Exhibit 4.7
FORM OF
AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
DATED AS OF FEBRUARY 19, 2002
among
PETCO ANIMAL SUPPLIES, INC.
and
CERTAIN STOCKHOLDERS
OF PETCO ANIMAL SUPPLIES, INC.
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS; RESTRICTIONS ON TRANSFER...............................2
1.1 Definitions..................................................2
1.2 Restrictions on Transfer; No Prohibited Transfer of Shares...3
1.2.1 Restrictions on Transfer............................3
1.2.2 No Prohibited Transfer of Shares....................4
1.3 Improper Transfer............................................4
1.4 Call Option..................................................4
1.5 Tax Treatment................................................6
ARTICLE II. REGISTRATION RIGHTS................................................7
2.1 Definitions..................................................7
2.2 Demand Registrations.........................................9
2.2.1 Number of Demand Registrations......................9
2.2.2 Registration.......................................10
2.2.3 Inclusion of Registrable Shares....................11
2.2.4 Priority on Demand Registrations...................12
2.2.5 Compliance.........................................12
2.3 Piggyback Registration......................................13
2.3.1 Right to Include Registrable Shares................13
2.3.2 Priority on Piggyback Registrations................13
2.4 Registrations on Form S-3...................................16
2.5 Registration Statement......................................17
2.6 Registration Procedures.....................................17
2.7 Holdback Agreements.........................................22
2.8 Registration Expenses.......................................23
2.9 Conditions to Holder's Rights...............................23
2.9.1 Cooperation........................................24
2.9.2 Undertakings.......................................24
2.9.3 Indemnification....................................24
2.10 Indemnification.............................................24
2.10.1 indemnification by the Company....................24
2.10.2 Indemnification by Holders of Registrable Shares..25
2.10.3 Conduct of Indemnification Proceedings............26
2.10.4 Contribution......................................27
2.10.5 Underwriting Agreement to Govern..................27
2.11 Rule 144....................................................28
ARTICLE III. REPRESENTATIONS AND WARRANTIES...................................28
3.1 Representations and Warranties of the Company...............28
3.1.1 Organization.......................................28
3.1.2 Authority..........................................28
3.1.3 Binding Obligation.................................28
i
3.1.4 No Conflict........................................28
3.2 Representations and Warranties of the Stockholders..........28
3.2.1 Organization.......................................28
3.2.2 Authority..........................................28
3.2.3 Binding Obligation.................................29
3.2.4 No Conflict........................................29
3.2.5 Investment Intent of Management Stockholders.......29
ARTICLE IV. EFFECTIVENESS AND TERMINATION OF AGREEMENT........................29
4.1 Effectiveness...............................................29
4.2 Termination.................................................29
ARTICLE V. GENERAL............................................................29
5.1 Financial Reports and Information...........................29
5.2 Recapitalization, Exchanges, Etc., Affecting the Shares.....30
5.3 Injunctive Relief...........................................30
5.4 Legend......................................................30
5.5 Amendment; Waiver; Representatives..........................31
5.6 Additional Documents; Further Changes.......................32
5.7 No Third-Party Benefits.....................................32
5.8 Successors and Assigns......................................32
5.9 Severability................................................32
5.10 Integration.................................................33
5.11 Governing Law...............................................33
5.12 Attorneys' Fees.............................................33
5.13 Headings....................................................33
5.14 Information For Notices.....................................33
5.15 Counterparts................................................33
5.16 Consent to Jurisdiction.....................................33
5.17 No Inconsistent Agreements..................................34
5.18 Information Regarding Beneficial Ownership..................34
5.19 No Tax Advice...............................................34
5.20 After Acquired Shares.......................................34
5.21 Notices.....................................................34
ii
FORM OF
AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
THIS AMENDED AND RESTATED STOCKHOLDERS AGREEMENT (the "AGREEMENT") is
entered into as of February 19, 2002, by and among PETCO Animal Supplies, Inc.,
a Delaware corporation (the "COMPANY"), the persons named in Schedule I hereto
(collectively the "PURCHASING STOCKHOLDERS"), the individuals named in Schedule
II hereto (collectively the "MANAGEMENT STOCKHOLDERS" and each individually, a
"MANAGEMENT STOCKHOLDER"), and the persons named in Schedule III hereto
(collectively the "FINANCING STOCKHOLDERS"). Each of the parties to this
Agreement (other than the Company) and any other Person who shall become a party
to or agree to be bound by the terms of this Agreement after the date hereof is
sometimes hereinafter referred to as a "STOCKHOLDER."
RECITALS
WHEREAS, the Company, BD Recapitalization Holdings LLC, a Delaware
limited liability company ("BD RECAP LLC"), certain of the Management
Stockholders and certain of the Financing Stockholders entered into the
Stockholders Agreement, dated as of October 2, 2000, as amended by that certain
Amendment No. 1 to Stockholders Agreement dated as of January 22, 2001 (as so
amended, the "ORIGINAL AGREEMENT");
WHEREAS, on December 21, 2001, the Company filed with the Commission
(as defined in Section 1.1) a Registration Statement on Form S-1, as amended,
pursuant to which the Company will make a firm commitment underwritten public
offering of its common stock, par value $0.001 per share (the "COMMON
STOCK"), for gross proceeds to the Company of greater than $75,000,000, and
following the Initial Public Offering such Common Stock will be listed on the
Nasdaq Stock Market (the "INITIAL PUBLIC OFFERING");
WHEREAS, upon completion of the Initial Public Offering, which shall
qualify as a "Public Offering Event" under the Original Agreement, certain
rights and obligations in the Original Agreement will terminate pursuant to
Section 6.1 thereof;
WHEREAS, in connection with the Initial Public Offering, the Company
will use all or part of the proceeds thereof to redeem in full (the
"REDEMPTION") all outstanding shares of the Company's 14% Series A Senior
Redeemable Exchangeable Cumulative Preferred Stock, par value $0.01 per share
(the "SERIES A PREFERRED STOCK"), and the Company's 12% Series B Junior
Redeemable Cumulative Preferred Stock, par value $0.01 per share (the "SERIES B
PREFERRED STOCK" and, together with the Series A Preferred Stock, the "PREFERRED
STOCK"), and the Warrants (as defined in the Original Agreement) will be
exercised or expire;
WHEREAS, following completion of the Initial Public Offering and the
Redemption, the Purchasing Stockholders, the Management Stockholders and the
Financing Stockholders will own, in the aggregate, that number of shares of
Common Stock set forth opposite their names on Schedule IV, and will not own any
Warrants or shares of Preferred Stock (the shares of Common Stock are
collectively referred to as the "COMMON SHARES," and the Common Shares, whether
issued or acquired hereafter, including all shares of capital stock of the
Company issuable upon the exercise of warrants, options or other rights to
acquire shares of
1
capital stock of the Company, or upon the conversion or exchange of any
security, are collectively referred to as the "SHARES"); and
WHEREAS, as a condition to and upon completion of the Initial Public
Offering and the Redemption, the Company and each of the Stockholders desire,
for their mutual benefit and protection, to enter into this Agreement to amend
and restate the Original Agreement and to set forth their respective rights and
obligations with respect to their Shares.
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I.
DEFINITIONS; RESTRICTIONS ON TRANSFER
1.1 DEFINITIONS.
The term "AFFILIATE" means, with respect to any Person, any other
Person directly or indirectly controlling, controlled by or under common control
with such Person.
"COMMISSION" means the Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act.
The term "CONTROL" (including, with correlative meanings, the terms
"CONTROLLING," "CONTROLLED BY" and "UNDER COMMON CONTROL WITH") as used with
respect to any Person, shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the management or policies of such
Person, whether through the ownership of voting securities or by contract or
otherwise.
The Management Stockholders and their respective spouses, any direct or
adopted lineal descendants and ancestors and any trusts solely for the benefit
of any or all of the foregoing, and any of their Transferees (as defined in
Section 1.2.1), are sometimes referred to in this Agreement, collectively, as
the "MANAGEMENT PARTIES" and, individually, as a "MANAGEMENT PARTY."
"MERGER AGREEMENT" means that certain Agreement and Plan of Merger,
dated as of May 17, 2000, as amended, between the Company and BD
Recapitalization Corp., a Delaware corporation and wholly owned subsidiary of BD
Recap LLC.
"PERSON" means an individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization, other
entity or government or other agency or political subdivision thereof.
The Purchasing Stockholders and their respective members and affiliates
and their limited partners, general partners, principals, stockholders and
affiliates, and any of their Transferees, are sometimes referred to in this
Agreement, collectively, as the "PURCHASER PARTIES" and, individually, as a
"PURCHASER PARTY."
2
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
similar federal statute, and the rules and regulations of the Commission
thereunder.
1.2 RESTRICTIONS ON TRANSFER; NO PROHIBITED TRANSFER OF SHARES.
1.2.1 RESTRICTIONS ON TRANSFER. Each of the Stockholders agrees
that, except for (i) the Transfer (as defined below) of Shares pursuant to
Section 1.4 hereof and (ii) the Transfer of Shares by any Purchaser Party to any
other Purchaser Party or to its equity participants, such Stockholder will not,
directly or indirectly, sell, hypothecate, give, bequeath, transfer, assign,
pledge or in any other way whatsoever encumber or dispose of (whether for or
without consideration, whether voluntarily or involuntarily or by operation of
law) (any such event, a "TRANSFER") any Shares now or hereafter at any time
owned by such Stockholder (or any interest therein) to another Person (a
"TRANSFEREE"), unless and until:
(a) with respect to Shares that are not subject to the
Call Option pursuant to Section 1.4 below, including all of the Shares owned
by the Purchaser Parties, (i) there is then in effect a registration
statement under the Securities Act covering such proposed Transfer and such
Transfer is (A) made in accordance with such registration statement and (B)
in compliance with any applicable state securities or Blue Sky laws, (ii) the
Transfer is effected pursuant to and in compliance with Rule 144 promulgated
under the Securities Act and is in compliance with any applicable state
securities or Blue Sky laws or (iii) (A) such Stockholder shall have
furnished the Company with an opinion of counsel, to the extent reasonably
required by the Company, which opinion and counsel shall be reasonably
satisfactory to the Company, to the effect that no registration under the
Securities Act is required because of the availability of an exemption
therefrom and (B) such Transfer is in compliance with any applicable state
securities or Blue Sky laws; or
(b) with respect to Shares that are subject to the Call
Option (i) the Transferee of such Transferred Shares shall have executed and
delivered to the Company, as a condition precedent to such Transfer, an
instrument or instruments in form and substance satisfactory to the Company
confirming that the Transferee agrees to be bound by the terms of this Agreement
and accepts the rights and obligations of the transferor Stockholder set forth
in this Agreement as if it were the transferor Stockholder, (ii) such
Stockholder shall have furnished the Company with an opinion of counsel, to the
extent reasonably required by the Company, which opinion and counsel shall be
reasonably satisfactory to the Company, to the effect that no registration under
the Securities Act is required because of the availability of an exemption
therefrom and (iii) such Transfer is in compliance with any applicable state
securities or Blue Sky laws.
(c) Notwithstanding the provisions of paragraphs (a) and
(b) above, no such registration statement or opinion of counsel shall be
necessary for a Transfer (i) by a Stockholder which is a partnership to its
partners or former partners in accordance with partnership interests, (ii) by a
Stockholder which is a limited liability company to its members or former
members in accordance with their interest in the limited liability company,
(iii) by a Stockholder to such Stockholder's spouse, any direct or adopted
lineal descendant or ancestor of
3
such Stockholder or his or her spouse or any trust solely for the benefit of any
or all of the foregoing, provided that after giving effect to such Transfer
under this clause (iii), sole voting power with respect to such Transferred
Shares shall be held by the transferor Stockholder (unless such Transfer occurs
by reason of the death of such Stockholder) or (iv) any Transfer by a
Stockholder which is a state-sponsored employee benefit plan to a successor
trust or fiduciary or pursuant to a statutory reconstitution.
1.2.2 NO PROHIBITED TRANSFER OF SHARES. The Company shall not
transfer upon its books any Shares to any Person to the extent prohibited by
this Agreement and any purported transfer in violation hereof shall be null and
void ab initio and of no effect.
1.3 IMPROPER TRANSFER. Any attempt to Transfer or otherwise encumber
any Shares in violation of this Agreement shall be null and void and neither the
Company nor any transfer agent of such Shares shall give any effect to such
attempted Transfer or encumbrance in its stock records.
