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EXHIBIT 10.8
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WARRANT REGISTRATION RIGHTS AGREEMENT
DATED AS OF SEPTEMBER 29, 1997
BY AND AMONG
MGC COMMUNICATIONS, INC.,
BEAR, XXXXXXX & CO. INC.
AND
XXXXXX XXXX LLC
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THIS WARRANT REGISTRATION RIGHTS AGREEMENT (THE "AGREEMENT")
IS MADE AND ENTERED INTO AS OF SEPTEMBER 29, 1997, AMONG MGC COMMUNICATIONS,
INC., A NEVADA CORPORATION (THE "COMPANY") AND BEAR, XXXXXXX & CO. INC. AND
XXXXXX XXXX LLC (EACH AN "INITIAL PURCHASER" AND TOGETHER, THE "INITIAL
PURCHASERS").
THIS AGREEMENT IS MADE PURSUANT TO THE PURCHASE AGREEMENT,
DATED SEPTEMBER 24, 1997 (THE "PURCHASE AGREEMENT"), BY AND AMONG THE COMPANY
AND THE INITIAL PURCHASERS. IN ORDER TO INDUCE THE INITIAL PURCHASERS TO
PURCHASE THE UNITS, CONSISTING OF AN AGGREGATE OF $160,000,000 PRINCIPAL AMOUNT
13% SENIOR SECURED NOTES DUE 2004 (THE "NOTES") AND WARRANTS (THE "WARRANTS") TO
PURCHASE 1,291,200 SHARES OF COMMON STOCK, PAR VALUE $.001 PER SHARE, OF THE
COMPANY (THE "COMMON STOCK"), THE COMPANY HAS AGREED TO PROVIDE THE REGISTRATION
RIGHTS SET FORTH IN THIS AGREEMENT. THE EXECUTION AND DELIVERY OF THIS AGREEMENT
IS A CONDITION TO THE OBLIGATIONS OF THE INITIAL PURCHASERS SET FORTH IN SECTION
8 OF THE PURCHASE AGREEMENT.
IN CONSIDERATION OF THE FOREGOING, THE PARTIES HERETO AGREE AS
FOLLOWS:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms
shall have the following meanings:
"Act" means the Securities Act of 1933, as amended.
"Business Day" means any day except a Saturday, Sunday or
other day in the City of New York on which banks are authorized to close.
"CHANGE OF CONTROL" HAS THE MEANING ASCRIBED TO THAT TERM IN
THE INDENTURE.
"EXCHANGE ACT" MEANS THE SECURITIES EXCHANGE ACT OF 1934, AS
AMENDED FROM TIME TO TIME.
"HOLDER" MEANS THE INITIAL PURCHASERS, FOR SO LONG AS THE
INITIAL PURCHASERS OWN ANY WARRANTS OR ANY REGISTRABLE SECURITIES, AND THEIR
SUCCESSORS, ASSIGNS AND DIRECT AND INDIRECT TRANSFEREES WHO BECOME REGISTERED
OWNERS OF WARRANTS OR REGISTRABLE SECURITIES.
"INDENTURE" MEANS THE INDENTURE DATED AS OF THE DATE HEREOF
AMONG THE COMPANY AND MARINE MIDLAND BANK, AS TRUSTEE, AS THE SAME MAY BE
AMENDED OR SUPPLEMENTED FROM TIME TO TIME IN ACCORDANCE WITH THE TERMS THEREOF.
"EQUITY OFFERING" HAS THE MEANING ASCRIBED TO THAT TERM IN THE
INDENTURE.
"NASD" MEANS THE NATIONAL ASSOCIATION OF SECURITIES DEALERS,
INC.
"PERSON" MEANS AN INDIVIDUAL, PARTNERSHIP, CORPORATION, TRUST
OR UNINCORPORATED ORGANIZATION, OR A GOVERNMENT OR AGENCY OR POLITICAL
SUBDIVISION THEREOF.
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"PROSPECTUS" MEANS THE PROSPECTUS INCLUDED IN A REGISTRATION
STATEMENT AT THE TIME SUCH REGISTRATION STATEMENT IS DECLARED EFFECTIVE, AS
AMENDED OR SUPPLEMENTED BY ANY PROSPECTUS SUPPLEMENT AND BY ALL OTHER AMENDMENTS
THERETO, INCLUDING POST-EFFECTIVE AMENDMENTS, AND ALL MATERIAL INCORPORATED BY
REFERENCE INTO SUCH PROSPECTUS.
"REGISTRABLE SECURITIES" SHALL MEAN ANY OF (a) THE WARRANT
SHARES AND (b) ANY OTHER SECURITIES ISSUED OR ISSUABLE WITH RESPECT TO THE
WARRANT SHARES BY WAY OF A STOCK DIVIDEND OR STOCK SPLIT OR IN CONNECTION WITH A
COMBINATION OF SHARES, RECAPITALIZATION, MERGER, CONSOLIDATION OR OTHER
REORGANIZATION OR OTHERWISE UNTIL SUCH DATE AS SUCH SECURITY (i) IS EFFECTIVELY
REGISTERED UNDER THE SECURITIES ACT AND DISPOSED OF IN ACCORDANCE WITH A
REGISTRATION STATEMENT OR (ii) IS DISTRIBUTED TO THE PUBLIC PURSUANT TO RULE 144
UNDER THE SECURITIES ACT.
"REGISTRATION STATEMENT" SHALL MEAN ANY REGISTRATION STATEMENT
OF THE COMPANY WHICH COVERS ANY OF THE REGISTRABLE SECURITIES PURSUANT TO THE
PROVISIONS OF THIS AGREEMENT AND ALL AMENDMENTS AND SUPPLEMENTS TO ANY SUCH
REGISTRATION STATEMENT, INCLUDING POST-EFFECTIVE AMENDMENTS, IN EACH CASE
INCLUDING THE PROSPECTUS CONTAINED THEREIN, ALL EXHIBITS THERETO AND ALL
MATERIAL INCORPORATED BY REFERENCE THEREIN.
"RULE 144" SHALL MEAN RULE 144 UNDER THE ACT, AS SUCH RULE MAY
BE AMENDED FROM TIME TO TIME, OR ANY SIMILAR RULE (OTHER THAN RULE 144A) OR
REGULATION HEREAFTER ADOPTED BY THE SEC PROVIDING FOR OFFERS AND SALES OF
SECURITIES MADE IN COMPLIANCE THEREWITH RESULTING IN OFFERS AND SALES BY
SUBSEQUENT HOLDERS THAT ARE NOT AFFILIATES OF AN ISSUER OF SUCH SECURITIES BEING
FREE OF THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF THE ACT.
"RULE 144A" SHALL MEAN RULE 144A UNDER THE ACT, AS SUCH RULE
MAY BE AMENDED FROM TIME TO TIME.
"SEC" SHALL MEAN THE SECURITIES AND EXCHANGE COMMISSION.
"TRIGGERING EVENT" SHALL MEAN THE OCCURRENCE OF ANY OF THE
FOLLOWING: (i) THE DAY IMMEDIATELY PRIOR TO A CHANGE OF CONTROL, (ii) THE 90TH
DAY (OR SUCH EARLIER DATE AS DETERMINED BY THE COMPANY IN ITS SOLE DISCRETION)
FOLLOWING AN INITIAL EQUITY OFFERING OF THE COMPANY OR (iii) OTHER THAN AS A
RESULT OF AN INITIAL EQUITY OFFERING OF THE COMPANY, A CLASS OF COMMON EQUITY
SECURITIES OF THE COMPANY IS LISTED ON A NATIONAL SECURITIES EXCHANGE OR
AUTHORIZED FOR QUOTATION ON THE NASDAQ NATIONAL MARKET SYSTEM OR IS OTHERWISE
SUBJECT TO REGISTRATION UNDER THE EXCHANGE ACT.
"WARRANT AGREEMENT" MEANS THE WARRANT AGREEMENT DATED AS OF
THE DATE HEREOF AMONG THE COMPANY AND MARINE MIDLAND BANK, AS WARRANT AGENT, AS
THE SAME MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME IN ACCORDANCE WITH THE
TERMS THEREOF.
"WARRANT SHARES" MEANS THE SHARES OF COMMON STOCK OR OTHER
SECURITIES ISSUED OR ISSUABLE UPON THE EXERCISE OF THE WARRANTS.
SECTION 2. REGISTRATION RIGHTS.
(a) DEMAND REGISTRATION.
