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EXHIBIT 10.4
AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
This AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this "Amended
Registration Rights Agreement") is entered into as of June 15, 1999 by and among
the following parties:
1. Novatel Wireless, Inc., a Delaware corporation (the "Corporation");
2. Golden Gate Development and Investment Limited Partnership, Advent Israel
Limited Partnership, Advent Partners Limited Partnership, each a Delaware
limited partnership, and Advent Israel (Bermuda) Limited Partnership, a Bermuda
limited partnership (collectively, the "Advent Investors");
3. Ventures West Investments Limited, a Canada corporation ("Ventures West"),
Bank of Montreal Capital Corporation, a specialized financing corporation
incorporated under the laws of Canada ("BMO-CC"), Xxx Xxxxxxx and Xxxxx Xxxxx
(collectively, "Ventures West Investors");
4. Working Ventures Canadian Fund, Inc., a Canadian corporation ("Working
Ventures");
5. GSM Capital Limited Partnership, a Delaware limited partnership ("GSM");
6. Harcol Limited Partnership ("Harcol");
7. Ventures West Investors, Working Ventures, GSM, BT Investment Partners, Inc.
("BT Partners") and certain other holders of the Corporation's Series B
Convertible Preferred Stock, par value $.001 per shares ("Series B Stock")
(each, individually, a "Series B Investor", and collectively, the "Series B
Investors"); and
8. any additional investors ("Additional Investors") who comply with the
provisions of Section 16 hereof (each of the Additional Investors and each of
the investors as named under paragraphs 2 through 7 above, an "Investor" and
collectively, the "Investors").
WHEREAS, the Corporation has entered into a certain Registration Rights
Agreement, dated as of August 21, 1996, as amended by that certain Amendment No.
1, dated as of December 23, 1997, as further amended by that certain Amendment
Agreement, dated as of April 24, 1998 and by that certain Second Amendment
Agreement, dated as of August 31, 1998, entered into by and among the
Corporation and other parties listed therein (the "Original Registration Rights
Agreement"); and
WHEREAS, pursuant to that certain Series A Convertible Preferred Stock
Purchase Agreement, dated as of August 21, 1996 by and among the Corporation and
Advent Investors, GSM, Harcol, the Venture West Investors and such other
investors named in the Schedule of Investors thereto (collectively, the "Initial
Investors") (the "Stock Purchase Agreement"), the Corporation issued and sold to
the Initial Investors certain shares of the Corporation's Series A Convertible
Preferred Stock, par value $.001 per share ("Series A Stock"); and
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WHEREAS, as of August 21, 1996, Working Ventures purchased certain
shares of Series A Preferred Stock of Novatel Wireless Technologies Ltd., an
Alberta corporation and a subsidiary of the Corporation ("NWT") (the "NWT Series
A Shares") which shares are convertible into Series A Stock pursuant to the
Share Purchase Agreement dated as of the date hereof between NWT and Working
Ventures (the "NWT Share Purchase Agreement"); and
WHEREAS, pursuant to that certain Series B Preferred Stock and Warrant
Purchase Agreement, dated as of December 23, 1997, as amended by that certain
Amended and Restated Series B Convertible Preferred Stock and Warrant Purchase
Agreement, dated as of April 24, 1998 and that certain Second Amendment
Agreement, dated as of September 1, 1998 (the "Series B Stock Purchase
Agreement"), the Corporation issued and sold to Venture West Investors, Working
Ventures, GSM, BT Partners and certain other investors listed in Schedule of
Investors thereto, certain shares of the Corporation's Series B Convertible
Preferred Stock, par value $.001 per share ("Series B Stock") and certain
warrants to purchase certain shares of Common Stock (as defined below) (the
"Initial Warrants"); and
WHEREAS, as of December 23, 1997, Working Ventures purchased certain
shares of the Series B Preferred Stock of NWT (the "NWT Series B Shares"), which
shares are convertible into shares of the Series B Stock and certain warrants to
purchase certain shares of the NWT's exchangeable common stock ("NWT
Exchangeable Common Shares"), which shares are exchangeable for shares of Common
Stock, pursuant to the Series B Stock Purchase Agreement and the Novatel
Wireless Technologies Ltd. Share and Warrant Purchase Agreement (the "NWT Series
B Share Purchase Agreement"); and
WHEREAS, the Corporation proposes to issue and sell to certain persons
listed on the Schedule of Investors set forth in Exhibit A attached hereto (the
"Schedule of Investors") (each, individually, an "Investor" and, collectively,
the "Investors") a certain number of "Units" (defined as follows) in exchange
for an aggregate investment of up $3,120,000, each Unit consisting of (a) a
Convertible Subordinated Debenture issued by the Corporation ("Debenture") which
may under certain circumstances convert into shares of Series A Preferred Stock
in accordance with the terms and conditions set forth in that certain Unit
Purchase Agreement, dated as of the date hereof by and among the Corporation and
the Investors (the "Unit Purchase Agreement") and (b) a Common Stock Purchase
Warrant ("Warrant") to purchase a certain number of shares of Common Stock at a
price of $2.00, in accordance with the terms and conditions of the Unit Purchase
Agreement; and
WHEREAS, concurrently with the closing of the Unit Purchase Agreement
and pursuant to the terms and conditions therein and in that certain Unit
Purchase Agreement, dated as of the date hereof by and between NWT and Working
Ventures (the "NWT Unit Purchase Agreement"), Working Ventures will purchase a
certain number of "NWT Units" (defined as follows), each NWT Unit consisting of
(a) a Convertible Subordinated Debenture issued by NWT (the "NWT Debenture"),
which NWT Debenture may under certain circumstances convert into shares of
equity securities of NWT in accordance with the terms and conditions set forth
in the NWT Unit Purchase Agreement and (b) a NWT Common Stock Purchase Warrant
(the "NWT Warrant") to purchase a number of shares of the NWT Exchangeable
Common Stock; and
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WHEREAS, it is a condition to closing pursuant to the Unit Purchase
Agreement and the NWT Unit Purchase Agreement that that the the parties hereto
enter into this Amended and Restated Registration Rights Agreement.
