EXHIBIT 4
SECOND AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT
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This Second Amended and Restated Investors' Rights Agreement (this
"Agreement") is made as of the 30th day of March, 2001, by and among USDATA
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Corporation, a Delaware corporation (the "Company"), the Investors listed on
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Schedule A hereto (each, an "Investor" and collectively, the "Investors") and,
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for the limited purpose of agreeing to Sections 2, 3 and 5 hereof, Safeguard
Scientifics, Inc. ("Safeguard"). This Agreement shall become effective as of
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the Closing (as defined therein) of the transactions contemplated by that
certain Series C Preferred Stock Purchase Agreement, dated as of even date
herewith (the "Purchase Agreement"), by and between the Company and SCP Private
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Equity Partners II, L.P., a Delaware limited partnership ("SCP").
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RECITALS
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WHEREAS, the Company and the Investor named therein are parties to the
Stock Purchase Agreement (the "Original Purchase Agreement"), dated August 6,
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1999;
WHEREAS, the Company, the Investor named therein and Safeguard are
parties to the Investors' Rights Agreement (the "Original Agreement"), dated
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August 6, 1999;
WHEREAS, the Company and the Investors named therein are parties to the
Securities Purchase Agreement (the "Securities Purchase Agreement"), dated
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August 4, 2000;
WHEREAS, the Company, the Investors and Safeguard are parties to the
Amended and Restated Investors' Rights Agreement (the "Amended Agreement"),
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dated as of September 12, 2000;
WHEREAS, the execution of this Agreement and the amendment and
restatement of the Amended Agreement pursuant hereto is a condition precedent to
the closing of the Purchase Agreement; and
WHEREAS, in order to induce SCP to enter into the Purchase Agreement and
to consummate the transactions contemplated thereby, the Company, the Investors
and Safeguard hereby agree that this Agreement shall amend, restate and
supercede the Amended Agreement and shall govern the rights of the Investors to
cause the Company to register shares of Common Stock and certain other matters
as set forth herein;
AGREEMENT
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NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, each intending to be legally bound hereby,
agree as follows:
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1. Registration Rights. The Company covenants and agrees as
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follows:
1.1 Definitions. For purposes of this Section 1:
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(a) the term "Act" means the Securities Act of 1933, as amended;
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(b) the term "Holder" means any person owning or having the right to
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acquire Registrable Securities or any assignee thereof in accordance with
Section 1.12 hereof;
(c) the term "1934 Act" shall mean the Securities Exchange Act of
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1934, as amended;
(d) the terms "register," "registered," and "registration" refer to
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a registration effected by preparing and filing a registration statement or
similar document in compliance with the Act, and the declaration or ordering of
effectiveness of such registration statement or document;
(e) the term "Registrable Securities" means (i) the Series A and B
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Registrable Securities, (ii) the Series C Registrable Securities; and (iii) any
Common Stock of the Company issued as (or issuable upon the conversion or
exercise of any warrant, right or other security which is issued as) a dividend
or other distribution with respect to, or in exchange for or in replacement of
the securities referenced under (i) and (ii) above;
(f) the term "Common Stock" means shares of the Company's Common
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Stock, par value $0.01 per share;
(g) the term "Series A Preferred Stock" means shares of the
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Company's Series A Preferred Stock, par value $0.01 per share;
(h) the term "Series B Preferred Stock" means shares of the
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Company's Series B Preferred Stock, par value $0.01 per share;
(i) the term "Series C-1 Preferred Stock" means shares of the
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Company's Series C-1 Preferred Stock, par value $0.01 per share;
(j) the term "Series C-2 Preferred Stock" means shares of the
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Company's Series C-2 Preferred Stock, par value $0.01 per share;
(k) the term "Series C Preferred Stock" means shares of the Series
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C-1 Preferred Stock and the Series C-2 Preferred Stock;
(l) the term "Series A and B Registrable Securities" means the
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Common Stock issued and sold to Safeguard Delaware, Inc. pursuant to the
Original Purchase Agreement, the Common Stock issuable or issued upon conversion
of the Series A Preferred Stock issued and sold to Safeguard Delaware, Inc.
pursuant to the Original Purchase Agreement and the Common Stock issued or
issuable upon conversion of the Series B Preferred Stock issuable or issued
under the Exchange Agreements (as defined in the Securities Purchase Agreement);
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(m) the term "Series C Registrable Securities" means the Common
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Stock issuable or issued upon conversion of (i) the Series C-1 Preferred Stock
issued and sold to SCP pursuant to the Purchase Agreement or (ii) the Series C-2
Preferred Stock issued to SCP upon its exercise of the Warrant (as defined in
the Purchase Agreement);
(n) the number of shares of "Registrable Securities then
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outstanding" shall be determined by the number of shares of Common Stock
outstanding which are, and the number of shares of Common Stock issuable
pursuant to then exercisable or convertible securities which are, Registrable
Securities;
(o) the term "SEC" shall mean the Securities and Exchange
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Commission;
(p) the term "Shelf Registration Period" shall have the meaning set
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forth in Section 1.2(b) hereof; and
(q) the term "Shelf Registration Statement" shall mean a "shelf"
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registration statement of the Company pursuant to the provisions of Section 1.2
hereof which covers all of the Registrable Securities on Form S-3 or on another
appropriate form for an offering to be made on a delayed or continuous basis
pursuant to Rule 415 under the Act, or any similar rule that may be adopted by
the SEC, and all amendments and supplements to such registration statement,
including post-effective amendments, in each case, including the prospectus
contained therein, all exhibits thereto and all documents incorporated or deemed
to be incorporated by reference therein.
1.2 Shelf Registration.
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(a) Upon the request of the Holders of 25% of the Registrable
Securities then outstanding, the Company shall prepare and, not later than 30
days following such request, shall file with the SEC a Shelf Registration
Statement with respect to resales of the Registrable Securities from time to
time in accordance with the methods of distribution elected by the Holders of
the Registrable Securities and set forth in such Shelf Registration Statement
and thereafter shall use its best efforts to cause such Shelf Registration
Statement to be declared effective under the Act prior to 45 days following the
filing of the Shelf Registration Statement with the SEC. The Company shall
supplement or amend the Shelf Registration Statement if required by the rules,
regulations or instructions applicable to the registration form used by the
Company for the Shelf Registration Statement, if required by the Act, the 1934
Act or the SEC.