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(i) REQUEST FOR REGISTRATION. AT ANY TIME ON OR AFTER THE
EARLIER TO OCCUR OF OCTOBER 1, 2002 OR THE OCCURRENCE OF A TRIGGERING EVENT,
HOLDERS OF WARRANTS AND/OR WARRANT SHARES REPRESENTING NOT LESS THAN 25% OF THE
WARRANT SHARES ISSUABLE UPON EXERCISE OF THE WARRANTS MAY MAKE ONE WRITTEN
REQUEST FOR REGISTRATION UNDER THE ACT OF THEIR REGISTRABLE SECURITIES (A
"DEMAND REGISTRATION"). ANY SUCH REQUEST WILL SPECIFY THE NUMBER OF REGISTRABLE
SECURITIES PROPOSED TO BE SOLD AND WILL ALSO SPECIFY THE INTENDED METHOD OF
DISPOSITION THEREOF. SUBJECT TO THE OTHER PROVISIONS OF THIS SECTION 2(a), THE
COMPANY SHALL GIVE WRITTEN NOTICE OF SUCH REGISTRATION REQUEST WITHIN 10 DAYS
AFTER THE RECEIPT THEREOF TO ALL OTHER HOLDERS. WITHIN 30 DAYS AFTER RECEIPT OF
SUCH NOTICE BY ANY HOLDER, SUCH HOLDER MAY REQUEST IN WRITING THAT ITS
REGISTRABLE SECURITIES BE INCLUDED IN SUCH REGISTRATION AND THE COMPANY SHALL
INCLUDE IN THE DEMAND REGISTRATION THE REGISTRABLE SECURITIES OF ANY SUCH
SELLING HOLDER REQUESTED TO BE SO INCLUDED. EACH SUCH REQUEST BY SUCH OTHER
SELLING HOLDERS SHALL SPECIFY THE NUMBER OF REGISTRABLE SECURITIES PROPOSED TO
BE SOLD AND THE INTENDED METHOD OF DISPOSITION THEREOF. UPON A DEMAND, THE
COMPANY WILL (x) PREPARE, FILE AND USE ITS BEST EFFORTS TO CAUSE TO BECOME
EFFECTIVE WITHIN 120 DAYS OF SUCH DEMAND A REGISTRATION STATEMENT IN RESPECT OF
ALL THE REGISTRABLE SECURITIES WHICH HOLDERS REQUEST FOR INCLUSION THEREIN;
PROVIDED THAT IF SUCH DEMAND OCCURS DURING THE BLACK OUT PERIOD (AS DEFINED
BELOW) OR OTHER PERIOD (NOT TO EXCEED 180 DAYS) DURING WHICH THE COMPANY IS
PROHIBITED OR RESTRICTED FROM ISSUING OR SELLING COMMON STOCK PURSUANT TO ANY
UNDERWRITING OR PURCHASE AGREEMENT RELATING TO AN UNDERWRITTEN RULE 144A
OFFERING OR REGISTERED PUBLIC OFFERING OF COMMON STOCK OR SECURITIES CONVERTIBLE
INTO OR EXCHANGEABLE FOR COMMON STOCK UNDER RULE 144A OR REGISTERED UNDER THE
ACT (A "LOCK UP PERIOD"), THE COMPANY SHALL NOT BE REQUIRED TO NOTIFY THE
HOLDERS OF SUCH DEMAND OR FILE SUCH REGISTRATION STATEMENT PRIOR TO THE END OF
THE BLACK OUT PERIOD OR LOCK UP PERIOD, AS THE CASE MAY BE, IN WHICH EVENT, THE
COMPANY WILL USE ITS BEST EFFORTS TO CAUSE SUCH REGISTRATION STATEMENT TO BECOME
EFFECTIVE NO LATER THAN 30 DAYS AFTER THE END OF THE BLACK OUT PERIOD OR LOCK UP
PERIOD, AS THE CASE MAY BE, AND (y) KEEP SUCH REGISTRATION STATEMENT
CONTINUOUSLY EFFECTIVE FOR THE SHORTER OF (A) 180 DAYS (THE "EFFECTIVENESS
PERIOD") AND (B) SUCH PERIOD OF TIME AS ALL OF THE REGISTRABLE SECURITIES
INCLUDED IN SUCH REGISTRATION STATEMENT HAVE BEEN SOLD THEREUNDER; PROVIDED,
HOWEVER, THAT THE COMPANY MAY POSTPONE THE FILING OF ANY REGISTRATION STATEMENT,
SUSPEND THE EFFECTIVENESS OF ANY REGISTRATION, SUSPEND THE USE OF ANY PROSPECTUS
AND SHALL NOT BE REQUIRED TO AMEND OR SUPPLEMENT THE REGISTRATION STATEMENT, ANY
RELATED PROSPECTUS OR ANY DOCUMENT INCORPORATED THEREIN BY REFERENCE (OTHER THAN
AN EFFECTIVE REGISTRATION STATEMENT BEING USED FOR AN UNDERWRITTEN OFFERING) IN
THE EVENT THAT, AND FOR A PERIOD, IN THE CASE OF THE DEMAND REGISTRATION, NOT TO
EXCEED AN AGGREGATE OF 45 DAYS ("BLACK OUT PERIOD") IF (1) AN EVENT OR
CIRCUMSTANCE OCCURS AND IS CONTINUING AS A RESULT OF WHICH THE REGISTRATION
STATEMENT, ANY RELATED PROSPECTUS OR ANY DOCUMENT INCORPORATED THEREIN BY
REFERENCE AS THEN AMENDED OR SUPPLEMENTED WOULD, IN THE COMPANY'S GOOD FAITH
JUDGMENT, CONTAIN AN UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO STATE A
MATERIAL FACT NECESSARY IN ORDER TO MAKE THE STATEMENTS THEREIN, IN THE LIGHT OF
THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING, AND (2)(A) THE
COMPANY DETERMINES IN ITS GOOD FAITH JUDGMENT THAT THE DISCLOSURE OF SUCH EVENT
AT SUCH TIME WOULD HAVE A MATERIAL ADVERSE EFFECT ON THE BUSINESS, OPERATIONS OR
PROSPECTS OF THE COMPANY OR (B) THE DISCLOSURE OTHERWISE RELATES TO A MATERIAL
BUSINESS TRANSACTION WHICH HAS NOT YET BEEN PUBLICLY DISCLOSED; PROVIDED,
FURTHER THAT THE EFFECTIVENESS PERIOD SHALL BE EXTENDED BY THE NUMBER OF DAYS IN
ANY BLACK OUT PERIOD OCCURRING DURING THE EFFECTIVENESS PERIOD. SUBJECT TO
SECTION 2(a)(ii), THE COMPANY SHALL ONLY BE REQUIRED TO REGISTER REGISTRABLE
SECURITIES PURSUANT TO THIS SECTION 2(a) ONCE.
IN THE EVENT OF THE OCCURRENCE OF ANY BLACK OUT PERIOD OR LOCK
UP PERIOD DURING AN EFFECTIVENESS PERIOD, THE COMPANY WILL PROMPTLY NOTIFY THE
HOLDERS OF REGISTRABLE SECURITIES THEREOF IN WRITING.
