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EXHIBIT 4.4
Cynara
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT dated as of November 18, 1998 by and
between NATCO Group Inc., a Delaware corporation (the "Company"), and the
undersigned holders of Common Stock of the Company (the "Designated
Stockholders").
R E C I T A L S:
On November 18, 1998, the Certificate of Incorporation of the Company
was amended to authorize two classes of common stock, par value $0.01 per share
("Common Stock"), to wit: 45,000,000 shares of Class A Common Stock ("Class A
Common Stock") and 5,000,000 shares of Class B Common Stock ("Class B Common
Stock"), and to convert each of the then outstanding shares of common stock of
the Company into one share of Class A Common Stock (the "Charter Amendments").
After giving effect to the Charter Amendments, Cap I owns of record
and beneficially 5,563,667 shares (68.3%) of the outstanding Class A Common
Stock.
After giving effect to the Charter Amendments, Cap II owns of record
and beneficially 2,582,259 shares (31.7%) of the outstanding Class A Common
Stock.
Together, Cap I and Cap II own of record and beneficially, as of the
date of this Agreement, all the outstanding Class A Common Stock, being all the
outstanding Common Stock.
The Company, National Tank Company, a Delaware corporation and a
wholly owned subsidiary of the Company ("Natco"), Natco Acquisition Company, a
Delaware corporation and a wholly owned subsidiary of the Company ("Newco") and
The Cynara Company, a Delaware corporation ("Cynara"), are parties to an
Amended and Restated Agreement and Plan of Merger dated November 17 1998 but
effective as of March 26, 1998 (the "Merger Agreement"), pursuant to which
Cynara will be merged with and into Natco (the "Merger") and the Designated
Stockholders will receive shares of Class B Common Stock through conversion of
the outstanding shares of Cynara common stock.
The Company and Cap II have executed and delivered an Investment
Agreement dated November 17, 1998 pursuant to which the Company has agreed to
issue and sell, and Cap II has agreed to purchase, a non-negotiable promissory
note convertible upon occurrence of the events therein specified into 504,762
shares of Class A Common Stock.
Cap I and Cap II have entered into a Registration Rights Agreement of
even date herewith between the Company and such stockholders which contains
terms and provisions substantially similar to those herein (the "Capricorn
Registration Rights Agreement").
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It is a condition to consummation of the Merger that the stockholders
of Cynara who will become stockholders of the Company upon consummation of the
Merger shall have entered into a registration rights agreement as contemplated
by the Merger Agreement.
NOW, THEREFORE, for and in consideration of the foregoing, the mutual
covenants and agreements contained herein and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereto agree as follows:
Section 1. Definitions and Usage.
A. Definitions. The terms defined in this Section, wherever
used in this Agreement, shall, unless the context otherwise requires, have the
respective meanings hereinafter specified.
"Affected Stockholders" shall mean each Stockholder all or a portion
of whose shares of Common Stock have been included in a Registration Statement
filed with the Commission pursuant to the provisions of this Agreement.
"Agreement" shall mean this Registration Rights Agreement.
"Cap I" shall mean Capricorn Partners, L.P., a Delaware limited
partnership.
"Cap II" shall mean Capricorn Partners II, L.P., a Delaware limited
partnership.
"Capricorn Registration Rights Agreement" shall have the meaning
ascribed to such term in the recitals to this Agreement.
"Class A Common Stock" shall have the meaning ascribed to such term in
the recitals to this Agreement.
"Class B Common Stock" shall have the meaning ascribed to such term in
the recitals to this Agreement.
"Commission" shall mean the United States Securities and Exchange
Commission.
"Common Stock" shall have the meaning ascribed to such term in the
recitals to this Agreement.
"Company" shall mean NATCO Group Inc., a Delaware corporation, and any
successor corporation by merger, consolidation or otherwise and any parent
corporation resulting from the merger or consolidation of the Company with or
into a subsidiary of another corporation.
"Cynara" shall mean The Cynara Corporation, a Delaware corporation.
REGISTRATION RIGHTS AGREEMENT
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"Designated Stockholders" shall have the meaning ascribed to such term
in the first paragraph of this Agreement.
"Earnout Shares" shall mean the CTOC Earnout Shares, the Initial
Earnout Shares and the Supplemental Earnout Shares as those terms are defined
in the Merger Agreement.
"Effective Period" shall mean such period as shall be required under
the provisions of the Securities Act and the Securities Act Rules for delivery
of a prospectus meeting the requirements of Section 10(a) of the Securities Act
to any Person purchasing Common Stock in connection with an Underwritten Public
Offering or a Market Public Offering; provided, however, that such period shall
not include any delivery requirement with respect to the distribution by an
underwriter of its unsold allotment relating to an Underwritten Public
Offering.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, as the same shall be in effect at the date of any determination to be
made hereunder.
"Exchange Act Rules" shall mean the rules and regulations promulgated
by the Commission under the Exchange Act, as the same shall be in effect at the
date of any determination to be made hereunder.
"Market Public Offering" shall mean a public offering for cash of
shares of Common Stock into an existing trading market for outstanding shares
of Common Stock at other than a fixed price on or through the facilities of a
national securities exchange or to or through a market maker otherwise than on
an exchange, but in any case pursuant to a Registration Statement filed and
declared effective under the Securities Act and the Securities Act Rules.
"Merger" shall have the meaning ascribed to such term in the recitals
to this Agreement.
"Merger Agreement" shall have the meaning ascribed to such term in the
recitals to this Agreement.