1.4 CALL OPTION. Each of the Management Stockholders agrees, for
themselves and all Management Parties who subsequently acquire or hold Shares
previously held by such Management Stockholder (including Transferees of such
Management Stockholder), that the Company will have a call option (the "CALL
OPTION") on all Shares held by any Management Stockholder or Management Party,
including all Common Shares issuable upon exercise of any Employee Options (the
"CALLABLE SECURITIES"), upon the voluntary termination by such Management
Stockholder of such Management Stockholder's employment with the Company (each,
a "CALL EVENT"); PROVIDED that the Company may provide that the Company may
exercise the Call Option through the purchase of the Management Stockholder's
Employee Options. The Call Option will expire: (a) with respect to Management
Stockholders who began employment with the Company prior to January 1, 2001, (i)
as to 50% of the Shares owned, or Common Shares issuable upon exercise of any
Employee Options owned, by each such Person upon the closing of the Initial
Public Offering and (ii) as to 25% of the Shares owned, or Common Shares
issuable upon exercise of any Employee Options owned, by each such Person upon
each of the first two anniversaries of the date of the closing of the Initial
Public Offering, or (b) with respect to Management Stockholders who began
employment with the Company on or after January 1, 2001, (i) as to 25% of the
Shares owned, or Common Shares issuable upon exercise of any Employee Options
owned, by each such Person upon the closing of the Initial Public Offering and
(ii) as to 25% of the Shares owned, or Common Shares issuable upon exercise of
any Employee Options owned, by each such Person upon each of the first three
anniversaries of the date of the closing of the Initial Public Offering. Upon
the occurrence of a Call Event, the Company may exercise the Call Option by
written notice (an "OPTION NOTICE") of its election to do so delivered to the
Management Stockholder (or, if different, the then current holder of the Shares)
within the later of (1) ninety (90) days after such Call Event, (2) the date of
expiration of the options, in the event of an election to purchase Employee
Options and (3) thirty (30) days after the Management Stockholder's exercise of
Employee Options, in the case of an election to purchase Common Shares issuable
upon exercise of options to acquire Common Shares from the Company, and, upon
the giving of such notice, the Company will be obligated to purchase, and the
Management Stockholder (or, if different, the then current holder of the Shares)
("SELLER") will be obligated to sell, all or any lesser portion indicated in the
Option
4
Notice of the Callable Securities owned at the time of the Call Event by the
Seller. The consideration for the Callable Securities referred to in the
preceding sentence shall be the Management Stockholder's Cost of such Callable
Securities.
The closing for all purchases and sales of Callable Securities pursuant
to this Section 1.4 will be at the principal executive offices of the Company on
the 60th day after the giving of the Option Notice. The applicable purchase
price for the Callable Securities will be paid in cash or by cashier's check.
The Seller will cause the Callable Securities to be delivered to the Company at
the closing free and clear of all liens, charges or encumbrances of any kind
except those which shall continue to apply to such Shares by the terms of this
Agreement. Such Seller will take all such actions as the Company reasonably
requests to vest in the Company title to the Callable Securities free of any
lien, charge or encumbrance incurred by or through the Seller.
Notwithstanding any other section of this Agreement, in the event a
Management Stockholder's employment with the Company is terminated other than
through the Management Stockholder's Retirement from the Company, all of the
Management Stockholder's Employee Options may be exercisable for three months
following such termination and the exercise price may be paid at the Management
Stockholder's election (a) by cash or cashiers check, or (b) by surrender of
Common Shares or Employee Options (other than Common Shares or Employee Options
that are subject to the Call Option) ("NET ISSUANCE") as determined below. If
the Management Stockholder elects the Net Issuance method, the Company will
issue Shares in accordance with the following formula:
X = Y(A-B)
------
A
Where:
X = the number of Shares to be issued to the Stockholder
Y = the number of Shares requested to be exercised under this
Agreement
A = the Fair Market Value of one (1) Share
B = the exercise price
Notwithstanding, any other section of this Agreement, in the event a Management
Stockholder's employment with the Company is terminated through the Management
Stockholder's Retirement from the Company, all of the Management Stockholder's
Employee Options may be exercised at any time and from time to time until the
expiration of such Employee Options.
For purposes of this Section 1.4, the following terms have the
following meanings:
"MANAGEMENT STOCKHOLDER'S COST" means (x) in respect of Common Shares
(1) $0.50 per share (subject to adjustment for stock splits, stock dividends,
recapitalizations or
5
similar events), with respect to Common Shares which were retained by the holder
thereof pursuant to Section 2.2(c) of the Merger Agreement, (2) the Fair Market
Value of such Common Shares at the time such Common Shares were originally
acquired from the Company, with respect to Common Shares which were acquired
pursuant to the exercise of Options (as defined in the Merger Agreement)
retained by the holder thereof pursuant to Section 2.6(c) of the Merger
Agreement, or (3) the consideration originally paid to the Company for such
Common Shares, with respect to Common Shares which are otherwise acquired, (y)
with respect to Options (as defined in the Merger Agreement) retained by the
holder thereof pursuant to Section 2.6(c) of the Merger Agreement, the excess of
$0.50 over the exercise price thereof per share (subject to adjustment for stock
splits, stock dividends, recapitalizations or similar events), and (z) with
respect to Employee Options granted after the Effective Time (as defined in the
Merger Agreement), the amount, if any, paid by the holder thereof to the Company
to acquire such options.
"FAIR MARKET VALUE" means, as of any date, the value of a share of the
Common Stock determined as follows: (a) if the Common Stock is then quoted on
the Nasdaq National Market, its last reported sale price on the Nasdaq National
Market or, if no such reported sale takes place on such date, the average of the
closing bid and asked prices; (b) if the Common Stock is publicly traded and is
then listed on a national securities exchange but is not quoted on the Nasdaq
National Market, the last reported sale price or, if no such reported sale takes
place on such date, the average of the closing bid and asked prices on the
principal national securities exchange on which the Common Stock is listed or
admitted to trading; (c) if such Common Stock is publicly traded but is not
quoted on the Nasdaq National Market nor listed or admitted to trading on a
national securities exchange, the average of the closing bid and asked prices on
such date, as reported in the Western Edition of THE WALL STREET JOURNAL, for
the over-the-counter market; or (d) if none of the foregoing is applicable, by
the Company's Board of Directors in good faith.
"RETIREMENT" means retirement pursuant to the Company's standard
retirement policy in effect from time to time but in no event prior to the age
of 65, unless otherwise agreed upon by the Stockholder and the Company's Board
of Directors.
1.5 TAX TREATMENT. The attachment of restrictions to the Shares held
by the Management Stockholders and the subsequent lapse of those restrictions
(the "EXCHANGE RESTRICTIONS") is not intended to constitute a transfer of
property in connection with the performance of services by the Management
Stockholders within the meaning of Section 83 of the Internal Revenue Code of
1986, as amended (the "CODE"). Accordingly, the Company will not report
compensation to the Management Stockholders at any time with respect to the
Exchange Restrictions unless required to by applicable law.
6
ARTICLE II.
REGISTRATION RIGHTS.
2.1 DEFINITIONS.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
or any similar federal statute, and the rules and regulations of the Commission
thereunder.
"FINANCING HOLDER" means a Holder of Registrable Financing Shares,
including a Transferee of Registrable Financing Shares if (i) the Transfer to
such Transferee is not prohibited by this Agreement, and (ii) the Shares
Transferred to such transferee continue to be Registrable Shares.
The Financing Stockholders, and any accounts managed by Trust Company
of the West, and any of their Transferees, are sometimes referred to in this
Agreement, collectively, as the "FINANCING PARTIES" and, individually, as a
"FINANCING PARTY."
"HOLDER" means a Holder of Registrable Shares. A Person is deemed to be
a Holder of Registrable Shares whenever such Person owns Registrable Shares;
PROVIDED, HOWEVER, that unless the Company is otherwise notified by the Holder
of Registrable Shares, the Holder of Registrable Shares shall be deemed to be
that Person set forth on the books and records of the Company or the registrar
for such Registrable Shares.
"LGP HOLDER" means a Holder of Registrable LGP Shares, including a
Transferee of Registrable LGP Shares if (i) the Transfer to such Transferee is
not prohibited by this Agreement, and (ii) the Shares Transferred to such
transferee continue to be Registrable Shares.
Green Equity Investors III, L.P. and its members and affiliates and
their limited partners, general partners, principals, stockholders and
affiliates, and any of their Transferees, are sometimes referred to in this
Agreement, collectively, as the "LGP PARTIES" and, individually, as an "LGP
PARTY."
"MAJORITY MANAGEMENT STOCKHOLDERS" means Management Holders holding a
majority of the voting power of all Registrable Management Shares held by the
Management Holders.
"MANAGEMENT HOLDER" means a Holder of Registrable Management Shares,
including a Transferee of Registrable Management Shares if (i) the Transfer to
such Transferee is not prohibited by this Agreement, and (ii) the Shares
Transferred to such Transferee continue to be Registrable Shares.
"PURCHASER HOLDER" means the LGP Holders and the TPG Holders.
"REGISTRABLE FINANCING SHARES" means (i) the shares of Common Stock
owned by the Financing Parties immediately following the Initial Public
Offering or subsequently acquired by any Financing Party (and any securities
issued or issuable with respect to such Common
7
Stock by way of stock dividends or stock splits or in connection with a
combination of shares, recapitalization, merger, consolidation, or other
reorganization or otherwise) and (ii) the shares of the Company's preferred
stock owned by the Financing Parties prior to their redemption by the Company.
"REGISTRABLE LGP SHARES" means (i) the shares of Common Stock owned
by the LGP Parties immediately following the Initial Public Offering or
subsequently acquired by any LGP Party (and any securities issued or issuable
with respect to such Common Stock by way of stock dividends or stock splits
or in connection with a combination of shares, recapitalization, merger,
consolidation, or other reorganization or otherwise) and (ii) the shares of
the Company's preferred stock owned by the LGP Parties prior to their
redemption by the Company.
"REGISTRABLE MANAGEMENT SHARES" means the shares of Common Stock owned
by the Management Parties immediately following the Initial Public Offering or
subsequently acquired by any Management Party (and any securities issued or
issuable with respect to such Common Stock by way of stock dividends or stock
splits or in connection with a combination of shares, recapitalization, merger,
consolidation, or other reorganization or otherwise); PROVIDED, HOWEVER, the
Registrable Management Shares shall not include Shares which are then subject to
the Call Option.
"REGISTRABLE PURCHASER SHARES" means the Registrable LGP Shares and the
Registrable TPG Shares.
"REGISTRABLE TPG SHARES" means (i) the shares of Common Stock owned
by the TPG Parties immediately following the Initial Public Offering or
subsequently acquired by any TPG Party (and any securities issued or issuable
with respect to such Common Stock by way of stock dividends or stock splits
or in connection with a combination of shares, recapitalization, merger,
consolidation, or other reorganization or otherwise) and (ii) the shares of
the Company's preferred stock owned by the TPG Parties prior to their
redemption by the Company.
"REGISTRABLE SHARES" means the Registrable Financing Shares, the
Registrable Management Shares and the Registrable Purchaser Shares; PROVIDED,
HOWEVER, that any such Shares will cease to be Registrable Shares, as the case
may be, when (i) a registration statement covering such Shares has been declared
effective and such Shares have been disposed of pursuant to such effective
registration statement or (ii) such Shares are distributed to the public
pursuant to Rule 144.
"RULE 144" means Rule 144 promulgated under the Securities Act.
"SELLING HOLDER" means, with respect to any registration statement, any
Holder whose Registrable Shares are included therein.
"TPG HOLDER" means a Holder of Registrable TPG Shares, including a
Transferee of Registrable TPG Shares if (i) the Transfer to such Transferee is
not prohibited by this Agreement, and (ii) the Shares Transferred to such
transferee continue to be Registrable Shares.
TPG Partners III, L.P., TPG Parallel III, L.P., TPG Dutch Parallel III,
C.V., TPG Investors III, L.P., FOF Partners III, L.P. and FOF Partners III-B,
L.P. and their respective members and affiliates and their limited partners,
general partners, principals, stockholders and
8
affiliates, and any of their Transferees, are sometimes referred to in this
Agreement, collectively, as the "TPG PARTIES" and, individually, as a "TPG
PARTY."
2.2 DEMAND REGISTRATIONS.
2.2.1 NUMBER OF DEMAND REGISTRATIONS.
(a) LGP HOLDERS' DEMAND RIGHTS. LGP Holders, acting
collectively as a group, holding an aggregate number of Registrable LGP Shares
at least equal to or greater than fifty percent (50%) of the number of
Registrable LGP Shares outstanding on the date of their request shall be
entitled to make written request (any such written request pursuant to this
Section 2.2 by Purchaser Holders, Management Holders or Financing Holders, a
"DEMAND") of the Company to register under the Securities Act (including, but
not limited to, a shelf registration under Rule 415 promulgated under the
Securities Act) (any such Demand by Purchaser Holders, Management Holders or
Financing Holders to register Registrable Shares pursuant to this Section 2.2, a
"DEMAND REGISTRATION") all or part of the Registrable LGP Shares; PROVIDED,
HOWEVER, that not more than an aggregate of three (3) Demand Registrations with
respect to the Registrable LGP Shares may be made pursuant to the rights granted
by this Section 2.2.1(a).
