VANSTAR FINANCING TRUST
6 3/4% Trust Convertible Preferred Securities
("Preferred Securities")
Guaranteed to a limited extent by, and convertible into shares of
common stock of,
Vanstar Corporation
REGISTRATION RIGHTS AGREEMENT
October 2, 1996
XXXXXXXXX, XXXXXXXX & COMPANY LLC
ALEX. XXXXX & SONS INCORPORATED
XXXXXXXXX, LUFKIN & XXXXXXXX SECURITIES CORPORATION
THE XXXXXXXX-XXXXXXXX COMPANY, INC.
As Representatives of the several Initial Purchasers
c/x Xxxxxxxxx, Xxxxxxxx & Company LLC
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Ladies and Gentlemen:
Vanstar Financing Trust, a statutory business trust formed under the laws
of the State of Delaware (the "Trust") by Vanstar Corporation ("the Company"), a
Delaware corporation, as sponsor, among others, proposes to issue and sell to
the Initial Purchasers named in the Purchase Agreement referred to below (the
"Initial Purchasers"), for whom Xxxxxxxxx, Xxxxxxxx & Company, LLC, Alex.
Xxxxx & Sons Incorporated, Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation
and The Xxxxxxxx-Xxxxxxxx Company, Inc. are acting as representatives (the
"Representatives"), upon the terms set forth in a purchase agreement dated
September 26, 1996 (the "Purchase Agreement"), among the Initial Purchasers, the
Company and the Trust, 6 3/4% Trust Convertible Preferred Securities
(liquidation amount $50 per Convertible Preferred Security) (the "Preferred
Securities") (the "Initial Placement"). As an inducement to the Initial
Purchasers to enter into the Purchase Agreement and in satisfaction of a
condition to the obligations of the Initial Purchasers thereunder, the Trust and
the Company agree with you, (i) for the benefit of the Initial Purchasers and
(ii) for the benefit of the holders from time to time of the Preferred
Securities, the 6 3/4% Convertible Subordinated Debentures due 2016 (the
"Debentures") issued by the Company and the common stock, par value $0.001 per
share, of the Company (the "Common Stock") issuable upon conversion of the
Preferred Securities and the Debentures and any shares of Common Stock issued
with respect to such Common Stock upon any dividend, stock split,
reclassification merger, reorganization or similar event (collectively, together
with the Guarantee of the Company of the Preferred Securities, the "Registrable
Securities"), including the Initial Purchasers (each of the foregoing, a
"Holder" and, together, the "Holders"), as follows:
1. DEFINITIONS. Capitalized terms used herein without definition shall
have their respective meanings set forth in or pursuant to the Purchase
Agreement or the Offering Circular,
dated September 26, 1996, in respect of the Preferred Securities, as
applicable. All references to Sections herein are to Sections of this
Agreement unless otherwise indicated. As used in this Agreement, the
following capitalized defined terms shall have the following meanings:
"Act" or "Securities Act" means the Securities Act of 1933, as amended.
"Affiliate" of any specified person means any other person which, directly
or indirectly, is in control of, is controlled by, or is under common control
with such specified person. For purposes of this definition, control of a
person means the power, direct or indirect, to direct or cause the direction of
the management and policies of such person whether by ownership, contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
"Commission" means the Securities and Exchange Commission.
"Company Offering" means the sale of Common Stock pursuant to a
registration statement filed by the Company under the Act (other than (i) a
registration statement filed on Form S-4 or any successor form or (ii) a
registration statement filed on Form S-8 or any successor form) respecting an
underwritten offering, whether primary or secondary, that is declared effective
by the Commission.
"DTC" means The Depository Trust Company.
"Effectiveness Period" has the meaning set forth in Section 2(b) hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Declaration" means the Amended and Restated Declaration of Trust dated as
of October 2, 1996, among the Company and the Regular Trustee, the Property
Trustee and the Delaware Trustee named therein.
"Indenture" means the Indenture dated as of October 2, 1996, among the
Company and Wilmington Trust Company as trustee.
"Managing Underwriters" means the investment banker or investment bankers
and manager or managers that shall administer an underwritten offering, if any,
as set forth in Section 6 hereof.
"Person" means an individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
"Prospectus" means the prospectus included in any Shelf Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A under
-2-
the Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities.
"Shelf Registration" means a registration effected pursuant to Section 2
hereof.
"Shelf Registration Statement" means a Shelf Registration statement of the
Trust and the Company pursuant to the provisions of Section 2 hereof filed with
the Commission which covers some or all of the Registrable Securities, as
applicable, on an appropriate form under Rule 415 under the Act, or any similar
rule that may be adopted by the Commission, amendments and supplements to such
registration statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"underwriter" means any underwriter of Registrable Securities in connection
with an offering thereof under a Shelf Registration Statement.
