REGISTRATION RIGHTS AGREEMENT
TABLE OF CONTENTS
Page
1. REGISTRATION RIGHTS......................................................1
1.1. Incidental Registration..........................................1
1.2. Registration Procedures..........................................2
1.3. Reasonable Investigation.........................................4
1.4. Registration Expenses............................................4
1.5. Indemnification; Contribution....................................4
1.6. Holdback Agreements; Registration Rights to Others...............7
1.7. Other Registration of Common Stock...............................8
1.8. Availability of Information......................................8
1.9. Limitations on Registration Rights...............................8
2. OTHER AGREEMENTS.........................................................8
2.1. Termination of Restrictions......................................8
3. INTERPRETATION OF THIS AGREEMENT.........................................8
3.1. Certain Defined Terms............................................8
3.2. Directly or Indirectly..........................................11
3.3. Section Headings and Table of Contents and Construction.........12
3.4. Satisfaction Requirement........................................12
3.5. Governing Law...................................................12
4. MISCELLANEOUS...........................................................12
4.1. Communications..................................................12
4.2. Reproduction of Documents.......................................12
4.3. Survival........................................................13
4.4. Successors and Assigns..........................................13
4.5. Amendment and Waiver............................................13
4.6. Expenses........................................................13
4.7. Waiver of Jury Trial; Consent to Jurisdiction; Etc..............13
4.8. Indemnification of the Investors................................14
4.9. Entire Agreement................................................14
4.10. Execution in Counterpart........................................14
4.11. Severability....................................................15
i
REGISTRATION RIGHTS AGREEMENT
-----------------------------
REGISTRATION RIGHTS AGREEMENT (as the same may hereafter be amended,
supplemented or modified, this "Agreement"), dated as of February 26, 2009,
between DEI HOLDINGS, INC. (together with its successors and assigns, the
"Parent"), Coliseum Capital Partners, L.P. ("CCP"), and Xxxxxxxxx Partners,
L.L.C. ("Xxxxxxxxx") (CCP and Xxxxxxxxx collectively with their respective
successors and assigns, the "Investors").
RECITALS
WHEREAS, the Investors are beneficial owners of more than 10% of the
Parent's outstanding common stock (the "Common Stock");
WHEREAS, an affiliate of the Investors is joining the Parent's Board of
Directors as of the date hereof; and
WHEREAS, the parties desire to provide the Investors with certain rights
relating to shares of Parent's Common Stock held by the Investors.
AGREEMENT
NOW THEREFORE, in consideration of the mutual covenants contained in this
Agreement, the parties hereto agree as follows:
1. REGISTRATION RIGHTS.
1.1. Incidental Registration.
-----------------------
(a) Filing of Registration Statement. If the Parent at any time
-----------------------------------
proposes to register any of its Common Stock or Rights (an "Incidental
Registration") under the Securities Act (other than pursuant to a registration
statement on Form S-4 or Form S-8 or any successor forms thereto, solely in
connection with Securities to be issued in a merger, acquisition of stock or
assets of another Person or in a similar transaction, or relating solely to
Securities issued or to be issued under any employee stock option or purchase
plan), for sale in a Public Offering, it will each such time give prompt written
notice to each Investor of its intention to do so. Upon the written request of
any Investor to include its shares under such registration statement (which
request shall be made within thirty (30) days after the receipt of any such
notice and shall specify the Registrable Securities intended to be disposed of
by the Investor), the Parent will effect the registration of all Registrable
Securities that the Parent has been so requested to register by the Investor;
provided, however, that if, at any time after giving written notice of its
intention to register any Securities, the Parent shall determine for any reason
not to register such Securities or to delay or not complete that sale of any
Securities covered by such registration statement, the Parent may, at its
election, give written notice of such determination to each Investor and,
thereupon, shall be relieved of its obligation to register any Registrable
Securities of any Investor in connection with such registration, and may
withdraw the filing or effectiveness of such registration.
(b) Selection of Underwriters. Notice of the Parent's intention to
--------------------------
register such Securities shall designate the proposed underwriters of such
offering (which shall be one or more underwriting firms of recognized standing)
and shall contain the Parent's agreement, if requested to do so, to arrange for
such underwriters to include in such underwriting the Registrable Securities
that the Parent has been so requested to register pursuant to this Section 1.1,
it being understood that no Investor shall have the right to select different
underwriters for the disposition of its Registrable Securities.
(c) Priority on Incidental Registrations. If the managing underwriter
------------------------------------
shall advise the Parent in writing (with a copy to each Investor requesting
sale) that, in such underwriter's opinion, the number of shares of Securities
requested to be included in such Incidental Registration exceeds the
number that can be sold in such offering within a price range acceptable to the
Parent (such writing to state the basis of such opinion and the approximate
number of shares of Securities that may be included in such offering without
such effect), the Parent will be obligated to include in any such registration
statement only such limited portion of each Investor's Registrable Securities
(which may be none) as is determined in good faith by such underwriter (the
reduction in the number of Registrable Securities shall be allocated among the
Investors requesting registration in proportion to the respective number of
Registrable Securities with respect to which each such Investor has timely
requested registration); provided that if any Securities are being offered for
the account of any Person pursuant to that certain Amended and Restated
Registration Rights Agreement dated as of November 23, 2005 among Parent and the
other signatories thereto (the "Prior Agreement"), the number of Registrable
Securities for any Investor shall be reduced or eliminated prior to any
reduction of Securities being offered pursuant to the Prior Agreement.
