person who controls such stockholder or
underwriter within the meaning of the 1933 Act or the 1934 Act (collectively and
together with an Indemnified Person, an "Indemnified Party"), against any Claim
to which any of them may become subject, under the 1933 Act, the 1934 Act or
otherwise, insofar as such Claim arises out of or is based upon any Violation,
in each case to the extent (and only to the extent) that such Violation occurs
in reliance upon and in conformity with written information furnished to the
Company by Interwest expressly for use in connection with such Registration
Statement; and, subject to the restrictions set forth in Section 6(d) with
respect to the number of legal counsel, Interwest will reimburse any legal or
other expenses reasonably incurred by any Indemnified Party, promptly as such
expenses are incurred and are due and payable, in connection with investigating
or defending any such Claim; provided, however, that the indemnity agreement
contained in this Section 6(b) shall not apply to amounts paid in settlement of
any Claim if such settlement is effected without the prior written consent of
Interwest, which consent shall not be unreasonably withheld; provided, further,
however, that Interwest shall be liable under this Section 6(b) for only that
amount of a Claim as does not exceed the amount by which the net proceeds to
Interwest from the sale of Registrable Securities pursuant to such Registration
Statement exceeds the cost of such Registrable Securities to Interwest. Such
indemnity shall remain in full force and effect regardless of any investigation
made by or on behalf of such Indemnified Party. Notwithstanding anything to the
contrary contained herein, the indemnification agreement contained in this
Section 6(b) with respect to any preliminary prospectus shall not inure to the
benefit of any Indemnified Party if the untrue statement or omission of material
fact contained in the preliminary prospectus was corrected on a timely basis in
the prospectus, as then amended or supplemented.
(c) The Company shall be entitled to receive indemnities from
underwriters, selling brokers, dealer managers and similar securities industry
professionals participating in any distribution, to the same extent as provided
above, with respect to information so furnished in writing by such persons
expressly for inclusion in a Registration Statement.
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(d) Promptly after receipt by an Indemnified Person or Indemnified
Party under this Section 6 of notice of the commencement of any action
(including any governmental action), such Indemnified Person or Indemnified
Party shall, if a Claim in respect thereof is to be made against any
indemnifying party under this Section 6, 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
control of the defense thereof with counsel selected by the indemnifying party
but reasonably acceptable to the Indemnified Person or the Indemnified Party, as
the case may be; provided, however, that an Indemnified Person or Indemnified
Party shall have the right to retain its own counsel with the fees and expenses
to be paid by the indemnifying party, if, in the reasonable opinion of counsel
retained by the indemnifying party, the representation by such counsel of the
Indemnified Person or Indemnified Party and the indemnifying party would be
inappropriate due to actual or potential differing interests between such
Indemnified Person or Indemnified Party and any other party represented by such
counsel in such proceeding. In such event, the indemnifying party shall pay for
only one separate legal counsel for the Indemnified Person or Indemnified Party.
The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action shall not relieve such
indemnifying party of any liability to the Indemnified Person or Indemnified
Party under this Section 6, except to the extent that the indemnifying party is
prejudiced in its ability to defend such action. The indemnification required by
this Section 6 shall be made by periodic payments of the amount thereof during
the course of the investigation or defense, as such expense, loss, damage or
liability is incurred and is due and payable.
7. CONTRIBUTION. To the extent any indemnification by an indemnifying
party is prohibited or limited by law, the indemnifying party agrees to make the
maximum contribution with respect to any amounts for which it would otherwise be
liable under Section 6 to the fullest extent permitted by law; provided,
however, that (a) no contribution shall be made under circumstances where the
maker would not have been liable for indemnification under the fault standards
set forth in Section 6, (b) no party guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 0000 Xxx) shall be entitled to
contribution from any party who was not guilty of such fraudulent
misrepresentation and (c) contribution by Interwest shall be limited in amount
to the amount by which the net amount of proceeds received by Interwest from the
sale of Registrable Securities exceeds the purchase price paid by Interwest for
such Registrable Securities.
8. REPORTS UNDER 1934 ACT. With a view to making available to Interwest
the benefits of Rule 144, the Company agrees to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144;
(b) file with the SEC in a timely manner all reports and other
documents required of the Company under the 1933 Act and the 1934 Act; and
(c) furnish to Interwest so long as Interwest owns Registrable
Securities, promptly upon request, (i) a written statement by the Company that
it has complied with the reporting requirements of Rule 144 and the 1934 Act,
(ii) a copy of the most recent annual or quarterly report of the Company and
such other reports and documents so filed by the Company and (iii) such other
information as may be reasonably requested to permit Interwest to sell
Registrable Securities pursuant to Rule 144 without registration.
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9. AMENDMENT OF REGISTRATION RIGHTS. Any provision of this Agreement
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 the Company and Interwest.
10. MISCELLANEOUS.
(a) All notices and other communications hereunder will be in writing
and will be deemed given if delivered personally, telecopied (which is
confirmed) or sent by an overnight courier service, such as FedEx, to the
parties at the following addresses (or at such other address for a party as will
be specified by like notice):
If to Interwest:
Interwest Group, Inc.
2400 Anaconda Tower
000 Xxxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: President
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxx & Xxxxxxx, L.L.P.
One Xxxxx Center
0000 Xxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Facsimile No.: 000-000-0000
If to the Company:
XXX.XXX, Inc.
000 00xx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxxx, Vice President
and General Counsel
Facsimile No.: 000-000-0000
with a copy to:
Xxxxxxxxxx, Xxxxx & Xxxxxx, P.C.
000 00xx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Esq.
Facsimile No.: 303-223-1111
(b) Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.
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(c) This Agreement shall be enforced, governed by and construed in
accordance with the laws of the State of Colorado applicable to agreements made
and to be performed entirely within such State. In the event that any provision
of this Agreement is invalid or unenforceable under any applicable statute or
rule of law, then such provision shall be deemed inoperative to the extent that
it may conflict therewith and shall be deemed modified to conform with such
statute or rule of law. Any provision hereof which may prove invalid or
unenforceable under any law shall not affect the validity or enforceability of
any other provision hereof.
(d) This Agreement constitutes the entire agreement among the parties
hereto with respect to the subject matter hereof. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein. This Agreement supersedes all prior agreements and understandings among
the parties hereto with respect to the subject matter hereof.
(e) This Agreement shall inure to the benefit of and be binding upon
the successors and assigns of each of the parties hereto.
(f) All pronouns and any variations thereof refer to the masculine,
feminine or neuter, singular or plural, as the context may require.
(g) The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.
(h) Each party shall do and perform, or cause to be done and performed,
all such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as the other party may
reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.
(i) The language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent, and no rules of
strict construction will be applied against any party.
(j) This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original but all of which shall constitute one and the
same agreement. This Agreement, once executed by a party, may be delivered to
the other party hereto by facsimile transmission of a copy of this Agreement
bearing the signature of the party so delivering this Agreement.
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IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed by their respective officers thereunto duly authorized as of day and
year first above written.
XXX.XXX, INC.
By:
-----------------------------------
Name:
Title:
INTERWEST GROUP, INC.
By:
-----------------------------------
Name:
Title:
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