2. SHELF REGISTRATION. (a) The Trust and the Company shall, within 75
days following the date of original issuance (the "Issue Date") of the Preferred
Securities, file with the Commission a Shelf Registration Statement relating to
the offer and sale of the Registrable Securities by the Holders from time to
time in accordance with the methods of distribution elected by such Holders and
set forth in such Shelf Registration Statement and, thereafter, shall each use
their reasonable efforts to cause such Shelf Registration Statement to be
declared effective under the Act within 135 calendar days following the Issue
Date; PROVIDED, HOWEVER, that no Holder shall be entitled to sell or otherwise
transfer any Registrable Securities held by it unless such Holder is in
compliance with Section 3(m) hereof.
(b) The Trust and the Company shall each use its reasonable efforts
to keep the Shelf Registration Statement continuously effective in order to
permit the Prospectus forming part thereof to be usable by Holders for a period
of three years from the date the Shelf Registration Statement is declared
effective or such shorter period that will terminate upon the earliest of the
following: (A) when all outstanding Preferred Securities have been sold pursuant
to a registration statement, all Debentures issued to Holders in respect of
Preferred Securities that had not been sold pursuant to a registration statement
have been sold pursuant to a registration statement, all shares of Common Stock
issued upon conversion of any such Preferred Securities or any such Debentures
(or in respect of such shares of Common Stock) that had not been sold pursuant
to a registration statement have been sold pursuant to a registration statement,
(B) when, in the written opinion of counsel to the Trust and the Company, all
outstanding Registrable Securities held by persons which are not affiliates of
the Trust or the Company may be resold without registration under the Act
pursuant to Rule 144(k) under the Act or any successor provision thereto or any
other applicable law, rule or regulation, whether now in effect or hereinafter
promulgated, adopted or issued (in any such case, such period being called the
"Effectiveness Period") or (C) when all Registrable Securities (or their
predecessor securities) have been sold pursuant to a registration statement or
redeemed.
-3-
(c) In the event that a Shelf Registration Statement with respect to
the Registrable Securities is not (i) filed on or prior to the 75th calendar day
following the Issue Date or (ii) declared effective on or prior to the 135th
calendar day following the Issue Date (each, a "Registration Default"), the
interest rate borne by the Debentures and, accordingly, the distribution rate
borne by the Preferred Securities, shall be increased by one-quarter of one
percent (0.25 %) per annum, from and including the day following the
Registration Default to and including the 90th day following such Registration
Default and by one-half of one percent (0.50%) thereof from and after the 91st
day following such Registration Default. Upon (x) the filing of the Shelf
Registration Statement after the 75-day period described in clause (i) above or
(y) the effectiveness of the Shelf Registration Statement after the 135-day
period described in clause (ii) above, the interest rate borne by the Debentures
and the distribution rate borne by the Preferred Securities from the date of
such filing or effectiveness, as the case may be, will be reduced to the
original interest rate in respect of all periods thereafter. In the event that
the Shelf Registration Statement ceases to be effective or otherwise becomes
unavailable for effecting resales during the Effectiveness Period for more than
30 consecutive days or 90 days, whether or not consecutive, during any 12-month
period, then the interest rate borne by the Debentures and the distribution rate
borne by the Preferred Securities will each increase by one-half of one percent
(0.50%) per annum from such 31st or 91st day, as applicable, until such time as
the Shelf Registration Statement again becomes effective or available for
effecting resales, as applicable. Any interest payments contemplated by this
Section 2(c) shall be made pursuant to the terms of the Indenture and the
Declaration.
(d) The Trust and the Company shall be deemed not to have used their
reasonable efforts to keep the Shelf Registration Statement effective during the
requisite period if the Trust or the Company voluntarily takes any action that
would result in Holders of Registrable Securities covered thereby not being able
to offer and sell any such Registrable Securities during that period, unless
(i) such action is required by applicable law or (ii) upon the occurrence of any
event contemplated by paragraph 3(c)(2)(iii) below (even if such event results
from a voluntary action of the Company or is within the control of the Company),
and such action is taken by the Trust or the Company in good faith and for valid
business reasons or (iii) the continued effectiveness of the Shelf Registration
Statement would require the Company to disclose a material financing,
acquisition or other corporate development, and the proper officers of the
Company shall have determined in good faith that such disclosure is not in the
best interests of the Company and its stockholders, and, in the case of clause
(ii) above, the Trust and the Company thereafter promptly comply with the
requirements of Section 3(i) below.