"Notice of Intent to File" shall mean a written notice given by the
Company pursuant to Section 2.C or Section 3.A that the Company is preparing to
file a Primary Distribution Registration Statement or a Secondary Distribution
Registration Statement under the Securities Act relating to an Underwritten
Public Offering of Common Stock.
"Notice of Registration Request" shall mean a written notice given by
the Company pursuant to Section 2.A or 4.A to each Stockholder that did not
send the applicable Registration Request, notifying such Stockholders that the
applicable Registration Request has been received by the Company and briefly
advising such Stockholders that they have the right to request Registration for
the distribution of their holdings of Common Stock, subject to the terms and
provisions of this Agreement.
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"Person" shall mean an individual, a corporation, a partnership, a
trust, an unincorporated organization or a government or any agency or
political subdivision thereof.
"Primary Distribution" shall mean an Underwritten Public Offering of
Common Stock offered, sold and delivered by the Company.
"Primary Distribution Registration Statement" shall mean a
Registration Statement filed by the Company and declared effective under the
Securities Act and the Securities Act Rules relating to a Primary Distribution.
"Public Offering" shall mean either an Underwritten Public Offering or
a Market Public Offering.
"Registrable Shares" shall mean shares of Common Stock owned of record
by any Stockholder as to which such Stockholder has requested Registration
pursuant to the provisions of Section 2.A, 3.B or 4.A.
"Registration" shall mean the registration under the registration
provisions of the Securities Act of the offering, sale and delivery of shares
of Common Stock.
"Registration Expenses" shall mean the expenses associated with the
preparation and filing of any registration statement pursuant to Section 2.B,
3.C or 4.B herein and any sale covered thereby (including the reasonable fees
and expenses of legal counsel to the Affected Stockholders, fees related to
blue sky qualifications and filing fees in respect of the National Association
of Securities Dealers, Inc.), but excluding underwriting discounts or
commissions in respect of shares of Common Stock to be sold by the Affected
Stockholders.
"Registration Request" shall mean a written notice from a Stockholder
requesting that the Company file a Registration Statement with respect to an
Underwritten Public Offering pursuant to Section 2.A herein or with respect to
a Public Offering pursuant to Section 4.A herein.
"Registration Period" shall mean the period of time from the decision
of the Company to prepare and file a Registration Statement to and including
the effective date of such Registration Statement.
"Registration Statement" shall mean a registration statement filed on
Form X-0, X-0 or S-3 (or any successor form) under the registration provisions
of the Securities Act and the Securities Act Rules.
"Request Period" shall mean a period of fifteen (15) business days
after receipt of a Notice of Registration Request from the Company pursuant to
Section 2.A or 4.A by each Stockholder that did not send the applicable
Registration Request.
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"Secondary Distribution" shall mean an Underwritten Public Offering of
Common Stock offered, sold and delivered by shareholders of the Company other
than the Stockholders, but including the holders of Common Stock subject to the
Capricorn Registration Rights Agreement.
"Secondary Distribution Registration Statement" shall mean a
Registration Statement filed by the Company and declared effective under the
Securities Act and the Securities Act Rules relating to a Secondary
Distribution, including a distribution requested by the shareholders subject to
the Capricorn Registration Rights Agreement.
"Securities Act" shall mean the Securities Act of 1933, as amended, as
the same shall be in effect at the date of any determination to be made
hereunder.
"Securities Act Rules" shall mean the rules and regulations
promulgated by the Commission pursuant to the Securities Act, as the same shall
be in effect at the date of any determination to be made hereunder.
"Stockholders" shall mean any or all of the Designated Stockholders
and any assignee of shares of Common Stock theretofore held by any of them;
provided, however, that, in the case of any such assignee, the offering, sale
and delivery of shares of such Common Stock by such assignee are not exempt
from the registration provisions of the Securities Act pursuant to Section 4(1)
thereof (without regard to the exemption provided by Rule 144 under the
Securities Act unless paragraph (k) of Rule 144 is applicable thereto); and
provided, further, that, in the case of any assignee, such assignee has agreed
to be bound by the provisions of this Agreement in accordance with Section 15
herein.
"Supplemental Registration Request" shall mean a written notice given
by any Stockholder pursuant to the provisions of Section 2.A, 3.B or 4.A
herein, in which the Stockholder advises the Company as to the number of shares
of Common Stock that the Stockholder wishes to include in the applicable
Registration and in which the Stockholder agrees to (i) the specified method of
distribution, (ii) if applicable, the designated managing underwriter and (iii)
provide to the Company all such information as may be required by the Company
pursuant to Section 7 herein.
"Underwritten Public Offering" shall mean a firm commitment
underwritten public offering for cash of shares of Common Stock pursuant to a
Registration Statement filed and declared effective under the Securities Act
and the Securities Act Rules.
B. Rules of Construction. Unless the context otherwise
requires, as used in this Agreement: (a) a term has the meaning ascribed to it;
(b)"including" means "including without limitation;" (c) words in the singular
include the plural; (d) words in the plural include the singular; (e) words
applicable to one gender shall be construed to apply to each gender; (f) the
terms "hereof," "herein," "hereby," "hereto" and derivative or similar words
refer to this entire Agreement; and (g) the term "Section" shall refer to the
specified Section of this Agreement.
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Section 2. Registration Rights.
A. Registration Request. If the Company shall receive a Registration
Request from a Stockholder requesting that the Company file a Registration
Statement relating to an Underwritten Public Offering of shares of Common Stock
owned by such Stockholder, the Company shall give promptly (and in any event
within ten business days) a Notice of Registration Request to each other
Stockholder of the receipt of the Registration Request, enclosing a copy of the
Registration Request. During the Request Period, the other Stockholders shall
be entitled to give a Supplemental Registration Request to the Company in which
any or all such Stockholders request that the Company register pursuant to the
Securities Act and the Securities Act Rules all or any portion of the shares of
Common Stock owned by such Stockholders to be distributed in an Underwritten
Public Offering.
