REGISTRATION RIGHTS AGREEMENT
Exhibit 10.4
[Execution Copy]
[Execution Copy]
This REGISTRATION RIGHTS AGREEMENT, dated as of September 12, 2007 (the “Agreement”), is
entered into by and between NavSite, Inc., a Delaware corporation (including any successor thereto,
whether by merger, consolidation, conversion or otherwise, the “Company”) and GTCR Fund VI, L.P.
(the “Representative”) as representative of the Purchasers (as defined below).
WHEREAS, the Company, NSite Acquisition Corp., a Delaware corporation and wholly owned
subsidiary of the Company, netASPx, Inc., a Delaware corporation (“netASPx”) and the
Representative, solely in its capacity as Representative thereunder have entered into that certain
Agreement and Plan of Merger (the “Merger Agreement”), dated as of September 12, 2007;
WHEREAS, pursuant to the Merger Agreement, the Representative has been appointed by the
Purchasers as agent for, and to act on behalf of, the Purchasers in connection with, among other
things, the Purchasers’ rights under this Agreement;
WHEREAS, the Purchasers have the right to acquire shares of common stock, par value $0.01 per
share, of the Company (“Common Stock”) upon conversion of shares of Preferred Stock (as hereinafter
defined) of the Company, purchased pursuant to the Merger Agreement; and
WHEREAS, the Company and the Representative (on behalf of the Purchasers) deem it to be in
their respective best interests to set forth their rights in connection with public offerings and
sales of shares of Common Stock and are entering into this Agreement as a condition to and in
connection with netASPx and the Representative entering into the Merger Agreement.
NOW, THEREFORE, in consideration of the premises and mutual covenants and obligations
hereinafter set forth, the Company and the Representative hereby agree as follows:
Section 1. Certain Definitions. For purposes of this Agreement, the following
terms shall have the following respective meanings:
“Commission” means the United States Securities and Exchange Commission, or any other federal
agency at the time administering the Exchange Act or the Securities Act, whichever is the relevant
statute for the particular purpose.
“Effective Time” means the time and date as of which the Commission declares the Shelf
Registration Statement effective or as of which the Shelf Registration Statement otherwise becomes
effective.
“Exchange Act” means the Securities Exchange Act of 1934, or any successor thereto, as the
same shall be amended from time to time.
The term “holder” means each of the Purchasers and other persons who acquire Registrable
Securities from time to time (including any successors or assigns), in each case for so long as
such person owns any Registrable Securities.
The term “person” means a corporation, association, partnership, organization, limited
liability company, limited partnership, limited liability partnership, or other similar entity,
individual, government or political subdivision thereof or governmental agency.
“Purchasers” means the Company Stockholders, as such term is defined in the Merger Agreement.
“Preferred Stock” means the Company’s Series A Convertible Preferred Stock, par value $0.01
per share.
“Registrable Securities” means the Securities; provided, however, that a Security shall cease
to be a Registrable Security upon the earliest to occur of the following: (i) a Shelf Registration
Statement registering such Security under the Securities Act has been declared or becomes effective
and such Security has been sold or otherwise transferred by the holder thereof pursuant to and in a
manner contemplated by such effective Shelf Registration Statement; (ii) such Security is sold
pursuant to Rule 144 under circumstances in which any legend borne by such Security relating to
restrictions on transferability thereof, under the Securities Act or otherwise, is removed by the
Company; (iii) such Security is eligible to be sold pursuant to paragraph (k) of Rule 144; or (iv)
such Security shall cease to be outstanding.
“Registration Expenses” shall have the meaning assigned thereto in Section 4 hereof.
“Rule 144,” “Rule 145,” “Rule 405” and “Rule 415” mean, in each case, such rule promulgated
under the Securities Act (or any successor provision), as the same shall be amended from time to
time.
“Securities” means (i) the shares of Preferred Stock issued to the Purchasers pursuant to the
Merger Agreement and (ii) the shares of Common Stock of the Company issued or issuable upon
conversion of the shares of Preferred Stock issued to the Purchasers pursuant to the Merger
Agreement, and (iii) any other capital stock of the Company into which such shares of Preferred
Stock or Common Stock may be converted or which is issued or issuable upon conversion of such
shares of Preferred Stock, in each case as a result of any stock split, stock dividend,
recapitalization, exchange or similar event.
“Securities Act” means the Securities Act of 1933, or any successor thereto, as the same shall
be amended from time to time.
“Shelf Registration” shall have the meaning assigned thereto in Section 2(a) hereof.
“Shelf Registration Statement” shall have the meaning assigned thereto in Section 2(a) hereof.
Unless the context otherwise requires, any reference herein to a “Section” or “clause” refers
to a Section or clause, as the case may be, of this Agreement, and the words “herein,” “hereof” and
“hereunder” and other words of similar import refer to this Agreement as a whole
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and not to any particular Section or other subdivision. Capitalized terms used herein but not defined herein shall
have the meaning assigned to such terms in the Merger Agreement.