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(ii) EFFECTIVE REGISTRATION. EXCEPT AS SPECIFICALLY PROVIDED
HEREIN, THE COMPANY IS ONLY REQUIRED TO EFFECT ONE REGISTRATION AS A DEMAND
REGISTRATION UNDER THIS AGREEMENT (WHETHER OR NOT ALL OF THE HOLDERS OF
REGISTRABLE SECURITIES ELECT TO PARTICIPATE IN SUCH DEMAND REGISTRATION ON THE
BASIS SET FORTH HEREIN). A REGISTRATION WILL NOT BE DEEMED TO HAVE BEEN EFFECTED
AS A DEMAND REGISTRATION, AND THEREBY SATISFY THE OBLIGATION HEREUNDER, UNLESS
IT HAS BEEN DECLARED EFFECTIVE BY THE SEC AND THE COMPANY HAS COMPLIED IN ALL
MATERIAL RESPECTS WITH ITS OBLIGATIONS UNDER THIS AGREEMENT WITH RESPECT
THERETO; PROVIDED THAT IF, AFTER IT HAS BECOME EFFECTIVE, THE OFFERING OF
REGISTRABLE SECURITIES PURSUANT TO SUCH REGISTRATION IS OR BECOMES THE SUBJECT
OF ANY STOP ORDER, INJUNCTION OR OTHER ORDER OR REQUIREMENT OF THE SEC OR ANY
OTHER GOVERNMENTAL OR ADMINISTRATIVE AGENCY, OR IF ANY COURT PREVENTS OR
OTHERWISE LIMITS THE SALE OF REGISTRABLE SECURITIES PURSUANT TO THE REGISTRATION
(FOR ANY REASON OTHER THAN THE ACT OR OMISSIONS OF THE HOLDERS) FOR THE PERIOD
OF TIME CONTEMPLATED HEREBY, SUCH REGISTRATION WILL BE DEEMED NOT TO HAVE BEEN
EFFECTED. IF (x) A REGISTRATION REQUESTED PURSUANT TO THIS SECTION 2(a) IS
DEEMED NOT TO HAVE BEEN EFFECTED OR (y) THE REGISTRATION REQUESTED PURSUANT TO
THIS SECTION 2(a) DOES NOT REMAIN EFFECTIVE FOR THE EFFECTIVENESS PERIOD, THEN
THE COMPANY SHALL CONTINUE TO BE OBLIGATED TO EFFECT AN ADDITIONAL REGISTRATION
PURSUANT TO THIS SECTION 2(A). THE HOLDERS OF REGISTRABLE SECURITIES SHALL BE
PERMITTED TO WITHDRAW ALL OR ANY PART OF THE REGISTRABLE SECURITIES FROM A
DEMAND REGISTRATION AT ANY TIME PRIOR TO THE EFFECTIVE DATE OF SUCH DEMAND
REGISTRATION. IF AT ANY TIME A REGISTRATION STATEMENT IS FILED PURSUANT TO A
DEMAND REGISTRATION, AND SUBSEQUENTLY A SUFFICIENT NUMBER OF THE REGISTRABLE
SECURITIES ARE WITHDRAWN FROM THE DEMAND REGISTRATION SO THAT SUCH REGISTRATION
STATEMENT DOES NOT COVER THAT NUMBER OF REGISTRABLE SECURITIES AT LEAST EQUAL TO
ONE-QUARTER OF THE REGISTRABLE SECURITIES, THE HOLDERS WHO HAVE NOT WITHDRAWN
THEIR REGISTRABLE SECURITIES SHALL HAVE THE OPPORTUNITY TO INCLUDE AN ADDITIONAL
NUMBER OF REGISTRABLE SECURITIES IN THE DEMAND REGISTRATION SO THAT SUCH
REGISTRATION STATEMENT COVERS THAT NUMBER OF REGISTRABLE SECURITIES AT LEAST
EQUAL TO ONE-QUARTER OF THE REGISTRABLE SECURITIES. IF AN ADDITIONAL NUMBER OF
REGISTRABLE SECURITIES IS NOT SO INCLUDED, THE COMPANY MAY WITHDRAW THE
REGISTRATION STATEMENT. SUCH WITHDRAWN REGISTRATION STATEMENT WILL NOT COUNT AS
A DEMAND REGISTRATION AND THE COMPANY SHALL CONTINUE TO BE OBLIGATED TO EFFECT A
REGISTRATION PURSUANT TO THIS SECTION 2(a).
(iii) PRIORITY IN DEMAND REGISTRATIONS PURSUANT TO SECTION
2(a). IF A DEMAND REGISTRATION PURSUANT TO THIS SECTION 2(a) INVOLVES AN
UNDERWRITTEN OFFERING AND THE LEAD MANAGING UNDERWRITER ADVISES THE COMPANY IN
WRITING THAT, IN ITS VIEW, THE NUMBER OF REGISTRABLE SECURITIES REQUESTED BY THE
HOLDERS TO BE INCLUDED IN SUCH REGISTRATION, TOGETHER WITH ANY OTHER SECURITIES
PERMITTED TO BE INCLUDED IN SUCH REGISTRATION, EXCEEDS THE NUMBER WHICH, IN THE
VIEW OF SUCH LEAD MANAGING UNDERWRITER, CAN BE SOLD: FIRST, THE SECURITIES OTHER
THAN THE REGISTRABLE SECURITIES OF THE HOLDERS INCLUDED IN SUCH REGISTRATION
SHALL BE REDUCED IN THEIR ENTIRETY BEFORE ANY REDUCTION OF REGISTRABLE
SECURITIES; AND SECOND, TO THE EXTENT THE REDUCTION SET FORTH IN THE IMMEDIATELY
PRECEDING CLAUSE IS INSUFFICIENT TO REDUCE THE NUMBER OF SECURITIES REQUESTED
FOR INCLUSION IN SUCH REGISTRATION TO A NUMBER, WHICH, IN THE VIEW OF SUCH LEAD
MANAGING UNDERWRITER, CAN BE SOLD, THE NUMBER OF SUCH REGISTRABLE SECURITIES TO
BE INCLUDED IN SUCH REGISTRATION SHALL BE ALLOCATED PRO RATA AMONG ALL
REQUESTING HOLDERS ON THE BASIS OF THE RELATIVE NUMBER OF REGISTRABLE SECURITIES
THEN HELD BY EACH SUCH HOLDER (PROVIDED THAT ANY REGISTRABLE SECURITIES THEREBY
ALLOCATED TO ANY SUCH HOLDER THAT EXCEED SUCH HOLDER'S REQUEST SHALL BE
REALLOCATED AMONG THE REMAINING REQUESTING HOLDERS IN LIKE MANNER). IN THE EVENT
THAT THE NUMBER OF REGISTRABLE SECURITIES REQUESTED TO BE INCLUDED IN SUCH
REGISTRATION IS LESS THAN THE NUMBER WHICH, IN THE VIEW OF THE LEAD MANAGING
UNDERWRITER, CAN BE SOLD, THE COMPANY MAY INCLUDE IN SUCH REGISTRATION
SECURITIES THAT THE COMPANY OR ANY OTHER PERSON PROPOSES TO SELL UP TO THE
NUMBER OF SECURITIES THAT, IN THE VIEW OF THE LEAD MANAGING UNDERWRITER, CAN BE
SOLD.
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(iv) SELECTION OF UNDERWRITER. IF THE HOLDERS SO ELECT, THE
OFFERING OF SUCH REGISTRABLE SECURITIES PURSUANT TO SUCH DEMAND REGISTRATION
SHALL BE IN THE FORM OF AN UNDERWRITTEN OFFERING. THE INVESTMENT BANKER OR
INVESTMENT BANKERS AND MANAGER OR MANAGERS THAT WILL ADMINISTER SUCH
UNDERWRITTEN OFFERING WILL BE SELECTED BY THE HOLDERS OF A MAJORITY IN AGGREGATE
PRINCIPAL AMOUNT OF THE REGISTRABLE SECURITIES INCLUDED IN SUCH OFFERING;
PROVIDED, THAT SUCH INVESTMENT BANKERS AND MANAGERS MUST BE REASONABLY
SATISFACTORY TO THE COMPANY.
(b) PIGGY-BACK REGISTRATION.
(i) NOTICE OF REGISTRATION. IF AT ANY TIME THE COMPANY
PROPOSES TO FILE A REGISTRATION STATEMENT UNDER THE ACT WITH RESPECT TO AN
OFFERING BY THE COMPANY FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF ANY OF ITS
RESPECTIVE SECURITYHOLDERS OF ANY CLASS OF COMMON STOCK (OTHER THAN (x) A
REGISTRATION STATEMENT ON FORM S-4 OR S-8 (OR ANY SUBSTITUTE FORM THAT MAY BE
ADOPTED BY THE SEC), (y) A REGISTRATION STATEMENT FILED IN CONNECTION WITH AN
OFFER OR OFFERING OF SECURITIES SOLELY TO THE COMPANY'S EXISTING SECURITYHOLDERS
OR (z) A DEMAND REGISTRATION), THEN THE COMPANY SHALL GIVE WRITTEN NOTICE OF
SUCH PROPOSED FILING TO THE HOLDERS OF REGISTRABLE SECURITIES AS SOON AS
PRACTICABLE (BUT IN NO EVENT LESS THAN 20 BUSINESS DAYS BEFORE THE ANTICIPATED
FILING DATE), AND SUCH NOTICE SHALL OFFER SUCH HOLDERS THE OPPORTUNITY TO
REGISTER SUCH NUMBER OF REGISTRABLE SECURITIES AS EACH SUCH HOLDER MAY REQUEST
(WHICH REQUEST SHALL SPECIFY THE REGISTRABLE SECURITIES INTENDED TO BE DISPOSED
OF BY SUCH HOLDER AND THE INTENDED METHOD OF DISTRIBUTION THEREOF) (A
"PIGGY-BACK REGISTRATION"), EXCEPT THAT THE PIGGY-BACK REGISTRATION RIGHTS OF
THE HOLDERS SHALL NOT APPLY TO ANY EQUITY OFFERING THAT IS THE INITIAL EQUITY
OFFERING OF THE COMPANY UNLESS SECURITIES OF SELLING SECURITYHOLDERS OTHER THAN
THE HOLDERS ARE TO BE INCLUDED THEREIN. THE COMPANY SHALL USE ITS BEST EFFORTS
TO CAUSE THE MANAGING UNDERWRITER OR UNDERWRITERS OF SUCH PROPOSED UNDERWRITTEN
OFFERING TO PERMIT THE REGISTRABLE SECURITIES REQUESTED TO BE INCLUDED IN A
PIGGYBACK REGISTRATION TO BE INCLUDED ON THE SAME TERMS AND CONDITIONS AS ANY
SIMILAR SECURITIES OF THE COMPANY OR ANY OTHER SECURITYHOLDER INCLUDED THEREIN
AND TO PERMIT THE SALE OR OTHER DISPOSITION OF SUCH REGISTRABLE SECURITIES IN
ACCORDANCE WITH THE INTENDED METHOD OF DISTRIBUTION THEREOF. ANY HOLDER SHALL
HAVE THE RIGHT TO WITHDRAW ITS REQUEST FOR INCLUSION OF ITS REGISTRABLE
SECURITIES IN ANY REGISTRATION STATEMENT PURSUANT TO THIS SECTION 2(b) BY GIVING
WRITTEN NOTICE TO THE COMPANY OF ITS REQUEST TO WITHDRAW PRIOR TO THE
EFFECTIVENESS OF THE REGISTRATION STATEMENT. THE COMPANY MAY WITHDRAW A
PIGGY-BACK REGISTRATION AT ANY TIME PRIOR TO THE TIME IT BECOMES EFFECTIVE;
PROVIDED THAT THE COMPANY SHALL GIVE PROMPT NOTICE THEREOF TO PARTICIPATING
HOLDERS.