B. Required Registration. At the end of the Request Period, the
Company shall, subject to the provisions of Section 2.C herein, prepare as
promptly as practicable and file a Registration Statement with respect to the
distribution in accordance with the applicable method of distribution of the
Registrable Shares to be included therein and use its best efforts to cause the
Registration Statement to become effective under the Securities Act in
accordance with the Securities Act Rules,.
C. Suspension of Obligations. The Company's obligations under Section
2.B herein to prepare and file a Registration Statement and to seek its
effectiveness shall be subject to the following provisions:
i. The Company shall be required to file no more than two (2)
Registration Statements pursuant to Section 2.A herein and one (1)
Registration Statement pursuant to Section 4.B herein.
ii. The Company's obligations to prepare, file and seek
effectiveness of a requested Registration Statement shall be
suspended:
(a) if the aggregate number of Registrable Shares to
be included in such requested Registration Statement is less
than 500,000 shares of the then issued and outstanding Common
Stock;
(b) in any case, during the period from the time
that it gives a Notice of Intent to File to Stockholders that
it is preparing to file a Primary Distribution Registration
Statement until 90 days (or such shorter period as to which
the managing underwriter of the Primary Distribution to which
the Primary Distribution Registration Statement relates shall
consent in writing) have lapsed following the effective date
of a Primary Distribution Registration Statement under the
Securities Act; provided, however, that (A) such Notice of
Intent to File is given prior to the time of receipt by the
Company of a Registration Request by any Stockholder and (B)
that the Company shall use its best efforts to cause such
Primary Distribution
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Registration Statement to be declared effective as promptly
as practicable; and provided, further, that the obligation to
file a Registration Statement on behalf of any Stockholder
shall be reinstated if the Company does not file a Primary
Distribution Registration Statement within 30 days after
giving the Notice of Intent to File;
(c) in any case, during the period from the time
that it gives a Notice of Intent to File to Stockholders that
it is preparing to file a Secondary Distribution Registration
Statement until 90 days (or such shorter period as to which
the managing underwriter of a Secondary Distribution effected
by means of a Secondary Distribution Registration Statement
shall consent in writing) have lapsed following the effective
date of the Secondary Distribution Registration Statement
under the Securities Act; provided, however, that (A) such
Notice of Intent to File is given prior to time of receipt by
the Company of a Registration Request by any Stockholder and
(B) that the Company shall use its best efforts to cause such
Secondary Distribution Registration Statement to be declared
effective as promptly as practicable; and provided, further,
that the obligation to file a Registration Statement on
behalf of any Stockholder shall be reinstated if the Company
does not file a Secondary Distribution Registration Statement
within 30 days after giving the Notice of Intent to File;
(d) if at the time of receipt by the Company of a
Registration Request the Company has material inside
information as to which it believes it has a valid business
purpose in refraining from disclosing publicly for the time
being and that current public disclosure of such information
would have a material adverse effect on the Company, for a
period commencing with the date of receipt of the
Registration Request and ending on the earlier of (a) 60 days
after such receipt of the Registration Request; (b) the
public announcement of such material inside information; or
(c) the date on which the Company gives the Stockholder who
issued the Registration Request a notice that suspension of
its obligation is no longer required; provided, however, that
the same material inside information shall not constitute a
basis for continuation of this suspension period; or
(e) if at the time of receipt by the Company of a
Registration Request the Company is not required to file
reports with the Commission pursuant to Section 15(d) of the
Securities Act or Section 13 of the Exchange Act.
iii. A Registration Statement filed pursuant to a
Registration Request made under Section 2.B herein shall first include
all Registrable Shares requested to be included by any and all
Stockholders and, only after such inclusion, may include Common Stock
being sold for the account of the Company or any other security
holders. Any Common Stock to be offered on behalf of the Company or
such other security holders will be included in such Registration
Statement only to the extent that, in the reasonable opinion of the
managing underwriter for the Underwritten Public Offering of
Registrable Shares on behalf of
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Stockholders, such inclusion will not materially adversely affect the
distribution of Registrable Shares on behalf of such Stockholders.
D. Underwriter. The selection of an underwriter for an Underwritten
Public Offering of Registrable Shares by Stockholders shall be subject to the
approval of the Company, which shall not be unreasonably withheld.
E. Withdrawn Registration Statement. For purposes of Section 2.C(i)
herein, if a requested Registration Statement is filed and the Company
otherwise complies with its obligations hereunder, and
i. the Registration Statement is withdrawn with the consent
of the Affected Stockholders as a result of a delay in the offering
requested by the Company, then no requested Registration Statement
shall be deemed to have been filed; or
ii. the Affected Stockholders cease to prosecute the Public
Offering subject thereto actively and in good faith, the Company shall
have the right to withdraw the Registration Statement without the
consent of the Affected Stockholders and the requested Registration
Statement shall be deemed to have been filed.
Section 3. Incidental/"Piggy-back" Registration.
A. Notice of Intent to File. If the Company at any time proposes to
file a Primary Distribution Registration Statement or a Secondary Distribution
Registration Statement under the Securities Act relating to an Underwritten
Public Offering of Common Stock that would permit the inclusion therein of
shares of Common Stock to be distributed in accordance with the method of
distribution contemplated by such Registration Statement, the Company shall
give to each Stockholder a Notice of Intent to File promptly after a
determination has been made by the Company to prepare and file such
Registration Statement, but in any event not less than ten days before the
filing with the Commission of such Registration Statement, which notice shall
set forth the intended method of distribution (including the name of the
managing underwriter) of the securities proposed to be registered. The Notice
of Intent to File shall include an offer to include in such filing, subject to
the other provisions of this Agreement, such amount of Registrable Shares as
each Stockholder may request.