Section 2. Registration Under the Securities Act .
(a) The Company shall file under the Securities Act, as soon as reasonably practicable but
in no event later than November 30, 2007, a “shelf” registration statement providing for the
registration of, and the sale on a continuous or delayed basis by the holders of, all of the
Registrable Securities, pursuant to Rule 415 or any similar rule that may be adopted by the
Commission (such filing, the “Shelf Registration” and such registration statement, the “Shelf
Registration Statement”). The Company agrees to use its reasonable best efforts (x) to cause the
Shelf Registration Statement to become or be declared effective as soon as reasonably practicable
after such filing, but in no event later than January 31, 2008, and subject to Section 3(d), to
keep such Shelf Registration Statement continuously effective until such time as there are no
longer any Registrable Securities outstanding, and (y) after the Effective Time of the Shelf
Registration Statement, promptly upon the request of any holder of Registrable Securities, to take
any action reasonably necessary to enable such holder to use the prospectus forming a part thereof
for resales of Registrable Securities, including, without limitation, any action necessary to
identify such holder as a selling securityholder in the Shelf Registration Statement. The Company
further agrees to supplement or make amendments to the Shelf Registration Statement, including
without limitation, any post effective amendments, as and when required by the rules, regulations
or instructions applicable to the registration form used by the Company for such Shelf Registration
Statement or by the Securities Act or rules and regulations thereunder for shelf registration. To
the extent the Company is required to file a prospectus under Rule 424(b) of the Securities Act, it
shall file such prospectus on the third business day following the Effective Time. In the event
that the Company and the Representative agree that it would be advisable to delay the registration
of a portion of the Securities, the Company shall file a subsequent Shelf Registration Statement
covering such portion of the Securities at a time which shall be mutually agreed by the Company and
the Representative. Such Shelf Registration Statement shall be subject to all of the terms and
provisions of this Agreement, except for the initial filing deadline described above.
(b) The Company shall use all reasonable best efforts to take all actions necessary or
advisable to be taken by it to ensure that the transactions contemplated herein are effected as so
contemplated in Section 2(a) hereof, and to submit to the Commission, within two business days
after the Company learns that no review of the Shelf Registration Statement will be made by the
staff of the Commission or that the staff has no further comments on the Shelf Registration
Statement, as the case may be, a request for acceleration of effectiveness (or post effective
amendment, if applicable) of the Shelf Registration Statement to a time and date not later than 48
hours after the submission of such request.
(c) If (but without any obligation to do so) the Company proposes to register (including for
this purpose a registration effected by the Company for stockholders of the Company other than the holders) any of its stock or other securities under the Securities Act
in connection with the public offering of such securities (other than a registration relating
solely to the sale of securities to participants in a Company stock plan, a registration relating
to a
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corporate reorganization or other transaction under Rule 145, or a registration in which the
only Common Stock being registered is Common Stock issuable upon conversion of debt securities that
are also being registered), the Company shall, at such time, promptly give each holder written
notice of such registration. Upon the written request of each holder given within twenty (20) days
after mailing of such notice by the Company, the Company shall use its best efforts to cause to be
registered under the Securities Act all of the Registrable Securities that each such holder has
requested to be registered. The Company shall have the right to terminate or withdraw any
registration initiated by it under this Section 2(c) prior to the effectiveness of such
registration whether or not any holder has elected to include securities in such registration. The
expenses of such withdrawn registration shall be borne by the Company in accordance with Section 4
hereof.
(d) Any reference herein to a registration statement or prospectus as of any time shall be
deemed to include any document incorporated, or deemed to be incorporated, therein by reference as
of such time and any reference herein to any post-effective amendment to a registration statement
as of any time shall be deemed to include any document incorporated, or deemed to be incorporated,
therein by reference as of such time. Any reference to a prospectus as of any time shall include
any supplement thereto, preliminary prospectus, or any free writing prospectus in respect thereof.
Section 3. Registration Procedures.