1.2. Registration Procedures. The Parent will use its best efforts to
------------------------
effect each Registration, and to cooperate with the sale of such Registrable
Securities in accordance with the intended method of disposition thereof as
quickly as practicable, and the Parent will as expeditiously as possible:
(a) subject to the proviso to Section 1.1(a), prepare and file with
the SEC the registration statement and use its best efforts to cause the
Registration to become effective; provided, however, that before filing any
registration statement or prospectus or any amendments or supplements thereto,
the Parent will furnish to each Investor, their counsel, and the underwriters,
if any, and their counsel, copies of all such documents proposed to be filed a
reasonable time (which, in the case of any original registration statement,
shall be at least fifteen (15) days) prior thereto, which documents will be
subject to the reasonable review, within such period, of the Investors, their
counsel and the underwriters; and the Parent will not file any registration
statement or amendment thereto or any prospectus or any supplement thereto to
which any Investor shall reasonably object in writing within such period;
(b) subject to the proviso to Section 1.1(a), prepare and file with
the SEC such amendments and post-effective amendments to any registration
statement and any prospectus used in connection therewith as may be necessary to
keep such registration statement effective for a period not to exceed 180 days
and to comply with the provisions of the Securities Act with respect to the
disposition of all Registrable Securities covered by such registration
statement; and cause the prospectus to be supplemented by any required
prospectus supplement, and as so supplemented to be filed pursuant to Rule 424
under the Securities Act;
(c) furnish to each Investor and the underwriter or underwriters, if
any, without charge, at least one signed copy of the registration statement and
any post-effective amendment thereto, upon request, and such number of conformed
copies thereof and such number of copies of the prospectus (including each
preliminary prospectus and each prospectus filed under Rule 424 under the
Securities Act), any amendments or supplements thereto and any documents
incorporated by reference therein, as any Investor or such underwriter may
reasonably request in order to facilitate the disposition of the Registrable
Securities being sold by such Investor (it being understood that the Parent
consents to the use of the prospectus and any amendment or supplement thereto by
each Investor and the underwriter or underwriters, if any, in connection with
the offering and sale of the Registrable Securities covered by the prospectus or
any amendment or supplement thereto);
(d) notify each Investor of any stop order or other order suspending
the effectiveness of any registration statement, issued or threatened by the SEC
in connection therewith, and take all reasonable actions required to prevent the
entry of such stop order or to remove it or obtain withdrawal of it at the
earliest possible moment if entered;
(e) if requested by the managing underwriter or underwriters, if any,
or any Investor in connection with any sale pursuant to a registration
statement, promptly incorporate in a prospectus supplement or post-effective
amendment such information relating to such underwriting as the managing
underwriter or underwriters, if any, or any Investor reasonably requests to be
included therein; and make all required filings of such prospectus supplement or
post-effective amendment as soon as practicable
2
after being notified of the matters incorporated in such prospectus supplement
or post-effective amendment;
(f) on or prior to the date on which a Registration is declared
effective, use its best efforts to register or qualify, and cooperate with the
Investors, the underwriter or underwriters, if any, and their counsel, in
connection with the registration or qualification of the Registrable Securities
covered by such Registration for offer and sale under the securities or "blue
sky" laws of each state and other jurisdiction of the United States as the
Investors or the managing underwriter, if any, reasonably request in writing;
use its best efforts to keep each such registration or qualification effective,
including through new filings, or amendments or renewals, during the period such
registration statement is required to be kept effective; and do any and all
other acts or things necessary or advisable to enable the disposition in all
such jurisdictions reasonably requested of the Registrable Securities covered by
such Registration; provided, however, that the Parent will not be required to
qualify generally to do business in any jurisdiction where it is not then so
qualified or to take any action which would subject it to general service of
process or required to submit to liability for state or local taxes in any such
jurisdiction where it is not then so subject;
(g) in connection with any sale pursuant to a Registration, cooperate
with each Investor and the managing underwriter or underwriters, if any, to
facilitate the timely preparation and delivery of certificates (not bearing any
restrictive legends) representing Securities to be sold under such Registration,
and enable such Securities to be in such denominations and registered in such
names as the managing underwriter or underwriters, if any, or any Investor may
request;
(h) use its best efforts to cause the Registrable Securities to be
registered with or approved by such other governmental agencies or authorities
within the United States and having jurisdiction over the Parent or any
Subsidiary as may reasonably be necessary to enable the seller or sellers
thereof or the underwriter or underwriters, if any, to consummate the
disposition of such Securities;
(i) enter into such agreements (including underwriting agreements in
customary form) and take such other actions as the Investors shall reasonably
request in order to expedite or facilitate the disposition of such Registrable
Securities;
(j) use its best efforts to obtain:
(i) at the time of effectiveness of each Registration, a "comfort
letter" from the Parent's independent certified public accountants covering such
matters of the type customarily covered by "cold comfort letters" as the
Investors and the underwriters reasonably request; and
(ii) at the time of any underwritten sale pursuant to the
registration statement, a "bring-down comfort letter," dated as of the date of
such sale, from the Parent's independent certified public accountants covering
such matters of the type customarily covered by comfort letters as the Investors
and the underwriters reasonably request;
(k) use its best efforts to obtain, at the time of effectiveness of
each Registration and at the time of any underwritten sale pursuant to each
Registration, an opinion or opinions, favorable to the Investors in form and
scope, from counsel for the Parent in customary form;
(l) notify each Investor, upon discovery that, or upon the discovery
of any event as a result of which, the prospectus included in such Registration,
as then in effect, includes an untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading, and promptly prepare, file with the SEC and
furnish to the Investors a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers or prospective purchasers of such Securities, such
prospectus shall not include an untrue statement of a material fact or omit to
state a
3
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances under which they are
made;
(m) otherwise comply with all applicable rules and regulations of the
SEC, and make generally available to its security holders (as contemplated by
Section 11(a) under the Securities Act) an earning statement satisfying the
provisions of Rule 158 under the Securities Act no later than ninety (90) days
after the end of the twelve (12) month period beginning with the first month of
the Parent's first fiscal quarter commencing after the effective date of the
registration statement, which statement shall cover said twelve (12) month
period;
(n) provide and cause to be maintained a transfer agent and registrar
for all Registrable Securities covered by each Registration from and after a
date not later than the effective date of such Registration; and
(o) use its best efforts to cause all Registrable Securities covered
by each Registration to be listed subject to notice of issuance, prior to the
date of first sale of such Registrable Securities pursuant to such Registration,
on each securities exchange on which the Common Stock is then listed; and, if
the Common Stock is not so listed, to use its best efforts to cause all
Registrable Securities covered by each Registration to be designated as National
Market System Securities, if the Common Stock is so designated; and, if the
Common Stock is not so designated, to arrange for at least two market makers to
register with FINRA as such with respect to such Registrable Securities.