NO REGISTRATION EFFECTED UNDER THIS SECTION 2(b) SHALL RELIEVE
THE COMPANY OF ITS OBLIGATION TO EFFECT A REGISTRATION UPON THE REQUEST OF
HOLDERS PURSUANT TO SECTION 2(a).
(ii) REDUCTION OF OFFERING. IF THE LEAD MANAGING UNDERWRITER
OF ANY UNDERWRITTEN OFFERING DESCRIBED IN SECTION 2(b)(i) HAS INFORMED, IN
WRITING, THE HOLDERS OF THE REGISTRABLE SECURITIES REQUESTING INCLUSION IN SUCH
OFFERING THAT IT IS ITS VIEW THAT THE TOTAL NUMBER OF SECURITIES WHICH THE
COMPANY, THE HOLDERS AND ANY OTHER PERSONS DESIRING TO PARTICIPATE IN SUCH
REGISTRATION INTEND TO INCLUDE IN SUCH OFFERING IS SUCH AS TO MATERIALLY AND
ADVERSELY AFFECT THE SUCCESS OF SUCH OFFERING, INCLUDING THE PRICE AT WHICH SUCH
SECURITIES CAN BE SOLD, THEN THE NUMBER OF REGISTRABLE SECURITIES TO BE OFFERED
FOR THE ACCOUNT OF SUCH HOLDERS AND THE NUMBER OF SUCH SECURITIES TO BE OFFERED
FOR THE ACCOUNT OF ALL SUCH OTHER PERSONS (OTHER THAN THE COMPANY) PARTICIPATING
IN SUCH REGISTRATION SHALL BE REDUCED OR LIMITED PRO RATA IN PROPORTION TO THE
RESPECTIVE NUMBER OF SECURITIES REQUESTED TO BE REGISTERED TO THE EXTENT
NECESSARY TO REDUCE THE TOTAL NUMBER OF SECURITIES REQUESTED TO BE INCLUDED IN
SUCH OFFERING TO THE NUMBER OF
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SECURITIES, IF ANY, RECOMMENDED BY SUCH LEAD MANAGING UNDERWRITER, UNLESS SUCH
OFFERING IS BEING MADE PURSUANT TO EXERCISE OF A DEMAND REGISTRATION RIGHT
GRANTED BY THE COMPANY TO OTHER PERSONS, IN WHICH CASE THE NUMBER OF SECURITIES
TO BE OFFERED FOR THE ACCOUNT OF ALL PERSONS NOT EXERCISING DEMAND REGISTRATION
RIGHTS (INCLUDING THE HOLDERS) SHALL BE ELIMINATED OR REDUCED PRO RATA IN
PROPORTION TO THE RESPECTIVE NUMBER OF SECURITIES REQUESTED TO BE REGISTERED BY
SUCH PERSONS TO REDUCE THE TOTAL NUMBER OF SECURITIES REQUESTED TO BE INCLUDED
IN SUCH OFFERING TO THE NUMBER OF SECURITIES, IF ANY, RECOMMENDED BY SUCH LEAD
MANAGING UNDERWRITER BEFORE ANY REDUCTION IS MADE IN SECURITIES REQUESTED TO BE
REGISTERED BY PERSONS EXERCISING A DEMAND REGISTRATION RIGHT. IF THE LEAD
MANAGING UNDERWRITER OF ANY UNDERWRITTEN OFFERING DESCRIBED IN SECTION 2(b)
NOTIFIES THE HOLDERS REQUESTING INCLUSION OF REGISTRABLE SECURITIES IN SUCH
OFFERING, THAT THE KIND OF SECURITIES THAT SUCH HOLDERS AND ANY OTHER PERSONS
DESIRING TO PARTICIPATE IN SUCH REGISTRATION INTEND TO INCLUDE IN SUCH OFFERING
IS SUCH AS TO MATERIALLY AND ADVERSELY AFFECT THE SUCCESS OF SUCH OFFERING, (x)
THE REGISTRABLE SECURITIES TO BE INCLUDED IN SUCH OFFERING SHALL BE REDUCED AS
DESCRIBED IN THE PRECEDING SENTENCE OR (y) IF A REDUCTION IN THE REGISTRABLE
SECURITIES PURSUANT TO THE PRECEDING SENTENCE WOULD, IN THE JUDGMENT OF THE LEAD
MANAGING UNDERWRITER, BE INSUFFICIENT TO SUBSTANTIALLY ELIMINATE THE ADVERSE
EFFECT THAT INCLUSION OF THE REGISTRABLE SECURITIES REQUESTED TO BE INCLUDED
WOULD HAVE ON SUCH OFFERING, SUCH REGISTRABLE SECURITIES WILL BE EXCLUDED FROM
SUCH OFFERING.
(iii) WITHDRAWAL ELECTION. IF, AS A RESULT OF THE PRORATION
PROVISIONS OF THIS SECTION 2(b), ANY HOLDER SHALL NOT BE ENTITLED TO INCLUDE ALL
REGISTRABLE SECURITIES IN A PIGGY-BACK REGISTRATION THAT SUCH HOLDER HAS
REQUESTED TO BE INCLUDED, SUCH HOLDER MAY ELECT TO WITHDRAW HIS REQUEST TO
INCLUDE REGISTRABLE SECURITIES IN SUCH REGISTRATION (A "WITHDRAWAL ELECTION");
PROVIDED THAT A WITHDRAWAL ELECTION SHALL BE MADE PRIOR TO THE EFFECTIVENESS OF
THE REGISTRATION STATEMENT AND SHALL BE IRREVOCABLE AND, AFTER MAKING A
WITHDRAWAL ELECTION, A HOLDER SHALL NO LONGER HAVE ANY RIGHT TO INCLUDE
REGISTRABLE SECURITIES IN THE REGISTRATION AS TO WHICH SUCH WITHDRAWAL ELECTION
WAS MADE.
(c) LOCK UP OF HOLDERS. IF THE COMPANY HAS COMPLIED WITH ALL
OF ITS OBLIGATIONS WITH RESPECT TO A DEMAND REGISTRATION OR A PIGGY-BACK
REGISTRATION THAT IS A FIRM COMMITMENT UNDERWRITTEN PUBLIC OFFERING, ALL HOLDERS
OF WARRANTS AND REGISTRABLE SECURITIES, UPON REQUEST OF THE LEAD MANAGING
UNDERWRITER WITH RESPECT TO SUCH UNDERWRITTEN PUBLIC OFFERING, AGREE NOT TO SELL
OR OTHERWISE DISPOSE OF ANY WARRANTS OR ANY REGISTRABLE SECURITIES OWNED BY THEM
FOR A PERIOD NOT TO EXCEED 180 DAYS FROM THE CONSUMMATION OF SUCH UNDERWRITTEN
PUBLIC OFFERING; PROVIDED THAT REGISTRABLE SECURITIES WHICH HAD BEEN REQUESTED
FOR INCLUSION IN A DEMAND REGISTRATION OR A PIGGY-BACK REGISTRATION BUT WHICH
WERE NOT SO INCLUDED PURSUANT TO SECTION 2(a)(iii) OR SECTION 2(b)(ii) SHALL
ONLY BE SUBJECT TO THE RESTRICTION ON SALE AND DISPOSITION IN THIS SECTION 2(c)
FOR A PERIOD NOT TO EXCEED 90 DAYS FROM THE CONSUMMATION OF SUCH UNDERWRITTEN
PUBLIC OFFERING.
SECTION 3. REGISTRATION PROCEDURES.