B. Supplemental Registration Request. If any Stockholder wishes to
have Registrable Shares (including Earnout Shares) registered pursuant to this
Section 3, it shall advise the Company by giving a Supplemental Registration
Request within 20 days after the date of receipt of the Notice of Intent to
File (or such shorter period, but in any event not less than ten days, as the
Company shall specify in its Notice of Intent to File), setting forth the
amount of Registrable Shares for which Registration is requested.
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C. Registration Obligation. Subject to the provisions of the next
sentence, the Company shall include all Registrable Shares specified in the
Supplemental Registration Requests received by it in accordance with Subsection
B of this Section 3. If, however, the managing underwriter of the proposed
Primary Distribution or Secondary Distribution shall advise the Company in
writing that, in the reasonable opinion of such managing underwriter, the
inclusion in the Registration Statement of the aggregate number of shares of
Common Stock requested by the Stockholders to be included in the Primary
Distribution or Secondary Distribution would materially adversely affect such
distribution of securities, then the Company shall so advise the Affected
Stockholders and the number of such shares of Common Stock included in the
Registration Statement shall be reduced to the number acceptable to such
managing underwriter and such reduced number of shares shall be allocated pro
rata among the Affected Stockholders based on the Registrable Shares held by
each. If any Stockholder does not agree to the terms of underwriting of such
Primary Distribution or Secondary Distribution, the shares of Common Stock
owned by such Stockholder shall be excluded therefrom by written notice from
the Company or such managing underwriter.
D. Underwriting Agreement. Any obligation of the Company to include
shares of Common Stock of any Stockholder in a Registration Statement prepared
and filed pursuant to this Section 3 shall be conditioned upon the agreement of
such Stockholder to enter into an underwriting agreement with the Company,
other security holders, if any, and the managing underwriter of the Primary
Distribution or the Secondary Distribution of the type described in subsection
(H) of Section 5.
Section 4. Special Registration Right. Pursuant to the terms of
the Merger Agreement, the Designated Stockholders may in the future receive
Earnout Shares and, in order to provide liquidity to the Designated
Stockholders who receive such Earnout Shares, the Company has agreed to provide
a special right of Registration with respect to such Earnout Shares as in this
Section 4 provided.
A. Notices. If, at any time during the term hereof, (i) some or all of
the Stockholders receive the record and beneficial ownership of Earnout Shares,
whether from the Company upon original issue pursuant to the Merger Agreement
or from one or more Designated Stockholders upon assignment not involving a
Public Offering, (ii), in the opinion of counsel reasonably satisfactory to the
Company, all or part of such Earnout Shares may not be sold by such
Stockholders without registration under the Securities Act or reliance on an
exemption from the registration provisions thereof (other than Section 4(1) of
the Securities Act) and (iii) the Company shall receive a Registration Request
from one or more such Stockholders requesting that the Company file a
Registration Statement relating to a Public Offering of shares of Common Stock
owned by such Stockholder or Stockholders, then the Company shall give promptly
(and in any event within ten business days) a Notice of Registration Request to
each other Stockholder who, to the knowledge of the Company, holds Earnout
Shares of the receipt of the Registration Request, enclosing a copy of the
Registration Request. During the Request Period, such other Stockholders shall
be entitled to give a Supplemental Registration Request to the Company in which
any or all such Stockholders request that the Company register pursuant to the
Securities Act and the Securities Act Rules all or
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any portion of the shares of Common Stock constituting Earnout Shares owned by
such Stockholders.
B. Preparation and Filing. After the Request Period, the Company
shall, subject to the provisions of Section 2.C herein, prepare as promptly as
practicable and file a Registration Statement with respect to the offering,
sale and delivery by the Stockholders of all or any part of the shares of
Common Stock constituting Earnout Shares in accordance with the applicable
method of distribution of the Registrable Shares to be included therein
specified in the Registration Request and use its best efforts to cause the
Registration Statement to become effective under the Securities Act in
accordance with the Securities Act Rules. If so requested by such Affected
Stockholders, the Registration Statement shall be filed pursuant to Rule 415
(relating to "shelf registration statements") of the Securities Act Rules.
C. Distribution. The applicable method of distribution of the
Registrable Shares shall be as requested by the Affected Stockholders and the
methods of distribution may include a distribution by one or more
broker-dealers named in the Registration Statement "at the market" pursuant to
a Market Public Offering. The Company agrees that it will amend the
Registration Statement or supplement the prospectus to include any material
information with respect to the plan of distribution not previously disclosed
in the Registration Statement or any material change to such information in the
Registration Statement.