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt of which is hereby acknowledged, the parties
hereto do hereby agree that the Original Registration Rights Agreement is hereby
amended and restated in its entirety, and hereafter shall contain the following
terms and conditions:
The Corporation hereby grants to each party hereto the registration
rights set forth in this Amended and Restated Registration Rights Agreement with
respect to the Registrable Securities (as hereinafter defined) owned by such
party.
1. Definitions. As used in this Amended Registration Rights Agreement:
(a) "Act" shall mean the Securities Act of 1933, as amended, or
any similar federal statute, and the rules and regulations of the Securities and
Exchange Commission (the "SEC") thereunder, all as the same shall be in effect
at the time;
(b) "Additional Shares" shall mean the shares of Preferred Stock
issued and sold to the Initial Investors, other than the Advent Investors, GSM,
Harcol and the Venture West Investors, pursuant to the Stock Purchase Agreement;
(c) "Common Stock" shall mean the Corporation's Common Stock, par
value $.001 per share;
(d) "Follow-on Shares" shall mean the shares of Preferred Stock
issued and sold to investors pursuant to Section 2.3 of the Stock Purchase
Agreement;
(e) "Form S-3" shall mean such form under the Act as in effect on
the date hereof or any successor registration form under the Act subsequently
adopted by the SEC which permits inclusion or incorporation of substantial
information by reference to other documents fried by the Corporation with the
SEC;
(f) "Holder" shall mean any person owning or having the fight to
acquire Registrable Securities or any assignee thereof in accordance with
Section 13 hereof;
(g) "NWT Conversion Shares" shall mean, as of any given date, the
number of shares of Common Stock into which the NWT Shares are convertible as of
such date, or if as of such date the NWT Shares have been converted into
Preferred Stock, the number of shares of Common Stock into which such shares of
Preferred Stock are convertible as of such date.
(h) "Preferred Stock" shall mean those shares of the
Corporation's (i) Series A Convertible Preferred Stock, par value $.001 per
share, issued to the Initial Investors pursuant to the Stock Purchase Agreement;
issued to the Investors upon the conversion of the Debentures or the pursuant to
that certain Unit Purchase Agreement, dated as of the date hereof; or issued
upon conversion of the NWT Shares and (ii) Series B Convertible Preferred Stock
issued and sold pursuant to that certain Amended and Restated Series B
Convertible Preferred Stock and
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Warrant Purchase Agreement, dated as of April 24, 1998, by and among the
Corporation and the investors named in the Schedule of Investors thereto
("Series B Stock Purchase Agreement"), including without limitation those shares
issued to BT Investment Partners, pursuant to the Series B Stock Purchase
Agreement, as amended by that certain Second Amendment Agreement, dated as of
August 31, 1998, by and among the parties hereto, or issued upon the conversion
of any preferred shares of NWT sold pursuant to the NWT Series B Stock Purchase
Agreement reference therein (the "Series B NWT Shares").
(i) "Register," "registered," and "registration" shall refer to a
registration effected by preparing and filing a registration statement or
similar document in compliance with the Act, and the declaration or ordering of
effectiveness of such registration statement or document.