(b) TPG HOLDERS' DEMAND RIGHTS. TPG Holders, acting
collectively as a group, holding an aggregate number of Registrable TPG Shares
at least equal to or greater than fifty percent (50%) of the number of
Registrable TPG Shares outstanding on the date of their request shall be
entitled to make a Demand of the Company to consummate a Demand Registration of
all or part of the Registrable TPG Shares; PROVIDED, HOWEVER, that not more than
an aggregate of three (3) Demand Registrations with respect to the Registrable
TPG Shares may be made pursuant to the rights granted by this Section 2.2.1(b).
(c) MANAGEMENT HOLDERS' DEMAND RIGHTS.
(i) Commencing on the date that is six (6) months
after the later of (A) the Initial Public Offering and (B) the sale by the
Purchasing Stockholders, any Purchaser Party and the equity participants of any
Purchaser Party, in the aggregate when combined with all such sales (excluding
any Transfer by any Purchaser Party to any other Purchaser Party or to its
equity participants) by all such parties, of Shares equal to twenty-five percent
(25%) or more of the Shares owned by the Purchasing Stockholders immediately
following the Effective Time (as defined in the Merger Agreement), the Majority
Management Stockholders shall be entitled to Demand of the Company one (1)
Demand Registration with respect to the Registrable Management Shares.
(ii) Commencing on the date that is six (6) months
after the later of (A) the Initial Public Offering and (B) the sale by the
Purchasing Stockholders, any Purchaser Party and the equity participants of any
Purchaser Party, in the aggregate when combined with all such sales (excluding
any Transfer by any Purchaser Party to any other Purchaser Party or to its
equity participants) by all such parties, of Shares equal to fifty percent (50%)
or more of the Shares owned by the Purchasing Stockholders immediately following
the Effective Time (as defined in the Merger Agreement), the Majority Management
Stockholders
9
shall be entitled to Demand of the Company (X) one Demand Registration with
respect to the Registrable Management Shares or (Y) if the Majority Management
Stockholders have not made a Demand Registration pursuant to Section
2.2.1(c)(i), two (2) Demand Registrations with respect to the Registrable
Management Shares.
(d) FINANCING HOLDERS' DEMAND RIGHTS. Commencing on the
date that is six (6) months after the Initial Public Offering, Financing
Holders, acting collectively as a group, holding an aggregate number of
Registrable Financing Shares at least equal to or greater than fifty percent
(50%) of the number of Registrable Financing Shares outstanding on the date of
their request shall be entitled to make a Demand of the Company to consummate a
Demand Registration of all or part of the Registrable Financing Shares;
PROVIDED, HOWEVER, that not more than one (1) Demand Registration with respect
to the Registrable Financing Shares may be made pursuant to the rights granted
by this Section 2.2.1(d).
(e) SELECTION OF UNDERWRITER. Any Demand Registration
hereunder shall be on any appropriate form under the Securities Act permitting
registration of such Registrable Shares for resale by the Selling Holders in the
manner or manners designated by them (including, without limitation, pursuant to
one or more underwritten offerings). The determination of whether the offering
will involve an underwritten offering, and the selection of investment bankers
and managers, if any, and counsel, shall be made by Holders of a majority of the
Registrable Shares demanded to be included in such registration; PROVIDED,
HOWEVER, that the selection of investment bankers and managers, if any, and
counsel so selected shall be reasonably satisfactory to the Company. If
requested, the Company shall enter into an underwriting or purchase agreement
with an investment banking firm in connection with a Demand Registration,
containing representations, warranties, indemnities and agreements then
customarily included in underwriting or purchase agreements by such underwriter
with respect to secondary distributions of securities.
2.2.2 REGISTRATION. The Company shall file a registration
statement with respect to each Demand Registration and use its best efforts to
cause the same to be declared effective as promptly as practicable following
such Demand, but not later than one hundred twenty (120) days thereafter. Unless
all of the Registrable Shares covered by the registration statement have earlier
been sold or withdrawn from sale, the Company shall keep any such Registration
Statement effective for a period of at least one hundred eighty (180) days after
such registration statement is first declared effective plus a period equal to
(x) any period during which the Selling Holders are prohibited from making sales
because of any stop order, injunction or other order or requirement of the
Commission or any other governmental agency or court plus (y) any Demand
Suspension Period (as defined below) plus (z) any holdback period pursuant to
Section 2.7 that occurs while the registration statement is effective (the
"DEMAND PERIOD") and a registration will not count as a Demand Registration
unless it is declared effective by the Commission and remains effective until
the earlier of such time as all of the Registrable Shares included in such
registration have been sold or disposed of or withdrawn from sale by the Selling
Holders or the expiration of the Demand Period or, if the registration remains
effective for a shorter period, the Selling Holders have sold at least eighty
percent (80%) of their Registrable Shares included in such Demand Registration.
In addition, a request for registration shall not be deemed to constitute a
Demand Registration if: (a) the conditions to closing specified in the
10
purchase agreement or underwriting agreement entered into in connection with
such Demand Registration are not satisfied other than by reason of some act or
omission by the Selling Holders; (b) the Company voluntarily takes any action
that would result in the Selling Holders not being able to sell such Registrable
Shares covered thereby during the Demand Period; (c) after it has become
effective, such Demand Registration becomes subject to any stop order,
injunction or other order or requirement of the Commission or other governmental
agency or court and such order, injunction or requirement is not promptly
withdrawn or lifted, and such Demand Registration has not otherwise remained
effective for the Demand Period (including effective periods both before and
after the order, injunction or requirement is made or imposed); or (d) such
Demand Registration does not involve an underwritten offering and the Selling
Holders determine not to proceed following any delay imposed hereunder by the
Company; PROVIDED, HOWEVER, that prior to such a delay under this clause (d),
the Selling Holders have not sold more than eighty percent (80%) of the
Registrable Shares included in such Demand Registration. Notwithstanding the
foregoing, the Company may, at any time, delay the filing or delay or suspend
the effectiveness of the Demand Registration or, without suspending such
effectiveness, instruct the Selling Holders not to sell any securities included
in the Demand Registration, if the Company shall have determined in good faith
(as evidenced by a resolution of the Company's Board of Directors delivered to
the Selling Holders) that proceeding with the Demand Registration at such time
may have a material adverse effect on the Company or the Company shall have
determined upon the advice of counsel that as a result of complying with such
Demand it would be required to disclose any material actions proposed to be
taken by the Company in good faith and for valid business reasons, including,
without limitation, the acquisition or divestiture of assets, which disclosure
may have a material adverse effect on the Company or on such actions (a "DEMAND
SUSPENSION PERIOD"), by providing the Selling Holders with written notice of
such Demand Suspension Period and the reasons therefor. The Company shall use
its reasonable best efforts to provide such notice at least ten (10) days prior
to the commencement of such a Demand Suspension Period; PROVIDED, HOWEVER, that
in any event the Company shall provide such notice no later than the
commencement of such Demand Suspension Period; and provided, further, that in no
event shall the Demand Suspension Periods exceed a total of sixty (60) days in
any twelve (12) month period.
The Company further agrees to supplement or amend such registration
statement with respect to such Demand Registration, as required by the
registration form utilized by the Company or by the instructions applicable to
such registration form or by the Securities Act for the registration of
securities or as reasonably requested (which request shall result in the filing
of a supplement or amendment subject to approval thereof by the Company, which
approval shall not be unreasonably withheld) by any Selling Holder or any
managing underwriter of Registrable Shares to which such Demand Registration
relates, and the Company agrees to furnish to the Selling Holders (and any
managing underwriter) copies, in substantially the form proposed to be used
and/or filed, of any such supplement or amendment prior to the use thereof
and/or filing thereof with the Commission. The Company shall amend or supplement
the registration statement with respect to such Demand Registration no less
frequently than every forty five (45) days to update the list of Selling Holders
pursuant to written requests by such Holders.
2.2.3 INCLUSION OF REGISTRABLE SHARES. Any written request for a
Demand shall specify the number of Registrable Shares to be registered and the
intended methods of
11
disposition thereof. Within ten (10) days after receipt of such Demand, the
Company shall give written notice of such registration request to all Holders,
as applicable, which have not made the Demand, and, subject to the limitations
set forth elsewhere herein, the Company shall include in such registration all
Registrable Shares with respect to which the Company has received written
requests for inclusion therein within fifteen (15) days after the date on which
such notice is given. Each such request shall also specify the aggregate number
of Registrable Shares to be registered. The Company may also include in such
Demand Registration shares of Common Stock for the account of the Company and
any other Persons who hold shares of Common Stock.
2.2.4 PRIORITY ON DEMAND REGISTRATIONS. If a Demand Registration
is an underwritten registration and the managing underwriters of such offering
determine that the aggregate number of (a) Registrable Shares of the Selling
Holders exercising their rights to participate in the Demand Registration on a
demand basis, pursuant to this Section 2.2; (b) Shares of the Company; and (c)
Shares of any other Persons entitled to participate in such Demand Registration,
in each case proposed to be included in such registration statement, exceeds the
maximum number of Shares that can reasonably be expected to be sold within a
price range acceptable to the Company and the Selling Holders, then the number
of shares to be offered for the account of the Company and for the account of
all such other Persons, other than holders of Registrable Shares who initiated
the demand, participating in such registration shall be reduced or limited pro
rata (and to zero, if necessary) in proportion to the respective number of
Shares requested to be registered to the extent necessary to reduce the total
number of Shares requested to be included in such registration statement to the
maximum number of Shares that can reasonably be expected to be included therein
and still satisfy such price requirement. If the foregoing market "cutback" does
not reduce the aggregate number of Shares proposed to be included in the
registration statement to the maximum number of Shares that can reasonably be
expected to be sold within the price range acceptable to the Company and the
Selling Holders, the Company shall further reduce the number of Shares to be
included in such registration pro rata among all such remaining Selling Holders
on the basis of the number of Registrable Shares requested to be included by all
such Selling Holders. Any request for registration with respect to which such a
market "cutback" with respect to such Selling Holders occurs shall be deemed to
constitute a Demand Registration for all purposes of this Article II; PROVIDED,
HOWEVER, that if any such market "cutback" occurs with respect to a Demand
Registration and all Selling Holders who initiated the Demand are not able to
sell at least eighty percent (80%) of the Registrable Shares which such Holders
proposed to sell pursuant to such Demand Registration, then, although such
request for registration will be effectuated, such request will not count
against the number of Demands to which the Purchaser Holders, the Management
Holders and the Financing Holders are entitled pursuant to Section 2.2 hereof.
2.2.5 COMPLIANCE. Notwithstanding any other provisions hereof,
the Company shall use its reasonable best efforts to ensure that (a) any
registration statement filed in connection with a Demand Registration, and any
amendment thereto, and any prospectus forming a part thereof, and any supplement
thereto, complies in all material respects with the Securities Act and the rules
and regulations thereunder, (b) any registration statement filed in connection
with a Demand Registration, and any amendment thereto, does not, when it becomes
effective, contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading and (c) any
12
prospectus forming part of any registration statement filed in connection with a
Demand Registration, and any supplement to such prospectus, does not include an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements, in the light of the circumstances under which
they are made, not misleading.
2.3 PIGGYBACK REGISTRATION.
2.3.1 RIGHT TO INCLUDE REGISTRABLE SHARES. If the Company at any
time proposes to register any of its equity securities under the Securities Act,
whether or not for sale for its own account, on a form and in a manner which
would permit registration of Registrable Shares for a public offering under the
Securities Act (other than on a registration statement (a) on Form S-4 or Form
S-8 or any successor form thereto or (b) filed in connection with an exchange
offer), the Company shall give written notice of the proposed registration to
each Holder at least fifteen (15) days prior to the filing thereof, and each
Holder shall have the right to request that all or any part of its Registrable
Shares of the same class or series of the equity securities proposed to be
registered by the Company be included in such registration by giving written
notice to the Company within ten (10) days after the giving of such notice by
the Company. If the registration statement is to cover an underwritten offering,
such Registrable Shares shall be included in the underwriting on the same terms
and conditions as the securities otherwise being sold through the underwriters.
Notwithstanding the foregoing, a Holder may not request the registration of its
Registrable Shares if such Shares may, at the time (or within thirty days
thereafter), be distributed to the public pursuant to Rule 144, or any other
similar provision hereafter adopted by the Commission.
2.3.2 PRIORITY ON PIGGYBACK REGISTRATIONS.
(a) COMPANY REGISTRATIONS. If the registration is an
underwritten primary registration on behalf of the Company and the managing
underwriter(s) of such offering determine in their good faith judgment that the
aggregate number of securities, including Registrable Shares, of the Company
which all Holders and all other security holders of the Company, pursuant to
contractual rights to participate in such registration (the "OTHER HOLDERS"),
propose to include in such registration statement exceeds the maximum number of
securities, including Registrable Shares, that can reasonably be expected to be
sold in such offering without materially and adversely affecting the
marketability of the offering or the selling price to be obtained, the Company
will include in such registration, first, the shares of Common Stock or other
securities which the Company proposes to sell and, second, the Registrable
Shares of such Selling Holders and other securities to be sold for the account
of Other Holders, pro rata among all such Selling Holders and Other Holders,
taken together, on the basis of the number of Registrable Shares or other
securities of the Company requested to be included by all Selling Holders and
Other Holders who have requested that securities owned by them be so included
(it being agreed and understood, however, that such managing underwriter(s)
shall have the right to eliminate entirely the participation in such
registration of all Selling Holders and Other Holders).