3. REGISTRATION PROCEDURES. In connection with any Shelf Registration
Statement, the following provisions shall apply:
(a) The Trust and the Company shall furnish to the Initial Purchasers
and their counsel, prior to the filing thereof with the Commission, a copy of
any Shelf Registration Statement, and each amendment thereof and each amendment
or supplement, if any, to the Prospectus included therein and shall each use its
reasonable efforts to reflect in each such
-4-
document, when so filed with the Commission, such comments as the Initial
Purchasers and such counsel reasonably may propose.
(b) The Trust and the Company shall take such action as may be
necessary so that (i) any Shelf Registration Statement, and any amendment
thereto, and any Prospectus forming a part thereof, and any amendment or
supplement thereto (and each report or other document incorporated therein by
reference in each case) complies in all material respects with the Securities
Act and the Exchange Act and the respective rules and regulations thereunder,
(ii) any Shelf Registration Statement, 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, in the light of the circumstances under which they were
made, not misleading and (iii) any Prospectus forming part of any Shelf
Registration Statement, and any amendment or 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 were made, not misleading.
(c) (1) The Company shall advise the Initial Purchasers and, in the
case of clause (i) of this Section 3(c), the Holders, and, if requested by the
Initial Purchasers or any such Holder, confirm such advice in writing:
(i) when a Shelf Registration Statement, and any
amendment thereto, has been filed with the Commission and when the Shelf
Registration Statement or any post-effective amendment thereto has become
effective; and
(ii) of any request by the Commission for amendments or
supplements to the Shelf Registration Statement or the Prospectus included
therein or for additional information.
(2) The Company shall advise the Initial Purchasers and the
Holders and, if requested by the Initial Purchasers or any such Holder, confirm
such advice in writing of:
(i) the issuance by the Commission of any stop order
suspending effectiveness of the Shelf Registration Statement or the initiation
of any proceedings for that purpose;
(ii) the receipt by the Trust or the Company of any
notification with respect to the suspension of the qualification of the
securities included therein for sale in any jurisdiction or the initiation of
any proceeding for such purpose; and
(iii) the happening of any event (which event need not be
described (if such disclosure would, in the good faith judgment of the Company,
be detrimental to the Company or the Holders) absent confidentiality
arrangements reasonably satisfactory to the Company) that requires the making of
any changes in the Shelf Registration Statement or the
-5-
Prospectus so that, as of such date, the Shelf Registration Statement and the
Prospectus do not contain an untrue statement of a material fact and do not
omit to state a material fact required to be stated therein or necessary to
make the statements therein (in the case of the Prospectus, in light of the
circumstances under which they were made) not misleading (which advice shall
be accompanied by an instruction to suspend the use of the Prospectus until
the requisite changes have been made).
(d) The Company and the Trust shall use their reasonable efforts to
prevent the issuance, and, if issued, to obtain the withdrawal, of any order
suspending the effectiveness of any Shelf Registration Statement at the earliest
possible time.
(e) The Trust and the Company shall furnish to each Holder of
Registrable Securities included within the coverage of any Shelf Registration
Statement, without charge, at least one copy of such Shelf Registration
Statement and any post-effective amendments thereto, including financial
statements and schedules contained therein, provided, that such parties shall
not be required to furnish to the Holders reports and other documents
incorporated by reference in the Shelf Registration Statement or any exhibits
thereto (including those incorporated by reference).
(f) The Trust and the Company shall, during the Effectiveness Period,
deliver to each Holder of Registrable Securities included within the coverage of
any Shelf Registration Statement, without charge, as many copies of the
Prospectus (including each preliminary prospectus) included in such Shelf
Registration Statement and any amendment or supplement thereto as such Holder
may reasonably request, and each of the Trust and the Company consents (except
upon and during the continuance of any event described in paragraphs 2(d) or
3(c)(2)(iii) above) to the use of the Prospectus or any amendment or supplement
thereto by each of the selling Holders of Registrable Securities in connection
with the offering and sale of the Registrable Securities covered by the
Prospectus or any amendment or supplement thereto during the Effectiveness
Period.
(g) Prior to any offering of Registrable Securities pursuant to any
Shelf Registration Statement, the Trust and the Company shall register or
qualify or cooperate with the Holders of Registrable Securities included therein
and their respective counsel in connection with the registration or
qualification of such Registrable Securities for offer and sale under the
securities or blue sky laws of such jurisdictions in the United States as any
such Holders reasonably request in writing and do any and all other acts or
things necessary or advisable to enable the offer and sale in such jurisdictions
of the Registrable Securities covered by such Shelf Registration Statement;
PROVIDED, HOWEVER, that in no event shall the Trust or the Company be obligated
to (1) qualify generally to do business or as a foreign corporation or as a
dealer in securities in any jurisdiction where it would not otherwise be
required to so qualify but for this Section 3(g), (ii) file any general consent
to service of process in any jurisdiction where it is not as of the date hereof
then so subject or (iii) subject itself to taxation in any such jurisdiction if
it is not so subject.