D. Limitations. The preparation and filing of a Registration Statement
pursuant to this Section 4 and the offering, sale and delivery of Registrable
Shares pursuant thereto shall be subject to the following limitations:
i. The Company shall be obligated to prepare, file and cause
to become effective only one Registration Statement pursuant to this
Section 4.
ii. Only Earnout Shares, whether received by a Designated
Stockholder from the Company upon original issue pursuant to the
Merger Agreement or received by another Stockholder from a Designated
Stockholder upon an assignment not involving a Public Offering, may be
included in a Registration Statement filed pursuant to this Section 4,
and no sales of such shares shall be effected by the Affected
Stockholders under such Registration Statement prior to the delivery
to the Company of a certificate of the Affected Stockholders to such
effect.
iii. The proposed and actual filing by the Company of a
Registration Statement pursuant to this Section 4 shall not entitle
any Stockholder to registration rights pursuant to Section 3 herein.
iv. The offering, sale and delivery of Registrable Shares
pursuant to any Registration Statement filed pursuant to Rule 415
(relating to "shelf registration statements") of the Securities Act
Rules under this Section 4 shall be suspended if, at the time of any
offering,
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sale and delivery pursuant to a shelf registration statement, the
Company has material inside information as to which it believes it has
a valid business purpose in refraining from disclosing publicly for
the time being and that current public disclosure of such information
would have a material adverse effect on the Company. Such suspension
period shall commence upon notice by the Company to the Affected
Stockholders and shall continue until the earlier of (a) the
expiration of 60 days thereafter; (b) the public announcement of such
material inside information; or (c) the date on which the Company
gives the Affected Stockholders notice that such suspension is no
longer required; provided, however, that the same material inside
information shall not constitute a basis for continuation of this
suspension period.
v. The Company shall be obligated to maintain the
effectiveness of a Registration Statement filed pursuant to Rule 415
(relating to "shelf registration statements") of the Securities Act
Rules under this Section 4 until the third anniversary of the
effective date thereof and no longer.
Section 5. Registration Procedures. If the Company is required
by the provisions of Section 2, 3 or 4 to effect the Registration of any of the
Registrable Shares, the Company shall, as expeditiously as possible:
A. Filing. Prepare and file with the Commission a Registration
Statement with respect to such shares of Common Stock and use its best efforts
to cause such Registration Statement to become and, subject to Subsection C of
this Section 5, remain effective.
B. Amendments. Prepare and file with the Commission during the
Registration Period such amendments and supplements to such Registration
Statement and the prospectus used in connection therewith as may be necessary
to permit such Registration Statement to become effective in accordance with
the Securities Act and the Securities Act Rules and to ensure that such
Registration Statement and the prospectus used in connection therewith comply
with the disclosure standards of Section 11 of the Securities Act and Section
10(b) of the Exchange Act and that such prospectus complies with Section 10 of
the Securities Act, in each case during the Effective Period.
C. Maintenance of Effectiveness. Subject to the provisions of Section
4.D herein, use its best efforts to maintain the effectiveness of such
Registration Statement and to ensure compliance of the prospectus contained
therein with Section 10(a) of the Securities Act for the Effective Period.
D. Copies. Furnish to each Affected Stockholder (i) such number of
copies of such Registration Statement and of each amendment and supplement
thereto (in each case including all exhibits), such number of copies of the
prospectus included in such Registration Statement (including each preliminary
prospectus, summary prospectus and prospectus supplement), in conformity with
the requirements of the Securities Act, and such other documents as such
Affected Stockholder may reasonably require in order to facilitate the
offering, sale and delivery or other disposition of the Registrable Shares
owned by such Affected Stockholder and (ii), during the
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Registration Period and the Effective Period, copies of any written
correspondence or memoranda relating to oral communications in each case with
the Commission and copies of any request by the Commission for any amendment of
or supplement to the Registration Statement or the prospectus included therein
or for additional information.
E. Blue Sky Laws. Use its best efforts to register or qualify the
Common Stock covered by such Registration Statement under the securities or
blue sky laws of such jurisdictions as the managing underwriter of such
Distribution may reasonably request (excluding, however, any jurisdiction in
which the filing would subject the Company to additional tax liability and any
jurisdiction in which the Company would thereby be required to execute a
general consent to service of process) and use all reasonable efforts to do
such other acts and things as may be required to enable the Affected
Stockholders to consummate the public sale or other disposition in such
jurisdictions of the Registrable Shares owned by such Affected Stockholders.
F. Earnings Statement. Make available to its holders of Common Stock,
as soon as reasonably practicable, an earnings statement covering the period of
at least 12 months, but not more than 18 months, beginning with the first month
after the effective date of the Registration Statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the Securities Act.
G. Amended Prospectuses. Notify each Affected Stockholder immediately
if the Company shall become aware at any time during the Effective Period that
the prospectus included in the Registration Statement, as such prospectus may
be amended or supplemented, includes an untrue statement of a material fact or
omits to state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading in light of the
circumstances then existing, and at the request of any Affected Stockholder to
prepare promptly and to furnish to each Affected Stockholder such number of
copies of an amended or supplemental prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such Registrable Shares, such
prospectus shall not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to
make the statements therein not misleading in the light of the circumstances
then existing.
H. Underwriting Agreements. Enter into such agreements (including an
underwriting agreement in customary form and containing customary provisions
relating to legal opinions and accountants' letters, representations and
warranties and mutual indemnification and contribution between the Company and
the underwriters for the Affected Stockholders) and use all reasonable efforts
to take such other actions as the Affected Stockholders may reasonably request
in order to expedite or facilitate the disposition of such Registrable Shares.
I. Inspection. Make available for inspection by the Affected
Stockholders, by any underwriter participating in any distribution to be
effected pursuant to such Registration Statement and by any attorney,
accountant or other agent retained by the Affected Stockholders or any such
underwriter all pertinent financial and other records, pertinent corporate
documents and properties of the Company and cause all of the Company's
officers, directors and employees to supply all such
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information requested by the Affected Stockholders, such underwriter, attorney,
accountant or agent, as is reasonably needed in connection with such
Registration.