13
(b) SELLING HOLDERS' REGISTRATION.
(i) If the registration is being made pursuant to a
Demand by Purchaser Holders pursuant to Section 2.2 hereof, and the managing
underwriter(s) determine that the aggregate number of securities which all
Selling Holders, the Company and all Other Holders propose to include in such
registration exceeds the maximum number of securities that can reasonably be
expected to be sold within the price range acceptable to the Company and the
Purchaser Holders that are Selling Holders, the Company will include in such
registration, first, the Registrable Purchaser Shares of the Selling Holders
participating in such registration on a demand basis in accordance with Section
2.2.4 hereof, and, second, any securities to be sold for the account of the
Company, securities to be sold for the account of the Selling Holders that are
either Purchaser Holders or Management Holders or Financing Holders and that are
participating in such offering on a piggyback basis and any securities to be
sold for the account of the Other Holders electing to include securities in such
registration, PRO RATA among the Company, all such Selling Holders and all such
Other Holders, taken together, on the basis of the number of Shares or other
securities to be sold by the Company in the absence of such PRO RATION, the
number of Registrable Shares or other securities requested to be included by all
such Selling Holders and the number of Shares or other securities requested to
be included by all such Other Holders (it being agreed and understood, however,
that such managing underwriter(s) shall have the right to eliminate entirely the
participation therein of the Company and of all such Selling Holders and Other
Holders pursuant to the terms of this sentence).
(ii) If the registration is being made pursuant to a
Demand by Management Holders pursuant to Section 2.2 hereof, and the managing
underwriter(s) determine that the aggregate number of securities which all
Selling Holders, the Company and all Other Holders propose to include in such
registration exceeds the maximum number of securities that can reasonably be
expected to be sold within the price range acceptable to the Company and the
Management Holders that are Selling Holders, the Company will include in such
registration, first, the Registrable Management Shares of the Selling Holders
participating in such registration on a demand basis in accordance with Section
2.2.4 hereof, and, second, any securities to be sold for the account of the
Company, securities to be sold for the account of the Selling Holders that are
either Purchaser Holders or Management Holders or Financing Holders and that are
participating in such offering on a piggyback basis and any securities to be
sold for the account of the Other Holders electing to include securities in such
registration, PRO RATA among the Company, all such Selling Holders and all such
Other Holders, taken together, on the basis of the number of Shares or other
securities to be sold by the Company in the absence of such PRO RATION, the
number of Registrable Shares or other securities requested to be included by all
such Selling Holders and the number of Shares or other securities requested to
be included by all such Other Holders (it being agreed and understood, however,
that such managing underwriter(s) shall have the right to eliminate entirely the
participation therein of the Company and of all such Selling Holders and Other
Holders pursuant to the terms of this sentence).
(iii) If the registration is being made pursuant to a
Demand by Financing Holders pursuant to Section 2.2 hereof, and the managing
underwriter(s) determine that the aggregate number of securities which all
Selling Holders, the Company and
14
all Other Holders propose to include in such registration exceeds the maximum
number of securities that can reasonably be expected to be sold within the price
range acceptable to the Company and the Financing Holders that are Selling
Holders, the Company will include in such registration, first, the Registrable
Financing Shares of the Selling Holders participating in such registration on a
demand basis in accordance with Section 2.2.4 hereof, and, second, any
securities to be sold for the account of the Company, securities to be sold for
the account of the Selling Holders that are either Purchaser Holders or
Management Holders or Financing Holders and that are participating in such
offering on a piggyback basis and any securities to be sold for the account of
the Other Holders electing to include securities in such registration, PRO RATA
among the Company, all such Selling Holders and all such Other Holders, taken
together, on the basis of the number of Shares or other securities to be sold by
the Company in the absence of such PRO RATION, the number of Registrable Shares
or other securities requested to be included by all such Selling Holders and the
number of Shares or other securities requested to be included by all such Other
Holders (it being agreed and understood, however, that such managing
underwriter(s) shall have the right to eliminate entirely the participation
therein of the Company and of all such Selling Holders and Other Holders
pursuant to the terms of this sentence).
(c) OTHER HOLDERS' REGISTRATION. If the registration is an
underwritten secondary registration on behalf of any of the Other Holders
pursuant to demand registration rights and the managing underwriters determine
that the aggregate number of securities which all Selling Holders, the Company
and all Other Holders propose to include in such registration exceeds the
maximum number of securities that can reasonably be expected to be sold within
the price range acceptable to the Company and the Other Holders, the Company
will include in such registration, first, the securities to be sold for the
account of the Other Holders demanding registration (but only to the extent such
Other Holders are entitled to demand inclusion thereof pursuant to demand
registration rights), second, any securities to be sold for the account of the
Company, and, third, the Registrable Shares of such Selling Holders and other
securities to be sold for the account of the Other Holders electing to include
(but not being entitled pursuant to demand registration rights to demand
inclusion of) securities in such registration, pro rata among all such Selling
Holders and Other Holders, taken together, on the basis of the number of
Registrable Shares or other securities of the Company requested to be included
by all Selling Holders and such Other Holders who have requested that securities
owned by them be included (it being agreed and understood, however, that such
managing underwriter(s) shall have the right to eliminate entirely the
participation therein of all such Selling Holders and Other Holders with respect
to such securities since they are not entitled to demand inclusion of such
securities pursuant to demand registration rights).
(d) UNDERWRITERS. Registrable Shares proposed to be
registered and sold for the account of any Selling Holder pursuant to a
piggyback registration shall be sold to prospective underwriters selected or
approved by the Company, and on the terms and subject to the conditions of one
or more underwriting agreements negotiated between the Company, the Selling
Holders, if any, and/or Other Holders demanding registration and such
prospective underwriters. The Selling Holders shall be permitted to withdraw all
or a part of the Registrable Shares held by such Selling Holders which were to
be included in such piggyback registration at any time prior to the effective
date of such registration. The Company may withdraw any registration statement
for such registration at any time before it becomes effective, or postpone
15
the offering of securities, without obligation or liability to any Selling
Holder participating on a piggyback basis (except pursuant to Section 2.8
hereof).
2.4 REGISTRATIONS ON FORM S-3. At such time as the Company shall have
qualified for the use of Form S-3, or any similar form or forms promulgated by
the Commission, the Holders shall each have the right to request an unlimited
number of registrations on Form S-3. Any such request shall be in writing, shall
specify the Registrable Securities intended to be sold or disposed of by the
Holders thereof, shall state the intended method of disposition of such
Registrable Securities by the Holder(s) requesting such registration and shall
relate to Registrable Securities having proposed gross cash offering proceeds
(prior to deduction of underwriters commissions and expenses, if any) of Two
Million Dollars ($2,000,000) or more for all Registrable Securities to be
included, on the basis of a reasonable (in light of the current market price)
proposed per share offering price. The Company shall be obligated to effect such
registration or registrations on Form S-3 as soon as practicable after receipt
of such request; PROVIDED, HOWEVER, that the Company shall not be obligated to
effect the filing of a registration pursuant to this Section 2.4: (a) during the
period starting with the date ninety (90) days prior to the Company's estimated
date of filing of, and ending on a date one hundred eighty (180) days following
the effective date of, a registration statement pertaining to a public offering
of Common Stock for the account of the Company, PROVIDED that the Company is
actively employing in good faith all reasonable efforts to cause such
registration statement to become effective and that, in the good faith judgment
of the Company's underwriter for an underwritten offering or of the Company's
Board of Directors for any other offering, an offering pursuant to such a
registration statement would interfere in any material respect with the
successful marketing (including pricing) of the Common Stock to be included in
the Company's proposed registration statement, or (b) if the Company's Board of
Directors shall determine in good faith that such filing will interfere in any
material respect with a pending or contemplated financing, merger, sale of
assets, recapitalization or other similar corporate action of the Company. In
the event the Company's obligations are abated pursuant to the foregoing
proviso, and if any of the Holders on whose behalf the requested registration
statement would be filed and who were unable to have all of the Registrable
Securities included in the Company's registration statement pursuant to Section
2.3 hereof and then want such registration statement to be filed, the Company
shall file such registration statement as promptly as practicable following (x)
one hundred eighty (180) days after the effective date of the registration
statement with respect to the offering referred to in clause (a) above, or (y)
the date on which the transactions referred to in clause (b) above shall have
been completed or abandoned (as the case may be), but not later than one hundred
twenty (120) days after the initial registration request notice was given;
PROVIDED FURTHER, HOWEVER, that the Company shall not be obligated to file and
cause to become effective (i) more than two (2) registrations on Form S-3 in any
one twelve (12) month period or (ii) any registration on Form S-3 within six (6)
months after the effective date of any previous registration statement filed
under Section 2.2 or Section 2.3, with respect to which all Holders who had
requested the inclusion of any such shares in a registration statement were
entitled to included in such registration statement all Registrable Securities
requested to be included therein. No registration pursuant to this Section 2.4
shall count as a Demand Registration pursuant to Section 2.2 hereof.
16
2.5 REGISTRATION STATEMENT. In connection with any registration of
Registrable Shares under the Securities Act pursuant to this Agreement, the
Company will furnish each Selling Holder and each underwriter, if any, with a
copy of the registration statement and all amendments thereto and will supply
each such Selling Holder with copies of any prospectus included therein
(including a preliminary prospectus and all amendments and supplements thereto),
in each case including all exhibits, and such other documents as may be
reasonably requested, in such quantities as may be reasonably necessary for the
purposes of the proposed sale or distribution covered by such registration (the
Company hereby consenting to the use in accordance with all applicable law of
each such registration statement (or amendment or post-effective amendment
thereto) and each such prospectus (or preliminary prospectus or supplement
thereto) by each such Selling Holder and the underwriters, if any, in connection
with the offering and sale of the Registrable Shares covered by such
registration statement or prospectus). The Company shall not, however, be
required to maintain the registration statement relating to a Demand
Registration and to supply copies of a prospectus for a period beyond the Demand
Period, and, at the end of such period, the Company may register any Registrable
Shares covered by such registration statement and not then sold or distributed.
In connection with any such registration of Registrable Shares, the Company
will, at the request of the managing underwriter with respect thereto (or, if
not an underwritten offering, at the request of Selling Holders holding a
majority of the Registrable Shares to be included in the registration) use its
reasonable best efforts to register or qualify such Registrable Shares for sale
under the securities laws of such states as is reasonably requested to permit
the distribution of such Registrable Shares and to use its reasonable efforts to
keep each such registration or qualification effective during the period such
registration statement is required to be kept effective and to do such other
acts or things reasonably necessary to enable the disposition in such
jurisdictions of the securities covered by the applicable registration statement
in accordance with applicable Blue Sky securities laws of such jurisdictions;
PROVIDED, HOWEVER, that the Company shall not be required in connection
therewith or as a condition thereof to qualify as a foreign corporation or to
execute a general consent to service of process in any jurisdiction or become
subject to taxation in any jurisdiction. In connection with any offering of
Registrable Shares registered pursuant to this Agreement, the Company shall (a)
furnish each Selling Holder, at the Company's expense and at least three (3)
business days prior to the sale of any Registrable Shares to the underwriters,
with unlegended certificates in a form eligible for deposit with The Depository
Trust Company representing ownership of the Registrable Shares which are sold
pursuant to the registration statement, in such denominations and registered in
such names as the managing underwriter, if any, or such Selling Holder shall
reasonably request, and (b) instruct the transfer agent and registrar of the
Common Stock to release any stop transfer orders with respect to the Registrable
Shares so sold.