(j) "Registrable Securities" shall mean (1) the Common Stock
issuable or issued upon conversion of the Preferred Stock, (2) the NWT
Conversion Shares and shares of Common Stock issuable upon conversion of the
Series B NWT Shares (the "Series B NWT Conversion Shares") upon issuance
thereof, (3) the Common Stock issuable or issued upon exercise of warrants to
purchase Common Stock granted in accordance with the Series B Stock Purchase
Agreement or the Unit Purchase Agreement and (4) any Common Stock of the
Corporation issued as (or issuable upon the conversion or exercise of any
warrant, right or other security which is issued as) a dividend or other
distribution with respect to, or in exchange for or in replacement of, such
Preferred Stock, NWT Conversion Shares and Series B NWT Conversion Shares (after
issuance thereof), shares of NWT's exchangeable common stock issued upon
exercise of warrants to purchase such exchangeable shares (after issuance
thereof), or such Common Stock, excluding in all cases, however, any Registrable
Securities sold by a person in a transaction in which his rights under this
Amended Registration Rights Agreement are not assigned and shares sold by a
person pursuant to a registration statement filed pursuant to the Act or Rule
144 adopted thereunder.
(k) The number of shares of "Registrable Securities then
outstanding" shall be determined by the number of shares of Common Stock then
outstanding which are, and the number of shares of Common Stock issuable
pursuant to then exercisable securities which are, Registrable Securities.
2. Demand Registration.
(a) If the Corporation shall receive at any time after the
earlier of (i) the date two years from the date hereof, or (ii) 180 days after
the effective date of the first registration statement for a public offering of
securities of the Corporation ("IPO") (other than a registration statement
relating either to the sale of securities to employees of the Corporation
pursuant to a stock option, stock purchase or similar plan or a SEC Rule 145
transaction), and prior to five years after the effective date of such IPO, a
written request (a "Registration Request") from the Holders of a majority of the
Registrable Securities then outstanding that the Corporation file a registration
statement under the Act covering the registration of all or a portion of the
Registrable Securities, then the Corporation shall within 10 days of the receipt
thereof, give written notice of such request to all Holders and shall, subject
to the limitations in Section 3, effect as soon as practicable (and in any event
use its best efforts to file the registration statement within 60 days
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of the receipt of such request) the registration under the Act of all
Registrable Securities which the Holders request to be registered within 20 days
of the mailing of such notice by the Corporation.
(b) If the Holders initiating the registration request hereunder
("Initiating Holders") intend to distribute the Registrable Securities covered
by their request by means of an underwriting, they shall so advise the
Corporation as a part of their request made pursuant to this Section 2 and the
Corporation shall include such information in the written notice referred to in
subsection 2(a). The underwriter will be selected by a majority in interest of
the Initiating Holders, shall be of recognized national standing and shall be
reasonably acceptable to the Corporation. In such event, the fight of any Holder
to include his Registrable Securities in such registration shall be conditioned
upon such Holder's participation in such underwriting and the inclusion of such
Holder's Registrable Securities in the underwriting (unless otherwise mutually
agreed by a majority in interest of the Initiating Holders and such Holder) to
the extent provided herein. All Holders proposing to distribute their securities
through such underwriting shall (together with the Corporation as provided in
subsection 5(e)) enter into an underwriting agreement in usual and customary
form with the underwriter or underwriters selected for such underwriting.
3. Limitations on Demand Registration. Notwithstanding any provision of
Section
(a) If the underwriter advises the Initiating Holders in writing
that marketing factors require a limitation of the number of shares to be
underwritten, then the Initiating Holders shall so advise all Holders of
Registrable Securities which would otherwise be underwritten pursuant hereto,
and the number of shares of Registrable Securities that may be included in the
underwriting shall be allocated among all Holders thereof, including the
Initiating Holders, in proportion (as nearly as practicable) to the amount of
Registrable Securities of the Corporation owned by each Holder.
(b) If the Corporation shall furnish to Holders requesting a
registration statement pursuant to Section 2, a certificate signed by Xxxxxx
Xxxxxxx, as an authorized officer of the Corporation, or his replacement,
stating that in the good faith judgment of the Board of Directors of the
Corporation, it would be seriously detrimental to the Corporation and its
stockholders for such registration statement to be fried at the time requested,
and it is therefore necessary to defer the filing of such registration
statement, the Corporation shall have the fight to defer notifying all Holders
of its receipt of a Registration Request, as otherwise required under Section
2(a), for a period of not more than 90 days after receipt of the request of the
Initiating Holders in which case the Corporation shall thereafter use its best
efforts to file the registration statement within 150 days after its receipt of
the Registration Request; provided, however, that the Corporation may not
utilize this fight more than once in any 12-month period.