6. Classes of Stock. The parties hereto intend that any capital stock
sold by a Stockholder pursuant to the provisions of this Agreement shall be
Class A Common Stock if sold prior to January 1, 2002 or Common Stock if sold
thereafter. Accordingly, subject to the proviso to Article Fourth, II-A-4, of
the Certificate of Incorporation of the Company, each Stockholder agrees to
convert any Class B Common Stock that is included as Registrable Shares in a
Registration Statement filed pursuant to any provision of this Agreement into
Class A Common Stock prior to the effective date of such Registration Statement
under the Securities Act.
7. Expenses; Limitations on Registration. The Registration Expenses
relating to any Registration effected by the Company pursuant to this Agreement
shall be for the account of the Company; provided, however, that any and all
underwriting discounts and commissions attributable to the sale of the shares
of Common Stock of the Affected Stockholders shall be for the account of the
Affected Stockholders.
For purposes of this Section 7, the Company shall be obligated to pay
the fees and expenses of only one law firm representing the Affected
Stockholders. If more than one such firm shall represent the Affected
Stockholders in connection with a Registration under this Agreement, the
Affected Stockholders shall notify the Company as to which firm shall be deemed
to represent the Affected Stockholders for purposes of this Section 7.
Section 8. Stockholders' Information. The Affected Stockholders
shall provide all information reasonably requested by the Company for inclusion
in any Registration Statement to be filed hereunder. The actual provision of
such information shall be a condition precedent to the obligation of the
Company to take any action pursuant to this Agreement in respect of the
Registration of Registrable Shares of any Affected Stockholder.
Section 9. Indemnification.
A. In connection with the Registration of any Registrable Shares under
the Securities Act pursuant to this Agreement, the Company agrees to indemnify
and hold harmless each Affected Stockholder, its partners, directors, officers
and employees, and each other Person, if any, who controls such Affected
Stockholder within the meaning of Section 15 of the Securities Act, against any
losses, claims, damages or liabilities, joint or several, to which such
Affected Stockholder or any such partner, director, officer, employee or
controlling Person may become subject under the Securities Act or any other
statute or at common law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon (i)
any untrue statement or any alleged untrue statement of a material fact
contained in the Registration Statement or the prospectus included therein at
the time the Registration Statement is declared effective or any omission or
alleged omission of a material fact required to be stated therein or necessary
in order to make the statements therein not misleading or (ii) any untrue
statement of a material fact or alleged untrue
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statement of a material fact contained in the Registration Statement, any
preliminary prospectus, the prospectus included therein or any amendment or
supplement thereto or any omission or alleged omission of a material fact
required to be stated therein or necessary in order to make the statements
concerning the Company therein, in the light of the circumstances under which
they were made, not misleading and shall reimburse each Affected Stockholder
and each such partner, director, officer, employee and controlling Person for
any legal or other expenses reasonably incurred by such Affected Stockholder or
such partner, director, officer employee or controlling Person in connection
with investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Company shall not be liable in any such
case to the extent that any such loss, claim, damage or liability arises out of
or is based upon any untrue statement or alleged untrue statement or omission
or alleged omission made in such Registration Statement, preliminary
prospectus, prospectus, or amendment or supplement in reliance upon and in
conformity with written information furnished by or on behalf of an Affected
Stockholder to the Company expressly for use therein; and provided, further,
that the Company shall not be liable in any such case to the extent that any
such loss, claim, damage, liability or expense arises out of or is based upon
an untrue statement or alleged untrue statement or omission or alleged omission
in any preliminary prospectus if such untrue statement or alleged untrue
statement or omission or alleged omission was corrected in the final prospectus
included in the Registration Statement at the time it became effective and the
Affected Stockholder, in the case of a Market Public Offering, or the managing
underwriter, in the case of an Underwritten Public Offering, failed to provide
the final prospectus as required by the Securities Act and the Securities Act
Rules. Such indemnity shall remain in full force and effect regardless of any
investigation made by or on behalf of any Affected Stockholder or any such
partner, director, officer, employee or controlling Person, and shall survive
the transfer of such securities by any Affected Stockholder.
B. Each Affected Stockholder agrees to indemnify and hold harmless the
Company, its directors, officers and employees, each other Person, if any, who
controls the Company and each other Affected Stockholder against any losses,
claims, damages or liabilities, joint or several, to which the Company, any
such director, officer or employee, any such controlling Person or such other
Affected Stockholder may become subject under the Securities Act or any other
statute or at common law, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon (i)
any untrue statement or any alleged untrue statement of a material fact
contained in the Registration Statement or the prospectus included therein at
the time the Registration Statement is declared effective or any omission or
alleged omission of a material fact required to be stated therein or necessary
in order to make the statements therein not misleading or (ii) any untrue
statement of a material fact or alleged untrue statement of a material fact
contained in the Registration Statement, any preliminary prospectus, the
prospectus included therein or any amendment or supplement thereto or any
omission or alleged omission of a material fact required to be stated therein
or necessary in order to make the statements concerning the Company therein, in
the light of the circumstances under which they were made, not misleading, in
each case to the extent, but only to the extent, that such alleged untrue
statement or alleged omission was made in such Registration Statement,
preliminary prospectus, prospectus, amendment or supplement in reliance upon
and in conformity with written information furnished by or on behalf of an
Affected
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Stockholder to the Company expressly for use therein, and shall reimburse the
Company or such director, officer, employee or other Person for any legal or any
other expenses reasonably incurred in connection with investigating or defending
any such loss, claim, damage, liability or action.