2.6 REGISTRATION PROCEDURES. In connection with the Company's
obligations to effect a registration pursuant to Sections 2.2, 2.3 and 2.4 (but
subject to the last sentence of Section 2.3.2(d) and provided that any time
periods set forth in this Section 2.6 regarding effective periods and the like
shall apply only in the event of a Demand Registration), the Company will as
expeditiously as is reasonably practicable:
(a) prepare and file with the Commission as soon as practicable
(in the case of a Demand Registration) a registration statement with respect to
such Registrable Shares, on a form available for the sale of the Registrable
Shares by the Holders thereof in accordance
17
with the intended method or methods of distribution thereof and use its
commercially reasonable efforts to cause each such registration statement to
become and remain effective; PROVIDED, HOWEVER, that before filing a
registration statement or prospectus or any amendments or supplements thereto
(including documents that would be incorporated or deemed to be incorporated
therein by reference) and, whether or not filed pursuant to Section 2.2, 2.3 or
2.4, the Company will furnish to the Holders of the Registrable Shares covered
by such registration statement and the underwriters, if any, and any attorney,
accountant or other agent retained by the Holders of Registrable Shares covered
by such registration statement, copies of all such documents proposed to be
filed, which documents will be subject to the review and comment of such
Holders, such counsel and underwriters, if any. The Company will not file any
registration statement or any amendment thereto or any prospectus or any
supplement thereto in connection with a Demand Registration pursuant to Section
2.2 (including such documents incorporated by reference and proposed to be filed
after the initial filing of the registration statement) to which the Holders of
a majority of the Registrable Shares covered by such registration statement or
the underwriters, if any, shall reasonably and timely object;
(b) prepare and file with the Commission such amendments and
post-effective amendments to such registration statement and such supplements to
the prospectus used in connection therewith as may be necessary to keep such
registration statement effective (to the extent otherwise required by this
Agreement) and to comply with the provisions of the Securities Act with respect
to the disposition of all securities covered by such registration statement
until such time as all of such securities have been disposed of in accordance
with the intended methods of disposition by the seller or sellers thereof set
forth in such registration statement or the expiration of the Demand Period (in
the case of a Demand Registration), whichever occurs earlier; PROVIDED, HOWEVER,
that the only remedy for any failure to keep the registration statement so
effective shall be as set forth in Section 2.2.2 and PROVIDED, FURTHER, that the
Company will have no obligation to a Selling Holder participating on a
"piggyback" basis in a registration statement that has become effective to keep
such registration statement effective for a period beyond one hundred twenty
(120) days from the effective date of such registration statement;
(c) cooperate and assist in any filings required to be made with
the National Association of Securities Dealers, Inc. (the "NASD");
(d) notify each Selling Holder and the managing underwriter, if
any, promptly (and in any event within three (3) business days): (i) when the
prospectus or any prospectus supplement or post-effective amendment has been
filed, and with respect to the registration statement or any post-effective
amendment, when the same has become effective; (ii) of any request by the
Commission or any other federal or state governmental authority for any
amendments or supplements to the registration statement or the prospectus or for
additional information; (iii) of the issuance by the Commission of any stop
order suspending the effectiveness of the registration statement or the
initiation of any proceedings for that purpose; (iv) if, at any time prior to
the closing contemplated by an underwriting agreement entered into in connection
with such registration statement, that the representations and warranties of the
Company contained in such agreement cease to be true and correct; (v) of the
receipt by the Company of any notification with respect to the suspension of the
qualification of the Registrable Shares for sale in any jurisdiction or the
initiation or threatening of any proceeding for such
18
purpose; (vi) of the happening of any event which makes any statement made in
the registration statement, the prospectus or any document incorporated or
deemed to be incorporated therein by reference untrue or which requires the
making of any changes in the registration statement, the prospectus or any
document incorporated therein by reference in order to make the statements
therein not misleading; and (vii) of the Company's reasonable determination that
a post-effective amendment to a registration statement would be required;
(e) make commercially reasonable efforts to prevent the issuance
of any order suspending the effectiveness of the registration statement or of
any order preventing or suspending the use of a prospectus or suspending the
qualification of any of the Registrable Shares included therein for sale in any
jurisdiction (subject to the proviso at the end of the penultimate sentence of
Section 2.5), and, in the event of the issuance of any stop order suspending the
effectiveness of the registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any Shares included in such registration statement for sale in any jurisdiction
(subject to the proviso at the end of the penultimate sentence of Section 2.5),
the Company will use its reasonable best efforts to promptly obtain the
withdrawal of any such order;
(f) furnish to each Selling Holder and the managing underwriters,
if any, without any additional charge, one signed copy of the registration
statement and any post-effective amendment thereto, including financial
statements and schedules, all documents incorporated therein by reference and
all exhibits (including those incorporated by reference);
(g) as promptly as reasonably practicable, if required, based on
the advice of the Company's counsel, or upon the occurrence of any event
contemplated by Section 2.6(d) hereof, prepare and file a supplement or
post-effective amendment to the registration statement, the related prospectus
or any document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of the Registrable
Shares, the prospectus will not contain an untrue statement of a material fact
or omit to state any material fact necessary to make the statements therein not
misleading;
(h) cause all Registrable Shares covered by the registration
statement to be listed on each securities exchange on which identical securities
issued by the Company are then listed if requested by the Selling Holders
holding a majority in number of the Registrable Shares covered by the
Registration Statement or the managing underwriters, if any;
(i) provide and cause to be maintained a transfer agent and
registrar for all Registrable Shares covered by such registration statement from
and after a date not later than the effective date of such registration
statement;
(j) use its reasonable best efforts to provide a CUSIP number for
the Registrable Shares, not later than the effective date of the registration
statement;
(k) use its reasonable best efforts to (i) obtain opinions of
counsel to the Company (which counsel and opinions (in form, scope and
substance) shall be reasonably satisfactory to the managing underwriters, if
any, and not objected to by the Holders of a majority of the Registrable Shares
being sold), and updates thereof addressed to the Selling
19
Holders, covering the matters customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably requested by
the underwriters, if any; and (ii) obtain "cold comfort" letters and updates
thereof (which letters and updates (in form, scope and substance) shall be
reasonably satisfactory to the managing underwriters, if any, and counsel to the
Holders of a majority of the Registrable Shares being sold) from the Company's
independent certified public accountants addressed to such Selling Holders (and,
if necessary, any other independent certified public accountants of any
subsidiary of the Company or of any business acquired by the Company for which
financial statements and financial data are, or are required to be, included in
the registration statement), such letters to be in customary form and covering
matters of the type customarily covered in "cold comfort" letters by accountants
in connection with underwritten offerings and such other matters as the
underwriters, if any, or the Holders of a majority of the Registrable Shares
being sold, reasonably request. The above shall be done at each closing under
such underwriting or similar agreement or as and to the extent required
thereunder or, if not an underwritten offering, as otherwise reasonably
requested by the Holders of a majority of the Registrable Shares being sold;
(l) make available for inspection by a representative of the
Selling Holders and any attorneys or accountants retained by such Holders (and,
to the extent reasonably requested, furnish copies), in connection with the
preparation of a registration statement pursuant to this Agreement, all
financial and other records and pertinent corporate documents and properties of
the Company, and cause the Company's officers, directors and employees to supply
all information reasonably requested by any such representative(s), attorney(s)
or accountant(s) in connection with such registration; PROVIDED, HOWEVER, that
any records, information or documents that are designated by the Company in
writing as confidential shall be kept confidential by such persons unless
disclosure of such records, information or documents is required by court or
administrative order or under applicable law; and PROVIDED, FURTHER, that
appropriate arrangements are made, to the extent required by applicable
antitrust law, to limit access to such information of the Company to
representatives of the Holders who are not officers or employees of the Selling
Holders; and PROVIDED, FURTHER, that, without limiting the foregoing, no such
information shall be used by any such Person in connection with any market
transactions in securities of the Company or its subsidiaries in violation of
law;
(m) enter into such agreements reasonably requested (including,
as applicable, an underwriting agreement in form, scope and substance as is
customary in underwritten secondary offerings and is reasonably satisfactory to
the Company) and take all such other customary and reasonable actions in
connection therewith (including those requested by the managing underwriters) in
order to expedite or facilitate the disposition of the Registrable Shares, and
in such connection, whether or not an underwriting agreement is entered into and
whether or not the registration is an underwritten registration:
(i) make such representations and warranties to the Holders
of such Registrable Shares included in the registration statement and
the underwriters, if any, with respect to the business of the Company
and the registration statement, prospectus and documents, if any,
incorporated or deemed to be incorporated by reference therein, in each
case, in form, substance and scope as are customarily made by
20
issuers to underwriters in underwritten offerings and confirm the same,
if and when reasonably requested; and
(ii) deliver such documents and certificates as may be
reasonably requested by the Holders of a majority of the Registrable
Shares being included in the registration statement and managing
underwriters, if any, to evidence compliance with clause (a) above and
with any provisions contained in the underwriting agreement or other
similar agreement entered into by the Company;
The above shall be done at each closing under such underwriting or similar
agreement or, if not an underwritten offering, to the extent otherwise
reasonably requested by the Holders of a majority of the Registrable Shares
being sold pursuant to the registration statement;
(n) (i) if so required by the managing underwriter in an
underwritten offering of Registrable Shares covered by a registration statement
filed pursuant to Section 2.2, 2.3 or 2.4 hereof, not publicly or privately
sell, make any short sale of, loan, grant any option, effect any public sale or
distribution of or otherwise dispose of its equity securities or securities
convertible into or exchangeable or exercisable for any of such securities
during the ten (10) days prior to and the ninety (90) days after any
underwritten registration pursuant hereto has become effective, except as part
of such underwritten registration and except pursuant to any exchange offer or
registrations on Form S-4 or S-8 or any successor or similar forms thereto,
except that the Company may make grants of options under its stock option plans
and may issue securities issuable upon the exercise or conversion of outstanding
convertible securities, stock options and other options, warrants and rights of
the Company and (ii) if requested, use reasonable efforts to cause each holder
of ten percent (10%) or more of the securities of the same class as the
securities included in any underwritten registration pursuant to Section 2.2
hereof, or any securities convertible into or exchangeable or exercisable for
such securities, in each case purchased from the Company at any time after the
date of this Agreement (other than in a registered public offering) to agree not
to effect any public or private sale or distribution or otherwise dispose
(including sales pursuant to Rule 144) of any such securities during the ten
(10) days prior to and the ninety (90) days after any underwritten registration
pursuant hereto has become effective (except as part of such underwritten
registration, if otherwise permitted), unless the underwriters managing the
registered public offering otherwise agree;
(o) if requested, furnish each Selling Holder with a copy (or a
reasonable number of copies, as requested) of the registration statement
(together with the Exhibits thereto) and each amendment thereto prior to the
filing thereof with the Commission;
(p) if requested by the managing underwriters, if any, or a
Holder of Registrable Shares being sold, promptly incorporate in a prospectus,
supplement or post-effective amendment such information as the managing
underwriters, if any, and the Holders of the Registrable Shares being sold
reasonably request to be included therein relating to the sale of the
Registrable Shares, including, without limitation, information with respect to
the number of Registrable Shares being sold to underwriters, the purchase price
being paid therefor by such underwriters and with respect to any other terms of
the underwritten offering of the Registrable Shares to be sold in such offering;
and make all required filings of such prospectus, supplement
21
or post-effective amendment promptly following notification of the matters to be
incorporated in such supplement or post-effective amendment;
(q) upon the occurrence of any event that would cause a shelf
registration statement (i) to contain a material misstatement or omission or
(ii) to be not effective and usable for resale of Registrable Shares during the
Demand Period, the Company shall promptly file an amendment to such shelf
registration statement, in the case of clause (i), correcting any such
misstatement or omission and, in the case of either clause (i) or (ii), use its
commercially reasonable efforts to cause such amendment to be declared effective
and such shelf registration statement to become usable as soon as reasonably
practicable thereafter;
(r) otherwise use its reasonable best efforts to (i) comply with
all applicable rules and regulations of the Commission and to take all other
steps reasonably necessary to effect the registration of the Registrable Shares
covered by the registration statement contemplated hereby, and (ii) make
available to its security holders an earnings statement which satisfies the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or
any similar rule promulgated under the Securities Act) no later than forty-five
(45) days after the end of any twelve-month (12) period (or ninety (90) days
after the end of any twelve-month (12) period if such period is a fiscal year)
(or in each case within such extended period of time as may be permitted by the
Commission for filing the applicable report with the Commission) (y) commencing
at the end of any fiscal quarter in which Registrable Shares are sold to
underwriters in a firm commitment or best efforts underwritten offering and (z)
if not sold to underwriters in such an offering, commencing on the first day of
the first fiscal quarter of the Company after the effective date of a
Registration Statement, which statements shall cover said twelve-month (12)
periods; and
(s) in connection with any underwritten offering, cooperate with
all marketing efforts reasonably requested by the managing underwriter or
managing underwriters in connection with the sale of the Registrable Shares,
including, without limitation, participation in a reasonable number of road-show
presentations and other marketing activity by Management Stockholders and other
employees of the Company requested by such underwriter or underwriters;
PROVIDED, HOWEVER, that the scheduling of the road-show presentations shall be
set in consultation with the Company and will not require the Company's
involvement at any time or place to which the Company has a reasonable
objection.
2.7 HOLDBACK AGREEMENTS. Each of the Company and each Holder of
Registrable Shares (whether or not such Registrable Shares are covered by a
Registration Statement filed pursuant to Section 2.2 or 2.3 hereof) agrees, if
requested (pursuant to a timely written notice) by the managing underwriter or
underwriters in an underwritten offering, not to effect any public sale or
distribution of any of the Company's securities, including a sale pursuant to
Rule 144 (except as part of such underwritten offering), during the period
beginning ten (10) days prior to, and ending one hundred and eighty (180) days
after, the closing date of the underwritten offering made pursuant to such
Registration Statement. The foregoing provisions shall not apply to the Company
or any Holder of Registrable Shares if such Person is prevented by applicable
statute or regulation from entering into any such agreement; PROVIDED, HOWEVER,
that any such Person shall undertake not to effect any public sale or
distribution of the class of
22
securities covered by such Registration Statement (except as part of such
underwritten offering) during such period unless it has provided sixty (60)
days' prior written notice of such sale or distribution to the managing
underwriter.