(c) The Corporation shall not be obligated to file a registration
statement to effect any registration, qualification or compliance pursuant to
Section 2 during the period starting with the date 60 days prior to the
Corporation's bona fide estimated date of filing (as certified to the Holders by
the Corporation promptly after their Registration Request) of, and ending on the
date 180 days immediately following the effective date of, any registration
statement pertaining to securities of the Corporation, including any securities
registered pursuant
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to Section. 2 (other than a registration of securities in a Rule 145 transaction
or with respect to a stock or option plan or other employee benefit plan),
provided that the Corporation is actively employing its best efforts, during
such period, to cause such registration statement to become effective.
4. Corporation Registration. If at any time the Corporation proposes to
register (including for this purpose a registration effected by the Corporation
for stockholders other than the Holders) any of its stock or other equity
securities under the Act in connection with the public offering of such
securities solely for cash (other than a registration relating solely to the
sale of securities to participants in a Corporation stock or option plan or
other employee benefit plan, a registration relating solely to a Rule 145
transaction on a form inapplicable to the sale of Registrable Securities, or a
registration on any form which does not include substantially the same
information as would be required to be included in a registration statement
covering the sale of the Registrable Securities), the Corporation shall, at such
time, promptly give each Holder written notice of such registration. Upon the
written request of each Holder given within 20 days after mailing of such notice
by the Corporation, the Corporation shall, subject to the provisions of Section
8, cause to be registered under the Act all of the Registrable Securities that
each such Holder has requested to be registered. Notwithstanding the foregoing,
should the Corporation, prior to the sale of any shares pursuant to a
registration statement described above in this Section 4, decide to deregister
or not proceed with such offering, the Corporation shall have no further
obligation to the Holders with respect to such offering or registration except
to promptly notify them of its decision.
5. Obligations of the Corporation. Whenever required under this Amended
Registration Rights Agreement to effect the registration of any Registrable
Securities, the Corporation shall, as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use its best efforts to muse such
registration statement to become effective, and upon the request of the Holders
of a majority of the Registrable Securities registered thereunder, keep such
registration statement effective for up to 90 days.
(b) Prepare and file with the SEC such amendments and supplements
to such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Act with respect to the disposition of all securities covered by such
registration statement.
(c) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as they may reasonably request
in order to facilitate the disposition of Registrable Securities owned by them.
(d) Use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or Blue Sky
laws of such jurisdictions as shall be reasonably requested by the Holders,
provided that the Corporation shall not be required in connection therewith or
as a condition thereto to qualify to do business or to file a general consent to
service of process in any such states or jurisdictions.
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(e) In the event of any underwritten public offering, enter into
and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
(f) Notify each Holder of Registrable Securities covered by such
registration statement at any time when a prospectus relating thereto is
required to be delivered under the Act of the happening of any event as a result
of which the prospectus included in such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing.
(g) Use its best efforts to furnish, at the request of any Holder
requesting registration of Registrable Securities pursuant to Section 2 of this
Amended Registration Rights Agreement, on the date that such Registrable
Securities are delivered to the underwriters for sale in connection with a
registration pursuant to this Amended Registration Rights Agreement, if such
securities are being sold through underwriters, or, if such securities are not
being sold through underwriters, on the date that the registration statement
with respect to such securities becomes effective, (i) an opinion, dated such
date, of the counsel representing the Corporation for the purposes of such
registration, in form and substance as is customarily given to underwriters in
an underwritten public offering, addressed to the underwriters, if any, and to
the Holders requesting registration of Registrable Securities and (ii) a letter
dated such date, from the independent certified public accountants of the
Corporation, in form and substance as is customarily given by independent
certified public accountants to underwriters in an underwritten public offering,
addressed to the underwriters, if any, and to the Holders requesting
registration of Registrable Securities.
6. Furnish Information. It shall be a condition precedent to the
obligations of the Corporation to take any action pursuant to this Amended
Registration Rights Agreement with respect to the Registrable Securities of any
selling Holder that such Holder shall furnish to the Corporation such
information regarding itself, the Registrable Securities held by it, and the
intended method of disposition of such securities as shall be required to effect
the registration of such Holder's Registrable Securities.
7. Expenses of Registration. The Corporation shall bear and pay all
expenses incurred in connection with any registration, filing or qualification
of Registrable Securities with respect to the registrations pursuant to Section
2 or Section 4 for each Holder (which fight may be assigned as provided in
Section 13), including, without limitation, all registration, filing, and
qualification fees, printers' and accounting fees relating or apportionable
thereto and the fees and disbursements of one counsel for the selling Holders,
but excluding underwriting discounts and commissions relating to Registrable
Securities.