The Parent may require such Investor to furnish the Parent with such information
in respect of such Investor and, if the Securities are not being offered in an
underwritten offering, the proposed plan of distribution by such Investor, that
will be included in such Registration as the Parent may reasonably request in
writing to assure compliance with applicable laws or regulations.
1.3. Reasonable Investigation. The Parent shall follow procedures
--------------------------
customarily observed by issuers in Public Offerings, and accord to the Investors
and the managing underwriters with respect to such offering, as the case may be,
all rights customarily accorded to selling stockholders in secondary
distributions and to managing underwriters if the transaction in question is or
was an underwritten Public Offering, in each such case, as shall be reasonably
necessary, in the opinion of the Investors or such underwriter, to enable it to
conduct a "reasonable investigation" within the meaning of Section 11(b)(3) of
the Securities Act and to satisfy the requirement of reasonable care imposed by
Section 12(a)(2) of the Securities Act.
1.4. Registration Expenses. The Parent will pay all Registration Expenses
----------------------
in connection with each registration of Registrable Securities, including,
without limitation, any such registration not effected by the Parent, except to
the extent that such Registration Expenses relate to any Registrable Securities
requested to be included in any registration proceeding begun pursuant to
Section 1.1, the request of which has been withdrawn by the Investors; in which
case, such Registration Expenses shall be borne by the Investors requesting or
causing such withdrawal, and, in any such case, the Investors shall reimburse
the Parent for all Registration Expenses reasonably paid or incurred by the
Parent in connection with such withdrawn registration proceeding prior to such
withdrawal. Investors shall pay their respective Selling Expenses pro rata on
the basis of the Registrable Securities so registered and sold by such
Investors.
1.5. Indemnification; Contribution.
-----------------------------
(a) Indemnification by the Parent. The Parent shall indemnify, to the
-----------------------------
fullest extent permitted by law, each Investor, its officers, directors and
agents, if any, and each Person, if any, who controls such Investor within the
meaning of Section 15 of the Securities Act, and each underwriter, its officers,
directors and agents, if any, and each Person, if any, who controls such
underwriter within the meaning of Section 15 of the Securities Act, against all
losses, claims, damages, liabilities (or proceedings in respect thereof) and
expenses (under the Securities Act or common law or otherwise), joint or
several, resulting from any violation by the Parent of the provisions of the
Securities Act or any
4
untrue statement or alleged untrue statement of a material fact contained in any
registration statement or prospectus (and as amended or supplemented if amended
or supplemented) or any preliminary prospectus or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein (in the case of any prospectus, in
light of the circumstances under which they were made) not misleading, except to
the extent that such losses, claims, damages, liabilities (or proceedings in
respect thereof) or expenses are caused by any untrue statement or alleged
untrue statement contained in or by any omission or alleged omission from
information concerning such Investor furnished in writing to the Parent by such
Investor expressly for use therein. If the offering pursuant to any registration
statement provided for under this Section 1 is made through underwriters, no
action or failure to act on the part of such underwriters (whether or not such
underwriter is an Affiliate of an Investor) shall affect the obligations of the
Parent to indemnify each Investor or any other Person pursuant to the preceding
sentence. If the Parent shall indemnify in a separate Underwriting Agreement any
of the parties set forth in this Section 1.5(a), then the provisions of such
Underwriting Agreement shall control and this Section 1.5(a) shall not apply as
to any such parties with respect to that Public Offering.
(b) Indemnification for Controlling Person Liability. In addition to
-------------------------------------------------
the indemnification provided for in Section 1.5(a), the Parent shall indemnify
each Investor, its officers, directors, partners and agents, if any, and each
Person, if any, who controls such Investor within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act, against all losses,
claims, damages, liabilities (or proceedings in respect thereof) and expenses,
joint or several, in each case, under the Securities Act, the Exchange Act,
common law or otherwise, resulting from:
(i) any violation by the Parent of the provisions of the
Securities Act or the Exchange Act;
(ii) any untrue statement or alleged untrue statement of a
material fact contained in any registration statement or amendment thereto or
prospectus (and as amended or supplemented if amended or supplemented) or any
preliminary prospectus or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein (in the case of any prospectus, in light of the circumstances
under which they were made) not misleading, whether or not, in each such case,
the registration statement or amendment thereto or prospectus (or amendment or
supplement thereto) or preliminary prospectus related or relates to any offering
or sale of Registrable Securities by such Investor; and
(iii) any other untrue statement or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact necessary
to make the statements in any document issued or delivered to any purchaser or
potential purchaser or filed with the SEC pursuant to Section 13 or Section
15(d) of the Exchange Act (in light of the circumstances under which they were
made) not misleading, in each case, in connection with any offering or sale of
Securities of the Parent by any Person, whether or not such Securities offered
or sold are or were registered or required to be registered under the Securities
Act;
in each such case, to the extent that such losses, claims, damages, liabilities
(or proceedings in respect thereof) and expenses, joint or several, are alleged
to result from or exist by virtue of the fact that such Investor controls or is
alleged to control (within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act) the Parent or any Subsidiary or Affiliate,
whether such claim or allegation arises under Section 15 of the Securities Act
or Section 20 of the Exchange Act or otherwise; provided, however, that such
indemnification shall not extend to losses, claims, damages, liabilities (or
proceedings in respect thereof) or expenses caused by any untrue statement or
alleged untrue statement contained in or by any omission or alleged omission
from information furnished in writing to the Parent by such Investor expressly
for use therein, or from any such information provided by an underwriter
selected by such Investor.