IN CONNECTION WITH THE OBLIGATIONS OF THE COMPANY WITH RESPECT
TO ANY REGISTRATION STATEMENT TO BE FILED PURSUANT TO SECTIONS 2(a) OR 2(b)
HEREOF, THE COMPANY SHALL:
(i) A REASONABLE PERIOD OF TIME PRIOR TO THE INITIAL FILING
OF A REGISTRATION STATEMENT OR PROSPECTUS AND A REASONABLE PERIOD OF TIME PRIOR
TO THE FILING OF ANY AMENDMENT OR SUPPLEMENT THERETO (INCLUDING ANY DOCUMENT
THAT WOULD BE INCORPORATED OR DEEMED TO BE INCORPORATED THEREIN BY REFERENCE),
FURNISH TO THE HOLDERS OF THE REGISTRABLE SECURITIES INCLUDED IN SUCH
REGISTRATION STATEMENT, AND THE MANAGING UNDERWRITERS, IF ANY, COPIES OF ALL
SUCH DOCUMENTS SUBSTANTIALLY IN THE FORM PROPOSED TO BE
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FILED, WHICH DOCUMENTS (OTHER THAN THOSE INCORPORATED OR DEEMED TO BE
INCORPORATED BY REFERENCE) WILL BE SUBJECT TO THE REVIEW OF SUCH HOLDERS, AND
SUCH UNDERWRITERS, IF ANY, AND USE BEST EFFORTS TO CAUSE THE OFFICERS AND
DIRECTORS OF THE COMPANY, COUNSEL TO THE COMPANY AND INDEPENDENT CERTIFIED
PUBLIC ACCOUNTANTS TO THE COMPANY TO RESPOND TO SUCH REASONABLE INQUIRIES AS
SHALL BE NECESSARY, IN THE OPINION OF RESPECTIVE COUNSEL TO SUCH HOLDERS AND
SUCH UNDERWRITERS, TO CONDUCT A REASONABLE INVESTIGATION WITHIN THE MEANING OF
THE ACT. THE COMPANY SHALL NOT FILE ANY SUCH REGISTRATION STATEMENT OR RELATED
PROSPECTUS OR ANY AMENDMENTS OR SUPPLEMENTS THERETO TO WHICH THE UNDERWRITERS,
IF ANY, OR THE HOLDERS OF A MAJORITY OF THE REGISTRABLE SECURITIES INCLUDED IN
SUCH REGISTRATION STATEMENT SHALL REASONABLY OBJECT ON A TIMELY BASIS;
(ii) PREPARE AND FILE WITH THE SEC SUCH AMENDMENTS, INCLUDING
POST-EFFECTIVE AMENDMENTS, TO EACH REGISTRATION STATEMENT AS MAY BE NECESSARY TO
KEEP SUCH REGISTRATION STATEMENT CONTINUOUSLY EFFECTIVE FOR THE APPLICABLE TIME
PERIOD REQUIRED HEREUNDER; CAUSE THE RELATED PROSPECTUS TO BE SUPPLEMENTED BY
ANY REQUIRED PROSPECTUS SUPPLEMENT, AND AS SO SUPPLEMENTED TO BE FILED PURSUANT
TO RULE 424 UNDER THE ACT; AND COMPLY WITH THE PROVISIONS OF THE ACT AND THE
EXCHANGE ACT WITH RESPECT TO THE DISPOSITION OF ALL SECURITIES COVERED BY SUCH
REGISTRATION STATEMENT DURING SUCH PERIOD IN ACCORDANCE WITH THE INTENDED
METHODS OF DISPOSITION BY THE SELLERS THEREOF SET FORTH IN SUCH REGISTRATION
STATEMENT AS SO AMENDED OR IN SUCH PROSPECTUS AS SO SUPPLEMENTED;
(iii) NOTIFY THE HOLDERS OF REGISTRABLE SECURITIES TO BE SOLD
AND THE MANAGING UNDERWRITERS, IF ANY, PROMPTLY, AND (IF REQUESTED BY ANY SUCH
PERSON), CONFIRM SUCH NOTICE IN WRITING, (1)(A) WHEN A PROSPECTUS OR ANY
PROSPECTUS SUPPLEMENT OR POST-EFFECTIVE AMENDMENT IS PROPOSED TO BE FILED, AND
(B) WITH RESPECT TO A REGISTRATION STATEMENT OR ANY POST-EFFECTIVE AMENDMENT,
WHEN THE SAME HAS BECOME EFFECTIVE, (2) OF ANY REQUEST BY THE SEC OR ANY OTHER
FEDERAL OR STATE GOVERNMENTAL AUTHORITY FOR AMENDMENTS OR SUPPLEMENTS TO A
REGISTRATION STATEMENT OR RELATED PROSPECTUS OR FOR ADDITIONAL INFORMATION, (3)
OF THE ISSUANCE BY THE SEC, ANY STATE SECURITIES COMMISSION, ANY OTHER
GOVERNMENTAL AGENCY OR ANY COURT OF ANY STOP ORDER, ORDER OR INJUNCTION
SUSPENDING OR ENJOINING THE USE OF A PROSPECTUS OR THE EFFECTIVENESS OF A
REGISTRATION STATEMENT OR THE INITIATION OF ANY PROCEEDINGS FOR THAT PURPOSE,
(4) OF THE RECEIPT BY THE COMPANY OF ANY NOTIFICATION WITH RESPECT TO THE
SUSPENSION OF THE QUALIFICATION OR EXEMPTION FROM QUALIFICATION OF ANY OF THE
REGISTRABLE SECURITIES FOR SALE IN ANY JURISDICTION, OR THE INITIATION OR
THREATENING OF ANY PROCEEDING FOR SUCH PURPOSE, AND (5) OF THE HAPPENING OF ANY
EVENT OR INFORMATION BECOMING KNOWN THAT MAKES ANY STATEMENT MADE IN A
REGISTRATION STATEMENT OR RELATED PROSPECTUS UNTRUE IN ANY MATERIAL RESPECT OR
THAT REQUIRES THE MAKING OF ANY CHANGES IN SUCH REGISTRATION STATEMENT OR
PROSPECTUS SO THAT, IN THE CASE OF A REGISTRATION STATEMENT, IT WILL 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
LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE, NOT MISLEADING, AND THAT
IN THE CASE OF A PROSPECTUS, IT WILL 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 LIGHT OF THE CIRCUMSTANCES UNDER
WHICH THEY WERE MADE, NOT MISLEADING;
(iv) USE ITS BEST EFFORTS TO AVOID THE ISSUANCE OF OR, IF
ISSUED, OBTAIN THE WITHDRAWAL OF ANY ORDER ENJOINING OR SUSPENDING THE USE OF A
PROSPECTUS OR THE EFFECTIVENESS OF A REGISTRATION STATEMENT OR THE LIFTING OF
ANY SUSPENSION OF THE QUALIFICATION (OR EXEMPTION FROM QUALIFICATION) OF ANY OF
THE REGISTRABLE SECURITIES FOR SALE IN ANY JURISDICTION DESCRIBED IN SECTION
3(viii), AT THE EARLIEST PRACTICABLE MOMENT;
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(v) IF REQUESTED BY THE SELLING HOLDERS OR THE MANAGING
UNDERWRITERS, IF ANY, (x) PROMPTLY INCORPORATE IN A PROSPECTUS SUPPLEMENT OR
POST-EFFECTIVE AMENDMENT SUCH INFORMATION AS THE SELLING HOLDERS OR THE MANAGING
UNDERWRITERS, IF ANY, REASONABLY BELIEVE IS REQUIRED TO BE INCLUDED THEREIN, AND
(y) MAKE ALL REQUIRED FILINGS OF SUCH PROSPECTUS SUPPLEMENT OR SUCH
POST-EFFECTIVE AMENDMENT UNDER THE ACT AS SOON AS PRACTICABLE AFTER THE COMPANY
HAS RECEIVED NOTIFICATION OF THE MATTERS TO BE INCORPORATED IN SUCH PROSPECTUS
SUPPLEMENT OR POST-EFFECTIVE AMENDMENT;
(vi) FURNISH TO EACH HOLDER OF REGISTRABLE SECURITIES TO BE
SOLD PURSUANT TO A REGISTRATION STATEMENT AND EACH MANAGING UNDERWRITER, IF ANY,
WITHOUT CHARGE, AT LEAST ONE CONFORMED COPY OF SUCH REGISTRATION STATEMENT AND
EACH AMENDMENT THERETO, INCLUDING FINANCIAL STATEMENTS AND SCHEDULES, ALL
DOCUMENTS INCORPORATED OR DEEMED TO BE INCORPORATED THEREIN BY REFERENCE, AND
ALL EXHIBITS TO THE EXTENT REQUESTED (INCLUDING THOSE PREVIOUSLY FURNISHED OR
INCORPORATED BY REFERENCE) AS SOON AS PRACTICABLE AFTER THE FILING OF SUCH
DOCUMENTS WITH THE SEC;
(vii) DELIVER TO EACH HOLDER OF REGISTRABLE SECURITIES TO BE
SOLD PURSUANT TO A REGISTRATION STATEMENT, AND THE UNDERWRITERS, IF ANY, WITHOUT
CHARGE, AS MANY COPIES OF THE PROSPECTUS (INCLUDING EACH FORM OF PROSPECTUS) AND