(b) The Company shall keep the Shelf Registration Statement
continuously effective under the Act in order to permit the prospectus forming a
part thereof to be usable by all Holders until the earliest of (i) the fifth
anniversary of the date hereof, (ii) the date as of which all Registrable
Securities could be transferred without restriction pursuant to Rule 144 under
the Securities Act (or any similar provision then in force), and (iii) such date
as of which all Registrable Securities have been sold pursuant to the Shelf
Registration Statement (in any such case, such period being called the "Shelf
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Registration Period"). The Company shall: (i) subject to Section 1.2(c),
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prepare and file with the SEC such amendments and post-effective amendments to
the Shelf Registration Statement as may be necessary to keep the Shelf
Registration Statement continuously effective for the Shelf Registration Period;
(ii) subject to
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Section 1.2(c), cause the related prospectus to be supplemented by any required
supplement, and as so supplemented to be filed pursuant to Rule 424 (or any
similar provisions then in force) under the Act; and (iii) comply in all
material respects with the provisions of the Act with respect to the disposition
of all securities covered by the Shelf Registration Statement during the
applicable period in accordance with the intended methods of disposition by the
sellers thereof set forth in such Shelf Registration Statement as so amended or
such prospectus as so supplemented.
(c) The Company may suspend the use of the prospectus forming a part
of the Shelf Registration Statement for two periods not to exceed an aggregate
of 60 days in any twelve-month period for valid business reasons, to be
determined by the Company in its reasonable judgment (not including avoidance of
the Company's obligations hereunder), including, without limitation, the
acquisition or divestiture of assets, public filings with the SEC, pending
corporate developments and similar events. The Company shall provide written
notice to the Holders of any such suspension.
1.3 Company Registration. If (but without any obligation to do so)
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the Company proposes to register (including for this purpose a registration
effected by the Company for stockholders other than the Holders) any securities
under the Act in connection with the public offering of such securities solely
for cash for its own account (other than a registration relating solely to the
sale of securities to participants in a Company stock plan, a registration on
Form S-4 (or its successor) relating to an offering of shares in connection with
any acquisition of any entity or business, a registration on any form which does
not include substantially the same information as would be required to be
included in a registration statement covering the sale of the Registrable
Securities or a registration in which the only Common Stock being registered is
Common Stock issuable upon conversion of debt securities or exercise of warrants
which are also being registered) and the Registrable Securities have not
theretofore been included in a Shelf Registration Statement pursuant to Section
1.2 that remains effective, the Company shall, at such time, promptly give each
Holder written notice of such registration. Upon the written request of each
Holder given within 20 days after mailing of such notice by the Company, the
Company shall, subject to the provisions of Section 1.8, cause to be registered
under the Act all of the Registrable Securities that each such Holder has
requested to be registered. The obligations of the Company under this Section
1.3 with respect to any particular offering may be waived at any time upon the
written consent of Holders of a majority of the outstanding Registrable
Securities. The right of any Holder to request inclusion of Registrable
Securities held by it in any registration pursuant to this Section 1.3 shall
terminate if all shares of Registrable Securities held or entitled to be held
upon conversion by such Holder are eligible to be sold under Rule 144 under the
Act during any 90-day period. In any event, such right shall terminate on the
fifth anniversary of the date hereof.
1.4 Obligations of the Company. Whenever required under this Section
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1 to effect the registration of any Registrable Securities, the Company shall,
in a reasonable amount of time and as promptly as possible:
(a) prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use its best efforts to cause such
registration statement to become effective, and in the case of a registration
under Section 1.14 hereof, upon the request of the
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Holders of a majority of the Registrable Securities registered thereunder, keep
such registration statement effective for a period of up to 120 days or, if
earlier, until the distribution contemplated in such registration statement has
been completed; provided, however, that such 120-day period shall be extended
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for a period of time equal to the period the Holder refrains from selling any
securities included in such registration at the request of an underwriter of
Common Stock (or other securities) of the Company;
(b) prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the
Act with respect to the disposition of all securities covered by such
registration statement;
(c) furnish to the Holders such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Act, and such other documents as they may reasonably request in order to
facilitate the disposition of Registrable Securities owned by them;
(d) use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or Blue Sky
laws of such jurisdictions as shall be reasonably requested by the Holders;
provided, however, that the Company shall not be required in connection
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therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions in
which it is not, at the time, so qualified or otherwise subject itself to
general taxation in any such states or jurisdictions;
(e) in the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter of such offering, it being understood and
agreed that each Holder participating in such underwriting shall also enter into
and perform its obligations under such an agreement;
(f) notify each Holder of Registrable Securities covered by such
registration statement in writing at any time when a prospectus relating thereto
is required to be delivered under the Act of the happening of any event as a
result of which the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing;
(g) cause all such Registrable Securities registered pursuant
hereunder to be listed on each securities exchange on which similar securities
issued by the Company are then listed;
(h) provide a transfer agent and registrar for all Registrable
Securities registered pursuant hereunder and a CUSIP number for all such
Registrable Securities, in each case not later than the effective date of such
registration;
(i) use its best efforts to obtain the withdrawal of any order
suspending the effectiveness of any such registration statement or the lifting
of any suspension of the
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qualification (or exemption from qualification) of any of the Registrable
Securities for offer or sale in any jurisdiction at the earliest possible time;
and
(j) cooperate in all necessary respects with (A) counsel in
preparation of the customary legal opinions and (B) accountants in preparation
of the customary comfort letters.
1.5 Furnish Information. It shall be a condition precedent to the
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obligations of the Company to take any action pursuant to this Section 1 with
respect to the Registrable Securities of any selling Holder that such Holder
shall furnish to the Company such information regarding itself, the Registrable
Securities held by it, and the intended method of disposition of such securities
as shall be required to effect the registration of such Holder's Registrable
Securities.
1.6 Expenses of Shelf Registration. All expenses other than
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underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications pursuant to Section 1.2, including
(without limitation) all registration, filing and qualification fees, printers'
and accounting fees, fees and disbursements of counsel for the Company and the
reasonable fees and disbursements, which shall not exceed $25,000, of one
counsel for the selling Holders (to be selected by the Holders holding a
majority of the Registrable Securities) shall be borne and paid by the Company.