C. Promptly after receipt by an indemnified party hereunder of written
notice of the commencement of any action or proceeding involving a claim
referred to in subsection (A) or (B) of this Section 9, such indemnified party
will, if a claim in respect thereof is to be made against an indemnifying
party, give written notice to the latter of the commencement of such action;
provided, that the failure of any indemnified party to give notice as provided
herein shall not relieve the indemnifying party of its obligation under this
subsection C to the extent the indemnifying party is not materially prejudiced
by such failure. In case any such action is brought against an indemnified
party, the indemnified party shall permit the indemnifying party to assume the
defense of such action or proceeding, provided that counsel for the
indemnifying party, who shall conduct the defense of such action or proceeding,
shall be approved by the indemnified party (whose approval shall not be
unreasonably withheld) and the indemnified party may participate in such
defense (in which case, such participation shall be at such indemnified party's
expense, unless in such indemnified party's reasonable judgment a conflict of
interest between such indemnified party and the indemnifying party shall exist
in respect of such claim, in which event the indemnifying party shall pay the
reasonable fees and expense of separate counsel for the indemnified party). No
indemnifying party shall consent to entry of any judgment or enter into any
settlement that does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such indemnified party of a release from all
liability in respect to such claim or litigation. The indemnifying party shall
not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the fees and expenses of more than one separate
firm for all indemnified parties. The indemnifying party shall not be liable
for any settlement of any proceeding effected without its written consent.
D. Indemnification similar to that specified in the preceding
subsections of this Section 9 shall be given by the Company and each Affected
Stockholder (with such modifications as shall be appropriate) with respect to
liability related to any required registration or other qualification of
Registrable Shares under any Federal or state law or regulation of governmental
authority other than the Securities Act.
E. If the indemnification provided for in this Section 9 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (A) or (B) above, then the indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in subsection (A) or (B) above, in
such proportion as is appropriate to reflect the relative fault of the Company,
on the one hand, and each Affected Stockholder, on the other, in connection
with the statements or omissions that resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company or such Affected Stockholder and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The
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Company and the Affected Stockholders agree that it would not be just and
equitable if contributions pursuant to this subsection (E) were to be determined
by pro rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in the first sentence of
this subsection (E). The amount paid by an indemnified party as a result of the
losses, claims, damages or liabilities referred to in the first sentence of
this subsection (E) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any action or claim (which shall be limited as provided in
subsection (C) above if the indemnifying party has assumed the defense of any
such action in accordance with the provisions thereof) that is the subject of
this subsection (E). Notwithstanding the provisions of this subsection (E), in
respect of any loss, claim, damage or liability based upon any untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact that relates to information other than information
supplied by any Affected Stockholder, no Affected Stockholder shall be required
to contribute any amount in excess of the amount by which the total price at
which the Registrable Shares offered by it and distributed to the public
exceeds the amount of any damages that such Affected Stockholder 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 Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation. Promptly after receipt by an indemnified party under this
subsection (E) of notice of the commencement of any action against such party
in respect of which a claim for contribution may be made against an
indemnifying party under this subsection (E), such indemnified party shall
notify the indemnifying party in writing of the commencement thereof if the
notice specified in subsection (C) above has not been given with respect to
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 under
this subsection (E) to the extent such omission is not prejudicial.
Section 10. Public Availability of Information. The Company shall
comply with all applicable public information reporting requirements of the
Commission, to the extent required from time to time to enable each Stockholder
to sell Registrable Shares without Registration under the Securities Act within
the limitation of the exemptions provided by (i) Rule 144 under the Securities
Act, as such Rule may be amended from time to time, or (ii) any similar rule or
regulation hereafter adopted by the Commission. Upon the request of any
Stockholder, the Company will deliver to such Stockholder a written statement
as to whether it has complied with such requirements.
Section 11. Supplying Information. The Company shall cooperate
with each Stockholder in supplying such information as may be necessary for
such Stockholder to complete and file any information reporting forms presently
or hereafter required by the Commission as a condition to the availability of
an exemption from the Securities Act for the sale of any Registrable Shares.
Section 12. Specific Performance. Each party hereto acknowledges
and agrees that each other party hereto would be irreparably harmed and would
have no adequate remedy of law if any of the provisions of this Agreement were
not performed in accordance with their specific terms or were otherwise
breached. Accordingly, it is agreed that, in addition to any other remedies by
law
REGISTRATION RIGHTS AGREEMENT
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or in equity which may be available, the parties hereto shall be entitled to
obtain preliminary and permanent injunctive relief with respect to any breach
or threatened breach of, or otherwise obtain specific performance of, the
covenants and other agreements contained in this Agreement.
Section 13. Representations and Warranties of the Company. The
Company represents and warrants to each Stockholder that, as of the date of
this Agreement, (a) the Company is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and has
the corporate power and authority to enter into this Agreement and to carry out
its obligations hereunder, (b) the execution and delivery of this Agreement by
the Company and the consummation by the Company of the transactions
contemplated hereby have been duly authorized by all necessary corporate action
on the part of the Company and no other corporate proceedings on the part of
the Company are necessary to authorize this Agreement or any of the
transactions contemplated hereby, and (c) this Agreement has been duly executed
and delivered by the Company and constitutes a valid and binding obligation of
the Company, and, assuming that this Agreement constitutes a valid and binding
obligation of each of the Designated Stockholders, is enforceable against the
Company in accordance with its terms, subject to applicable bankruptcy,
reorganization, insolvency, moratorium, fraudulent conveyance and similar laws
affecting creditors' rights generally from time to time and to general
principles of equity and except as the enforceability thereof may be limited by
considerations of public policy.