EACH AMENDMENT OR SUPPLEMENT THERETO AS SUCH PERSONS REASONABLY REQUEST; AND THE
COMPANY HEREBY CONSENTS TO THE USE OF SUCH PROSPECTUS AND EACH AMENDMENT OR
SUPPLEMENT THERETO BY EACH OF THE SELLING HOLDERS OF REGISTRABLE SECURITIES AND
THE UNDERWRITERS, IF ANY, IN CONNECTION WITH THE OFFERING AND SALE OF THE
REGISTRABLE SECURITIES COVERED BY SUCH PROSPECTUS AND ANY AMENDMENT OR
SUPPLEMENT THERETO;
(viii) PRIOR TO ANY PUBLIC OFFERING OF REGISTRABLE SECURITIES,
USE ITS BEST EFFORTS TO REGISTER OR QUALIFY OR COOPERATE WITH THE HOLDERS OF
REGISTRABLE SECURITIES TO BE SOLD, THE UNDERWRITERS, IF ANY, AND THEIR
RESPECTIVE COUNSEL IN CONNECTION WITH THE REGISTRATION OR QUALIFICATION (OR
EXEMPTION FROM SUCH REGISTRATION OR QUALIFICATION) OF SUCH REGISTRABLE
SECURITIES FOR OFFER AND SALE UNDER THE SECURITIES OR BLUE SKY LAWS OF SUCH
JURISDICTIONS AS ANY SUCH HOLDER OR UNDERWRITER REASONABLY REQUESTS IN WRITING;
KEEP EACH SUCH REGISTRATION OR QUALIFICATION (OR EXEMPTION THEREFROM) EFFECTIVE
DURING THE PERIOD SUCH REGISTRATION STATEMENT IS REQUIRED TO BE KEPT EFFECTIVE
HEREUNDER AND DO ANY AND ALL OTHER ACTS OR THINGS NECESSARY OR ADVISABLE TO
ENABLE THE DISPOSITION IN SUCH JURISDICTIONS OF THE REGISTRABLE SECURITIES
COVERED BY THE APPLICABLE REGISTRATION STATEMENT; PROVIDED, HOWEVER, THAT THE
COMPANY SHALL NOT BE REQUIRED TO (x) QUALIFY GENERALLY TO DO BUSINESS IN ANY
JURISDICTION WHERE IT IS NOT THEN SO QUALIFIED OR (y) TAKE ANY ACTION WHICH
WOULD SUBJECT IT TO GENERAL SERVICE OF PROCESS OR TO TAXATION IN ANY
JURISDICTION WHERE THEY ARE NOT SO SUBJECT;
(ix) IN CONNECTION WITH ANY SALE OR TRANSFER OF REGISTRABLE
SECURITIES THAT WILL RESULT IN SUCH SECURITIES NO LONGER BEING REGISTRABLE
SECURITIES, COOPERATE WITH THE HOLDERS THEREOF AND THE MANAGING UNDERWRITERS, IF
ANY, TO FACILITATE THE TIMELY PREPARATION AND DELIVERY OF CERTIFICATES
REPRESENTING REGISTRABLE SECURITIES TO BE SOLD, WHICH CERTIFICATES SHALL NOT
BEAR ANY RESTRICTIVE LEGENDS AND SHALL BE IN A FORM ELIGIBLE FOR DEPOSIT WITH
THE DEPOSITORY TRUST COMPANY AND TO ENABLE SUCH REGISTRABLE SECURITIES TO BE IN
SUCH DENOMINATIONS AND REGISTERED IN SUCH NAMES AS THE MANAGING UNDERWRITERS, IF
ANY, OR SUCH HOLDERS MAY REQUEST AT LEAST TWO BUSINESS DAYS PRIOR TO ANY SALE OF
REGISTRABLE SECURITIES;
(x) UPON THE OCCURRENCE OF ANY EVENT CONTEMPLATED BY
SECTION 3(iii)(5), AS PROMPTLY AS PRACTICABLE, PREPARE A SUPPLEMENT OR
AMENDMENT, INCLUDING, IF APPROPRIATE, A POST-EFFECTIVE AMENDMENT, TO EACH
REGISTRATION STATEMENT OR A SUPPLEMENT TO THE RELATED PROSPECTUS OR ANY
DOCUMENT INCORPORATED OR DEEMED TO BE INCORPORATED THEREIN BY REFERENCE, AND
FILE ANY OTHER REQUIRED DOCUMENT SO THAT, AS
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THEREAFTER DELIVERED, SUCH PROSPECTUS WILL NOT CONTAIN AN UNTRUE STATEMENT OF A
MATERIAL FACT OR OMIT TO STATE A MATERIAL FACT REQUIRED TO BE STATED THEREIN OR
NECESSARY TO MAKE THE STATEMENTS THEREIN, IN LIGHT OF THE CIRCUMSTANCES UNDER
WHICH THEY WERE MADE, NOT MISLEADING;
(xi) ENTER INTO SUCH AGREEMENTS (INCLUDING AN UNDERWRITING
AGREEMENT IN FORM, SCOPE AND SUBSTANCE AS IS CUSTOMARY IN UNDERWRITTEN
OFFERINGS) AND TAKE ALL SUCH OTHER REASONABLE ACTIONS IN CONNECTION THEREWITH
(INCLUDING THOSE REASONABLY REQUESTED BY THE MANAGING UNDERWRITERS, IF ANY) IN
ORDER TO EXPEDITE OR FACILITATE THE DISPOSITION OF SUCH REGISTRABLE SECURITIES,
AND, WHETHER OR NOT AN UNDERWRITING AGREEMENT IS ENTERED INTO AND WHETHER OR NOT
THE REGISTRATION IS AN UNDERWRITTEN REGISTRATION, (1) MAKE SUCH REPRESENTATIONS
AND WARRANTIES TO THE UNDERWRITERS, IF ANY, AND SELLING HOLDERS WITH RESPECT TO
THE BUSINESS OF THE COMPANY AND ITS SUBSIDIARIES (INCLUDING WITH RESPECT TO
BUSINESSES OR ASSETS ACQUIRED OR TO BE ACQUIRED BY ANY OF THEM), AND THE
REGISTRATION STATEMENT, PROSPECTUS AND DOCUMENTS, IF ANY, INCORPORATED OR DEEMED
TO BE INCORPORATED BY REFERENCE THEREIN, IN EACH CASE, IN FORM, SUBSTANCE AND
SCOPE AS ARE CUSTOMARILY MADE BY ISSUERS TO UNDERWRITERS IN UNDERWRITTEN
OFFERINGS, AND CONFIRM THE SAME IF AND WHEN REQUESTED; (2) OBTAIN OPINIONS OF
COUNSEL TO THE COMPANY AND UPDATES THEREOF (WHICH COUNSEL AND OPINIONS (IN FORM,
SCOPE AND SUBSTANCE) SHALL BE REASONABLY SATISFACTORY TO THE MANAGING
UNDERWRITERS IF ANY, ADDRESSED TO EACH OF THE UNDERWRITERS, IF ANY, AND SELLING
HOLDERS), COVERING THE MATTERS CUSTOMARILY COVERED IN OPINIONS REQUESTED IN
UNDERWRITTEN OFFERINGS AND SUCH OTHER MATTERS AS MAY BE REASONABLY REQUESTED BY
SUCH UNDERWRITERS OR SELLING HOLDERS; (3) USE THEIR BEST EFFORTS TO OBTAIN
CUSTOMARY "COLD COMFORT" LETTERS AND UPDATES THEREOF FROM THE INDEPENDENT
CERTIFIED PUBLIC ACCOUNTANTS OF THE COMPANY (AND, IF NECESSARY, ANY OTHER
INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS OF ANY SUBSIDIARY OF THE COMPANY OR OF
ANY BUSINESS ACQUIRED BY THE COMPANY FOR WHICH FINANCIAL STATEMENTS AND
FINANCIAL DATA IS, OR IS REQUIRED TO BE, INCLUDED IN THE REGISTRATION
STATEMENT), ADDRESSED (WHERE REASONABLY POSSIBLE) TO EACH OF THE UNDERWRITERS,
IF ANY, AND SELLING HOLDERS, SUCH LETTERS TO BE IN CUSTOMARY FORM AND COVERING
MATTERS OF THE TYPE CUSTOMARILY COVERED IN "COLD COMFORT" LETTERS IN CONNECTION
WITH UNDERWRITTEN OFFERINGS; (4) IF AN UNDERWRITING AGREEMENT IS ENTERED INTO,
THE SAME SHALL CONTAIN INDEMNIFICATION PROVISIONS AND PROCEDURES NO LESS
FAVORABLE TO THE UNDERWRITERS, IF ANY, THAN THOSE SET FORTH IN SECTION 5 HEREOF
(OR SUCH OTHER PROVISIONS AND PROCEDURES ACCEPTABLE TO THE MANAGING
UNDERWRITERS, IF ANY); AND (5) DELIVER SUCH DOCUMENTS AND CERTIFICATES AS MAY BE
REASONABLY REQUESTED BY THE MANAGING UNDERWRITERS, IF ANY, TO EVIDENCE THE
CONTINUED VALIDITY OF THE REPRESENTATIONS AND WARRANTIES MADE PURSUANT TO CLAUSE
(1) ABOVE AND TO EVIDENCE COMPLIANCE WITH ANY CUSTOMARY CONDITIONS CONTAINED IN
THE UNDERWRITING AGREEMENT OR OTHER AGREEMENT ENTERED INTO BY THE COMPANY;
(xii) MAKE AVAILABLE FOR INSPECTION BY A REPRESENTATIVE OF