(c) Indemnification by the Investors. In connection with any
-----------------------------------
registration statement in which an Investor is participating, each Investor,
severally and not jointly, shall indemnify, to the fullest
5
extent permitted by law, the Parent, each underwriter (if the underwriter so
requires) and their respective officers, directors and agents, if any, and each
Person, if any, who controls the Parent or such underwriter within the meaning
of Section 15 of the Securities Act, against any losses, claims, damages,
liabilities (or proceedings in respect thereof) and expenses resulting from any
untrue statement or alleged untrue statement of a material fact or any omission
or alleged omission of a material fact required to be stated in the registration
statement or prospectus or preliminary prospectus or any amendment thereof or
supplement thereto or necessary to make the statements therein (in the case of
any prospectus, in light of the circumstances under which they were made) not
misleading, but only to the extent that such untrue statement is contained in or
such omission is from information so concerning an Investor furnished in writing
by such Investor expressly for use therein; provided, however, that any
Investor's obligations hereunder shall be limited to an amount equal to the
proceeds to such Investor of the Registrable Securities sold pursuant to such
registration statement.
(d) Control of Defense. Any Person entitled to indemnification under
------------------
the provisions of this Section 1.5 shall give prompt written notice to the
indemnifying party of any claim with respect to which it seeks indemnification
and unless in such indemnified party's reasonable judgment a conflict of
interest between such indemnified and indemnifying parties may exist in respect
of such claim, permit such indemnifying party to assume the defense of such
claim at the expense of such indemnifying party, with counsel reasonably
satisfactory to the indemnified party. If such defense is so assumed, such
indemnifying party shall not be liable to such indemnified party for any legal
fees and expenses subsequently incurred by such indemnified party in connection
with the defense thereof, other than reasonable fees of liaison with counsel so
selected by the indemnifying party. Neither the indemnified party nor the
indemnifying party shall enter into any settlement without the consent of the
other party (which consent shall not be unreasonably withheld if such settlement
does not attribute liability to such other party); and any underwriting
agreement entered into with respect to any registration statement provided for
under this Section 1 shall so provide, if required by the underwriter. In the
event an indemnifying party shall not be entitled, or elects not, to assume the
defense of a claim, such indemnifying party shall not be obligated to pay the
fees and expenses of more than one counsel or firm of counsel for all parties
indemnified by such indemnifying party in respect of such claim, unless in the
reasonable judgment of any such indemnified party a conflict of interest may
exist between such indemnified party and any other of such indemnified parties
in respect to such claim, in which case the indemnifying party shall not be
obligated to pay the fees and expenses of more than one counsel for such
indemnified party.
(e) Contribution. If for any reason the foregoing indemnity is
------------
unavailable, then the indemnifying party shall contribute to the amount paid or
payable by the indemnified party as a result of such losses, claims, damages,
liabilities or expenses:
(i) in such proportion as is appropriate to reflect the relative
benefits received by the indemnifying party on the one hand and the indemnified
party on the other; or
(ii) if the allocation provided by clause (i) above is not
permitted by applicable law or provides a lesser sum to the indemnified party
than the amount hereinafter calculated, in such proportion as is appropriate to
reflect not only the relative benefits received by the indemnifying party on the
one hand and the indemnified party on the other but also the relative fault of
the indemnifying party and the indemnified party as well as any other relevant
equitable considerations.
Notwithstanding the foregoing, no Investor shall be required to contribute any
amount in excess of the amount such Investor would have been required to pay to
an indemnified party if the indemnity under Section 1.5(b) hereof was available.
No Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation. The obligation of any
Person to contribute pursuant to this Section 1.5(e) shall be several and not
joint.
(f) Timing of Payments. Each indemnifying party, as an interim measure
------------------
during the pendency of any claim, action, investigation, inquiry or proceeding
arising out of or based upon any
6
matter or subject for which indemnity (or contribution in lieu thereof) may be
available to any indemnified party under this Section 1.5, will, subject to
Section 1.5(d), promptly reimburse each indemnified party, as often as invoiced
therefor (but in no event more often than monthly) for all reasonable legal or
other expenses incurred in connection with the investigation or defense of any
such claim, action, investigation, inquiry or proceeding, notwithstanding the
absence of any judicial determination as to the propriety or enforceability of
the indemnifying party's obligation to reimburse the indemnified party for such
expenses and notwithstanding the possibility that the obligations to pay such
expenses might later have been held to be improper by a court of competent
jurisdiction. To the extent that any such interim reimbursement is held to be
improper, the indemnified party agrees to promptly return the amount so advanced
to the indemnifying party, together with interest, compounded monthly, at the
prime rate (or other commercial lending rate for borrowers of the highest credit
standing) listed from time to time in The Wall Street Journal. Any such interim
reimbursement payments which are not made to the indemnified party within thirty
(30) days of a request therefor shall bear interest at such prime rate from the
date of such request. To the extent required by any underwriter in connection
with the execution of any underwriting agreement pursuant to which any Investor
shall be selling any shares of Common Stock, the Parent shall agree to
advancement of the expenses of such underwriter to at least the same extent as
provided in this Section 1.5.
(g) Survival. The indemnity and contribution agreements contained in
--------
this Section 1.5 shall remain in full force and effect regardless of any
investigation made by or on behalf of any Investor, its officers, directors,
agents or any Person, if any, who controls such Investor as aforesaid, and shall
survive the transfer of such Securities by such Investor.
1.6. Holdback Agreements; Registration Rights to Others.
--------------------------------------------------
(a) If the Parent shall at any time register Securities under the
Securities Act (including, without limitation, any registration relating to any
registration pursuant to this Section 1) for offer or sale to the public, then
no Investor shall make any short sale of, grant an option for the transfer of,
or otherwise transfer, any Registrable Securities (other than:
(i) for the public sale of those Registrable Securities included
in and sold pursuant to such registration in accordance with this Section 1; or
(ii) in a private sale to a transferee who agrees to the
restrictions in this Section 1.6(a));
without the prior written approval of the Parent for such reasonable period (but
in no event longer than one hundred eighty (180) days following the effective
date of the related registration statement) as may be designated in writing to
the Investors by the Parent, or, if the Registration shall be, in whole or in
part, an underwritten offering, the managing underwriters; provided, that no
Investor shall be required to make such agreement unless all of the Trivest
Investors (as defined in the Prior Agreement) are subject to the same
restriction.