2.8 REGISTRATION EXPENSES. Except as otherwise required by state
securities laws or the rules and regulations promulgated thereunder, all
expenses, disbursements and fees incurred by the Company and the Selling Holders
in connection with carrying out their obligations under this Article II,
including but not limited to, (a) the reasonable and documented fees and
expenses of one law firm (plus local counsel) for the Selling Holders (which
counsel shall be selected by Holders of a majority of the Registrable Shares
held by the Holders who initially requested the applicable registration), (b)
all registration, filing fees and expenses (including fees with respect to
filings made with the NASD, including, if applicable, the fees and expenses of
any "qualified independent underwriter" and its counsel, as may be required by
the rules and regulations of the NASD), (c) fees and expenses of compliance with
securities or Blue Sky laws (including fees and disbursements of counsel for the
underwriters or Selling Holders in connection with Blue Sky qualifications of
the Registrable Shares and determinations of their eligibility for investment
under the laws of such jurisdiction as the managing underwriters or Holders of a
majority of the Registrable Shares being sold may designate, subject to the
proviso at the end of the penultimate sentence of Section 2.5), (d) printing
expenses (including printing certificates for the Registrable Shares to be sold
and the registration statements and prospectuses), messenger and delivery
expenses, duplication, word processing, and telephone expenses, (e) fees and
disbursements of counsel for the Company, and (f) fees and disbursements of all
independent certified public accountants of the Company incurred in connection
with such registration (including the expenses of any special audit and "cold
comfort" letters incident to such registration) and fees and disbursements of
underwriters (excluding discounts, commissions or fees of underwriters, selling
brokers, dealer managers or similar securities industry professionals relating
to the distribution of the Registrable Shares) and other Persons retained by the
Company (all such expenses being herein called "REGISTRATION EXPENSES"), will be
borne by the Company regardless of whether a registration statement becomes
effective; PROVIDED, HOWEVER, that the Company will, in any event, pay its
internal expenses (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties), the expenses
of any annual audit or quarterly review, the fees and expenses of any Person,
including special experts, retained by the Company, the expense of any liability
insurance and the expenses and fees for listing the securities to be registered
on each securities exchange on which similar securities issued by the Company
are then listed or on the Nasdaq Stock Market; and PROVIDED, FURTHER, that each
Selling Holder shall pay (x) all costs and expenses of counsel (other than the
counsel costs referred to in (a) above), accounting or financing professionals
retained by such Selling Holder, (y) all underwriting discounts, commissions,
fees and expenses and all transfer taxes with respect to the Shares sold by such
Selling Holder, and (z) all other expenses incurred by such Selling Holder and
incidental to the sale and delivery of the Shares to be sold by such Holder.
2.9 CONDITIONS TO HOLDER'S RIGHTS. It shall be a condition of each
Selling Holder's rights hereunder that:
23
2.9.1 COOPERATION. Such Selling Holder shall cooperate with the
Company by supplying information and executing documents relating to such
Selling Holder or the securities of the Company owned by such Selling Holder in
connection with such registration which are customary for offerings of the type
then proposed (including agreeing to sell such Selling Holder's Registrable
Shares on the basis provided in any underwriting arrangements containing
customary terms reasonably satisfactory to such Selling Holder);
2.9.2 UNDERTAKINGS. Such Selling Holder shall enter into any
undertakings and take such other action relating to the conduct of the proposed
offering which the Company or the underwriters may reasonably request as being
necessary to insure compliance with federal and state securities laws and the
rules or other requirements of the NASD or which the Company or the underwriters
may reasonably request to otherwise effectuate the offering; and
2.9.3 INDEMNIFICATION. Such Selling Holder shall execute and
deliver an agreement to indemnify to the fullest extent permitted by law and
hold harmless the Company, each of its directors, each of its officers who has
signed the registration statement, any underwriter (as defined in the Securities
Act), and each person, if any, who controls the Company or such underwriter
within the meaning of the Securities Act, against such losses, claims, damages
or liabilities (including reimbursement for legal and other expenses) to which
the Company or any such director, officer, underwriter or controlling person may
become subject under the Securities Act or otherwise, in such manner as is
customary for registrations of the type then proposed, but only with respect to
written information about or pertaining to such Selling Holder furnished by such
Selling Holder for inclusion in the Registration Statement.
2.10 INDEMNIFICATION.
2.10.1 INDEMNIFICATION BY THE COMPANY. In the case of any
offering registered pursuant to this Agreement, the Company agrees to indemnify
to the fullest extent permitted by law and hold each Selling Holder, each
affiliate of such Selling Holder and each director, officer, agent,
representative, principal, partner and employee of such Selling Holder and its
affiliates, each Person who controls each Selling Holder within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act and the
directors, officers, agents, principals, partners or employees of each such
controlling person harmless against any and all losses, claims, damages,
liabilities, actions (including reasonable and documented costs, including,
without limitation, costs of preparation and reasonable attorneys' fees and
disbursements) and expenses, including reasonable expenses of investigation
(collectively "LOSSES") to which they or any of them may become subject under
the Securities Act or any other statute or common law or otherwise, insofar as
any such Losses shall arise out of, be caused by or shall be based upon (a) any
untrue statement or alleged untrue statement of a material fact contained in the
registration statement relating to the sale of the Registrable Shares covered
thereby, or the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, or (b) any untrue statement or alleged untrue statement of a
material fact contained in any preliminary prospectus (as amended or
supplemented if the Company shall have filed with the Commission any amendment
thereof or supplement thereof), if used prior to the effective date of such
registration
24
statement, or contained in the prospectus (as amended or supplemented if the
Company shall have filed with the Commission any amendment thereof or supplement
thereof, including the information deemed part of such registration statement
pursuant to Rule 430A promulgated under the Securities Act), if used within the
period during which the Company shall be required to keep the registration
statement to which such prospectus relates current pursuant to the terms of this
Agreement, or the omission or alleged omission to state therein (if so used) a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; PROVIDED, HOWEVER,
that the indemnification agreement contained in this Section 2.10.1 shall not
apply to such Losses which shall arise from the sale of Registrable Shares to
any Person if such Losses shall arise out of, shall be caused by or shall be
based upon any such untrue statement or alleged untrue statement, or any such
omission or alleged omission, (x) if such statement or omission shall have been
made in reliance upon and in conformity with information furnished in writing to
the Company by and about such Selling Holder specifically for use in connection
with the preparation of the registration statement or any preliminary prospectus
or prospectus contained in the registration statement or any such amendment
thereof or supplement thereto; (y) if such untrue statement or omission was made
in any preliminary prospectus to the extent that (i) the prospectus corrected
such untrue statement or such omission and (ii) the Selling Holder was legally
required to and failed to send or deliver a copy of the prospectus with or prior
to the delivery of written confirmation of the sale by such Selling Holder of
Registrable Shares to the Person asserting the claim from which such Losses
arise and the Company made the prospectus available to such Selling Holder in
accordance with the terms of the Agreement; or (z) if any such Losses arise out
of, are caused by or are based upon an untrue statement or omission in the
prospectus, to the extent that (i) such untrue statement or omission is
corrected in an amendment or supplement to the prospectus and (ii) having
previously been furnished by or on behalf of the Company with copies of the
prospectus as so amended or supplemented, such Selling Holder was legally
required to and thereafter fails to deliver such prospectus as so amended or
supplemented, prior to or concurrently with the sale of Registrable Shares to
the Person asserting the claim from which such Losses arise. This indemnity
shall be in addition to any other indemnification arrangements to which the
Company may otherwise be a party.
2.10.2 INDEMNIFICATION BY HOLDERS OF REGISTRABLE SHARES. Each
Selling Holder agrees to indemnify to the fullest extent permitted by law and
hold the Company and each other Selling Holder, and their respective affiliates,
directors, officers, agents, members, principals, partners and employees, each
Person who controls the Company or such other Selling Holder within the meaning
of Section 15 of the Securities Act or Section 20 of the Exchange Act and the
directors, officers, agents or employees of such controlling persons harmless
against any and all Losses arising out of, caused by or based upon any untrue
statement of a material fact contained in any registration statement, prospectus
or form of prospectus, or arising out of, caused by or based upon any omission
of a material fact required to be stated therein or necessary to make the
statements therein (in the case of the preliminary prospectus and the
prospectus, in each case including amendments or supplements), in the light of
the circumstances in which they were made not misleading, to the extent, but
only to the extent, that such untrue statement or omission was contained in any
information regarding such Selling Holder furnished in writing by such Selling
Holder to the Company, expressly for use in such registration statement or
prospectus; PROVIDED, HOWEVER, that the obligation to indemnify will be several
and
25
not joint and in no event shall the liability of any Selling Holder hereunder be
greater in amount than the dollar amount of the proceeds (net of the payment of
underwriting discounts and commissions payable by such Selling Holder) received
by any such Selling Holder upon the sale of the Registrable Shares giving rise
to such indemnification obligation. The Company and the Selling Holders shall be
entitled to receive indemnities from underwriters, selling brokers, dealer
managers and similar securities industry professionals participating in the
distribution to the same extent as provided above with respect to information so
furnished in writing by such Persons and regarding such Person expressly for use
in any prospectus or registration statement.
2.10.3 CONDUCT OF INDEMNIFICATION PROCEEDINGS. Any Person
entitled to indemnity under this Agreement (an "INDEMNIFIED PARTY") shall give
prompt written notice to the party from which such indemnity is sought (the
"INDEMNIFYING PARTY") of any claim or of the commencement of any proceeding with
respect to which such Indemnified Party seeks indemnification or contribution
pursuant hereto; PROVIDED, HOWEVER, that the failure so to notify the
Indemnifying Party shall not relieve the Indemnifying Party from any obligation
or liability except to the extent that the Indemnifying Party has been
prejudiced materially by such failure. The Indemnifying Party shall have the
right exercisable by giving written notice to an Indemnified Party promptly
after the receipt of written notice from such Indemnified Party of such claim or
proceeding to assume, at the Indemnifying Party's expense, the defense of any
such claim or proceeding, with counsel reasonably satisfactory to such
Indemnified Party; PROVIDED, HOWEVER, that under such circumstances an
Indemnified Party shall have the right to employ separate counsel in any such
claim or proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Party
unless: (1) the Indemnifying Party agrees to pay such fees and expenses; or (2)
the Indemnifying Party fails promptly to assume the defense of such claim or
proceeding or fails to employ counsel reasonably satisfactory to such
Indemnified Party; or (3) the Indemnified Party shall have been advised by
counsel that (a) there may be one or more material defenses available to such
Indemnified Party that are different from or additional to those available to
the Indemnifying Party or its affiliates or (b) a conflict of interest likely
exists if such counsel represents such Indemnified Party and such Indemnifying
Party or its affiliate, in which case, if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense thereof, it being understood, however, that the
Indemnifying Party shall not, in connection with any one such claim or
proceeding, or separate but substantially similar or related claims or
proceedings arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys
(together with appropriate local counsel which such counsel shall be designated
by the Indemnified Party and be reasonably acceptable to the Indemnifying Party)
at any time for such Indemnified Party, or for fees and expenses that are not
reasonable. Whether or not such defense is assumed by the Indemnifying Party,
such Indemnifying Party will not be subject to any liability for any settlement
made without its consent (which consent shall not be unreasonably withheld). The
Indemnifying Party shall not consent to entry of any judgment or settle or
compromise any pending or threatened claim, action or proceeding, unless it
contains as an unconditional term thereof the giving by the claimant or
plaintiff to the Indemnified Party of a release, in form and substance
satisfactory to such Indemnified Party, from all liability in respect
26
of such claim or litigation for which such Indemnified Party would be entitled
to indemnification hereunder.
The Indemnifying Party's liability to any such Indemnified Party
hereunder shall not be extinguished solely because any other Indemnified Party
is not entitled to indemnity hereunder.
2.10.4 CONTRIBUTION. If the indemnification provided for in this
Section 2.10 is unavailable to an Indemnified Party in respect of any Losses or
is insufficient to hold such Indemnified Party harmless, then, except to the
extent that contribution is not permitted under Section 11(f) of the Securities
Act, each applicable Indemnifying Party shall contribute to the amount paid or
payable by such Indemnified Party as a result of such Losses, in such proportion
as is appropriate to reflect the relative fault of the Indemnifying Party, on
the one hand, and such Indemnified Party, on the other hand, in connection with
the actions, statements or omissions that resulted in such Losses as well as any
other relevant equitable considerations appropriate under the circumstances. The
relative fault of such Indemnifying Party, on the one hand, and such Indemnified
Party, on the other hand, shall be determined by reference to, among other
things, whether any action in question, including any untrue statement of a
material fact or omission to state a material fact, has been taken or made by,
or relates to information supplied by, such Indemnifying Party or Indemnified
Party, and the parties' relative intent, knowledge, access to information
concerning the matter with respect to which the claim was asserted and
opportunity to correct or prevent such action, statement or omission. The amount
paid or payable by a party as a result of any Losses shall be deemed to include
any legal or other fees or expenses reasonably incurred by such party in
connection with any investigation or proceeding.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 2.10.4 were determined by PRO RATA
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 2.10.4, no Indemnifying Party
that is a Selling Holder shall be required to contribute any amount in excess of
the amount by which the net proceeds received by such Selling Holder from the
sale of Registrable Shares exceeds the amount of any damages that such Selling
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission. 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.