The following provisions shall apply to the filing of the Shelf Registration Statement:
(a) The Company shall:
(i) prepare and file with the Commission, as soon as practicable but in any case within the
time period specified in Section 2(a), a Shelf Registration Statement on any form which may then be
utilized by the Company and which shall register all of the Registrable Securities for resale by
the holders thereof in accordance with such method or methods of disposition as may be specified by
the holders and use all reasonable best efforts to cause such Shelf Registration Statement to
become effective as soon as practicable but in any case within the time periods specified in
Section 2(a);
(ii) as soon as practicable prepare and file with the Commission such amendments and
supplements to such Shelf Registration Statement (including without limitation, any required post
effective amendments) and the prospectus included therein as may be necessary to effect and
maintain the effectiveness of such Shelf Registration Statement for the period specified in Section
2(a) hereof and as may be required by the applicable rules and regulations of the Commission and
the instructions applicable to the form of such Shelf Registration Statement, including without
limitation, to include any holder to be named as a selling security holder therein;
(iii) comply with the provisions of the Securities Act with respect to the disposition of
all of the Registrable Securities covered by such Shelf Registration Statement in accordance with
the intended methods of disposition by the holders provided for in such Shelf Registration
Statement;
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(iv) provide the Representative and its counsel the opportunity to participate in the
preparation of such Shelf Registration Statement, each prospectus included therein or filed with
the Commission and each amendment or supplement thereto, in each case by providing drafts and
otherwise, subject to customary confidentiality restrictions;
(v) for a reasonable period prior to the filing of such Shelf Registration Statement, and
throughout the period specified in Section 2(a), make available at reasonable times at the
Company’s principal place of business or such other reasonable place for inspection by the persons
referred to in Section 3(a)(iv) such financial and other information and books and records of the
Company, and cause the officers, employees, counsel and independent certified public accountants of
the Company to be available to respond to such inquiries, as shall be reasonably necessary, in the
judgment of the counsel referred to in such Section, to conduct a reasonable investigation within
the meaning of Section 11 of the Securities Act, and in connection therewith, the Company shall use
its reasonable best efforts to cooperate with such persons in obtaining from the Company’s
independent auditors, and counsel to the Company, such comfort letters and opinions and statements
as shall be appropriate to be delivered to and for the benefit of any such person in the relevant
circumstances, and the Company shall pay any fees and expenses of its independent certified public
accountants and counsel in connection therewith;
(vi) promptly notify each of the holders, and if requested by any such holder, confirm such
advice in writing, (A) when such Shelf Registration Statement or the prospectus included therein or
any prospectus amendment or supplement or post-effective amendment has been filed, and, with
respect to such Shelf Registration Statement or any post-effective amendment, when the same has
become effective, (B) of any comments by the Commission and by the blue sky or securities
commissioner or regulator of any state with respect thereto or any request by the Commission for
amendments or supplements to such Shelf Registration Statement or prospectus or for additional
information, (C) of the issuance by the Commission of any stop order suspending the effectiveness
of such Shelf Registration Statement or the initiation or threatening of any proceedings for that
purpose, (D) if at any time the representations and warranties of the Company contemplated by
Section 5 cease to be true and correct in all material respects, (E) of the receipt by the Company
of any notification with respect to the suspension of the qualification of the Registrable
Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such
purpose, or (F) that such Shelf Registration Statement, prospectus, prospectus amendment or
supplement or post-effective amendment does not conform in all material respects to the applicable
requirements of the Securities Act and the rules and regulations of the Commission thereunder or
contains an untrue statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading in light of the
circumstances then existing;
(vii) use all reasonable best efforts to obtain the withdrawal of any order suspending the
effectiveness of such registration statement or any post-effective amendment thereto at the
earliest practicable date;
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(viii) if requested by any holder, promptly incorporate in a prospectus supplement or
post-effective amendment such information as is required by the applicable rules and regulations of
the Commission and as such holder specifies should be included therein relating to the terms of the
sale of such Registrable Securities, including information with respect to the amount of
Registrable Securities being sold by such holder, the name and description of such holder the
offering price of such Registrable Securities and any compensation payable in respect thereof, and
make all required filings of such prospectus supplement or post-effective amendment promptly after
notification of the matters to be incorporated in such prospectus supplement or post-effective
amendment;
(ix) furnish to each holder and the respective counsel referred to in Section 3(a)(iv) a
conformed copy of such Shelf Registration Statement, each such amendment and supplement thereto (in
each case including all exhibits thereto and documents incorporated by reference therein) and such
number of copies of such Shelf Registration Statement (excluding exhibits thereto and documents
incorporated by reference therein unless specifically so requested by such holder) and of the
prospectus included in such Shelf Registration Statement, in conformity in all material respects
with the applicable requirements of the Securities Act and the rules and regulations of the
Commission thereunder, and such other documents, as such holder may reasonably request in order to
facilitate the offering and disposition of the Registrable Securities owned by such holder and to
permit such holder to satisfy the prospectus delivery requirements of the Securities Act; and
subject to Section 3(b) below, the Company hereby consents to the use of such prospectus and any
amendment or supplement thereto by each such holder, in each case in the form most recently
provided to such person by the Company, in connection with the offering and sale of the Registrable
Securities covered by the prospectus or any supplement or amendment thereto;
(x) use all reasonable best efforts to (A) register or qualify the Registrable Securities
to be included in such Shelf Registration Statement under such securities laws or blue sky laws of
such jurisdictions as any holder thereof shall reasonably request, (B) keep such registrations or
qualifications in effect and comply with such laws so as to permit the continuance of offers, sales
and dealings therein in such jurisdictions during the period the Shelf Registration is required to
remain effective under Section 2(b) above and for so long as may be necessary to enable any such
holder to complete its distribution of Securities pursuant to such Shelf Registration Statement and
(C) take any and all other actions as may be reasonably necessary to enable each such holder to
consummate the disposition in such jurisdictions of such Registrable Securities; provided, however,
that the Company shall not be required for any such purpose to (1) qualify as a foreign corporation
in any jurisdiction wherein it would not otherwise be required to qualify but for the requirements
of this Section 3(a)(x), or (2) consent to general service of process in any such jurisdiction or
become subject to taxation in any such jurisdiction unless already subject to service of process or
taxation in such jurisdiction and unless required by law;
(xi) use all reasonable best efforts to obtain the consent or approval of each governmental
agency or authority, whether federal, state or local, which may be required to effect the Shelf
Registration or the offering or sale in connection therewith or to enable the
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selling holder or holders to offer, or to consummate the disposition of, their Registrable Securities;
(xii) unless any Registrable Securities shall be in book-entry only form, cooperate with
the holders to facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold, which certificates, if so required by any securities exchange
upon which any Registrable Securities are listed, shall be penned, lithographed or engraved, or
produced by any combination of such methods, on steel engraved borders, and which certificates
shall not bear any restrictive legends;
(xiii) notify in writing each holder of Registrable Securities of any proposal by the
Company to amend or waive any provision of this Agreement pursuant to Section 8(i) hereof and of
any amendment or waiver effected pursuant thereto, each of which notices shall contain the text of
the amendment or waiver proposed or effected, as the case may be; and
(xiv) comply with all applicable rules and regulations of the Commission, and make
generally available to its securityholders as soon as practicable but in any event not later than
eighteen months after the effective date of such Shelf Registration Statement, an earning statement
of the Company and its subsidiaries complying with Section 11(a) of the Securities Act (including,
at the option of the Company, Rule 158 thereunder).