-6-
(h) Unless any Registrable Securities shall be in book-entry only
form, the Trust and the Company shall cooperate with the Holders of Registrable
Securities to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold pursuant to any Shelf
Registration Statement free of any restrictive legends and in such permitted
denominations and registered in such names as Holders may request in connection
with the sale of Registrable Securities pursuant to such Shelf Registration
Statement.
(i) Upon the occurrence of any event contemplated by paragraph
3(c)(2)(iii) above, the Trust and the Company shall, as promptly as reasonably
practicable, file with the Commission a post-effective amendment to any Shelf
Registration Statement or an amendment or supplement to the related Prospectus
or file any report required under the Exchange Act or other required document so
that, as thereafter delivered to purchasers of the Registrable Securities
included therein, the Prospectus will not include an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading (except, in each case, for an untrue statement of a
material fact or omission of a material fact made in reliance on and in
conformity with written information furnished to the Company or the Trust by or
on behalf of Holders specifically for use therein). The Trust and the Company
agree to notify the Holders to suspend use of the Prospectus, and the Holders
shall suspend use of the Prospectus, and not communicate such material non-
public information to any third party, and not sell or purchase, or offer to
sell or purchase, any securities of the Trust or the Company, until the Trust or
the Company has amended or supplemented the Prospectus so it does not contain
any such misstatement or omission. Subject to Section 2(d) above, at such time
as such public disclosure is otherwise made or the Trust and the Company
determine in good faith that such disclosure is not necessary, the Trust and the
Company agree to notify the Holders of such determination and to amend or
supplement the Prospectus if necessary, so that the Prospectus does not contain
any such untrue statement or omission therein and to furnish the Holders such
numbers of copies of the Prospectus as so amended or supplemented as the Holders
may reasonably request.
(j) Not later than the effective date of any Shelf Registration
Statement hereunder, the Trust and the Company shall provide a CUSIP number for
the Preferred Securities registered under such Shelf Registration Statement. In
the event of and at the time of any distribution of the Debentures to Holders
the Company shall provide a CUSIP number for the Debentures and provide the
applicable trustee with certificates for such Registrable Securities, in a form
eligible for deposit with DTC (to the extent that such Registrable Securities
are so eligible).
(k) The Trust and the Company shall use their reasonable efforts to
comply with all applicable rules and regulations of the Commission and shall
make generally available to their security holders or otherwise provide in
accordance with Section 11(a) of the Securities Act as soon as practicable after
the effective date of the applicable Shelf Registration Statement an earnings
statement satisfying the provisions of Section 11 (a) of the Securities Act.
-7-
(l) The Trust and the Company shall use their reasonable efforts to
cause the Indenture, the Declaration and the Preferred Securities Guarantee
Agreement to be qualified under the Trust Indenture Act in a timely manner.
(m) The Trust and the Company may require each Holder of Registrable
Securities to be sold pursuant to any Shelf Registration Statement to furnish to
the Trust and the Company such information regarding the Holder and the
distribution by such Holder of such Registrable Securities required by law to be
disclosed in the Shelf Registration Statement (the "Requisite Information") or
as the Trust and the Company may otherwise from time to time reasonably require
for inclusion in such Shelf Registration Statement and the Company or the Trust
may exclude from such registration statement such information as to any Holder
that fails to furnish such information within a reasonable time after receiving
such request.
The Company shall file, within five business days of the receipt
of notice from any Holder which includes the Requisite Information with respect
to such Holder, a Prospectus supplement pursuant to Rule 424 to amend or
supplement such Shelf Registration Statement to include in the Shelf
Registration Statement the Requisite Information as to such Holder (and the
Registrable Securities held by such Holder), and the Company shall provide such
Holder within five business days of such notice with a copy of such Prospectus
as so amended or supplemented containing the Requisite Information in order to
permit such Holder to comply with the Prospectus delivery requirements of the
Securities Act in a timely manner with respect to any proposed disposition of
such Holder's Registrable Securities.
No Holder shall be entitled to use the Prospectus unless and
until such Holder shall have furnished the information required by this
Section 3(m).
(n) The Trust and the Company will each use their reasonable efforts
to cause the Preferred Securities and the Common Stock issuable upon conversion
thereof to be listed on the New York Stock Exchange on or prior to the effective
date of any Shelf Registration Statement hereunder.
(o) The Trust and the Company shall use their reasonable efforts to
take all other steps necessary to effect the registration, offering and sale of
the Registrable Securities covered by the Shelf Registration Statement
contemplated hereby pursuant to such Shelf Registration Statement.