1.7 Expenses of Company Registration. The Company shall bear and pay
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all expenses incurred in connection with any registration, filing or
qualification of Registrable Securities with respect to the registrations
pursuant to Section 1.3 for each Holder (which right may be assigned as provided
in Section 1.13), including (without limitation) all registration, filing, and
qualification fees, printers and accounting fees relating or apportionable
thereto and the fees and disbursements, which shall not exceed $25,000, of one
counsel for the selling Holders (to be selected by the holders of a majority of
the Registrable Securities to be registered), but excluding underwriting
discounts and commissions relating to Registrable Securities.
1.8 Underwriting Requirements. In connection with any offering
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involving an underwriting of shares of the Company's capital stock under Section
1.3, the Company shall not be required to include any of the Holders' securities
in such underwriting unless they accept the terms of the underwriting as agreed
upon between the Company and the underwriters selected by it (or by other
persons entitled to select the underwriters), and then only in such quantity as
the underwriters determine in their sole discretion will not, jeopardize the
success of the offering by the Company. If the total amount of securities,
including Registrable Securities, requested by stockholders to be included in
such offering exceeds the amount of securities sold other than by the Company
that the underwriters determine in their sole discretion is compatible with the
success of the offering, then the Company shall be required to include in the
offering only that number of such securities, including Registrable Securities,
which the underwriters determine in their sole discretion will not jeopardize
the success of the offering. The securities so included shall be apportioned (a)
first to the holders of the Series C Registrable Securities selling Series C
Registrable Securities pro rata according to the total amount of Series C
Registrable Securities entitled to be included therein owned by each such
selling holder; (b) second to the holders selling Series A and B Registrable
Securities pro rata according to the total
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amount of Series A and B Registrable Securities entitled to be included therein
owned by each such selling holder and (c) third, to the extent determined by the
underwriters to be compatible with the offering, to other stockholders.
1.9 Delay of Registration. No Holder shall have any right to
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obtain or seek an injunction restraining or otherwise delaying any such
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Section 1.
1.10 Indemnification. In the event any Registrable Securities are
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included in a registration statement under this Section 1:
(a) to the extent permitted by law, the Company will indemnify and
hold harmless each Holder, any underwriter (as defined in the Act) for such
Holder and each person, if any, who controls such Holder or underwriter within
the meaning of the Act or the 1934 Act, against any losses, claims, damages, or
liabilities (joint or several) to which they may become subject under the Act,
the 1934 Act or other federal or state law, insofar as such losses, claims,
damages, or liabilities (or actions in respect thereof) arise out of or are
based upon any of the following statements, omissions or violations
(collectively a "Violation"): (i) any untrue statement or alleged untrue
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statement of a material fact contained in such registration statement, including
any preliminary prospectus or final prospectus contained therein (for which such
statement of material fact is untrue in light of the circumstances under which
it was made) or any amendments or supplements thereto, (ii) the omission or
alleged omission to state therein a material fact required to be stated therein,
or necessary to make the statements therein not misleading, or (iii) any
violation or alleged violation by the Company of the Act, the 1934 Act, any
state securities law or any rule or regulation promulgated under the Act, the
1934 Act or any state securities law; and the Company will pay to each such
Holder, underwriter or controlling person, promptly following delivery of an
invoice for such amounts incurred, any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability, or action; provided, however, that the indemnity
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agreement contained in this subsection 1.10(a) shall not apply to: (x) amounts
paid in settlement of any such loss, claim, damage, liability, or action if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld); (y) any such loss, claim, damage, liability, or
action to the extent that it arises out of or is based upon a Violation which
occurs in reliance upon and in conformity with written information furnished
expressly for use in connection with such registration by any such Holder,
underwriter or controlling person; (z) any such loss, claim, damage, liability
or action to the extent that it arises out of or is based upon such Holder's or
underwriter's failure to deliver a copy of the registration statement or
prospectus or any amendments or supplements thereto;
(b) to the extent permitted by law, each selling Holder will
indemnify and hold harmless the Company, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Company within the meaning of the Act, any underwriter, any other
Holder selling securities in such registration statement and any controlling
person of any such underwriter or other Holder, against any losses, claims,
damages, or liabilities (joint or several) to which any of the foregoing persons
may become subject, under the Act, the 1934 Act or other federal or state law,
insofar as such losses, claims, damages, or
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liabilities (or actions in respect thereto) arise out of or are based upon any
Violation, in each case to the extent (and only to the extent) that such
Violation occurs in reliance upon and in conformity with written information
furnished by such Holder expressly for use in connection with such registration;
and each such Holder will pay, as incurred, any legal or other expenses
reasonably incurred by any person intended to be indemnified pursuant to this
subsection 1.10(b), in connection with investigating or defending any such loss,
claim, damage, liability, or action; provided, however, that the indemnity
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agreement contained in this subsection 1.10(b) shall not apply to amounts paid
in settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall
not be unreasonably withheld; provided, that, in no event shall any indemnity
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under this subsection 1.10(b) exceed the gross proceeds from the offering
received by such Holder;
(c) promptly after receipt by an indemnified party under this Section
1.10 of notice of the commencement of any action (including any governmental
action), such indemnified party will, if a claim in respect thereof is to be
made against any indemnifying party under this Section 1.10, deliver to the
indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
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(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by such
counsel in such proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action, if prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section
1.10, but the omission so to deliver written notice to the indemnifying party
will not relieve it of any liability that it may have to any indemnified party
otherwise than under this Section 1.10;
(d) if the indemnification provided for in this Section 1.10 is held
by a court of competent jurisdiction to be unavailable to an indemnified party
with respect to any loss, liability, claim, damage, or expense referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party hereunder, shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, claim, damage, or expense
in such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand and of the indemnified party on the other in
connection with the statements or omissions that resulted in such loss,
liability, claim, damage, or expense as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement or omission. In no event shall any contribution by a Holder under this
subsection 1.10(d) exceed the gross proceeds from the offering received by such
Holder. In no event shall a person or entity guilty of
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fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) be
entitled to contribution from any person or entity who was not guilty of
fraudulent misrepresentation;
(e) notwithstanding the foregoing, to the extent that the provisions
on indemnification and contribution contained in the underwriting agreement
entered into in connection with the underwritten public offering are in conflict
with the foregoing provisions, the provisions in the underwriting agreement
shall control for such offering; and
(f) the obligations of the Company and Holders under this Section
1.10 shall survive the completion of any offering of Registrable Securities in a
registration statement under this Section 1, and otherwise.