(b) In the event that the Company would be required, pursuant to Section 3(a)(vi)(F) above,
to notify the holders of the matter described therein, the Company shall promptly prepare and
furnish to each of the holders a reasonable number of copies of a prospectus supplemented or
amended so that, as thereafter delivered to purchasers of Registrable Securities, such prospectus
shall conform in all material respects to the applicable requirements of the Securities Act and the
rules and regulations of the Commission thereunder and shall not 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 in light of the circumstances then existing. Each holder
agrees that upon receipt of any notice from the Company pursuant to Section 3(a)(vi)(F) hereof,
such holder shall forthwith discontinue the disposition of Registrable Securities pursuant to the
Shelf Registration Statement applicable to such Registrable Securities until such holder shall have
received copies of such amended or supplemented prospectus, and if so directed by the Company, such
holder shall deliver to the Company (at the Company’s expense) all copies, other than permanent
file copies, then in such holder’s possession of the prospectus covering such Registrable
Securities at the time of receipt of such notice.
(c) The Company may require such holder to furnish to the Company such information regarding
such holder, the Registrable Securities held by it, and such holder’s intended method of
distribution of Registrable Securities as may reasonably be required in order to comply with the
Securities Act. Each such holder agrees to notify the Company as promptly as practicable of any
inaccuracy or change in information previously furnished by such holder to
the Company or of the occurrence of any event in either case as a result of which any
prospectus relating to such Shelf Registration contains or would contain an untrue statement of a
material fact regarding such holder or such holder’s intended method of disposition of such
Registrable
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Securities or omits to state any material fact regarding such holder or such holder’s
intended method of disposition of such Registrable Securities required to be stated therein or
necessary to make the statements therein not misleading in light of the circumstances then
existing, and promptly to furnish to the Company any additional information required to correct and
update any previously furnished information or required so that such prospectus shall not contain,
with respect to such holder or the disposition of such Registrable Securities, 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 in light of the circumstances then existing.
(d) Notwithstanding any other provision of this Agreement, if after January 31, 2008 the
Company shall furnish to the holders a certificate signed by the Chief Executive Officer, the
Chairman of the Board, the Chief Financial Officer or the General Counsel of the Company stating
that in the good faith judgment of the Board of Directors of the Company, it would be seriously
detrimental to the Company and its stockholders for the Shelf Registration to be effected at such
time, in which event the Company shall have the right to defer the filing of the Shelf Registration
Statement for a period of not more than forty-five (45) days (any such period, a “Suspension
Period”), provided, however, that the Company shall not utilize this right more than two times in
any twelve (12) month period and provided further, that the Company shall not register any other of
its shares during any Suspension Period.
(e) The Company shall provide to each affected holder any comments or notifications of the
Commission or any other applicable regulatory authority that bears on the status of or disclosure
with respect to any such holder, or if applicable, the holders as a class, and in the event
requested by any holder, withdraw information relating to such holder as a selling shareholder from
such Shelf Registration Statement and any other related offering materials. In the event such
holder withdraws from such Shelf Registration Statement, such holder shall be eligible to
participate in any subsequent Shelf Registration Statement filed by the Company as contemplated by
Section 2(a), and the Company shall have no liability relating to the decision of such holder to
withdraw from such Shelf Registration Statement and shall not be deemed to have defaulted in its
obligations under this Agreement in any respect.
(f) The Company shall as expeditiously as possible: (i) secure designation and quotation of
all of the Registrable Securities covered by a Registration Statement on The NASDAQ Capital Market
and (ii) provide a transfer agent and registrar for all Registrable Securities registered pursuant
hereto and a CUSIP number for all such Registrable Securities, in each case not later than the
effective date of such registration.