8. Underwriting Requirements.
(a) In connection with any offering involving an underwriting of
shares of the Corporation, the Corporation shall not be required under Section 4
to include any of the Holders' securities in such underwriting unless they
accept the terms of the underwriting as agreed upon
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between the Corporation and the underwriters selected by it, and then only in
such quantity, which may be none, as will not, in the good faith opinion of the
underwriters, materially jeopardize the success of the offering by the
Corporation. If the total amount of securities, including Registrable
Securities, requested by stockholders to be included in such offering exceeds
the amount of securities sold other than by the Corporation that the
underwriters reasonably believe compatible with the success of the offering,
then the Corporation shall be required to include in the offering only that
number, which may be none, of such securities, including Registrable Securities,
which the underwriters believe will not materially jeopardize the success of the
offering (the securities so included to be apportioned pro rata among the
selling Holders according to the total amount of securities entitled to be
included therein owned by each selling Holder or in such other proportions as
shall mutually be agreed to by such selling Holders).
(b) With respect to any underwriting of shares to be registered
under Section 2, or an underwriting of shares to be registered under Section 12
if the Holders of a majority of the then outstanding Registrable Securities have
requested registration thereunder, such Holders shall have the fight to
designate the managing underwriter or underwriters, who shall be of recognized
national standing and shall be reasonably acceptable to the Corporation, which
acceptance shall not be unreasonably withheld or delayed. In all other
circumstances under such Sections and in connection with registrations under
Section 4, the Corporation shall have the fight to designate the managing
underwriter or underwriters, who shall be of recognized national standing.
9. Delay of Registration. No Holder shall have any fight to obtain or
seek an injunction restraining or otherwise delaying any such registration as
the result of any controversy that might arise with respect to the
interpretation or implementation of this Amended Registration Rights Agreement.
10. Indemnification. In the event any Registrable Securities are
included in a registration statement under this Amended Registration Rights
Agreement:
(a) To the extent permitted by law, the Corporation will
indemnify and hold harmless each Holder, any underwriter (as defined in the Act)
for such Holder and each person, if any, who controls such Holder or underwriter
within the meaning of the Act or the Securities Exchange Act of 1934, as amended
(the "1934 Act"), against any losses, claims, damages, or liabilities (joint or
several) to which they may become subject under the Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages, or liabilities
(or actions in respect thereof) arise out of or are based upon any of the
following statements, omissions or violations (collectively a "Violation"): (i)
any untrue statement or alleged untrue statement of a material fact contained in
such registration statement, including any preliminary prospectus or final
prospectus contained therein or any amendments or supplements thereto, (ii) the
omission or alleged omission to state therein a material fact required to be
stated therein, or necessary to make the statements therein not misleading, or
(iii) any violation or alleged violation by the Corporation of the Act, the 1934
Act, any state securities law or any rule or regulation promulgated under the
Act, the 1934 Act or any state securities law; and Corporation will pay, as
incurred, to each such Holder, underwriter or controlling person, any legal or
other expense reasonably incurred by them in connection with investigating or
defending any such loss, claim,
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damage, liability, or action; provided, however, that the indemnity agreement
contained in this subsection 10(a) shall not apply to amounts paid in settlement
of any such loss, claim, damage, liability, or action if such settlement is
effected without the consent of the Corporation, which consent shall not be
unreasonably withheld, nor shall the Corporation be liable in any such case for
any such loss, claim, damage, liability, or action to the extent that' it arises
out of or is based upon a violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by any such Holder, underwriter or controlling person;
and provided further, that reimbursement by the Corporation of attorneys' fees
incurred by Holders or such controlling persons in investigating or defending
any such loss; claim, damage, liability or action, shall be limited to fees of
one counsel representing such Holders and controlling persons jointly.
(b) To the extent permitted by law, each selling Holder will
indemnify and hold harmless the Corporation, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Corporation within the meaning of the Act, any underwriter, any
other Holder selling securities in such registration statement and any
controlling person of any such underwriter or other Holder, against any losses,
claims, damages, or liabilities (joint or several) to which any of the foregoing
persons may become subject, under the Act, the 1934 Act or other federal or
state law, insofar as such losses, claims, damages, or liabilities (or actions
in respect thereto) arise out of or are based upon any Violation, in each case
to the extent (and only to the extent) that such Violation occurs in reliance
upon and in conformity with written information furnished by such Holder
expressly for use in connection with such registration; and each such Holder
will pay, as incurred, any legal or other expense reasonably incurred by any
person intended to be indemnified pursuant to this subsection 10(b), in
connection with investigating or defending any such loss, claim, damage,
liability, or action; provided, however, that the indemnity agreement contained
in this subsection 10(b) shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability or action if such settlement is effected
without the consent of the Holder, which consent shall not be unreasonably
withheld, and provided further that no Holder shall have any liability under
this Section 10(b) in excess of the net pros actually received by such Holder in
the relevant public offering.