(b) In addition to the restriction contained in Section 1.6(a), each
Investor shall execute any restrictive agreement or "lock-up" agreement that any
underwriter engaged by the Parent in connection any underwritten Public Offering
shall reasonably request; provided that the restrictive or "lock-up" period
thereunder is not more than one hundred eighty (180) days after the effective
date of the registration statement for which such restrictive agreement or
"lock-up" agreement is sought and provided, that no Investor shall be required
to make such agreement unless all of the Trivest Investors (as defined in the
Prior Agreement) are subject to the same restriction.
(c) The Parent may impose stop-transfer instructions with respect to
the Registrable Securities until the end of any restrictive period provided for
pursuant to this Section 1.6.
7
1.7. Other Registration of Common Stock. If any shares of Common Stock
-------------------------------------
required to be reserved for purposes of exercise of warrants or conversion of
any class of Common Stock into any other class of Common Stock require
registration with or approval of any governmental authority under any federal or
state law (other than the Securities Act) before such shares may be issued upon
conversion, the Parent will, at its expense and as expeditiously as possible,
use its best efforts to cause such shares to be duly registered or approved, as
the case may be.
1.8. Availability of Information. At any time that any class of the Common
---------------------------
Stock is registered under Section 12(b) or Section 12(g) of the Exchange Act,
the Parent will comply with the reporting requirements of Sections 13 and 15(d)
of the Exchange Act (whether or not it shall be required to do so pursuant to
such Sections) and will comply with all other public information reporting
requirements of the SEC from time to time in effect. The Parent will furnish to
the Investors or file via the XXXXX system, promptly upon their becoming
available, copies of all financial statements, reports, notices and proxy
statements sent or made available generally by the Parent to its stockholders,
and copies of all regular and periodic reports and all registration statements
and prospectuses filed by the Parent with any securities exchange or with the
SEC.
1.9. Limitations on Registration Rights.
----------------------------------
(a) Notwithstanding anything to the contrary contained in this
Agreement, the Parent may delay the filing or effectiveness of, or may withdraw,
any Incidental Registration at any time for any reason whatsoever, but,
notwithstanding anything to the contrary contained herein, the Parent shall be
and remain obligated to pay all Registration Expenses and Selling Expenses, if
any, incurred in connection therewith.
2. OTHER AGREEMENTS.
2.1. Termination of Restrictions. Each and all of the provisions of this
----------------------------
Agreement shall terminate immediately as to any Issuable Shares (but this
Agreement shall remain in force with respect to any remaining Issuable Shares)
at such time as such Issuable Shares cease to be Registrable Securities.
Notwithstanding the foregoing, the provisions of Section 1.4, Section 1.5,
Section 4.6 and Section 4.7 shall survive any cessation of the Issuable Shares
covered thereby to be Registrable Securities.
3. INTERPRETATION OF THIS AGREEMENT.
3.1. Certain Defined Terms. For the purpose of this Agreement, the
-----------------------
following terms shall have the meanings set forth below or set forth in the
Section following such term:
Affiliate - means, at any time, a Person (other than an Investor):
(a) that directly or indirectly through one or more intermediaries
controls, or is controlled by, or is under common control with, the Parent;
(b) that beneficially owns or holds five percent (5%) or more of any
class of the Voting Stock of the Parent; or
(c) five percent (5%) or more of the Voting Stock (or in the case of a
Person that is not a corporation, five percent (5%) or more of the equity
interest) of which is beneficially owned or held by the Parent or a Subsidiary;
at such time.
As used in this definition,
Control - means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies
of a Person, whether through the ownership of voting securities, by
contract or otherwise.
Agreement - the introductory paragraph.
Xxxxxxxxx Registrable Securities - means, at any time:
(a) any outstanding shares of Common Stock purchased on behalf of
Xxxxxxxxx by Coliseum Capital Management, LLC pursuant to that certain
Investment Management Agreement by and between Xxxxxxxxx and Coliseum Capital
Management, LLC dated June 26, 2008, as such agreement may be amended from time
to time; and
(b) any other Securities into which any such shares (whether issued or
issuable) may be reclassified, recapitalized or converted or into which any such
shares (whether issued or issuable) may have been exchanged.
As to any particular Xxxxxxxxx Registrable Securities, such Securities
shall cease to be Xxxxxxxxx Registrable Securities:
(i) when a registration statement with respect to the sale of such
Securities shall have become effective under the Securities Act and such
Securities shall have been disposed of in accordance with such registration
statement;
(ii) when they shall have been distributed to the public pursuant
to Rule 144 (or any successor provision) under the Securities Act;
(iii) when they shall have been otherwise transferred and
subsequent disposition of them shall not require registration or qualification
under the Securities Act or any similar state law then in force; or
(iv) when they shall have ceased to be outstanding.
Coliseum Registrable Securities - means, at any time:
(a) any outstanding shares of Common Stock issued to CCP; and
(b) any outstanding shares of Common Stock over which Coliseum Capital
Management, LLC has investment authority (other than the Xxxxxxxxx Registrable
Securities); and
(c) any other Securities into which any such shares (whether issued or
issuable) may be reclassified, recapitalized or converted or into which any such
shares (whether issued or issuable) may have been exchanged.
As to any particular Coliseum Registrable Securities, such Securities
shall cease to be Coliseum Registrable Securities:
(v) when a registration statement with respect to the sale of such
Securities shall have become effective under the Securities Act and such
Securities shall have been disposed of in accordance with such registration
statement;
(vi) when they shall have been distributed to the public pursuant
to Rule 144 (or any successor provision) under the Securities Act;
9
(vii) when they shall have been otherwise transferred and
subsequent disposition of them shall not require registration or qualification
under the Securities Act or any similar state law then in force; or
(viii) when they shall have ceased to be outstanding.