2.10.5 UNDERWRITING AGREEMENT TO GOVERN. At such time as an
underwriting agreement with respect to a particular underwriting is entered
into, the terms of any such underwriting agreement shall govern with respect to
the matters set forth therein to the extent inconsistent with this Section 2.10;
PROVIDED, HOWEVER, however, that the indemnification provisions of such
underwriting agreement as they relate to Selling Holders are customary for
registrations of the type then proposed and provide for indemnification by such
Selling Holders only with respect to written information regarding such Selling
Holder furnished by such Selling Holders.
27
2.11 RULE 144. Following the Initial Public Offering, the Company
shall file the reports required to be filed by it under the Securities Act and
the Exchange Act and the rules and regulations adopted by the Commission
thereunder and will take such further action as any Holder of Registrable Shares
may reasonably request, all to the extent required from time to time to enable
such Holder to sell Registrable Shares without registration under the Securities
Act within the limitation of the exemptions provided by Rule 144. Upon the
request of any Holder of Registrable Shares, the Company will deliver to such
Holder a written statement as to whether it has complied with such requirements.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1 REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants to the Stockholders as follows:
3.1.1 ORGANIZATION. It is a corporation duly organized and
validly existing under the laws of the State of Delaware.
3.1.2 AUTHORITY. It has full corporate power and authority to
execute, deliver and perform this Agreement and to consummate the transactions
contemplated hereby.
3.1.3 BINDING OBLIGATION. The execution, delivery and
performance of this Agreement by it and the consummation by it of the
transactions contemplated hereby have been duly and validly authorized by all
necessary corporate action on its part, and, assuming the due execution by the
Stockholder seeking enforcement against the Company, this Agreement constitutes
its binding obligation, enforceable against it in accordance with its terms,
except insofar as enforceability may be limited by bankruptcy, insolvency,
moratorium or other laws which may affect creditors rights and remedies
generally and by principles of equity (regardless of whether enforceability is
considered in a proceeding in equity or at law).
3.1.4 NO CONFLICT. The execution, delivery and performance of
this Agreement by it and the consummation by it of the transactions contemplated
hereby will not, with or without the giving of notice or the lapse of time, or
both, (a) violate any provision of law, statute, rule or regulation to which it
is subject, (b) violate any order, judgment or decree applicable to it, or (c)
conflict with, or result in a breach or default under, any term or condition of
its certificate of incorporation or its bylaws or any material agreement or
other material instrument to which it is a party or by which it or its property
is bound.
3.2 REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS. Each of the
Stockholders represents and warrants to each other and to the Company as
follows (except with respect to the representations in Section 3.2.5, which
are made solely by the Management Stockholders):
3.2.1 ORGANIZATION. If it is an entity, it is a corporation,
limited partnership or other entity duly organized and validly existing under
the laws of its respective state of organization.
3.2.2 AUTHORITY. It has full power and authority to execute,
deliver and perform this Agreement and to consummate the transactions
contemplated hereby.
28
3.2.3 BINDING OBLIGATION. The execution, delivery and
performance of this Agreement by it and the consummation by it of the
transactions contemplated hereby have been duly and validly authorized by all
necessary action on its part, and, assuming the due execution by the Company,
this Agreement constitutes its binding obligation, enforceable against it in
accordance with its terms, except insofar as enforceability may be limited by
bankruptcy, insolvency, moratorium or other laws which may affect creditors'
rights and remedies generally and by principles of equity (regardless of whether
enforceability is considered in a proceeding in equity or at law).
3.2.4 NO CONFLICT. The execution, delivery and performance of
this Agreement by it and the consummation by it of the transactions contemplated
hereby will not, with or without the giving of notice or the lapse of time, or
both, (a) violate any provision of law, statute, rule or regulation to which it
is subject, (b) violate any order, judgment or decree applicable to it, or (c)
conflict with, or result in a breach or default under, any term or condition of
its certificate or articles of incorporation, bylaws, trust or equivalent
governing document or any material agreement or other material instrument to
which it is a party or by which it or its property is bound.
3.2.5 INVESTMENT INTENT OF MANAGEMENT STOCKHOLDERS. The Shares
owned by such Management Stockholder were acquired by such Management
Stockholder for investment only and not with a view to any public distribution
thereof, and there is not any current plan or intention on the part of such
Management Stockholder to offer to sell, exchange or otherwise dispose of the
Shares owned by such Management Stockholder in violation of any of the
requirements of the Securities Act or any comparable state or foreign securities
law.
ARTICLE IV.
EFFECTIVENESS AND TERMINATION OF AGREEMENT
4.1 EFFECTIVENESS. This Agreement is conditioned on and shall become
effective immediately prior to the closing of the Initial Public Offering. Until
this Agreement becomes effective, the Original Agreement remains in full force
and effect, and in the event the closing of the Initial Public Offering does not
occur on or before May 15, 2002, the execution and delivery of this Agreement
shall be disregarded and this Agreement shall be deemed null and void for all
purposes.
4.2 TERMINATION. Subject to Section 4.1, this Agreement shall
terminate on October 2, 2010.
ARTICLE V.
GENERAL
5.1 INTENTIONALLY OMITTED.
29
5.2 RECAPITALIZATION, EXCHANGES, ETC., AFFECTING THE SHARES. The
provisions of this Agreement shall apply to the full extent set forth herein
with respect to (a) the Shares and any option, right or warrant to acquire
Common Shares, and (b) any and all shares of capital stock of the Company or any
successor or assign of the Company (whether by merger, consolidation, sale of
assets or otherwise) which may be issued in respect of, in exchange for, or in
substitution for any Shares, by combination, recapitalization, reclassification,
merger, consolidation or otherwise. In the event of any change in the
capitalization of the Company, as a result of any stock split, stock dividend or
stock combination, the provisions of this Agreement shall be appropriately
adjusted.
5.3 INJUNCTIVE RELIEF. It is hereby agreed and acknowledged that it
will be impossible to measure in money the damages that would be suffered if the
parties fail to comply with any of the obligations herein imposed on them and
that, in the event of any such failure, an aggrieved person will be irreparably
damaged and will not have an adequate remedy of law. Any such person shall,
therefore, be entitled to injunctive relief, including specific performance, to
enforce such obligations, without the posting of any bond and if any action
should be brought in equity to enforce any of the provisions of this Agreement,
none of the parties hereto shall raise the defense that there is an adequate
remedy at law.
5.4 LEGEND. In addition to any other legend which may be required by
applicable law, each share certificate representing Shares which are subject to
this Agreement shall have endorsed, to the extent appropriate, upon its face the
following words:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), OR THE
SECURITIES LAWS OF ANY JURISDICTION. SUCH SECURITIES MAY NOT BE
OFFERED, SOLD, TRANSFERRED, PLEDGED, ASSIGNED, ENCUMBERED,
30
HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO (I) A
REGISTRATION STATEMENT WITH RESPECT TO SUCH SECURITIES THAT IS
EFFECTIVE UNDER SUCH ACT OR APPLICABLE STATE SECURITIES LAW, OR (II)
ANY EXEMPTION FROM REGISTRATION UNDER SUCH ACT, OR APPLICABLE STATE
SECURITIES LAW, RELATING TO THE DISPOSITION OF SECURITIES, INCLUDING
RULE 144, PROVIDED AN OPINION OF COUNSEL IS FURNISHED TO THE COMPANY,
IN FORM AND SUBSTANCE REASONABLY SATISFACTORY TO THE COMPANY, TO THE
EFFECT THAT AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE ACT
AND/OR APPLICABLE STATE SECURITIES LAW IS AVAILABLE.
IN ADDITION, THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE
TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE
DISPOSED OF UNLESS SUCH TRANSFER COMPLIES WITH THE PROVISIONS OF A
CERTAIN AMENDED AND RESTATED STOCKHOLDERS AGREEMENT, AS SUCH MAY BE
AMENDED FROM TIME TO TIME (THE "STOCKHOLDERS AGREEMENT"), A COPY OF
WHICH IS ON FILE AND MAY BE INSPECTED AT THE PRINCIPAL OFFICE OF THE
COMPANY. NO TRANSFER OF THE SECURITIES WILL BE MADE ON THE BOOKS OF THE
COMPANY UNLESS ACCOMPANIED BY EVIDENCE OF COMPLIANCE WITH THE TERMS OF
SUCH STOCKHOLDERS AGREEMENT. THE SECURITIES REPRESENTED BY THIS
CERTIFICATE ARE ALSO SUBJECT TO OTHER RIGHTS AND OBLIGATIONS AS SET
FORTH IN THE STOCKHOLDERS AGREEMENT.
To the extent the circumstances or provisions requiring any of the above legends
have ceased to be effective, the Company will upon request reissue certificates
without the applicable legend or legends.
5.5 AMENDMENT; WAIVER; REPRESENTATIVES. This Agreement may be
amended, modified, supplemented or terminated only by a written instrument
signed by each of (a) the Company, (b) Stockholders holding a majority of the
Registrable Purchaser Shares, (c) Management Stockholders holding a majority of
the Registrable Management Shares and (d) Financing Stockholders holding a
majority of the Registrable Financing Shares. No provision of this Agreement may
be waived orally, but only by a written instrument signed by the party against
whom enforcement of such waiver is sought. Stockholders shall be bound from and
after the date of the receipt of a written notice from the Company setting forth
such amendment or waiver by any consent authorized by this Section 5.5, whether
or not the Shares shall have been marked to indicate such consent; no
alteration, modification or impairment shall be implied by reason of any
previous waiver, extension of time, delay or omission in exercise, or other
indulgence. For purposes of this Agreement, the parties hereto shall designate
and appoint representatives (each, a "REPRESENTATIVE") as provided in this
Section 5.5. The Purchaser Parties hereby designate and appoint ________ (or any
successor designated in writing by the
31
Purchaser Parties holding Shares that constitute, on a fully-diluted basis, a
majority in value of the Shares held by all of the Purchaser Parties) as
Representative on behalf of the Purchaser Parties; the Management Parties hereby
designate and appoint Xxxxx X. Xxxxxx (or any successor designated in writing by
Management Parties holding Shares that constitute, on a fully-diluted basis, a
majority in value of the Shares held by all of the Management Parties) as
Representative on behalf of the Management Parties; and the Financing Parties
hereby designate and appoint Xxxx-Xxxx Xxxxxx (or any successor designated in
writing by Financing Parties holding Shares that constitute, on a fully-diluted
basis, a majority in value of the Shares held by all of the Financing Parties)
as Representative on behalf of the Financing Parties. Each Representative shall
have the authority to receive any notices, settle any claims, agree to any
amendments, and grant any consents or waivers on behalf of the parties that such
Representative represents. The parties hereto shall be entitled to deal
exclusively with the respective Representatives with respect to matters arising
out of this Agreement, and the parties hereto shall be entitled to deliver any
notices to the respective Representatives and rely on any action of the
respective Representatives with respect to actions taken under this Agreement on
behalf of the parties hereto.
5.6 ADDITIONAL DOCUMENTS; FURTHER CHANGES. Each party hereto agrees
to execute any and all further documents and writings within its powers and to
perform such other actions which may be or become necessary or expedient to
effectuate and carry out this Agreement.
5.7 NO THIRD-PARTY BENEFITS. Other than Section 2.10 hereof, none of
the provisions of this Agreement shall be for the benefit of, or enforceable by,
any third-party beneficiary.
5.8 SUCCESSORS AND ASSIGNS. Subject to the terms hereof, this
Agreement shall be binding upon and shall inure to the benefit of the
Stockholders, and their respective successors and permitted assigns; PROVIDED,
HOWEVER, (a) neither this Agreement nor any rights or obligations hereunder may
be transferred by the Company and (b) no rights or obligations of any
Stockholder under this Agreement may be assigned except that (x) any Stockholder
may transfer its rights and obligations hereunder, in whole or in part in
connection with a Transfer of Shares made in compliance with all of the
provisions of this Agreement and (y) any Purchaser Party may transfer such
Purchaser Party's rights hereunder, in whole or in part, to any affiliate in
connection with a Transfer of Shares made in compliance with all of the
provisions of this Agreement.
5.9 SEVERABILITY. In case any one or more of the provisions contained
in this Agreement shall, for any reason, be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Agreement, and this Agreement
shall be construed as if such invalid, illegal or unenforceable provision had
never been contained herein; PROVIDED, HOWEVER, that the parties hereto shall
use their reasonable best efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
invalid, illegal or unenforceable term, provision, covenant or restriction.