(c) Promptly after receipt by an indemnified party under this
Section 10 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 10, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the fight to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
(together with all other indemnified parties that may be represented without
conflict by one counsel) shall have the fight to retain its own counsel, with
the fees and expenses to be paid by the indemnifying party, if representation of
such indemnified party by the counsel retained by the indemnifying party would
be inappropriate due to actual or potential differing interests between such
indemnified party and any other party represented by such counsel in such
prying. The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action, to the extent materially
prejudicial to the indemnifying party's ability to defend such action, shall
relieve such indemnifying party of any liability to the indemnified party under
this Section 10, but the omission so to deliver written
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notice to the indemnifying party will not relieve it of any liability that it
may have to any indemnified party otherwise than under this Section 10; and
(d) The obligations of the Corporation and Holders under this
Section 10 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Amended Registration Rights
Agreement.
11. Reports Under Securities Exchange Act of 1934. With a view of making
available to the Holders the benefits of Rule 144 and Rule 144A promulgated
under the Act and any other rule or regulation of the SEC that may at any time
permit a Holder to sell securities of the Corporation to the public without
registration or pursuant to a registration on Form S-3, the Corporation agrees
to use its best efforts to:
(a) make and keep public information available, as those terms
are understood and defined in SEC Rule 144, at all times after 90 days after the
effective date of the first registration statement filed by the Corporation for
the offering of its equity securities to the general public;
(b) take all such action, including, without limitation, the
furnishing of all such information as a Holder or a proposed transferee may
reasonably request, to enable such Holder to sell securities of the Corporation
pursuant to SEC Rule 144A;
(c) take all such action, including the voluntary registration of
its Common Stock under Section 12 of the 1934 Act, as is necessary to enable the
Holders to utilize Form S-3 for the sale of their Registrable Securities, such
action to be taken as soon as practicable after the end of the first fiscal year
in which a registration statement on Form S-1 or other applicable form is filed
by the Corporation for the offering of its securities to the general public is
declared effective;
(d) file with the SEC in a timely manner all reports and other
documents required of the Corporation under the Act and the 1934 Act; and
(e) furnish to any Holder, so long as the Holder owns any
Registrable Securities, forthwith upon request (i) a written statement by the
Corporation that it has complied with the reporting requirements of SEC Rule 144
(at any time after 90 days after the effective date of the first registration
statement filed by the Corporation), the Act and the 1934 Act (at any time after
it has become subject to such reporting requirements), or that it qualified as a
registrant whose securities may be resold pursuant to Form S-3 (at any time
after it so qualifies), (ii) a copy of the most recent annual or quarterly
report of the Corporation and such other reports and documents so filed by the
Corporation, and (iii) such other information as may be reasonably requested in
availing any Holder of any rule or regulation of the SEC which permits the
selling of any such securities without registration or pursuant to such form.
12. Form S-3 Registration. In case the Corporation shall receive from
any Holder or Holders a written request or requests that the Corporation 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 such Holder or
Holders, the Corporation will:
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(a) promptly give written notice of the proposed registration,
and any related qualification or compliance, to all other Holders; and
(b) 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 such Holders or
Holders' Registrable Securities as are specified in such request, together with
all or such portion of the Registrable Securities of any other Holder or Holders
joining in such request as are specified in a written request given within 20
days after receipt of such written notice from the Corporation; provided,
however, that the Corporation shall not be obligated to effect any registration,
qualification or compliance, pursuant to this Section 12: (1) if Form S-3 is not
available for such offering by the Holders; (2) if the Holders, together with
the holders of any other securities of the Corporation entitled to inclusion in
such registration, propose to sell Registrable Securities and such other
securities (if any) at an aggregate price to the public (net of any
underwriters' discounts or commissions) of less than $500,000; (3) if the
Corporation shall furnish to the Holders a certificate signed by Xxxxxx Xxxxxxx
as an authorized officer of the Corporation, or his replacement, stating that in
the good faith judgment of the Board of Directors of the Corporation, it would
be seriously detrimental to the Corporation and its stockholders for such Form
S-3 Registration to be effected at such time, in which event the Corporation
shall have the fight to defer the filing of the Form S-3 registration statement
for a period of not more than 90 days after receipt of the request of the Holder
or Holders under this Section 12; provided, however, that the Corporation shall
not utilize this fight more than once in any 12 month period; (4) if the
Corporation has, within the 12 month period preceding the date of such request,
already effected two registrations on Form S-3 for the Holders pursuant to this
Section 12; or (5) in any particular jurisdiction in which the Corporation would
be required to qualify to do business or to execute a general consent to service
of pros in effecting such registration, qualification or compliance.
(c) Subject to the foregoing, the Corporation shall file a
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as practicable after receipt of the
request or requests of the Holders. All expenses incurred in connection with a
registration requested pursuant to Section 12, including (without limitation)
all registration, filing, qualification, printer's and accounting fees and the
reasonable fees and disbursements of counsel for the selling Holder or Holders
and counsel for the Corporation, shall be borne by the Corporation.