1.11 Reports Under Securities Exchange Act of 1934. The Company shall
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cause its Common Stock to continue to be registered under Sections 12(b) or
12(g) of the 1934 Act, shall comply in all respects with its reporting and
filing obligations under the 1934 Act, and shall not take any action or file any
document (whether or not permitted by the 1934 Act or the rules thereunder) to
terminate or suspend such registration or to terminate or suspend its reporting
and filing obligations under the 1934 Act. The Company shall take all reasonable
actions necessary to continue the listing or trading of its Common Stock on any
national securities exchange or the Automated Quotation System of the National
Association of Securities Dealers on which Common Stock is listed or traded, and
shall comply in all material respects with its reporting, filing and other
obligations under the bylaws or rules of such exchange or association. The
Company will furnish to any Holder, so long as the Holder owns any Registrable
Securities, forthwith upon request (i) a written statement by the Company that
it has complied with the reporting requirements of SEC Rule 144, the Act and the
1934 Act or that it qualifies as a registrant whose securities may be resold
pursuant to Form S-3 under the Act, (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents as are
filed by the Company under the 1934 Act, and (iii) such other information as may
be reasonably requested in availing any Holder of any rule or regulation of the
SEC which permits the selling of any such securities without registration or
pursuant to such form.
1.12 Assignment of Registration Rights. The rights to cause the
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Company to register Registrable Securities pursuant to this Section 1 may be
assigned (but only with all related obligations) by a Holder to (a) any partner
or retired partner of any holder which is a partnership, (b) any family member
or trust for the benefit of any individual holder, or (c) any transferee or
assignee who, after such assignment or transfer, holds at least 15% of the then
outstanding Registrable Securities, provided: (i) the Company is, within a
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reasonable time after such transfer, furnished with written notice of the name
and address of such transferee or assignee and the securities with respect to
which such registration rights are being assigned; (ii) such transferee or
assignee agrees in writing to be bound by and subject to the terms and
conditions of this Agreement; and (iii) such assignment shall be effective only
if immediately following such transfer the further disposition of such
securities by the transferee or assignee is restricted under the Act.
1.13 Limitations on Subsequent Registration Rights. From and after
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the date of this Agreement, the Company shall not, without the prior written
consent of the Holders of a majority of the outstanding Registrable Securities
then outstanding, enter into any agreement
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with any holder or prospective holder of any securities of the Company which
would allow such holder or prospective holder to interfere with or otherwise
limit a Holder's registration rights under this Agreement.
1.14 Request for Registration.
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(a) If the Company shall at any time during the Shelf Registration
Period be ineligible to use Form S-3 or Form S-3 shall be for any reason
unavailable to register the Registrable Securities under the rules and
regulation of the SEC, and the duration of such ineligibility or unavailability
exceeds or is expected to exceed 60 days, the Holders shall have the right by a
written request from the Holders of a majority of the Registrable Securities
then outstanding to the Company, to require the Company to file a registration
statement under the Act covering the resales of at least 25% of the Registrable
Securities then outstanding (or a lesser percent if the anticipated aggregate
offering price, net of underwriting discounts and commissions, would exceed
$10,000,000), but in no event will the aggregate value of the shares to be
registered under such registration statement be less than $500,000. Upon its
receipt of such a written request, the Company shall given written notice of
such request to all Holders within ten days thereof. The Company shall file as
soon as practicable, and in any event within 90 days of the receipt of such
request, a registration statement under the Act covering resales of all
Registrable Securities which Holders request to be registered, subject to the
limitations of subsection 1.14(b).
(b) If the Holders initiating the registration request hereunder
(the "Initiating Holders") intend to distribute the Registrable Securities
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covered by their request by means of an underwriting, they shall so advise the
Company as a part of their request made pursuant to subsection 1.14(a) and the
Company shall include such information in the written notice referred to in
subsection 1.14(a). The managing underwriter shall be selected by a majority in
interest of the Initiating Holders and shall be reasonably acceptable to the
Company. In such event, the right of any Holder to include his Registrable
Securities in such registration shall be conditioned upon such Holder's
participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting to the extent provided herein. All
Holders proposing to distribute their securities through such underwriting shall
(together with the Company as provided in subsection 1.4(e)) enter into an
underwriting agreement in customary form with the underwriter or underwriters
selected for such underwriting. Notwithstanding any other provision of this
Section 1.14, if the underwriter advises the Initiating Holders in writing that
marketing factors require a limitation of the number of shares to be
underwritten, then the Initiating Holders shall so advise all Holders of
Registrable Securities which would otherwise be underwritten pursuant hereto,
and the number of shares of Registrable Securities that may be included in the
underwriting shall be apportioned (a) first to the holders of the Series C
Registrable Securities selling Series C Registrable Securities pro rata
according to the total amount of Series C Registrable Securities entitled to be
included therein owned by each such selling holder; (b) second to the holders
selling Series A and B Registrable Securities pro rata according to the total
amount of Series A and B Registrable Securities entitled to be included therein
owned by each such selling holder and (c) third, to the extent determined by the
underwriters to be compatible with the offering, to other stockholders.
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(c) The Company shall not be obligated to effect, or to take any
action to effect, any registration pursuant to this Section 1.14(a) after the
Company has effected two registrations pursuant to this Section 1.14(a) and such
registrations have been declared or ordered effective; provided, however, that a
-------- -------
registration will not count as a registration pursuant to this Section 1.14(a)
unless the Holders requesting registration are able to register the offering and
sale of at least 50% of the shares of Registrable Securities that they have
requested be included in such registration.