32
5.10 INTEGRATION. This Agreement contains the entire understanding of
the parties with respect to the subject matter hereof. There are no
restrictions, agreements, promises, representations, warranties, covenants or
undertakings with respect to the subject matter hereof other than those
expressly set forth or referred to herein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to its subject
matter, including the Original Agreement.
5.11 GOVERNING LAW. THE RIGHTS AND LIABILITIES OF THE PARTIES SHALL BE
GOVERNED BY THE INTERNAL LAWS OF THE STATE OF DELAWARE, REGARDLESS OF THE CHOICE
OF LAWS PROVISIONS OF SUCH STATE OR ANY OTHER JURISDICTION.
5.12 ATTORNEYS' FEES. Should any litigation or arbitration be
commenced (including any proceedings in a bankruptcy court) between the parties
hereto or their representatives concerning any provision of this Agreement or
the rights and duties of any person or entity hereunder, the party or parties
prevailing in such proceeding shall be entitled, in addition to such other
relief as may be granted, to the reasonable attorneys' fees and court costs
incurred by reason of such litigation or arbitration.
5.13 HEADINGS. The headings in this Agreement are inserted only as a
matter of convenience, and in no way define, limit, extend or interpret the
scope of this Agreement or of any particular Section.
5.14 INFORMATION FOR NOTICES. No Stockholder (other than a Stockholder
as of the date of this Agreement with respect to the Shares held as of such
date) shall hold any of its Shares in nominee name unless it otherwise provides
the Company and the other Stockholders with its name and address and other
information reasonably requested by the Company in order to establish such
Stockholder's particular status under this Agreement (e.g., Purchaser Holder,
Management Party, etc.).
5.15 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
5.16 CONSENT TO JURISDICTION. Each Stockholder agrees that any
proceeding arising out of or relating to this Agreement or the breach or
threatened breach of this Agreement may be commenced and prosecuted in a court
in the State of Delaware. Each Stockholder hereby irrevocably and
unconditionally consents and submits to the non-exclusive personal jurisdiction
of any court in the State of Delaware in respect of any such proceeding. Each
Stockholder consents to service of process upon it with respect to any such
proceeding by registered mail, return receipt requested, and by any other means
permitted by applicable laws and rules. Each Stockholder waives any objection
that it may now or hereafter have to the laying of venue of any such proceeding
in any court in the State of Delaware and any claim that it may now or hereafter
have that any such proceeding in any court in the State of Delaware has been
brought in an inconvenient forum.
33
5.17 NO INCONSISTENT AGREEMENTS. The Company will not hereafter enter
into any agreements with respect to its securities which are inconsistent with
or violate in any material respects the rights granted to the parties to this
Agreement.
5.18 INFORMATION REGARDING BENEFICIAL OWNERSHIP. Each Stockholder
agrees to promptly provide to the Company any information or representations
that the Company may request regarding such holder's beneficial ownership of
shares of any class of the Company's capital stock.
5.19 NO TAX ADVICE. Each Management Stockholder acknowledges that the
United States federal, state, local and other tax consequences to such
stockholder of acquiring, holding and selling or otherwise disposing of its
Shares may be affected by an election by such stockholder under Section 83(b) of
the Code (an "83(b) ELECTION") with regard to such Shares. Each Management
Stockholder understands and acknowledges that (a) it has not relied on the
Company or the Purchasing Stockholders (or any of their affiliates, employees,
agents or advisors) with regard to the desirability or manner of making an 83(b)
Election and (b) the Company has urged such stockholder to consult its tax
advisor with regard to the desirability and manner of making an 83(b) Election.
Each Management Stockholder shall promptly provide the Company with a copy of
any 83(b) Elections made by such stockholder with regard to its Shares.
5.20 AFTER ACQUIRED SHARES. The provisions of this Agreement shall
apply to any shares of capital stock of the Company acquired after the date
hereof by any party hereto or by any party that agrees to be bound by the terms
thereof.
5.21 NOTICES. Unless otherwise specified herein, all notices and other
communications hereunder shall be in writing and shall be deemed given upon
personal delivery, facsimile transmission (which is confirmed), telex or
delivery by an overnight express courier service (delivery, postage or freight
charges prepaid), or on the fourth day following deposit in the United States
mail (if sent by registered or certified mail, return receipt requested,
delivery, postage or freight charges prepaid, and otherwise to be sent by first
class mail), addressed to the parties at the following addresses (or at such
other address for a party as shall be specified by like notice):
if to the Company, to:
PETCO Animal Supplies, Inc.
0000 Xxxxx Xxxx
Xxx Xxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxx X. Xxxxx, Chief Financial Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
34
with a copy (which shall not constitute notice) to:
Xxxxxx & Xxxxxxx
000 "X" Xxxxxx, Xxxxx 0000
Xxx Xxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to any of the Purchaser Parties, to:
Xxxxxxx Xxxxx & Partners, L.P.
00000 Xxxxx Xxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000]
and
c/o Texas Pacific Group
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxxx Xxxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
with a copy (which shall not constitute notice) to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
and
Cleary, Gottlieb, Xxxxx & Xxxxxxxx
Xxx Xxxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxxxxxxx, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
35
if to any of the Management Parties, to the address and/or telephone
number set forth below such Stockholder's name on the signature pages
hereto
with a copy (which shall not constitute notice) to:
Xxxxxx Xxxxxx & Xxxxx LLP
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxx X. Lorne, Esq.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to any of the Financing Parties, to:
TCW/Crescent Mezzanine LLC
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxx
Xxxx Xxxxxxx
with a copy (which shall not constitute notice) to:
Trust Company of the West
00000 Xxxxx Xxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
Attention: Xxxx-Xxxx Xxxxxx
with another copy to (which shall not constitute notice):
Xxxxxx Xxxxxxxx LLP
3000 Two Xxxxx Square
00xx Xxx Xxxx Xxxxxxx
Xxxxxxxxxxxx, XX 00000-0000
Facsimile: (000) 000-0000
Attention: Xxxx X. Xxxxxxxx, Esquire
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
36
IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement as of the day and year first set forth above.
PETCO ANIMAL SUPPLIES, INC.
By:
--------------------------------------
Name: Xxxxx X. Xxxxx
Title: Executive Vice President and
Chief Financial Officer
37
PURCHASING STOCKHOLDERS
GREEN EQUITY INVESTORS III, L.P.
By: GEI Capital III, LLC General Partner
By:
---------------------------------
Name: Xxxx Xxxxxxx
Title: Manager
TPG PARTNERS III, L.P.
By: TPG GenPar III, L.P.
its General Partner
By: TPG Advisors III, Inc.
its General Partner
By:
---------------------------------
Name:
Title:
TPG PARALLEL III, L.P.
By: TPG GenPar III, L.P.
its General Partner
By: TPG Advisors III, Inc.
its General Partner
By:
---------------------------------
Name:
Title:
38
TPG DUTCH PARALLEL III, C.V.
By: TPG GenPar III, L.P.
its General Partner
By: TPG Advisors III, Inc.
its General Partner
By:
---------------------------------
Name:
Title:
TPG INVESTORS III, L.P.
By: TPG GenPar III, L.P.
its General Partner
By: TPG Advisors III, Inc.
its General Partner
By:
---------------------------------
Name:
Title:
FOF PARTNERS III, L.P.
By: TPG GenPar III, L.P.
its General Partner
By: TPG Advisors III, Inc.
its General Partner
By:
---------------------------------
Name:
Title:
39
FOF PARTNERS III-B, L.P.
By: TPG GenPar III, L.P.
its General Partner
By: TPG Advisors III, Inc.
its General Partner
By:
---------------------------------
Name:
Title:
40
ANTIN FAMILY REVOCABLE TRUST
By:
--------------------------------------
Name: Xxxxxx X. Xxxxx
Title: Trustee
DAY ANNUITY TRUST
By:
--------------------------------------
Name: Xxxxxx X. Day
Title: Trustee
XXXXXX FAMILY HOLDINGS, LLC
By:
--------------------------------------
Name: Xxxxxx X. Xxxxxx
Title:
XXXXXX X. XXXXXX AND XXXXXXXXXX X.
XXXXXX TRUST DATED SEPTEMBER 13, 1990
By:
--------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Trustee
By:
--------------------------------------
Name: Xxxxxxxxxx X. Xxxxxx
Title: Trustee
41
--------------------------------------
Xxxxxxxx X. Xxxxxxx
--------------------------------------
Xxxxxx X. Xxxxxx
--------------------------------------
Xxxxx Xxxxxxx
42
MANAGEMENT STOCKHOLDERS
----------------------------------
Xxxxx X. Xxxxxx
Address:
-----------------------------
-----------------------------
-----------------------------
Facsimile:
-----------------------------
Phone:
-----------------------------
----------------------------------
Xxxxx X. Xxxx
Address:
-----------------------------
-----------------------------
-----------------------------
Facsimile:
-----------------------------
Phone:
-----------------------------
----------------------------------
Xxxxx X. Xxxxx
Address:
-----------------------------
-----------------------------
-----------------------------
Facsimile:
-----------------------------
Phone:
-----------------------------
----------------------------------
Xxxxxx X. Xxxxx
Address:
-----------------------------
-----------------------------
-----------------------------
Facsimile:
-----------------------------
Phone:
-----------------------------
43
THE XXXXXXXX FAMILY TRUST UTD 11/9/00
By:
--------------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Trustee
Address:
-----------------------------
-----------------------------
-----------------------------
Facsimile:
-----------------------------
Phone:
-----------------------------
XXXXXXX ENTERPRISES, LLC
By:
--------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title:
Address:
-----------------------------
-----------------------------
-----------------------------
Facsimile:
-----------------------------
Phone:
-----------------------------
XXXXXXX FAMILY TRUST UTD 1/15/96
By:
--------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Trustee
Address:
-----------------------------
-----------------------------
-----------------------------
Facsimile:
-----------------------------
Phone:
-----------------------------
44
FINANCING STOCKHOLDERS
TCW LEVERAGED INCOME TRUST, L.P.
By: TCW Advisers (Bermuda), Ltd.
as its General Partner
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
By: TCW Investment Management Company
as Investment Advisor
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
TCW LEVERAGED INCOME TRUST II, L.P.
By: TCW (XXXX XX), L.P.
as its General Partner
By: TCW Advisers (Bermuda), Ltd.
its General Partner
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
By: TCW Investment Management Company
as Investment Adviser
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
45
TCW LEVERAGED INCOME TRUST IV, L.P.
By: TCW Asset Management Company
as its Investment Adviser
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
By: TCW (XXXX XX), L.L.C.
as General Partner
By: TCW Asset Management Company
as its Managing Member
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
TCW/CRESCENT MEZZANINE PARTNERS II, L.P.
By: TCW/Crescent Mezzanine II, L.P.
its General Partner or Managing Member
By: TCW/Crescent Mezzanine, L.L.C.
its General Partner
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
46
TCW/CRESCENT MEZZANINE TRUST II
By: TCW/Crescent Mezzanine II, L.P.
its General Partner or Managing Member
By: TCW/Crescent Mezzanine, L.L.C.
its General Partner
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
CANTERBURY MEZZANINE CAPITAL II, L.P.
By: Canterbury Capital II, L.L.C.
its General Partner
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
TRANSAMERICA LIFE INSURANCE COMPANY
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
J/Z CBO (DELAWARE), LLC
By: Jordan/Zalaznick Advisers, Inc.
its Collateral Manager
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
IBJ WHITEHALL BANK & TRUST COMPANY
By:
------------------------------
Name:
------------------------------
Title:
------------------------------
47
SCHEDULE I
PURCHASING STOCKHOLDERS
Green Equity Investors III, L.P.
TPG Partners III, L.P.
TPG Parallel III, L.P.
TPG Dutch Parallel III, C.V.
TPG Investors III, L.P.
FOF Partners III, L.P.
FOF Partners III-B, L.P.
Day Annuity Trust
Antin Family Revocable Trust
Xxxxxx X. Xxxxxx and Xxxxxxxxxx X. Xxxxxx Trust dated September 13, 1990
Xxxxxxxx X. Xxxxxxx
Xxxxxx Family Holdings, LLC
Xxxxxx X. Xxxxxx
Xxxxx Xxxxxxx
48
SCHEDULE II
MANAGEMENT STOCKHOLDERS
Xxxxx X. Xxxxxx
Xxxxx X. Xxxx
Xxxxx X. Xxxxx
Xxxxxx X. Xxxxx
The Xxxxxxxx Family Trust UTD 11/9/00
Xxxxxxx Enterprises, LLC
Xxxxxxx Family Trust UTD 1/15/96
49
SCHEDULE III
FINANCING STOCKHOLDERS
TCW/Crescent Mezzanine Partners II, L.P.
TCW/Crescent Mezzanine Trust II
TCW Leveraged Income Trust, L.P.
TCW Leveraged Income Trust II, L.P.
TCW Leveraged Income Trust IV, L.P.
Canterbury Mezzanine Capital II, L.P.
Transamerica Life Insurance Company
J/Z CBO (Delaware), LLC
IBJ Whitehall Bank & Trust Company
50