4. REGISTRATION EXPENSES. Except as otherwise provided in Section 6
hereof, the Company shall bear all fees and expenses incurred in connection with
the performance of its obligations under Sections 2 and 3 hereof and shall bear
or reimburse the Holders for the reasonable fees and disbursements of one firm
of counsel designated by the Company and reasonably acceptable to the Initial
Purchasers on behalf of the Holders to act as counsel therefor in connection
therewith.
-8-
5. INDEMNIFICATION AND CONTRIBUTION. (a) In connection with any Shelf
Registration Statement, the Company and the Trust, jointly and severally, shall
indemnify and hold harmless the Initial Purchasers, each Holder, each
underwriter who participates in an offering of Registrable Securities, each
person, if any, who controls any of such parties within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act and each of
their respective directors, officers, employees, trustees and agents, as
follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in any Shelf Registration
Statement (or any amendment thereto) covering Registrable Securities, including
all documents incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading or arising out of any untrue statement or alleged
untrue statement of a material fact contained in any Prospectus (or any
amendment or supplement thereto) or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any such alleged untrue
statement or omission, if such settlement is effected with the written consent
of the Company; and
(iii) against any and all expenses whatsoever, as incurred
(including reasonable fees and disbursements of counsel chosen by the Holders,
such Holder or any underwriter (except to the extent otherwise expressly
provided in Section 5(c) hereof)), reasonably incurred in investigating,
preparing or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense is not
paid under subparagraph (i) or (ii) of this Section 5(a);
PROVIDED that this indemnity shall not apply to any loss, liability, claim,
damage or expense to the extent arising out of an untrue statement or omission
or alleged untrue statement or omission (i) made in reliance upon and in
conformity with written information furnished to the Trust or the Company by the
Initial Purchasers through Xxxxxxxxx, Xxxxxxxx & Company, LLC, such Holder or
any underwriter participating in an offering of Registrable Securities in
writing expressly for use in the Shelf Registration Statement (or any amendment
thereto) or any Prospectus (or any amendment or supplement thereto) or
(ii) contained in any preliminary prospectus if the Initial Purchasers, such
Holder or any such underwriter failed to send or deliver a copy of the
Prospectus (or any amendment or supplement thereto) to the Person
-9-
asserting such losses, claims, damages or liabilities on or prior to the
delivery of written confirmation of any sale of securities covered thereby to
such Person in any case where such Prospectus (or any amendment or supplement
thereto) would have cured the defect giving rise to such loss, claim, damage
or liability. Any amounts advanced by the Company to an indemnified party
pursuant to this Section 5 as a result of such losses shall be returned to
the Company if it shall be finally determined by such a court in a judgment
not subject to appeal or final review that such indemnified party was not
entitled to indemnification by the Company.
(b) Each Holder agrees, severally and not jointly, to indemnify and
hold harmless the Trust, the Company, the Initial Purchasers, each underwriter
who participates in an offering of Registrable Securities and the other selling
Holders and each of their respective directors, officers (including each officer
of the Company who signed the Shelf Registration Statement), employees, trustees
and agents and each Person, if any, who controls the Trust, the Company, the
Initial Purchasers, any such underwriter or any other selling Holder within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
from and against any and all loss, liability, claim, damage and expense
whatsoever described in the indemnity contained in Section 5(a) hereof, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Shelf Registration Statement (or any
amendment thereto) or any Prospectus (or any amendment or supplement thereto) in
reliance upon and in conformity with written information furnished to the
Company by such selling Holder expressly for use in the Shelf Registration
Statement (or any amendment thereto) or any Prospectus (or any amendment or
supplement thereto); PROVIDED, HOWEVER, that no such Holder shall be liable for
any claims hereunder in excess of the amount of net proceeds received by such
Holder from the sale of Registrable Securities pursuant to the Shelf
Registration Statement.
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, enclosing a copy of all papers served on such
indemnified party, but failure to so notify an indemnifying party shall not
relieve such indemnifying party from any liability which it may have otherwise
than under this Section 5 unless and to the extent it is not prejudiced as a
proximate result of such failure. An indemnifying party may participate at its
own expense in the defense of any such action. If an indemnifying party so
elects within a reasonable time after receipt of such notice, such indemnifying
party, jointly with any other indemnifying party, may assume the defense of such
action with counsel chosen by it (subject to the approval of the indemnified
parties defendant in such action, which approval shall not be unreasonably
withheld), unless such indemnified party reasonably determines that there may be
legal defenses available to such indemnified party which are different from or
in conflict with those available to such indemnifying party. If an indemnifying
party is not entitled to assume the defense of such action as a result of the
proviso to the preceding sentence, counsel for such indemnifying party shall be
entitled to conduct the defense of such indemnifying party and counsel for each
indemnified party or parties shall be entitled to conduct the defense of such
indemnified party or parties. If an indemnifying party assumes the defense of
an action in accordance with and as permitted by the provisions of this
paragraph, such indemnifying party shall not be liable for any
-10-
fees and expenses of counsel for the indemnified parties incurred thereafter
in connection with such action. In no event shall the indemnifying party or
parties be liable for the fees and expenses of more than one counsel (in
addition to any local counsel) separate from its own counsel for all
indemnified parties in connection with any one action or separate but similar
or related actions in the same jurisdiction arising out of the same general
allegations or circumstances.