Common Stock - means the Common Stock of the Parent, par value $0.01 per
share.
Exchange Act - means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the SEC promulgated thereunder.
FINRA - means the Financial Industry Regulatory Authority.
Incidental Registration - Section 1.1 hereof.
Indemnified Party - Section 4.8 hereof.
Issuable Share - means and includes at any time,
(a) a share of issued and outstanding Common Stock; and
(b) a Right, and (without duplication) all shares of Common Stock
issuable upon exercise of such Right, in each case at such time.
For purposes of this definition of "Issuable Share", a Right to acquire one
share of Common Stock shall constitute one Issuable Share, and a Person shall be
deemed to own an Issuable Share if such Person has a Right to acquire such share
whether or not such Right is exercisable at such time.
Parent - the introductory paragraph.
Person - means an individual, partnership, corporation, limited liability
company, trust, unincorporated organization, or a government or agency or
political subdivision thereof.
Prior Agreement - Section 1.1(c).
Public Offering - shall mean, with respect to any Issuable Shares, any sale
in a transaction either registered under, or requiring registration under,
Section 5 of the Securities Act.
Registrable Securities - means the Xxxxxxxxx Registrable Securities and the
Coliseum Registrable Securities.
Registration - means each Incidental Registration.
Registration Expenses - means all expenses incident to the Parent's
performance of or compliance with Section 1.1 through Section 1.3, inclusive,
including, without limitation:
(a) all registration and filing fees;
(b) fees and expenses of compliance with securities or blue sky laws
(including reasonable fees and disbursements of counsel in connection with blue
sky qualifications of the Registrable Securities);
(c) expenses of printing certificates for the Registrable Securities
in a form eligible for deposit with Depositary Trust Company;
10
(d) messenger and delivery expenses;
(e) internal expenses (including, without limitation, all salaries and
expenses of its officers and employees performing legal or accounting duties);
(f) fees and disbursements of counsel for the Parent and its
independent certified public accountants (including the expenses of any
management review, cold comfort letters or any special audits required by or
incident to such performance and compliance);
(g) securities acts liability insurance (if the Parent elects to
obtain such insurance);
(h) the reasonable fees and expenses of any special experts retained
by the Parent in connection with such registration; and
(i) fees and expenses of other Persons retained by the Parent; and
(j) fees and expenses of one counsel for the Investors if the
Investors retain the same counsel as the holders of the Registrable Securities
(as defined in the Prior Agreement);
but not including any Selling Expenses.
Right - means and includes any warrant, option or other right, to acquire
Common Stock and including, without limitation, any right pursuant to the
provisions of any Security (other than Common Stock) convertible or exchangeable
into Common Stock.
SEC - means, at any time, the Securities and Exchange Commission or any
other federal agency at such time administering the Securities Act.
Securities Act - means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Security - means "security" as defined by Section 2(1) of the Securities
Act.
Selling Expenses - means and includes, with respect to any sale of
Registrable Securities, any underwriting fees, discounts or commissions
attributable to the sale of Registrable Securities or fees and expenses of
counsel representing an Investor or any other selling expenses, discounts or
commissions incurred in connection with the sale of Registrable Securities.
Subsidiary - means, as to any Person, any corporation in which such Person
or one or more Subsidiaries of such Person or such Person and one or more
Subsidiaries of such Person owns sufficient voting securities to enable it or
them (as a group) ordinarily, in the absence of contingencies, to elect a
majority of the directors (or Persons performing similar functions) of such
corporation. The term "Subsidiary," as used herein without reference to any
Person, shall mean a Subsidiary of the Parent.
Voting Stock - means, with respect to any Person, any shares of stock or
similar equity interests of such Person whose holders are entitled under
ordinary circumstances to vote for the election of directors or similar
officials of such Person (irrespective of whether at the time stock or equity
interests of any other class or classes shall have or might have voting power by
reason of the happening of any contingency).
3.2. Directly or Indirectly. Where any provision herein refers to action to
----------------------
be taken by any Person, or which such Person is prohibited from taking, such
provision shall be applicable whether such action is taken directly or
indirectly by such Person, including actions taken by or on behalf of any
partnership in which such Person is a general partner.
11
3.3. Section Headings and Table of Contents and Construction.
-------------------------------------------------------
(a) Section Headings and Table of Contents, etc. The titles of the
------------------------------------------------
Sections of this Agreement and the Table of Contents of this Agreement appear as
a matter of convenience only, do not constitute a part hereof and shall not
affect the construction hereof. The words "herein," "hereof," "hereunder" and
"hereto" refer to this Agreement as a whole and not to any particular Section or
other subdivision. References to Sections are, unless otherwise specified,
references to Sections of this Agreement. References to Annexes and Exhibits
are, unless otherwise specified, references to Annexes and Exhibits attached to
this Agreement.
(b) Construction. Each covenant contained herein shall be construed
------------
(absent an express contrary provision herein) as being independent of each other
covenant contained herein, and compliance with any one covenant shall not
(absent such an express contrary provision) be deemed to excuse compliance with
one or more other covenants.
3.4. Satisfaction Requirement. If any agreement, certificate or other
-------------------------
writing, or any action taken or to be taken, is by the terms of this Agreement
required to be satisfactory to any Investor, the determination of such
satisfaction shall, unless specifically required herein in any instance to be
"reasonable" or words to similar effect, be made by such Investor, in the sole
and exclusive judgment (exercised in good faith) of such Investor.
3.5. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN
--------------
ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE
INTERNAL LAWS OF THE STATE OF NEW YORK.
4. MISCELLANEOUS.
4.1. Communications.
--------------
(a) Method; Address. All communications hereunder shall be in writing
---------------
and shall be delivered either by nationwide overnight courier or by facsimile
transmission (confirmed by delivery by nationwide overnight courier sent on the
day of the sending of such facsimile transmission). Communications to the Parent
shall be addressed as set forth on Annex 1, or at such other address of which
the Parent shall have notified the Investors. Communications to the Investors
shall be addressed as set forth on Annex 2 or at such other or further address
of which an Investor shall have notified the Parent.