Section 14. Representations and Warranties. Each of the
Designated Stockholders represents and warrants to the Company that, as of the
date of this Agreement, (a) to the extent it is a legal entity, it is an
organization duly organized, validly existing and in good standing under the
laws of the jurisdiction of its organization and has the organizational power
and authority to enter into this Agreement and to carry out its obligations
hereunder, (b) to the extent it is a legal entity, the execution and delivery
of this Agreement by such Stockholder and the consummation by such Stockholder
of the transactions contemplated hereby have been duly authorized by all
necessary organizational action on the part of such Stockholder and no other
organizational proceedings on the part of such Stockholder are necessary to
authorize this Agreement or any of the transactions contemplated hereby and (c)
this Agreement has been duly executed and delivered by such Stockholder and
constitutes a valid and binding obligation of such Stockholder and, assuming
that this Agreement constitutes a valid and binding obligation of the Company,
is enforceable against such Stockholder in accordance with its terms, subject
to applicable bankruptcy, reorganization, insolvency, moratorium, fraudulent
conveyance and similar laws affecting creditors' rights generally from time to
time and to general principles of equity and except as the enforceability
thereof may be limited by considerations of public policy.
Section 15. Expiration. This Agreement and the rights, benefits,
duties and obligations hereunder of the parties hereto and their successors and
permitted assigns shall expire and be of no further force or effect on May 31,
2004.
Section 16. Notices. All notices and other communications
hereunder shall be in writing and shall be deemed given if delivered personally
or transmitted by telex, telegram or facsimile
REGISTRATION RIGHTS AGREEMENT
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transmission or mailed by registered or certified mail (return receipt
requested) to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):
(a) if to any Designated Stockholder, to such Designated
Stockholder at the address of such Designated Stockholder set
forth on Annex A hereto
with a copy to:
Xxxx Xxxxx Xxxx & XxXxxx XX
Xxx Xxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attn.: Xx. Xxxx X. Xxxxxx
Facsimile: (000) 000-0000
(b) if to the Company, to:
NATCO Group, Inc.
Brookhollow Central III
0000 Xxxxx Xxxx Xxxx
Xxxxx 000
Xxxxxxx, Xxxxx 00000
Attn.: Xx. Xxxxxxxxx X. Xxxxxxx, Chairman and Chief
Executive Officer
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxx & Xxxxxx L.L.P.
First City Tower
0000 Xxxxxx Xxxxxx
Xxxxxxx, Xxxxx 00000-0000
Attn.: Xx. Xxxxxxx X. Xxxx III
Facsimile No.: (000) 000-0000
Section 17. Benefit and Assignment.
(a) The terms and conditions of this Agreement shall inure to
the benefit of and be binding on the parties hereto and their
respective successors and permitted assigns; provided, however, that,
except as otherwise provided in this Section, this Agreement shall not
be assignable by any party hereto except by operation of law or with
the prior express written consent of the other parties hereto. Nothing
in this Agreement, express or implied, is intended to confer upon any
party, other than the parties hereto and their respective successors
and permitted assigns, any rights, remedies, obligations or
liabilities under or by reason of this Agreement.
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(b) If any Designated Stockholder shall transfer and assign
shares of Common Stock to any Person otherwise than in an Underwritten
Public Offering (including any transfer on foreclosure of indebtedness
secured by the grant of a security interest in such shares of Common
Stock), such Designated Stockholder (or any Person who shall be a
transferee or assignee pursuant to this subsection (b)), as the case
may be, may assign such portion of its rights and benefits under this
Agreement as is necessary to permit such Person to act as a
Stockholder hereunder; provided, however, that such Person shall agree
in writing to be bound by the duties and obligations of a Stockholder
hereunder.
Section 18. Governing Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware without
regard to the application of doctrines of conflicts of law.
Section 19. Counterparts. This Agreement may be executed
simultaneously in one or more counterparts, any of which may have been
transmitted and received by facsimile transmission and each of which shall be
deemed to be an original but all of which together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their officers thereunto duly authorized.
NATCO GROUP, INC.
BY: /s/ XXXXXXXXX X. XXXXXXX
-------------------------------------------
Xxxxxxxxx X. Xxxxxxx
Chairman and Chief Executive Officer
THE DESIGNATED STOCKHOLDERS
/s/ XXXXXXX X. XXXXXXXX
----------------------------------------------------
Xxxxxxx X. Xxxxxxxx
/s/ XXXXXX X. XXXXXXX
----------------------------------------------------
Xxxxxx X. Xxxxxxx
/s/ XXXXXXX X. XXXXXX
----------------------------------------------------
Xxxxxxx X. Xxxxxx
/s/ XXXXXX X. XXXXXX, XX.
----------------------------------------------------
Xxxxxx X. Xxxxxx, Xx.
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/s/ XXXXX X. XXXXX
----------------------------------------------------
Xxxxx X. Xxxxx
/s/ XXXXXX X. XXXX
----------------------------------------------------
Xxxxxx X. Xxxx
/s/ XXXXXXX X. XXXXXXXXX
----------------------------------------------------
Xxxxxxx X. Xxxxxxxxx
/s/ XXXX X. XXXXX, XX.
----------------------------------------------------
Xxxx X. Xxxxx, Xx.
THE 1998 TRUST FOR XXXX XXXXX XXXXXXX
By: /s/ XXXX XXXXX XXXXXXX
-----------------------------------------------
Name: Xxxx Xxxxx Xxxxxxx
---------------------------------------------
Title: Trustee
--------------------------------------------
BANC ONE CAPITAL PARTNERS II, LTD.
By: /s/ XXXXX X. XXXXXXX
-----------------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Authorized Signer
REGISTRATION RIGHTS AGREEMENT
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