(d) The restriction on registrations pursuant to Section 2
provided for in subsection 2(d) shall apply equally to a registration under this
Section 12.
(e) The Corporation is obligated to effect only two (2)
registrations pursuant to this Section 12.
13. Assignment of Registration Rights. The rights to cause the
Corporation to register Registrable Securities pursuant to this Amended
Registration Rights Agreement may be assigned by a Holder to a legally and
contractually permitted transferee or assignee provided the Corporation is,
within a reasonable time after such transfer, furnished with written notice of
the name and address of such transferee or assignee and the securities with
respect to which such registration fights are being assigned; and provided,
further, that such assignment shall be
12
effective only if immediately following such transfer the further disposition of
such securities by the transferee or assignee is restricted under the Act.
14. Limitations on Subsequent Registration Rights. From and after the
date of this Amended Registration Rights Agreement, but subject to the
provisions of Section 16, the Corporation shall not, without the prior written
consent of the Holders of a majority of the outstanding Registrable Securities
and securities convertible into or exercisable for Registrable Securities, enter
into any agreement with any holder or prospective holder of any securities of
the Corporation which would allow such holder or prospective holder (a) to
include such securities in any registration filed under Section 2 hereof, unless
under the terms of such agreement, such holder or prospective holder may include
such securities in any such registration only to the extent that the inclusion
of his securities will not reduce the amount of the Registrable Securities of
the Holders which is included or (b) to make a demand registration which could
result in such registration statement being declared effective prior to the
earlier of either of the dates set forth in subsection 2(a) or within 180 days
of the effective date of any registration effected pursuant to Section 2. The
limitation on subsequent registration rights contained in this Section 14 shall
not apply to the Additional Shares, the Follow-On Shares or the NWT Conversion
Shares.
15. "Market Stand-Off" Agreement. Each Investor hereby agrees that,
during the period of duration (not to exceed 180 days) specified by the
Corporation and an underwriter of Common Stock or other securities of the
Corporation, following the effective date of a registration statement of the
Corporation filed under the Act, it shall not, to the extent requested by the
Corporation and such underwriter, sell or otherwise transfer or dispose of
(other than to donees who agree to be similarly bound) any Common Stock held by
it at any time during such period except Common Stock included in such
registration; provided, however, that:
(a) such agreement shall be applicable only to registration
statements of the Corporation which cover Common Stock (or other securities) to
be sold on its behalf to the public in a bona fide firm commitment underwritten
offering and, after the first registration statement under the Act, shall be
applicable only to Investors holding securities representing one percent or more
of the equity or voting power of the Corporation; and
(b) all other persons with registration rights (whether or not
pursuant to this Amended Registration Rights Agreement) and, except in the case
of the first registration statement filed under the Act, without the incentive
of the grant of additional participation or other special rights, all holders of
one percent or more of the equity or voting power of the Corporation, enter into
similar agreements.
In order to enforce the foregoing covenant, the Corporation may impose
stop-transfer instructions with respect to the Registrable Securities of each
Investor (and the shares or securities of every other person subject to the
foregoing restriction) until the end of such period. Notwithstanding anything
else herein (i) no transferee, assignee or successor of a Investor shall be
bound by this Section 15 if such transferee, assignee or successor has not been
transferred registration rights hereunder and (ii) the obligations of Investors
under this Section 15 shall expire upon expiration of the fights of the Holders
under Sections 2 and 4.
13
16. Accession. Any Additional Investors and any purchasers of Follow-on
Shares shall automatically become an Investor hereunder by delivering to the
Corporation a written instrument in the form of Exhibit A hereto, by which such
Additional Investor or purchaser of Follow-on Shares shall thereby agree to be
bound by the obligations imposed under this Amended Registration Rights
Agreement, whereupon such Additional Investor or purchaser of Follow-on Shares
shall automatically become a party to this Amended Registration Rights Agreement
and shall thereupon be deemed an "Investor" for all purposes of this Amended
Registration Rights Agreement.
17. Governing Law. This Amended Registration Rights Agreement shall be
governed by and construed under the laws of the State of Delaware without regard
to its principles governing conflicts of laws.
18. Entire Agreement; Amendment.
(a) This Amended Registration Rights Agreement constitutes the
full and entire understanding and agreement between the parties with respect to
the subject matter hereof. Any provisions of this Amended Registration Rights
Agreement may be amended, and the observance thereof may be waived (either
generally or in a particular instance and either retroactively or prospectively)
only by written consent of the Corporation and the holders of at least a
majority of the Registrable Securities and securities convertible into or
exercisable for Registrable Securities and then outstanding. Any amendment or
waiver effected in accordance with this paragraph shall be binding upon each
holder of any Registrable Securities then outstanding, each future holder of all
such securities, and the Corporation.