2. Rights Offering.
---------------
2.1 Rights.
------
(a) As used herein, the term "Subsidiary" shall mean, with respect to
----------
the Company, any direct or indirect subsidiary of the Company more than 50% of
the outstanding voting securities of which are owned directly or indirectly by
the Company. The Company shall, upon receipt of a Rights Offering Notice (as
defined below), cause the Subsidiary designated as the "Relevant Subsidiary" in
connection therewith (the "Relevant Subsidiary"), to grant to the holders of the
-------------------
common stock of Safeguard rights (the "Rights") to purchase from such Relevant
------
Subsidiary such number of shares of such Relevant Subsidiary's common stock as
determined by Safeguard up to a maximum of 40% of the sum of (i) all issued
shares of common stock of such Relevant Subsidiary, and (ii) all shares of
common stock of such Relevant Subsidiary subject to issuance pursuant to
options, warrants or other agreements, plans, instruments or understandings, all
as of the effective date of the registration statement relating to such Rights
(the "Rights Registration Statement"). The Rights shall be issued in an
-----------------------------
offering (the "Rights Offering") pursuant to the Rights Registration Statement,
---------------
shall be exercisable for a period of no greater than 45 days after the
commencement of the Rights Offering and shall be transferable by the holder
thereof during that period. The Company shall cause the Relevant Subsidiary to
engage an investment banking firm selected by the Company, subject to the
reasonable approval of Safeguard, which firm shall underwrite, on a standby,
firm commitment basis, any portion of the offered common stock of the Relevant
Subsidiary not purchased through the exercise of Rights. The Company shall also
engage legal counsel selected by Safeguard, subject to the reasonable approval
of a majority of the Board of Directors of the Company, which counsel shall
represent the Relevant Subsidiary in connection with the conduct of the Rights
Offering. The exercise price of the Rights shall be determined by negotiation
among the Relevant Subsidiary, the underwriters and the selling stockholders, if
any. Prior to the commencement of the Rights Offering, the Company shall use its
best efforts to cause (and shall cause the Relevant Subsidiary to use its best
efforts to cause) any holder of more than 1% of the Relevant Subsidiary's common
stock (or rights to acquire more than 1% of the Relevant Subsidiary's common
stock) and the Relevant Subsidiary's officers and directors to execute and
deliver to the underwriter of the Rights Offering a market stand-off agreement.
Such market stand-off agreement shall provide that, during the period of
duration specified by the Relevant Subsidiary and the underwriter of common
stock or other securities of the Relevant Subsidiary following the effective
date of the Rights Registration Statement, such persons shall not, to the extent
requested by the Relevant Subsidiary and such underwriter, directly or
indirectly sell, offer to sell, contract to sell (including, without limitation,
any short sale), grant any option to purchase or otherwise transfer or dispose
of (other than to donees who agree to be similarly bound) any securities of the
11
Relevant Subsidiary held by them at any time during such period except common
stock included in such Rights Registration Statement.
(b) Safeguard may initiate a Rights Offering with respect to any
Subsidiary by giving written notice to the Company (a "Rights Offering Notice")
----------------------
at any time during the Rights Exclusivity Period (as hereinafter defined) at
such time as the total market value of such Subsidiary is at least $35,000,000,
which determination shall be made in good faith, upon request by Safeguard from
time to time, by the Board with the assistance and advice of such experts or
consultants as the Board may choose to retain, if any. The obligations of the
Company pursuant to this Section 2.1 shall commence on the date hereof and
expire on August 6, 2004 (such period, the "Rights Exclusivity Period"), unless
-------------------------
a registration statement relating to a Rights Offering has been filed with the
SEC by such date, in which case the Rights covered by such Registration
Statement shall not expire until 150 days after the date such filing was made.
(c) The Company agrees that it will not (i) sell or otherwise
transfer any of the capital stock of any Subsidiary owned by it, (ii) permit any
Subsidiary to merge or consolidate with any other person or entity other than
the Company or another Subsidiary or sell, lease or otherwise transfer any
substantial portion of any Subsidiary's assets, or (iii) permit any Subsidiary
to undertake any registration of any of its securities under the Act or the 1934
Act other than pursuant to this Section 2.1, in any case, prior to the earlier
of the expiration of the Rights Exclusivity Period or the completion of a Rights
Offering with respect to such Subsidiary, except with the consent of Safeguard;
provided, however, that this subsection shall not apply to the registration
-------- -------
rights provided under that certain Investors' Rights Agreement, dated as of
September 12, 2000, by and among eMake Corporation and the other parties
thereto.
(d) Upon closing of a Rights Offering with respect to any
Subsidiary, Safeguard's right to require such Subsidiary to conduct any further
Rights Offerings under this Section 2 and any Directed Shares Offering under
Section 3 below shall terminate.
2.2 Split. After Safeguard has notified the Company of its intention
-----
to commence a Rights Offering, the Company shall, prior to the filing of the
Rights Registration Statement with respect thereto as provided hereinafter (or
at such earlier date as agreed to by the Company and Safeguard), take all such
actions as shall be necessary to cause the Relevant Subsidiary to cause a split
of its authorized common stock in such ratio as Safeguard shall determine. All
references to share amounts in this Agreement other than as specifically noted
shall be deemed to refer to share amounts prior to such split.
2.3 Registration Statement. Upon notice by Safeguard to the Company
----------------------
of its intention to commence a Rights Offering, the Company shall cause the
Relevant Subsidiary to promptly prepare a Rights Registration Statement to
register under the Act, the Rights and the shares of the common stock of the
Relevant Subsidiary to be acquired upon exercise of the Rights (the "Rights
------
Shares"). The Company covenants that such Rights Registration Statement and the
------
prospectus included therein shall be in form reasonably satisfactory to
Safeguard, shall comply in all material respects with the Act and the rules and
regulations of the SEC promulgated thereunder, shall not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in
12
light of the circumstances under which they were made, not misleading and shall
conform with the provisions of Section 1.4 hereof.