Section 4. Registration Expenses.
The Company agrees to bear and to pay or cause to be paid promptly all expenses incident to
the Company’s performance of or compliance with this Agreement, including (a) all Commission and
any NASD registration, filing and review fees and expenses (b) all fees and expenses in connection
with the qualification of the Securities for offering and sale under the State securities and blue
sky laws referred to in Section 3(a)(x) hereof and determination of their eligibility for investment under the laws of such jurisdictions as or the holders may
designate, (c) all expenses relating to the preparation, printing, production, distribution and
reproduction of each registration statement required to be filed hereunder, each prospectus
included therein or
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prepared for distribution pursuant hereto, each amendment or supplement to the
foregoing, the expenses of preparing the Securities for delivery and the expenses of printing or
producing blue sky memoranda and all other documents in connection with the offering, sale or
delivery of Securities to be disposed of (including certificates representing the Securities), (d)
messenger, telephone and delivery expenses relating to the offering, sale or delivery of Securities
and the preparation of documents referred in clause (c) above, (e) internal expenses (including all
salaries and expenses of the Company’s officers and employees performing legal or accounting
duties), (f) fees, disbursements and expenses of counsel and independent certified public
accountants of the Company (including the expenses of any opinions or “cold comfort” letters
required by or incident to such performance and compliance), (g) reasonable fees, disbursements and
expenses of one counsel for the holders retained in connection with a Shelf Registration, as
selected by the holders of at least a majority in aggregate principal amount of the Registrable
Securities held by holders (which counsel shall be reasonably satisfactory to the Company) in an
amount not to exceed $10,000, and (h) fees, expenses and disbursements of any other persons,
including special experts, retained by the Company in connection with such registration
(collectively, the “Registration Expenses”). To the extent that any Registration Expenses are
incurred, assumed or paid by any holder of Registrable Securities or any placement or sales agent
therefor or underwriter thereof, the Company shall reimburse such person for the full amount of the
Registration Expenses so incurred, assumed or paid promptly after receipt of a request therefor.
Notwithstanding the foregoing, the holders of the Registrable Securities being registered shall pay
all agency fees and commissions and underwriting discounts and commissions attributable to the sale
of such Registrable Securities and the fees and disbursements of any counsel or other advisors or
experts retained by such holders (severally or jointly), other than the counsel and experts
specifically referred to above.
Section 5. Representations and Warranties.
The Company represents and warrants to, and agrees with, each Purchaser and each of the
holders from time to time of Registrable Securities that:
(a) Each registration statement covering Registrable Securities and each prospectus
(including any preliminary or summary prospectus) contained therein or furnished pursuant to
Section 3(c) or Section 3(d) hereof and any further amendments or supplements to any such
registration statement or prospectus, when it becomes effective or is filed with the Commission, as
the case may be, will conform in all material respects to the requirements of the Securities Act
and the rules and regulations of the Commission thereunder and will not 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 at all times subsequent to the Effective Time when
a prospectus would be required to be delivered under the Securities Act, other than from (i) such
time as a notice has been given to holders of Registrable Securities pursuant to Section
3(a)(vi)(F) hereof until (ii) such time as the Company furnishes an amended or supplemented
prospectus pursuant to Section 3(b) hereof, each such registration statement, and each prospectus
contained therein or furnished pursuant to Section 3(a) hereof, as then
amended or supplemented, will conform in all material respects to the requirements of the
Securities Act and the rules and regulations of the Commission thereunder and will not contain an
untrue statement of a material fact or omit to state a material fact required to be stated therein
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or necessary to make the statements therein not misleading in the light of the circumstances then
existing; provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with information furnished in
writing to the Company by a holder of Registrable Securities expressly for use therein.
(b) Any documents incorporated by reference in any prospectus referred to in Section 5(a)
hereof, when they become or became effective or are or were filed with the Commission, as the case
may be, will conform or conformed in all material respects to the requirements of the Securities
Act or the Exchange Act, as applicable, and none of such documents will contain or contained an
untrue statement of a material fact or will omit or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading; provided, however, that
this representation and warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company by a holder of
Registrable Securities expressly for use therein.