19. Notices. All notices, requests, consents, demands and other
communications required or permitted under this Amended Registration Rights
Agreement shall be in writing and shall be deemed to have been duly given, made
and received (a) when delivered against receipt, (b) upon transmitter's
confirmation of the receipt of a facsimile transmission, which shall be followed
by an original sent otherwise in accordance with this Section 19, (c) upon
confirmed delivery by a standard overnight carrier, or (d) if to a U.S.
resident, upon expiration of three business days after the day when deposited in
the U.S. mail, first class postage prepaid, addressed in accordance with Section
20 of the Stock Purchase Agreement.
20. Counterparts. This Amended Registration Rights Agreement may be
executed in any number of counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument. Any such counterpart may contain one or more signature pages.
21. Severability. In the event that any provision of this Amended
Registration Rights Agreement becomes or is declared by a court of competent
jurisdiction to be illegal, unenforceable or void, this Amended Registration
Rights Agreement shall continue in full force and effect without said provision.
22. Captions. The captions and headings to Sections of this Amended
Registration Rights Agreement have been inserted for identification and
reference purposes only and shall not
14
be used to construe the meaning or the interpretation of this Amended
Registration Rights Agreement.
[SIGNATURE PAGES FOLLOW]
15
IN WITNESS WHEREOF, this Amended Registration Rights Agreement has been
duly executed under seal as of the date first written above.
NOVATEL WIRELESS, INC.
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
ADVENT PARTNERS LIMITED PARTNERSHIP
By: Advent International Corporation,
General Partner
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
ADVENT ISRAEL LIMITED PARTNERSHIP
By: Advent International Limited
Partnership,
General Partner
By: Advent International Corporation,
General Partner
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
16
ADVENT ISRAEL (BERMUDA) LIMITED
PARTNERSHIP
By: Advent International Limited
Partnership,
General Partner
By: Advent International Corporation,
General Partner
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
DIGITAL MEDIA & COMMUNICATIONS, LIMITED
PARTNERSHIP
By: Advent International Limited
Partnership,
General Partner
By: Advent International Corporation,
General Partner
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
00
XXXXXX XXXX DEVELOPMENT AND INVESTMENT
LIMITED PARTNERSHIP
By: Advent International Limited
Partnership,
General Partner
By: Advent International Corporation,
General Partner
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
XXXXXXX XXX
----------------------------------------
Xxxxxxx Xxx
BT INVESTMENT PARTNERS, INC.
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
XXXX XXXXXXX
----------------------------------------
Xxxx Xxxxxxx
18
XXXXX X. XXXX
----------------------------------------
Xxxxx X. Xxxx
XXX XXXXXXXX
Xxx Xxxxxxxx
DIGICOM CELLULAR INTERNATIONAL CO., LTD
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
ECOLOGY MANAGEMENT CORPORATION
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
XXXXXX X. XXXXXX
----------------------------------------
Xxxxxx X. Xxxxxx
19
GSM CAPITAL LIMITED PARTNERSHIP
By: Telcom Management Limited
Partnership,
General Partner
By: Telcom Investments Inc.,
General Partner
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
HARCOL LIMITED PARTNERSHIP
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
XXXX XXXXXXXX
----------------------------------------
Xxxx Xxxxxxxx
JONG XXX XXXX
----------------------------------------
Jong Xxx Xxxx
XXXXXXX X. XXXXXXXXX
----------------------------------------
Xxxxxxx X. Xxxxxxxxx
20
XXXXXX TRAIL, INC.
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
P.S. CAPITAL L.L.C.
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
XXXXXX XXXXXXX
----------------------------------------
Xxxxxx Xxxxxxx
XXXXXX XXXX
----------------------------------------
Xxxxxx Xxxx
VENTURES WEST MANAGEMENT, INC.
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
21
BANK OF MONTREAL CAPITAL CORPORATION
By: Ventures West Management TIP Inc.,
Manager
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
XXXXX XXXXX
----------------------------------------
Xxxxx Xxxxx
XXX XXXXXXX
----------------------------------------
Xxx Xxxxxxx
XXXX'X XXXXXXX PARTNERS
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
22
WORKING VENTURES CANADIAN FUND INC.
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
XXXXXX XXXXX
----------------------------------------
Xxxxxx Xxxxx
XXXXX XXXXXXX
----------------------------------------
Xxxxx Xxxxxxx
ROLLING PROFIT HOLDINGS, LTD
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
XXXXXXX CAPITAL PARTNERS, L.L.C.
----------------------------------------
By:
-------------------------------------
Its:
------------------------------------
23
EXHIBIT A
SCHEDULE OF INVESTORS