ANY UNDERWRITER PARTICIPATING IN ANY SUCH DISPOSITION OF REGISTRABLE
SECURITIES, AND ANY ATTORNEY, CONSULTANT OR ACCOUNTANT RETAINED BY SUCH SELLING
HOLDERS OR UNDERWRITER, AT THE OFFICES WHERE NORMALLY KEPT, DURING REASONABLE
BUSINESS HOURS, ALL PERTINENT FINANCIAL AND OTHER RECORDS, CORPORATE DOCUMENTS
AND PROPERTIES OF THE COMPANY AND ITS SUBSIDIARIES (INCLUDING WITH RESPECT TO
BUSINESSES AND ASSETS ACQUIRED OR TO BE ACQUIRED TO THE EXTENT THAT SUCH
INFORMATION IS AVAILABLE TO THE COMPANY), AND CAUSE THE OFFICERS, DIRECTORS,
AGENTS AND EMPLOYEES OF THE COMPANY AND ITS SUBSIDIARIES (INCLUDING WITH
RESPECT TO BUSINESSES AND ASSETS ACQUIRED OR TO BE ACQUIRED TO THE EXTENT THAT
SUCH INFORMATION IS AVAILABLE TO THE COMPANY) TO SUPPLY ALL INFORMATION IN EACH
CASE REASONABLY REQUESTED BY ANY SUCH REPRESENTATIVE, UNDERWRITER, ATTORNEY,
CONSULTANT OR ACCOUNTANT IN CONNECTION WITH SUCH REGISTRATION STATEMENT;
(xiii) COMPLY WITH ALL APPLICABLE RULES AND REGULATIONS OF THE
SEC AND MAKE GENERALLY AVAILABLE TO THEIR SECURITYHOLDERS EARNINGS STATEMENTS
SATISFYING THE PROVISIONS OF SECTION 11(a) OF THE ACT
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AND RULE 158 UNDER THE ACT, NO LATER THAN 45 DAYS AFTER THE END OF ANY 12-MONTH
PERIOD (OR 90 DAYS AFTER THE END OF ANY 12-MONTH PERIOD IF SUCH PERIOD IS A
FISCAL YEAR) (x) COMMENCING AT THE END OF ANY FISCAL QUARTER IN WHICH
REGISTRABLE SECURITIES ARE SOLD TO UNDERWRITERS IN A FIRM COMMITMENT OR
REASONABLE EFFORTS UNDERWRITTEN OFFERING AND (y) IF NOT SOLD TO UNDERWRITERS IN
SUCH AN OFFERING, COMMENCING ON THE FIRST DAY OF THE FIRST FISCAL QUARTER AFTER
THE EFFECTIVE DATE OF A REGISTRATION STATEMENT, WHICH STATEMENT SHALL COVER SAID
PERIOD, CONSISTENT WITH THE REQUIREMENTS OF RULE 158 UNDER THE ACT;
(xiv) CAUSE ALL REGISTRABLE SECURITIES COVERED BY THE
REGISTRATION STATEMENT TO BE LISTED ON EACH SECURITIES EXCHANGE ON WHICH SIMILAR
SECURITIES ISSUED BY THE COMPANY ARE THEN LISTED IF REQUESTED BY THE HOLDERS OF
A MAJORITY OF THE REGISTRABLE SECURITIES COVERED BY THE REGISTRATION STATEMENT
OR THE MANAGING UNDERWRITERS, IF ANY; AND
(xv) COOPERATE WITH EACH SELLER OF REGISTRABLE SECURITIES
COVERED BY ANY REGISTRATION STATEMENT AND EACH UNDERWRITER, IF ANY,
PARTICIPATING IN THE DISPOSITION OF SUCH REGISTRABLE SECURITIES AND THEIR
RESPECTIVE COUNSEL IN CONNECTION WITH ANY FILINGS REQUIRED TO BE MADE WITH THE
NASD.
THE COMPANY MAY REQUIRE A HOLDER OF REGISTRABLE SECURITIES TO
BE INCLUDED IN A REGISTRATION STATEMENT TO FURNISH TO THE COMPANY SUCH
INFORMATION REGARDING (x) THE INTENDED METHOD OF DISTRIBUTION OF SUCH
REGISTRABLE SECURITIES (y) SUCH HOLDER AND (z) THE REGISTRABLE SECURITIES HELD
BY SUCH HOLDER AS IS REQUIRED BY LAW TO BE DISCLOSED IN SUCH REGISTRATION
STATEMENT AND THE COMPANY MAY EXCLUDE FROM SUCH REGISTRATION STATEMENT THE
REGISTRABLE SECURITIES OF ANY HOLDER WHO FAILS TO FURNISH SUCH INFORMATION
WITHIN A REASONABLE TIME AFTER RECEIVING SUCH REQUEST. THE COMPANY SHALL NOT BE
REQUIRED TO PROVIDE INDEMNIFICATION TO ANY UNDERWRITER OR ANY OTHER PERSON
RELATING TO INFORMATION REFERRED TO IN CLAUSES (x), (y) AND (z) PROVIDED TO THE
COMPANY IN WRITING SPECIFICALLY FOR INCLUSION IN SUCH REGISTRATION STATEMENT.
EACH HOLDER OF REGISTRABLE SECURITIES AGREES BY ACQUISITION OF
SUCH REGISTRABLE SECURITIES THAT, UPON RECEIPT OF ANY NOTICE FROM THE COMPANY OF
THE HAPPENING OF ANY EVENT OF THE KIND DESCRIBED IN SECTION 3(iii)(2),
3(iii)(3), 3(iii)(4) OR 3(iii)(5) HEREOF, SUCH HOLDER WILL FORTHWITH DISCONTINUE
DISPOSITION OF SUCH REGISTRABLE SECURITIES COVERED BY SUCH REGISTRATION
STATEMENT OR PROSPECTUS UNTIL SUCH HOLDER'S RECEIPT OF THE COPIES OF THE
SUPPLEMENTED OR AMENDED PROSPECTUS CONTEMPLATED BY SECTION 3(x) HEREOF, OR UNTIL
IT IS ADVISED IN WRITING (THE "ADVICE") BY THE COMPANY THAT THE USE OF THE
APPLICABLE PROSPECTUS MAY BE RESUMED, AND, IN EITHER CASE, HAS RECEIVED COPIES
OF ANY ADDITIONAL OR SUPPLEMENTAL FILINGS THAT ARE INCORPORATED OR DEEMED TO BE
INCORPORATED BY REFERENCE IN SUCH PROSPECTUS. IF THE COMPANY SHALL GIVE ANY SUCH
NOTICE, THE EFFECTIVENESS PERIOD SHALL BE EXTENDED BY THE NUMBER OF DAYS DURING
SUCH PERIOD FROM AND INCLUDING THE DATE OF THE GIVING OF SUCH NOTICE TO AND
INCLUDING THE DATE WHEN EACH HOLDER OF REGISTRABLE SECURITIES COVERED BY SUCH
REGISTRATION STATEMENT SHALL HAVE RECEIVED (x) THE COPIES OF THE SUPPLEMENTED OR
AMENDED PROSPECTUS CONTEMPLATED BY SECTION 3(x) HEREOF OR (y) THE ADVICE, AND,
IN EITHER CASE, HAS RECEIVED COPIES OF ANY ADDITIONAL OR SUPPLEMENTAL FILINGS
THAT ARE INCORPORATED OR DEEMED TO BE INCORPORATED BY REFERENCE IN SUCH
PROSPECTUS.
SECTION 4. REGISTRATION EXPENSES
(a) All expenses incident to the Company's performance of
or compliance with this Agreement will be borne by the Company, regardless of
whether a Registration Statement becomes effective, including without
limitation: (i) all registration and filing fees and expenses (including
filings made with the NASD (including, if applicable, the fees and expenses of
any "qualified independent
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underwriter" and its counsel, as may be required by the rules and regulations of
the NASD)); (ii) all fees and expenses of compliance with federal securities and
state Blue Sky or securities laws; (iii) all expenses of printing (including
printing certificates for the Warrant Shares and printing of Prospectuses),
messenger and delivery services and telephone; (iv) all fees and disbursements
of counsel for the Company and, in accordance with Section 4(b) below, the
Holders of Registrable Securities; (v) all application and filing fees in
connection with listing the Warrant Shares on a national exchange or automated
quotation system if required hereunder; and (vi) all fees and disbursements of
independent certified public accountants of the Company (including the expenses
of any special audit and comfort letters required by or incident to such
performance).