(c) The compliance by the Company with all of the provisions of this Agreement and the
consummation of the transactions herein contemplated will not (i) conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the
Company or any subsidiary is a party or by which the Company or any subsidiary is bound or to which
any of the property or assets of the Company or any Subsidiary is subject, (ii) result in any
violation of the provisions of the certificate of incorporation or organization or the by-laws or
other governing documents, as applicable, of the Company or (iii) result in any violation of any
statute or any order, rule or regulation of any court or governmental agency or body having
jurisdiction over the Company or any subsidiary or any of their properties except, in the case of
clauses (i) and (iii), for such conflicts, breaches, violations or defaults as would not
individually, or in the aggregate, have a material adverse effect on the consolidated financial
position, stockholders’ equity or results of operations of the Company and its subsidiaries, taken
as a whole; and no consent, approval, authorization, order, registration or qualification of or
with any such court or governmental agency or body is required for the consummation by the Company
of the transactions contemplated by this Agreement, except (i) the registration under the
Securities Act of the Securities, (ii) such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or blue sky laws in connection with the
offering and distribution of the Securities, (iii) the filing of a notification form with the
Nasdaq Capital Market within five days after the Closing Date (as defined in the Merger Agreement),
(iv) such additional post-Closing filings as may be required to comply with applicable state and
federal securities laws and the listing requirements of the Nasdaq Capital Market and (v) such
consents, approvals, authorizations, registrations or qualifications that have been obtained and
are in full force and effect as of the date hereof.
(d) This Agreement has been duly authorized, executed and delivered by the Company.
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Section 6. Indemnification.
(a) Indemnification by the Company. The Company will indemnify and hold harmless each of
the holders of Registrable Securities included in a Shelf Registration Statement and the directors,
officers, members, partners, employees, agents and representatives thereof, and each other person,
if any, who controls such holder within the meaning of the Securities Act (the “Holder
Indemnitees”) against any losses, claims, damages or liabilities, joint or several, incurred in
investigating, preparing or defending any action, claim, suit, inquiry, proceeding, investigation
or appeal taken from the foregoing by or before any court or governmental, administrative or other
regulatory agency, body or the Commission, whether pending or threatened, whether or not an
indemnified party is or may be a party thereto, to which such person may become subject under the
Securities Act, the Exchange Act or any other law, including without limitation, any state
securities law, or any rule or regulation thereunder relating to the offer or sale of the
Registrable Securities pursuant to a Shelf Registration Statement, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue
statement or alleged untrue statement of a material fact contained in any Shelf Registration
Statement under which such Registrable Securities were registered under the Securities Act, or any
preliminary, final or free writing prospectus contained therein or furnished by the Company to any
such holder or any amendment or supplement thereto, or arise out of or are based upon 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 any other violation or alleged violation by the
Company of the Securities Act, the Exchange Act, any state securities law, or any rule or
regulation promulgated thereunder, in connection with any matter relating to the Shelf Registration
or the Shelf Registration Statement, and will reimburse such holder, such holder for any legal or
other expenses reasonably incurred by them in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that the Company shall not be
liable to any such person in any such case to the extent that any such loss, claim, damage or
liability (x) arises out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made in such registration statement, or preliminary, final or free
writing prospectus, or amendment or supplement thereto, in reliance upon and in conformity with
written information furnished to the Company by any such person expressly for use therein, or (y)
arises from such person’s use of the Shelf Registration Statement or prospectus or any amendments
or supplements thereto during a Suspension Period.
(b) Indemnification by the Holders. Each holder agrees, severally and not jointly, to (i)
indemnify and hold harmless the Company and all other Holders Indemnitees against any losses,
claims, damages or liabilities to which the Company or such other persons may become subject, under
the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement
of a material fact contained in such registration statement, or any preliminary, final or free
writing prospectus contained therein or furnished by the Company to any such holder, or any
amendment or supplement thereto, or arise out of or are based upon 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, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written information furnished to
the Company by such holder expressly for use therein, and (ii) reimburse the Company for any legal
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or other expenses reasonably incurred by the Company in connection with investigating or defending
any such action or claim as such expenses are incurred; provided, however, that no such holder
shall be required to undertake liability to any person under this Section 6(b) for any amounts in
excess of the dollar amount of the net proceeds to be received by such holder from the sale of such
holder’s Registrable Securities pursuant to such registration.