(b) When Given. Any communication addressed and delivered as herein
----------
provided shall be deemed to be received when actually delivered to the address
of the addressee (whether or not delivery is accepted) or received by the
telecopy machine of the recipient. Any communication not so addressed and
delivered shall be ineffective.
(c) Service of Process. Notwithstanding the foregoing provisions of
------------------
this Section 4.1, service of process in any suit, action or proceeding arising
out of or relating to this Agreement or any document, agreement or transaction
contemplated hereby, or any action or proceeding to execute or otherwise enforce
any judgment in respect of any breach hereunder or under any document or
agreement contemplated hereby, shall be delivered in the manner provided in
Section 4.7(c).
4.2. Reproduction of Documents. This Agreement and all documents relating
-------------------------
hereto, including, without limitation, consents, waivers and notifications that
may hereafter be executed, documents received by an Investor (except the
certificates representing the Registrable Securities themselves), may be
reproduced by the Parent or the Investors by any photographic, photostatic,
microfilm, micro-card, miniature photographic, digital or other similar process
and an Investor may destroy any original document so reproduced. Any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding (whether or not the original is in
existence and
12
whether or not such reproduction was made by the Parent or an Investor in the
regular course of business) and any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in evidence.
Nothing in this Section 4.2 shall prohibit the Parent or any Investor from
contesting the accuracy or validity of any such reproduction.
4.3. Survival. All warranties, representations, certifications and
--------
covenants made by the Parent hereunder shall be considered to have been relied
upon by each Investor and shall survive the delivery to such Investor of the
Registrable Securities regardless of any investigation made by or on behalf of
any such Investor. All statements in any certificate or other instrument
delivered by or on behalf of the Parent pursuant to the terms hereof shall
constitute warranties and representations by the Parent hereunder. All payment
obligations of the Parent hereunder shall survive the termination hereof.
4.4. Successors and Assigns. This Agreement shall inure to the benefit of
----------------------
and be binding upon each Investor and its respective successors and assigns. The
provisions hereof are intended to be for the benefit of each Investor and its
permitted respective successors and assigns. Anything contained in this
Agreement notwithstanding, no Investor may assign any of its rights, duties or
obligations hereunder without the prior written consent of the Company. Anything
contained in this Section 4.4 notwithstanding, the Parent may not assign any of
its rights, duties or obligations hereunder without the prior written consent of
the Investors.
4.5. Amendment and Waiver. This Agreement may be amended, and the
----------------------
observance of any term of this Agreement may be waived, with and only with the
written consent of the Parent and each Investor.
4.6. Expenses. Subject to Section 1.4, the Parent agrees to pay, and save
--------
each Investor harmless against liability for the payment of, all Registration
Expenses. The obligations of the Parent under this Section 4.6 shall survive the
termination of this Agreement.
4.7. Waiver of Jury Trial; Consent to Jurisdiction; Etc.
---------------------------------------------------
(a) Waiver of Jury Trial. THE PARTIES HERETO VOLUNTARILY AND
-----------------------
INTENTIONALLY WAIVE ANY RIGHT ANY OF THEM MAY HAVE TO A TRIAL BY JURY IN RESPECT
OF ANY LITIGATION ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT,
THE REGISTRABLE SECURITIES OR ANY OF THE DOCUMENTS, AGREEMENTS OR TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.
(b) Consent to Jurisdiction. ANY SUIT, ACTION OR PROCEEDING ARISING
-----------------------
OUT OF OR RELATING TO THIS AGREEMENT OR THE REGISTRABLE SECURITIES OR ANY OF THE
DOCUMENTS, AGREEMENTS OR TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY, OR ANY
ACTION OR PROCEEDING TO EXECUTE OR OTHERWISE ENFORCE ANY JUDGMENT IN RESPECT OF
ANY BREACH HEREUNDER OR THEREUNDER MAY BE BROUGHT BY SUCH PARTY IN ANY FEDERAL
DISTRICT COURT LOCATED IN NEW YORK CITY, NEW YORK, OR ANY NEW YORK STATE COURT
LOCATED IN NEW YORK CITY, NEW YORK AS SUCH PARTY MAY IN ITS SOLE DISCRETION
ELECT, AND BY THE EXECUTION AND DELIVERY OF THIS AGREEMENT, THE PARTIES HERETO
IRREVOCABLY AND UNCONDITIONALLY SUBMIT TO THE NON-EXCLUSIVE IN PERSONAM
JURISDICTION OF EACH SUCH COURT, AND EACH OF THE PARTIES HERETO IRREVOCABLY
WAIVES AND AGREES NOT TO ASSERT IN ANY PROCEEDING BEFORE ANY TRIBUNAL, BY WAY OF
MOTION, AS A DEFENSE OR OTHERWISE, ANY CLAIM THAT IT IS NOT SUBJECT TO THE IN
PERSONAM JURISDICTION OF ANY SUCH COURT. IN ADDITION, EACH OF THE PARTIES HERETO
IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION THAT
IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF VENUE IN ANY SUIT, ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE REGISTRABLE
SECURITIES OR ANY DOCUMENT, AGREEMENT OR TRANSACTION CONTEMPLATED HEREBY OR
THEREBY BROUGHT IN ANY SUCH COURT, AND HEREBY IRREVOCABLY WAIVES ANY CLAIM THAT
ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM.