(d) In order to provide for just and equitable contribution in
circumstances in which the indemnity provision agreement provided for in this
Section 5 is for any reason held to be unavailable to the indemnified parties
although applicable in accordance with its terms, the Company, the Initial
Purchasers and the Holders shall contribute to the aggregate losses,
liabilities, claims, damages and expenses of the nature contemplated by said
indemnity agreement incurred by the Company, the Initial Purchasers and the
Holders, as incurred; PROVIDED, that 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 that was not guilty of such
fraudulent misrepresentation. As between the Company, the Initial Purchasers
and the Holders, such parties shall contribute to such aggregate losses,
liabilities, claims, damages and expenses of the nature contemplated by such
indemnity agreement in such proportion as shall be appropriate to reflect the
relative fault of the Company, on the one hand, and the Initial Purchasers and
the Holders, on the other hand, with respect to the statements or omissions
which resulted in such loss, liability, claim, damage or expense, or action in
respect thereof, as well as any other relevant equitable considerations. The
relative fault of the Company, on the one hand, and of the Initial Purchasers
and the Holders, on the other hand, shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company, on the one hand, or by or on behalf of the
Initial Purchasers or the Holders, on the other, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company, the Initial Purchasers and the Holders
of the Registrable Securities agree that it would not be just and equitable if
contributions pursuant to this Section 5 were to be determined by pro rata
allocation or by any other method of allocation that does not take into account
the relevant equitable considerations. For purposes of this Section 5(d), each
director, officer, employee, trustee, agent and Person, if any, who controls an
Initial Purchaser or Holder within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act shall have the same rights to contribution
as such Initial Purchaser or Holder, and each director, officer, employee,
trustee and agent of each of the Company and the Trust, and each Person, if any,
who controls the Company or the Trust within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution as the Company or the Trust, as the case may be. No party shall be
liable for contribution with respect to any action, suit, proceeding or claim
settled without its written consent.
6. UNDERWRITTEN OFFERING.
-11-
(a) The Holders of Registrable Securities covered by the Shelf
Registration Statement who desire to do so may sell such Registrable Securities
in an underwritten offering in accordance with the conditions set forth below.
In any such underwritten offering, the investment banker or bankers and manager
or managers that will administer such offering will be selected by, and the
underwriting arrangements with respect thereto will be approved by, the Holders
of a majority of the Registrable Securities to be included in such offering;
PROVIDED, HOWEVER, that (i) such investment bankers and managers and
underwriting arrangements must be reasonably satisfactory to the Company and the
Trust and (ii) subject to Section 6(d) below, neither of the Company nor the
Trust shall be obligated to arrange for more than one underwritten offering
during the Effectiveness Period. No Holder may participate in any underwritten
offering contemplated hereby unless (i) such Holder agrees to sell such Holder's
Registrable Securities in accordance with any approved underwriting
arrangements, (ii) such Holder completes and executes all reasonable
questionnaires, powers of attorney, indemnities, underwriting agreements, lock-
up letters and other documents required under the terms of such approved
underwriting arrangements and (iii) at least 30% of the Registrable Securities
outstanding as of the Closing Time (giving effect to antidilution adjustments,
if applicable) are included in such underwritten offering (including for
purposes of this clause (iii) any Additional Preferred Securities actually
issued and sold under the Purchase Agreement). The Holders participating in any
underwritten offering shall be responsible for any expenses customarily borne by
selling securityholders, including underwriting discounts and commissions, fees
and expenses of counsel to the selling securityholders and transfer taxes, if
any, and shall reimburse the Trust and the Company for the fees and
disbursements of their counsel, their independent public accountants, any
printing expenses incurred in connection with such underwritten offering and any
other reasonable expenses incurred solely in connection therewith.
Notwithstanding the foregoing, upon receipt of a request from the Managing
Underwriter or a representative of Holders of a majority of the Registrable
Securities outstanding to prepare and file an amendment or supplement to the
Shelf Registration Statement and Prospectus in connection with an underwritten
offering, the Company and the Trust may delay the filing of any such amendment
or supplement for up to 90 days if the Company in good faith has a valid
business reason for such delay, which reason shall not be required to be
disclosed if such disclosure would, in the good faith judgment of the Company,
be detrimental to the Company or the Holders, absent confidentiality
arrangements reasonably satisfactory to the Company.