(c) Notices of Claims, Etc. Promptly after receipt by an indemnified party under subsection
(a) or (b) above of written notice of the commencement of any action, such indemnified party shall,
if a claim in respect thereof is to be made against an indemnifying party pursuant to the
indemnification provisions of or contemplated by this Section 6, notify such indemnifying party in
writing of the commencement of such action; but the omission so to notify the indemnifying party
shall not relieve it from any liability which it may have to any indemnified party otherwise than
under the indemnification provisions of or contemplated by Section 6(a) or 6(b) hereof to the
extent the indemnifying party is not materially prejudiced by such omission. In case any such
action shall be brought against any indemnified party and it shall notify an indemnifying party of
the commencement thereof, such indemnifying party shall be entitled to participate therein and, to
the extent that it shall wish, jointly with any other indemnifying party similarly notified, to
assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be counsel to the indemnifying party),
and, after notice from the indemnifying party to such indemnified party of its election so to
assume the defense thereof, such indemnifying party shall not be liable to such indemnified party
for any legal expenses of other counsel or any other expenses, in each case subsequently incurred
by such indemnified party, in connection with the defense thereof other than reasonable costs of
investigation; provided, however, that such indemnified party shall have the right
to retain its own counsel with the fees and expenses of not more than one counsel for such
indemnified party to be paid by the Company, if, in the reasonable opinion of such indemnified
party the representation by such counsel of such indemnified party and the Company would be
inappropriate due to actual or potential differing interests between such indemnified party and any
other party represented by such counsel in such proceeding, and provided, further,
that the indemnifying party shall not be required to pay for more than one such separate counsel
for all similarly situated indemnified parties in connection with any indemnification claim. No
indemnifying party shall, without the written consent of the indemnified party, effect the
settlement or compromise of, or consent to the entry of any judgment with respect to, any pending
or threatened action or claim in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified party is an actual or potential party to such action or
claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the
indemnified party from all liability arising out of such action or claim and (ii) does not include
a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
(d) Contribution. If for any reason the indemnification provisions contemplated by Section
6(a) or Section 6(b) are unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, claims, damages or liabilities (or actions in respect thereof)
referred to therein, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages or liabilities (or
actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of
the
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indemnifying party and the indemnified party in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as
well as any other relevant equitable considerations. The relative fault of such indemnifying party
and indemnified party shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or omission or alleged omission to state a material
fact relates to information supplied by such indemnifying party or by such indemnified party, and
the parties’ relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The parties hereto agree that it would not be just and
equitable if contributions pursuant to this Section 6(d) were determined by pro rata allocation
(even if the holders were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred to in this Section
6(d). The amount paid or payable by an indemnified party as a result of the losses, claims,
damages, or liabilities (or actions in respect thereof) referred to above shall be deemed to
include any legal or other fees or expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim. Notwithstanding the provisions
of this Section 6(d), no holder shall be required to contribute any amount in excess of the amount
by which the dollar amount of the proceeds received by such holder from the sale of any Registrable
Securities (after deducting any fees, discounts and commissions applicable thereto) exceeds the
amount of any damages which such holder has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged 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. The holders’
obligations in this Section 6(d) to contribute shall be several in proportion to the principal
amount of Registrable Securities registered by them and not joint.
(e) The obligations of the Company under this Section 6 shall be in addition to any
liability which the Company may otherwise have and shall extend, upon the same terms and
conditions, to each officer, director and partner of each holder and each person, if any, who
controls any holder within the meaning of the Securities Act; and the obligations of the holders
contemplated by this Section 6 shall be in addition to any liability which the respective holder
may otherwise have and shall extend, upon the same terms and conditions, to each officer and
director of the Company (including any person who, with his consent, is named in any registration
statement as about to become a director of the Company) and to each person, if any, who controls
the Company within the meaning of the Securities Act.
Section 7. Rule 144.
The Company covenants to the holders of Registrable Securities that to the extent it shall be
required to do so under the Exchange Act, the Company shall timely file the reports required to be
filed by it under the Exchange Act or the Securities Act (including the reports under Section 13
and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144) and the rules and
regulations adopted by the Commission thereunder, and shall take such further action
as any holder of Registrable Securities may reasonably request, all to the extent required
from time to time to enable such holder to sell Registrable Securities without registration under
the Securities Act within the limitations of the exemption provided by Rule 144, as such Rule may
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be amended from time to time, or any similar or successor rule or regulation hereafter adopted by
the Commission. Upon the request of any holder of Registrable Securities in connection with that
holder’s sale pursuant to Rule 144, the Company shall deliver to such holder a written statement as
to whether it has complied with such requirements.
Section 8. Miscellaneous.
(a) No Inconsistent Agreements . The Company represents, warrants, covenants and agrees
that it has not granted, and shall not grant, registration rights with respect to Registrable
Securities or any other securities which would be inconsistent with the terms contained in this
Agreement.
(b) Specific Performance. The parties hereto acknowledge that there would be no adequate
remedy at law if the Company fails to perform any of its obligations hereunder and that the
Purchasers and the holders from time to time of the Registrable Securities may be irreparably
harmed by any such failure, and accordingly agree that the Purchasers and such holders, in addition
to any other remedy to which they may be entitled at law or in equity, shall be entitled to compel
specific performance of the obligations of the Company under this Agreement in accordance with the
terms and conditions of this Agreement, in any court of the United States or any State thereof
having jurisdiction.
(c) Notices. All notices, requests, claims, demands, waivers and other communications hereunder
shall be in writing and shall be deemed to have been duly given when delivered by hand, if
delivered personally, by facsimile or by courier, or three days after being deposited in the mail
(registered or certified mail, postage prepaid, return receipt requested) as follows: If to the
Company, to it at 000 Xxxxxxxxx Xxxx, Xxxxxxx, XX 00000, Attention: Xxxxx X. Xxxxxxx, Facsimile:
(000) 000-0000 with a copy to BRL Law Group LLC, 00 Xx. Xxxxx Xxxxxx, Xxxxx 000, Xxxxxx, XX 00000,
Attention: Xxxxxx X. Rosedale, Esq., Facsimile: (000) 000-0000, if to the Representative, to it at
c/o GTCR Xxxxxx Xxxxxx, LLC, 0000 Xxxxx Xxxxx, Xxxxxxx, Xxxxxxxx 00000, Attention: Xxxxxx X.