13
(c) Service of Process. EACH PARTY HERETO IRREVOCABLY AGREES THAT
------------------
PROCESS PERSONALLY SERVED OR SERVED BY U.S. REGISTERED MAIL AT THE ADDRESSES
PROVIDED HEREIN FOR NOTICES SHALL CONSTITUTE, TO THE EXTENT PERMITTED BY LAW,
ADEQUATE SERVICE OF PROCESS IN ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR THE REGISTRABLE SECURITIES OR ANY DOCUMENT,
AGREEMENT OR TRANSACTION CONTEMPLATED HEREBY OR THEREBY, OR ANY ACTION OR
PROCEEDING TO EXECUTE OR OTHERWISE ENFORCE ANY JUDGMENT IN RESPECT OF ANY BREACH
HEREUNDER OR UNDER ANY DOCUMENT OR AGREEMENT CONTEMPLATED HEREBY. RECEIPT OF
PROCESS SO SERVED SHALL BE CONCLUSIVELY PRESUMED AS EVIDENCED BY A DELIVERY
RECEIPT FURNISHED BY THE UNITED STATES POSTAL SERVICE OR ANY COMMERCIAL DELIVERY
SERVICE.
(d) Other Forums. NOTHING HEREIN SHALL IN ANY WAY BE DEEMED TO LIMIT
------------
THE ABILITY OF THE INVESTORS TO SERVE ANY WRITS, PROCESS OR SUMMONSES IN ANY
MANNER PERMITTED BY APPLICABLE LAW OR TO OBTAIN JURISDICTION OVER THE PARENT IN
SUCH OTHER JURISDICTION, AND IN SUCH OTHER MANNER, AS MAY BE PERMITTED BY
APPLICABLE LAW.
4.8. Indemnification of the Investors. From and at all times after the date
--------------------------------
of this Agreement, and in addition to all other rights and remedies of the
Investors against the Parent, the Parent agrees to indemnify and hold harmless
each Investor and each director, trustee, officer, employee, agent, investment
advisor and affiliate of such Investor (each, an "Indemnified Party") against
any and all claims (whether valid or not), losses, damages, liabilities, costs
and expenses of any kind or nature whatsoever (including, without limitation,
reasonable attorneys' fees, costs and expenses), incurred by or asserted against
any Indemnified Party, from and after the date hereof, whether direct, indirect
or consequential, as a result of or arising from or in any way relating to any
suit, action or proceeding (including any inquiry or investigation) by any
Person, whether threatened or initiated, asserting a claim for any legal or
equitable remedy against any Person under any statute or regulation, including,
but not limited to, any federal or state securities laws, or under any common
law or equitable cause or otherwise, arising from or in connection with the
negotiation, preparation, execution, performance or enforcement of this
Agreement or any transactions contemplated herein, or any of the transactions
contemplated hereunder, whether or not such Indemnified Party is a party to any
such action, proceeding, suit or the target of any such inquiry or
investigation; provided, however, that no Indemnified Party shall have the right
to be indemnified hereunder for any liability resulting from the willful
misconduct or gross negligence of such Indemnified Party or breach by such
Indemnified Party of its own obligations under this Agreement. Notwithstanding
the foregoing, the Parent shall not be obligated to pay the fees, expenses or
disbursements of counsel of more than one counsel for all Indemnified Parties
hereunder and under the Prior Agreement (other than any special local counsel or
counsel for specific purposes which represents the Indemnified Parties) unless
in any Indemnified Party's reasonable judgment a conflict of interest between
the Indemnified Party and any other Indemnified Party exists, in which case the
Parent shall indemnify the Indemnified Party for the fees, expenses or
disbursements of its own separate counsel. All of the foregoing losses, damages,
costs and expenses of any Indemnified Party shall be payable as and when
incurred upon demand by such Indemnified Party and shall be additional
obligations hereunder. The obligations of the Parent and the rights of the
Indemnified Parties under this Section 4.8 shall survive the termination of this
Agreement.
Notwithstanding the foregoing, the indemnification for claims, losses,
damages, liabilities costs and expenses described in Section 1.5 shall be
governed by Section 1.5 and not this Section 4.8.
4.9. Entire Agreement. This Agreement constitutes the final written
-----------------
expression of all of the terms hereof and is a complete and exclusive statement
of those terms.
4.10. Execution in Counterpart. This Agreement may be executed in one or
-------------------------
more counterparts and shall be effective when at least one counterpart shall
have been executed by each party hereto, and each set of counterparts that,
collectively, show execution by each party hereto shall constitute one duplicate
original.
14
4.11. Severability. Any provision of this Agreement that is prohibited or
------------
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
[Remainder of page left blank intentionally; next page is signature page]
15
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered, all as of the date and year first above written.
DEI HOLDINGS, INC.
By: /s/ Xxxxx X. Xxxxxxx
-----------------------------------------------
Name:Xxxxx X. Xxxxxxx
---------------------------------------------
Title: CEO
--------------------------------------------
COLISEUM CAPITAL PARTNERS, L.P.
By: Coliseum Capital, LLC, General Partner
By: /s/ Xxxx Xxxx
-----------------------------------------------
Name: Xxxx Xxxx
Title: Managing Director
XXXXXXXXX PARTNERS, L.L.C.
By: Coliseum Capital Management, LLC, Power of
Attorney
By: /s/ Xxxx Xxxx
-----------------------------------------------
Name: Xxxx Xxxx
---------------------------------------------
Title: Managing Director
--------------------------------------------
Annex 1
DEI Holdings, Inc.
Xxx Xxxxx Xxx
Xxxxx, XX 00000
Telecopy: (000) 000-0000
Attn.: Xxxxx X. Xxxxxxx
with copies, which shall not constitute notice to the Parent, to:
Xxxxxxxxx Xxxxxxx, LLP
0000 X. Xxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxx, XX 00000
Telecopy: (000) 000-0000
Attn.: Xxxxx X. Xxxxxx, Esq.
Annex 2
-------
Coliseum Capital Partners, L.P.
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attn.: Xxxx Xxxx
Xxxxxxxxx Partners, L.L.C.
c/o Coliseum Capital Management, LLC
000 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attn.: Xxxx Xxxx
with copies, which shall not constitute notice to the Investors, to:
Akin Gump Xxxxxxx Xxxxx & Xxxx LLP
Xxx Xxxxxx Xxxx
Xxx Xxxx, XX 00000
Telecopy: (000) 000-0000
Attn.: Xxxxx X. Xxxxxxx, Esq.