2.4 Registration Process. The Company shall use its best efforts to
--------------------
cause the Relevant Subsidiary to cause the Rights Registration Statement to be
filed with the SEC and to become effective as promptly as practicable in
accordance with Section 1.4 hereof. The Company shall cause the Relevant
Subsidiary to prepare and file with the SEC, promptly upon Safeguard's request,
any amendments or supplements to the Rights Registration Statement or the
related prospectus that, in Safeguard's opinion, may be necessary or advisable
in connection with the Rights Offering, subject to the reasonable approval of
the Relevant Subsidiary and its counsel. The Company shall not permit the
Relevant Subsidiary to file any amendment or supplement to the Rights
Registration Statement or the related prospectus unless (A) it has furnished
Safeguard with a copy of such amendment or supplement a reasonable time prior to
filing and (B) Safeguard has not reasonably objected to such amendment or
supplement by notice to the Company within 10 days of receipt of such copy. The
Company shall not issue (and shall not permit the Relevant Subsidiary to issue)
any advertisement, press release, mailing or other solicitation material of
which Safeguard reasonably disapproves by prompt written notice to the Company
after receiving reasonable notice thereof. The Company shall cause the Relevant
Subsidiary to comply with the Act and the rules and regulations thereunder in
connection with the Rights Offering and, until the termination of the Rights
Offering, the Company shall cause the Relevant Subsidiary to use its best
efforts to qualify the Rights Shares under the securities laws of all
jurisdictions in which qualification is required and there are holders of
Safeguard common stock and to continue such qualifications in effect during the
exercise period of the Rights. At the time of mailing the prospectus relating to
the Rights Offering and at the time of the closing of the Rights Offering,
Safeguard shall be entitled to receive (A) from the Company and the Relevant
Subsidiary such certificates and documents evidencing compliance with such
representations and warranties of the Company and the Relevant Subsidiary as
Safeguard shall reasonably request of the Company, and (B) from the counsel and
independent accountants of the Company and the Relevant Subsidiary such opinions
and documents as Safeguard may reasonably request thereof as if it were
applicable to the Rights Offering.
2.5 Use of Proceeds. The Company shall cause the Relevant Subsidiary
---------------
to apply all proceeds of the Rights Offering first to the payment of the
expenses of the Rights Offering and thereafter to general working capital
purposes or such other purposes as shall be described in the related prospectus
and agreed to by Safeguard.
2.6 Registration Services.
---------------------
(a) Services. Safeguard shall diligently and in a timely fashion
--------
assist the Company and the Relevant Subsidiary in structuring the Rights
Offering, in preparing the necessary registration statement and related
disclosure documentation, in clearing the Rights Offering with the SEC and
applicable state securities authorities and shall provide such other services
and assistance in connection with the Rights Offering as the Company or the
Relevant Subsidiary shall reasonably request. Nothing contained herein shall
require Safeguard to provide to the Company or the Relevant Subsidiary any
services or assistance which, if rendered by Safeguard, would require Safeguard
to register as a broker-dealer under Section 15 of the
13
Exchange Act or any state securities laws, or as an investment adviser under the
Investment Advisor Act of 1940, as amended.
(b) Working Group. The Company shall cause the counsel, auditors,
-------------
employees, officers and consultants of the Company and the Relevant Subsidiary
to render such assistance in consummating the Rights Offering, at the expense of
the Company, as is customary in the consummation by a company of its initial
public offering. In addition, in rendering services under this Section 2.6,
Safeguard may engage special legal counsel, one or more rights, registrar and
transfer agents, and such other consultants as Safeguard may deem necessary or
desirable in connection with the Rights Offering, subject to the reasonable
approval of the Company, the expenses of which shall be paid by the Company and
which are not included in the reimbursement described in subsection 2.6(c)
below. In addition, Safeguard may require the Relevant Subsidiary to engage a
registered broker-dealer of Safeguard's designation, subject to the reasonable
approval of the Company, to provide such services in connection with the Rights
Offering as Safeguard may deem reasonably necessary or desirable, including
without limitation, to effect or underwrite the offering of the Rights or the
Rights Shares in states in which applicable state laws require that a registered
broker-dealer effect such offering.
(c) Expenses. The Company shall bear all reasonable costs and
--------
expenses of the Rights Offering, including, but not limited to, the Relevant
Subsidiary's printing, legal and accounting fees and expenses, SEC and NASD
filing fees and "Blue Sky" fees and expenses; provided, however, that the
-------- -------
Company shall have no obligation to pay or otherwise bear any portion of the
underwriters' discounts attributable to the Rights Shares not being offered and
sold by the Relevant Subsidiary, or the fees and expenses of counsel for the
selling holders of Rights Shares in connection with the registration of the
Rights Shares if other than counsel to the Relevant Subsidiary. The Company
shall reimburse Safeguard for its internal expenses incurred under this Section
2 by payment of $50,000 on a nonaccountable basis, such payment to be made on
the earlier of the closing of the Rights Offering or 90 days after the
Registration Statement is filed.