(b) The Trust and the Company shall enter into such customary
agreements (including underwriting agreements in customary form) which are
reasonably acceptable to the Trust and the Company, and take all other
reasonably requested actions in order to expedite or facilitate the registration
or the disposition of the Registrable Securities (subject to the last sentence
of paragraph (a) above), and in connection therewith, if an underwriting
agreement is entered into, cause the same to contain indemnification provisions
and procedures substantially identical to those set forth in Section 5 hereof
(or such other customary provisions and procedures acceptable to the Managing
Underwriters, if any, the Company and the Trust) with respect to all parties to
be indemnified pursuant to Section 5 hereof.
-12-
(c) The Trust and the Company shall (i) make available for inspection
by the Holders of Registrable Securities to be registered thereunder, any
underwriter participating in any disposition pursuant to such Shelf Registration
Statement, and any attorney, accountant or other agent retained by such Holders
or any such underwriter all relevant financial and other records, pertinent
corporate documents and properties of the Trust and the Company and its
subsidiaries; (ii) cause the Regular Trustees and the officers, directors and
employees of the Company to make reasonably available for inspection all other
relevant information reasonably requested by such Holders or any such
underwriter, attorney, accountant or agent in connection with any such Shelf
Registration Statement, in each case as is customary for similar due diligence
examinations; PROVIDED, HOWEVER, that any information that is designated in
writing by the Trust or the Company, in good faith, as confidential at the time
of delivery of such information shall be kept confidential by such Holders or
any such underwriter, attorney, accountant or agent, unless such disclosure is
made in connection with a court proceeding or required by law, or such
information becomes available to the public generally or through a third party
without an accompanying obligation of confidentiality, and PROVIDED further that
the foregoing inspection and information gathering shall, to the greatest extent
possible, be coordinated on behalf of the Holders and the other parties entitled
thereto by one counsel designated by and on behalf of such Holders and other
parties reasonably acceptable to the Company and the Trust; (iii) make such
representations and warranties in the related underwriting agreement to the
Holders of Registrable Securities registered thereunder and the underwriters, if
any, in form, substance and scope as are customarily made in primary
underwritten offerings; (iv) obtain opinions of counsel to the Trust and the
Company and updates thereof (which counsel and opinions (in form, scope and
substance) shall be reasonably satisfactory to the Managing Underwriters, if
any) in customary form addressed to each selling Holder and the underwriters, if
any, covering such matters as are customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably requested by
such Holders and underwriters (it being agreed that the matters to be covered by
such opinion or a written statement by such counsel delivered in connection with
such opinions shall include, without limitation, as of the date of the opinion
and as of the effective date of the Shelf Registration Statement or most recent
post-effective amendment thereto, as the case may be, the absence from such
Shelf Registration Statement and the Prospectus included therein, as then
amended or supplemented, including the documents incorporated by reference
therein, of an untrue statement of a material fact or the omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading); (v) obtain "comfort letters" and updates thereof from the
independent public accountants of the Company (and, if necessary, any other
independent public accountants of any subsidiary of the Company or of any
business acquired by the Company including without limitation for which
financial statements and financial data are, or are required to be, included in
the Shelf Registration Statement, addressed to each such Holder of Registrable
Securities registered thereunder and the underwriters, in customary form and
covering matters of the type customarily covered in comfort letters in
connection with primary underwritten offerings; and (vi) deliver such other
customary documents and certificates as may be reasonably requested by any such
Holders and the Managing Underwriters, if any, including those to evidence
compliance with Section 3(i) and with any customary conditions contained in
-13-
the underwriting agreement or other agreement entered into by the Trust or
the Company. The foregoing actions set forth in clauses (iii), (iv), (v) and
(vi) of this Section 3(c) shall be performed at each closing under any
underwritten offering to the extent required thereunder.
(d) Notwithstanding any other provision of this Section 6, if the
Managing Underwriters advise the Holders in writing that marketing factors
require a limitation on the number of shares to be underwritten, the number of
shares included in the underwriting by each Holder shall be reduced on a pro
rata basis (based on the number of shares originally proposed to be so included
by such Holder) by such minimum number of shares as is necessary to comply with
such request. If any Holder who has requested inclusion in such underwriting as
provided above disapproves of the terms of the underwriting, such Holder may
elect to withdraw therefrom by written notice to the Company and the Managing
Underwriters. In the event that the provisions of this Section 6(d) result in a
reduction of in excess of 33 1/3%, such underwritten offering shall not count
for purposes of the limit on the number of required underwritten offerings set
forth in Section 6(a) above.
7. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS; OTHER REGISTRATION RIGHTS. The
Company shall not enter into any agreement with respect to its securities that
is inconsistent with the rights granted to the Holders in this Agreement or
otherwise conflicts with the provisions hereof. The Company is not currently a
party to any agreement granting any registration rights with respect to any of
its securities to any person which conflicts with the Company's obligations
hereunder or gives any other party the right to include any securities in any
Registration Statement filed pursuant hereto (except in each case, as have been
waived). Without limiting the generality of the foregoing, the Company shall
not grant to any person the right to request it to register any of its
securities under the Securities Act unless the rights so granted are not in
conflict or inconsistent with the provisions of this Agreement. The Company
shall not grant to any of its security holders (other than the Holders in such
capacity) the right to include any of its securities in any Shelf Registration
Statement.
(b) AMENDMENTS AND WAIVERS. The provision of this Agreement,
including the provisions of this sentence, may not be amended, qualified,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given, unless the Trust and the Company have
obtained the written consent of the Initial Purchasers on behalf of the Holders
from time to time.
(c) NOTICES. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail,
telex, telecopier, or air courier guaranteeing overnight delivery:
1. if to a Holder, at the as it appears on the register for
the Preferred Securities, the Debentures or the Common Stock, as applicable
address of such Holder;
-14-
2. if to the Initial Purchasers, initially at the address set
forth in the Purchase Agreement; and
3. if to the Trust or the Company, initially at its address set
forth in the Purchase Agreement.
All such notices and communications shall be deemed to have duly given when
received, if delivered in person or by fax; five days after mailing, if sent by
mail; or the day following transmission, if sent by overnight courier.
The Initial Purchasers, the Trust and the Company by notice to the others
may designate additional or different addresses for subsequent notices or
communications.
(d) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the permitted successors and assigns of each of
the parties and the Holders, including, without the need for an express
assignment or any consent by the Trust or the Company thereto, subsequent
Holders of Registrable Securities. The Trust and the Company hereby agree to
extend the benefits of this Agreement to any Holder of Registrable Securities
and any such Holder may specifically enforce the provisions of this Agreement as
if an original party hereto. In the event of any Fundamental Change (as such
term is defined in the Indenture occurring prior to the end of the Effectiveness
Period, the Company shall require that the Person formed by such consolidation
or resulting from such merger or that acquires the assets or shares of the
Company, as the case may be (and its parent corporation, if appropriate), assume
the obligations under this Agreement and amend this Agreement to provide for
registration of the Preferred Securities, the Debenture and any securities of
such Persons into which the Preferred Securities of Debenture may become
convertible as a result of such transaction or transactions as appropriate to
provide for the continued benefits hereof are thereby made applicable to such
securities.
(e) COUNTERPARTS. This agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(f) HEADINGS. The headings in this agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(g) GOVERNING LAW. This agreement shall be governed by the internal
laws of the State of New York, without regard to principles of conflicts of law.
(h) SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions hereof shall not be in any way
-15-
impaired or affected thereby, it being intended that all of the rights and
privileges of the parties shall be enforceable to the fullest extent
permitted by law.
-16-
Please confirm that the foregoing correctly sets forth the agreement among
the Company, the Trust and you.
Very truly yours,
VANSTAR FINANCING TRUST
By: /s/ XXXX X. XXXXXXX, XX.
----------------------------------
Name: Xxxx X. Xxxxxxx, Xx.
Title: Regular Trustee
VANSTAR CORPORATION
By: /s/ H. XXXXXXXXXXX XXXXXXXXX
----------------------------------
Name: H. Xxxxxxxxxxx Xxxxxxxxx
Title: Senior Vice President, General
Counsel and Secretary
The foregoing Registration Rights Agreement is hereby confirmed and accepted as
of the date first above written.
XXXXXXXXX, XXXXXXXX & COMPANY LLC
ALEX. XXXXX & SONS INCORPORATED
XXXXXXXXX, LUFKIN & XXXXXXXX SECURITIES CORPORATION
THE XXXXXXXX-XXXXXXXX COMPANY, INC.
On their behalf and on behalf of each of the
several Initial Purchasers named in Schedule A hereto.
By XXXXXXXXX, XXXXXXXX & COMPANY LLC
By XXXXXXXXX, XXXXXXXX & COMPANY GROUP, L.L.C.
By /s/ SIGNATURE ILLEGIBLE
----------------------------------
Authorized Signatory
SCHEDULE A
Number of Preferred
Securities to be
Initial Purchaser Purchased
------------------------------------------------------------ -------------------
Xxxxxxxxx, Xxxxxxxx & Company LLC........................... 1,225,000
Alex. Xxxxx & Sons Incorporated............................. 875,000
Xxxxxxxxx, Lufkin & Xxxxxxxx Securities Corporation......... 875,000
The Xxxxxxxx-Xxxxxxxx Company, Inc. ........................ 525,000
---------
Total................................................. 3,500,000
---------
---------