Xxxxxxxx, Facsimile: (000) 000-0000, and if to a holder, to the address of such holder set forth in
the security register or other records of the Company, or to such other address as the Company or
any such holder may have furnished to the other in writing in accordance herewith, except that
notices of change of address shall be effective only upon receipt.
(d) Parties in Interest. All the terms and provisions of this Agreement shall be binding
upon, shall inure to the benefit of and shall be enforceable by the parties hereto, the Purchasers
and the holders from time to time of the Registrable Securities and the respective successors and
assigns of the parties hereto and such holders. In the event that any transferee of any holder of
Registrable Securities shall acquire Registrable Securities, in any manner, whether by gift,
bequest, purchase, operation of law or otherwise, such transferee shall, without any further
writing or action of any kind, be deemed a beneficiary hereof for all purposes and such Registrable
Securities shall be held subject to all of the terms of this Agreement, and by taking
and holding such Registrable Securities such transferee shall be entitled to receive the
benefits of, and be conclusively deemed to have agreed to be bound by all of the applicable terms
and provisions of, this Agreement.
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(e) Survival. The respective indemnities, agreements, representations, warranties and each
other provision set forth in this Agreement or made pursuant hereto shall remain in full force and
effect regardless of any investigation (or statement as to the results thereof) made by or on
behalf of any holder of Registrable Securities, any director, officer or partner of such holder or
any director, officer or partner thereof, or any controlling person of any of the foregoing, and
shall survive delivery of and payment for the Registrable Securities pursuant to the Merger
Agreement and the transfer and registration of Registrable Securities by such holder and the
consummation of the transactions contemplated herein.
(f) Governing Law . This Agreement shall be governed by and construed in accordance with
the laws of the State of Delaware.
(g) EACH PARTY HERETO IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO SUBMIT TO THE EXCLUSIVE
JURISDICTION OF COURTS OF UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE, OR THE STATE
OF DELAWARE, AND ANY APPELLATE COURT THEREFROM, FOR THE RESOLUTION OF ANY AND ALL DISPUTES,
CONTROVERSIES, CONFLICTS, LITIGATION OR ACTIONS ARISING OUT OF OR RELATING TO THIS AGREEMENT AND
THE SUBJECT MATTER HEREOF AND AGREES NOT TO COMMENCE ANY LITIGATION OR ACTIONS ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND THE SUBJECT MATTER HEREOF IN ANY OTHER COURT.
(h) Headings. The descriptive headings of the several Sections and paragraphs of this
Agreement are inserted for convenience only, do not constitute a part of this Agreement and shall
not affect in any way the meaning or interpretation of this Agreement.
(i) Entire Agreement; Amendments. This Agreement and the other writings referred to herein
or delivered pursuant hereto which form a part hereof contain the entire understanding of the
parties with respect to its subject matter. This Agreement supersedes all prior agreements and
understandings between the parties with respect to its subject matter. This Agreement may be
amended and the observance of any term of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively) only by a written instrument duly
executed by the Company and the holders of at least a majority of the Registrable Securities at the
time outstanding. Each holder of any Registrable Securities at the time or thereafter outstanding
shall be bound by any amendment or waiver effected pursuant to this Section 8(i), whether or not
any notice, writing or marking indicating such amendment or waiver appears on such Registrable
Securities or is delivered to such holder.
(j) Inspection. For so long as this Agreement shall be in effect, this Agreement and a
complete list of the names and addresses of all the holders of Registrable Securities shall be made
available for inspection and copying on any business day by any holder of Registrable Securities
for proper purposes only (which shall include any purpose related to the rights of the
holders of Registrable Securities under the Securities and this Agreement) at the offices of
the Company at the address thereof set forth in Section 8(c) above.
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(k) Counterparts. This Agreement may be executed by the parties in counterparts, each of
which shall be deemed to be an original, but all such respective counterparts shall together
constitute one and the same instrument. If the foregoing is in accordance with your understanding,
please sign and return to us counterparts hereof, and upon the acceptance hereof by you, on behalf
of each of the Purchasers, this letter and such acceptance hereof shall constitute a binding
agreement among the Purchasers and the Company.
[Signature Pages Follow]
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IN WITNESS WHEREOF, the Parties hereto have executed this Registration Rights Agreement as of
the date first above written.
COMPANY: | ||||
NaviSite, Inc. | ||||
By: | /s/ Xxxxx X. Xxxxxxx | |||
Name: Xxxxx X. Xxxxxxx | ||||
Title: Chief Financial Officer | ||||
REPRESENTATIVE: | ||||
GTCR FUND VI, L.P. | ||||
By: | GTCR Partners VI, L.P. | |||
Its: | General Partner | |||
By: | GTCR Xxxxxx Xxxxxx, L.L.C. | |||
Its: | General Partner | |||
By: | /s/ Xxxxxx X. Xxxxxxxx | |||
Name: Xxxxxx X. Xxxxxxxx | ||||
Its: Principal |
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