2.7 Indemnification. In connection with the Rights Offering:
---------------
(a) to the extent permitted by law, the Company will indemnify and
hold harmless Safeguard, any underwriter (as defined in the Act) for Safeguard
and each person, if any, who controls Safeguard or underwriter within the
meaning of the Act or the 1934 Act, against any losses, claims, damages, or
liabilities (joint or several) to which they may become subject under the Act,
the 1934 Act or other federal or state law, insofar as such losses, claims,
damages, or liabilities (or actions in respect thereof) arise out of or are
based upon any of the following statements, omissions or violations
(collectively a "Violation"): (i) any untrue statement or alleged untrue
---------
statement of a material fact contained in such registration statement, including
any preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto, (ii) the omission or alleged omission to
state therein a material fact required to be stated therein, or necessary to
make the statements therein not misleading, or (iii) any violation or alleged
violation by the Company or the Relevant Subsidiary of the Act, the 1934 Act,
any state securities law or any rule or regulation promulgated under the Act,
the 1934 Act or any state securities law; and the Company will pay to Safeguard
and each underwriter or controlling person, promptly following delivery of an
invoice for such amounts incurred, any
14
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this subsection
-------- -------
2.7(a) shall not apply to: (x) amounts paid in settlement of any such loss,
claim, damage, liability, or action if such settlement is effected without the
consent of the Company (which consent shall not be unreasonably withheld); (y)
any such loss, claim, damage, liability, or action to the extent that it arises
out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by Safeguard or the underwriter or controlling person;
(z) any such loss, claim, damage, liability or action to the extent that it
arises out of or is based upon Safeguard's or the underwriter's failure to
deliver a copy of the registration statement or prospectus or any amendments or
supplements thereto;
(b) to the extent permitted by law, Safeguard will indemnify and
hold harmless the Relevant Subsidiary, each of its directors, each of its
officers who has signed the registration statement, each person, if any, who
controls the Relevant Subsidiary within the meaning of the Act, any underwriter,
any other Holder selling securities in such registration statement and any
controlling person of any such underwriter or other Holder, against any losses,
claims, damages, or liabilities (joint or several) to which any of the foregoing
persons may become subject, under the Act, the 1934 Act or other federal or
state law, insofar as such losses, claims, damages, or liabilities (or actions
in respect thereto) arise out of or are based upon any Violation, in each case
to the extent (and only to the extent) that such Violation occurs in reliance
upon and in conformity with written information furnished by Safeguard expressly
for use in connection with such registration; and Safeguard will pay, as
incurred, any legal or other expenses reasonably incurred by any person intended
to be indemnified pursuant to this subsection 2.7(b), in connection with
investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this subsection
-------- -------
2.7(b) shall not apply to amounts paid in settlement of any such loss, claim,
damage, liability or action if such settlement is effected without the consent
of Safeguard, which consent shall not be unreasonably withheld; provided, that,
--------
in no event shall any indemnity under this subsection 2.7(b) exceed the gross
public offering price of all such securities offered by Safeguard and sold
pursuant to such registration statement;
(c) promptly after receipt by an indemnified party under this
Section 2.7(c) of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect thereof
is to be made against any indemnifying party under this Section 2.7, deliver to
the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
-------- -------
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by such
counsel in such proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action, if prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party
15
under this Section 2.7, but the omission so to deliver written notice to the
indemnifying party will not relieve it of any liability that it may have to any
indemnified party otherwise than under this Section 2.7;
(d) if the indemnification provided for in this Section 2.7 is held
by a court of competent jurisdiction to be unavailable to an indemnified party
with respect to any loss, liability, claim, damage, or expense referred to
therein, then the indemnifying party, in lieu of indemnifying such indemnified
party hereunder, shall contribute to the amount paid or payable by such
indemnified party as a result of such loss, liability, claim, damage, or expense
in such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand and of the indemnified party on the other in
connection with the statements or omissions that resulted in such loss,
liability, claim, damage, or expense as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative intent,
knowledge, access to information, and opportunity to correct or prevent such
statement or omission. In no event shall any contribution by Safeguard under
this subsection 2.7(d) exceed the gross public offering price of all such
securities offered by Safeguard and sold pursuant to such registration
statement. In no event shall a person or entity guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) be entitled
to contribution from any person or entity who was not guilty of fraudulent
misrepresentation;
(e) notwithstanding the foregoing, to the extent that the
provisions on indemnification and contribution contained in the underwriting
agreement entered into in connection with the underwritten public offering are
in conflict with the foregoing provisions, the provisions in the underwriting
agreement shall control; and
(f) the obligations of the Company and Safeguard under this Section
2.7 shall survive the completion of the Rights Offering.
3. Safeguard Subscription Offering.
-------------------------------
3.1 Directed Shares Registration. Safeguard shall have the right to
----------------------------
require the Company to cause any Subsidiary to file a registration statement on
Form S-1 for the registration of shares of the Subsidiary's common stock
pursuant to this Section 3 at such time as the total market value of such
Subsidiary is at least $35,000,000 (the "Safeguard Subscription Offering"). Such
-------------------------------
registration statement shall register common stock (i) sufficient in number to
satisfy the Directed Shares requirement described below and (ii) with an
aggregate offering price, prior to underwriting discounts and commissions, of at
least $10,000,000. In connection with such Safeguard Subscription Offering, the
Company shall cause the applicable Subsidiary to adjust its authorized shares as
requested by Safeguard in order to facilitate distribution of Directed Shares to
its stockholders. The Company shall cause the applicable Subsidiary to engage
(i) an underwriter or underwriters selected by Safeguard, subject to the
approval of a majority of the Board of Directors of the Company, and (ii) legal
counsel selected by Safeguard, subject to the reasonable approval of a majority
of the Board of Directors of the Company, which
16
counsel shall represent the applicable Subsidiary in connection with the conduct
of the Safeguard Subscription Offering.
3.2 Directed Shares Subscription Program. In connection with the
------------------------------------
Safeguard Subscription Offering, the Company shall cause the applicable
Subsidiary to:
(a) provide in the related underwriting agreement a right for
Safeguard to designate persons (the "Safeguard Designees") who may purchase from
-------------------
the underwriter(s) shares of the Relevant Subsidiary's common stock (the
"Directed Shares") at the public offering price of such Subsidiary's common
----------------
stock in the Safeguard Subscription Offering (the "IPO Price"); and
---------
(b) use its best efforts to cause such Subsidiary to cause the
underwriters of the Safeguard Subscription Offering to allow the Safeguard
Designees to purchase at the IPO Price that number of Directed Shares equal to
20% of the shares of common stock offered by such Subsidiary in such Safeguard
Subscription Offering. Upon closing of the Safeguard Subscription Offering with
respect to any Subsidiary and sale of the number of shares set forth in this
Section 3.2(b), Safeguard's right to require the Company to cause such
Subsidiary to conduct a Rights Offering pursuant to Section 2 above shall
terminate. The Company shall reimburse Safeguard for its internal expenses
incurred under this Section 3 by payment of $50,000 on a nonaccountable basis,
such payment to be made on the earlier of the closing of the Safeguard
Subscription Offering or 90 days after the Registration Statement is filed.
4. Board Nominations. In addition to its right to designate one of
-----------------
the members of the Board of Directors of the Company pursuant to the Company's
Certificate of Designation for Series C-1 Preferred Stock and Series C-2
Preferred Stock, for so long as SCP owns at least 5% of the outstanding Common
Stock of the Company (on an as-converted basis), SCP shall have the right to
propose one director for election to the Board of Directors of the Company and
the Company shall take all steps necessary to nominate such proposed director
for election to the Company's Board of Directors at its annual meeting of
stockholders.
5. Miscellaneous.
-------------
5.1 Successors and Assigns. Except as otherwise provided herein, the
----------------------
terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties. Nothing in
this Agreement, express or implied, is intended to confer upon any party other
than the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
5.2 Governing Law. The construction, validity and interpretation of
-------------
this Agreement will be governed by the internal laws of the State of Delaware
without giving effect to any choice of law or conflict of law provision or rule
(whether of the State of Delaware or any other jurisdiction) that would cause
the application of the laws of any jurisdiction other than the State of
Delaware.
17
5.3 Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
5.4 Titles and Subtitles. The titles and subtitles used in this
--------------------
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
5.5 Notices. All notices and other communications hereunder shall be
-------
in writing and shall be deemed given if delivered personally or by commercial
overnight courier (with confirmation of receipt) or sent via facsimile (with
confirmation of receipt) (i) if to the Company, at USDATA Corporation, 0000
Xxxxx Xxxxxxx Xxxxxxxxxx, Xxxxxxxxxx, Xxxxx 00000 (fax: (000) 000-0000),
Attention: Xxxxxx X. Merry, (ii) if to an Investor, at the address beneath such
Investor's name on Schedule A attached hereto, and (iii) if to Safeguard, at
Safeguard Scientifics, Inc., 800 The Safeguard Building, 000 Xxxxx Xxxx Xxxxx,
Xxxxx, Xxxxxxxxxxxx 00000 (fax: (000) 000-0000).
Notice given by facsimile shall be confirmed by appropriate answer
back and shall be effective upon actual receipt if received during the
recipient's normal business hours, or at the beginning of the recipient's next
business day after receipt if not received during the recipient's normal
business hours. All notices by facsimile shall be confirmed promptly after
transmission in writing by certified mail or personal delivery. Any party may
change any address to which notice is to be given to it by giving notice as
provided above of such change of address.
5.6 Expenses. If any action at law or in equity is necessary to
--------
enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorneys' fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
5.7 Amendments and Waivers. Any term other than Sections 1.1, 1.8,
----------------------
1.14, 2, 3 and 4 and the next two sentences of this Agreement may be amended and
the observance of any term other than Sections 1.1, 1.8, 1.14, 2, 3 and 4 and
the next two sentences of this Agreement may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company and the holders of a majority of the shares of
Registrable Securities then outstanding. Sections 1.1, 1.8, 1.14 and this
sentence of this Agreement may be amended and the observance of any term of
Sections 1.1, 1.8, 1.14 and this sentence of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company, the holders of a
majority of the shares of the Series C Registrable Securities and the holders of
a majority of the Series A and B Registrable Securities. Sections 2 and 3 and
this sentence of this Agreement may be amended and the observance of any term of
Sections 2 and 3 and this sentence of this Agreement may be waived (either
generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and Safeguard.
Section 4 of this Agreement may be amended and the observance of any term of
Section 4 of this Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively), only with the written
consent of the Company and SCP.
18
5.8 Severability. If one or more provisions of this Agreement are
------------
held to be unenforceable under applicable law, such provision shall be excluded
from this Agreement and the balance of the Agreement shall be interpreted as if
such provision were so excluded and shall be enforceable in accordance with its
terms.
5.9 Aggregation of Stock. All shares of securities held or acquired
--------------------
by affiliated entities or persons shall be aggregated together for the purpose
of determining the availability of any rights under this Agreement.
5.10 Entire Agreement. This Agreement (including the Schedules and
----------------
Exhibits hereto) amends, supercedes and replaces the Original Agreement
(including the Schedules and Exhibits thereto) in its entirety, and constitutes
the full and entire understanding and agreement between the parties with regard
to the subjects hereof and thereof.
[Signature page follows.]
19
IN WITNESS WHEREOF, the parties have executed this Second Amended and
Restated Investors' Rights Agreement as of the date first above written.
COMPANY:
-------
USDATA CORPORATION
By: /s/ Xxxxxx Xxxxx
---------------------------------
Xxxxxx Xxxxx
Chief Executive Officer
INVESTORS:
---------
SAFEGUARD DELAWARE, INC.
By: /s/ N. Xxxxxxx Xxxxxxx
---------------------------------
Name: N. Xxxxxxx Xxxxxxx
-------------------------------
Title: Vice President
------------------------------
SAFEGUARD 2000 CAPITAL, L.P.
By: Safeguard Delaware, Inc.,
its General Partner
By: /s/ N. Xxxxxxx Xxxxxxx
---------------------------------
Name: N. Xxxxxxx Xxxxxxx
-------------------------------
Title: Vice President
------------------------------
SCP PRIVATE EQUITY PARTNERS II, L.P.
By: SCP Private Equity II General Partner, L.P.,
its General Partner
By: SCP Private Equity II LLC,
its Manager
By: /s/ Xxxxxxx Xxxxxxxxx
----------------------------------
Name: Xxxxxxx Xxxxxxxxx
--------------------------------
Title: Manager
-------------------------------
OTHER PARTY:
-----------
SAFEGUARD SCIENTIFICS, INC.
(solely for the limited purpose of agreeing to
Sections 2, 3 and 5 hereof)
By: /s/ N. Xxxxxxx Xxxxxxx
----------------------------------------
Name: N. Xxxxxxx Xxxxxxx
----------------------------------------
Title: Vice President
---------------------------------------
2
SCHEDULE A
Investors
---------
Safeguard Delaware, Inc.
c/o Safeguard Scientifics, Inc.
800 The Safeguard Building
000 Xxxxx Xxxx Xxxxx
Xxxxx, Xxxxxxxxxxxx 00000
Fax: (000) 000-0000
ATTN: Chief Financial Officer
Safeguard 2000 Capital, L.P.,
c/o Safeguard Scientifics, Inc.
800 The Safeguard Building
000 Xxxxx Xxxx Xxxxx
Xxxxx, Xxxxxxxxxxxx 00000
Fax: (000) 000-0000
ATTN: Chief Financial Officer
SCP Private Equity Partners II, L.P.,
300 The Safeguard Building
000 Xxxxx Xxxx Xxxxx
Xxxxx, Xxxxxxxxxxxx 00000
Fax: (000) 000-0000
ATTN: Chief Financial Officer