The Company will, in any event, bear its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expenses of any annual
audit and the fees and expenses of any Person, including special experts,
retained by the Company.
EACH HOLDER SHALL PAY ALL UNDERWRITING DISCOUNTS AND
COMMISSIONS AND TRANSFER TAXES, IF ANY, RELATING TO THE SALE OR DISPOSITION OF
SUCH HOLDER'S REGISTRABLE SECURITIES PURSUANT TO A REGISTRATION STATEMENT.
(b) In connection with any Registration Statement required by
this Agreement, the Company will reimburse the Holders of Registrable Securities
being registered pursuant to a Demand Registration or Piggy-Back Registration,
as applicable, for the reasonable fees and disbursements of not more than one
counsel chosen by the Holders of a majority of the Registrable Securities for
whose benefit such Registration Statement is being prepared.
SECTION 5. INDEMNIFICATION
(a) The Company agrees to indemnify and hold harmless each
Initial Purchaser, each Holder, each underwriter who participates in an offering
of Registrable Securities, each person, if any, who controls a Holder within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act and the
respective officers, directors, partners, employees, representatives and agents
of any such party or any controlling person to the fullest extent lawful, from
and against any and all losses, liabilities, claims, damages and expenses
whatsoever (including but not limited to attorneys' fees and any and all
expenses whatsoever incurred in investigating, preparing or defending against
any investigation or litigation, commenced or threatened, or any claim
whatsoever, and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement or the Prospectus, or in
any supplement thereto or amendment thereof, or arise out of or are based upon
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the Company will not be liable in any such case to the extent, but only to
the extent, that (i) any such loss, liability, claim, damage or expense arises
out of or is based upon any such untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of such party
expressly for use therein and (ii) the foregoing indemnity with respect to any
untrue statement contained in or omitted from a Registration Statement or
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the Prospectus shall not inure to the benefit of any party (or any person
controlling such party), from whom the person asserting any such loss,
liability, claim, damage or expense purchased any of the Warrant Shares which
are the subject thereof if it is finally judicially determined that such loss,
liability, claim, damage or expense resulted solely from the fact that such
party sold Warrant Shares to a person to whom there was not sent or given, at or
prior to the written confirmation of such sale, a copy of the Registration
Statement or the Prospectus, as amended or supplemented, and (x) the Company
shall have previously and timely furnished sufficient copies of the Registration
Statement or Prospectus, as so amended or supplemented, to such party in
accordance with this Agreement and (y) the Registration Statement or Prospectus,
as so amended or supplemented, would have corrected such untrue statement or
omission of a material fact. This indemnity agreement will be in addition to any
liability which the Company may otherwise have, including, under this Agreement.
(b) Each Holder, severally and not jointly, agrees to
indemnify and hold harmless the Company, each Initial Purchaser, each
underwriter who participates in an offering of Registrable Securities and the
other selling Holders and each person, if any, who controls any such party
within the meaning of Section 15 of the Act or Section 20(a) of the Exchange
Act, against any losses, liabilities, claims, damages and expenses whatsoever
(including but not limited to attorneys' fees and any and all expenses
whatsoever incurred in investigating, preparing or defending against any
investigation or litigation, commenced or threatened, or any claim whatsoever
and any and all amounts paid in settlement of any claim or litigation), joint or
several, to which they or any of them may become subject under the Act, the
Exchange Act or otherwise, insofar as such losses, liabilities, claims, damages
or expenses (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement or the Prospectus, or in any amendment thereof or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, 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 any such loss, liability, claim, damage or expense arises
out of or is based upon any untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in conformity
with written information furnished to the Company by or on behalf of such Holder
expressly for use therein. This indemnity will be in addition to any liability
which a Holder may otherwise have, including under this Agreement. In no event,
however, shall the liability of any selling Holder hereunder be greater in
amount than the dollar amount of the proceeds received by such Holder upon its
sale of the Warrant Shares giving rise to such indemnification obligation.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify each party against whom
indemnification is to be sought in writing of the commencement thereof (but the
failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 5 except to the extent that it
has been prejudiced in any material respect by such failure or from any
liability which it may otherwise have). In case any such action is brought
against any indemnified party, and it notifies an indemnifying party of the
commencement thereof, the indemnifying party will be entitled to participate
therein, and to the extent it may elect by written notice delivered to the
indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party. Notwithstanding the foregoing, the
indemnified party or parties shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnified party or parties unless (i) the employment of
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such counsel shall have been authorized in writing by the indemnifying parties
in connection with the defense of such action, (ii) the indemnifying parties
shall not have employed counsel to take charge of the defense of such action
within a reasonable time after notice of commencement of the action, or (iii)
such indemnified party or parties shall have reasonably concluded that there may
be defenses available to it or them which are different from or additional to
those available to one or all of the indemnifying parties (in which case the
indemnifying party or parties shall not have the right to direct the defense of
such action on behalf of the indemnified party or parties), in any of which
events such fees and expenses of counsel shall be borne by the indemnifying
parties; provided, however, that the indemnifying party under subsection (a) or
(b) above, shall only be liable for the legal expenses of one counsel (in
addition to any local counsel) for all indemnified parties in each jurisdiction
in which any claim or action is brought. Anything in this subsection to the
contrary notwithstanding, an indemnifying party shall not be liable for any
settlement of any claim or action effected without its prior written consent,
provided, however, that such consent was not unreasonably withheld.
(d) In order to provide for contribution in circumstances in
which the indemnification provided for in this Section 5 is for any reason held
to be unavailable from the Company or is insufficient to hold harmless a party
indemnified thereunder, the Company and each Holder shall contribute to the
aggregate losses, claims, damages, liabilities and expenses of the nature
contemplated by such indemnification provision (including any investigation,
legal and other expenses incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims asserted, but after
deducting in the case of losses, claims, damages, liabilities and expenses
suffered by the Company, any contribution received by the Company from persons,
other than the Holders, who may also be liable for contribution, including
persons who control the Company within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act) to which the Company and any Holder may be
subject, in such proportion as is appropriate to reflect the relative benefits
received by the Company from the offering of the Notes, the Warrants and the
Warrant Shares and any such Holder from its sale of Warrant Shares or, if such
allocation is not permitted by applicable law or indemnification is not
available as a result of the indemnifying party not having received notice as
provided in this Section 5, in such proportion as is appropriate to reflect not
only the relative benefits referred to above but also the relative fault of the
Company and the Holders in connection with the statements or omissions which
resulted in such losses, claims, damages, liabilities or expenses, as well as
any other relevant equitable considerations. The relative benefits received by
the Company and any Holder shall be deemed to be in the same proportion as (x)
the total proceeds from the offering of the Notes, the Warrants and the Warrant
Shares (net of discounts but before deducting expenses) received by the Company
and (y) the total proceeds received by such Holder upon its sale of Warrant
Shares which would otherwise give rise to the indemnification obligation,
respectively. The relative fault of the Company and of the Holders 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 the Holders
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
each Holder agree that it would not be just and equitable if contribution
pursuant to this Section 5 were determined by pro rata allocation or by any
other method of allocation which does not take into account the equitable
considerations referred to above. Notwithstanding the provisions of this Section
5, (i) no Holder shall be required to contribute, in the aggregate, any amount
in excess of the amount by which the total received by such Holder with respect
to the sale of its Warrant Shares exceeds the sum of (A) the amount paid by such
Holder for such Warrant Shares plus (B) the amount of any damages which such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission and (ii) no person guilty
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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. For purposes of this Section 5, (A) each person,
if any, who controls a Holder within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act and (B) the respective officers, directors,
partners, employees, representatives and agents of a Holder or any controlling
person shall have the same rights to contribution as such Holder, and each
person, if any, who controls the Company within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act shall have the same rights to
contribution as the Company, subject in each case to clauses (i) and (ii) of
this Section 5(d). Any party entitled to contribution will, promptly after
receipt of notice of commencement of any action, suit or proceeding against such
party in respect of which a claim for contribution may be made against another
party or parties under this Section 5, notify such party or parties from whom
contribution may be sought, but the failure to so notify such party or parties
shall not relieve the party or parties from whom contribution may be sought from
any obligation it or they may have under this Section 5 or otherwise. No party
shall be liable for contribution with respect to any action or claim settled
without its prior written consent; provided, however, that such written consent
was not unreasonably withheld.
SECTION 6. RULE 144A
The Company hereby agrees with each Holder, for so long as any
Registrable Securities remain outstanding, to make available, upon request of
any Holder of Registrable Securities, to any Holder or beneficial owner of
Registrable Securities in connection with any sale thereof and any prospective
purchaser of such Registrable Securities designated by such Holder or beneficial
owner, the information required by Rule 144A(d)(4) under the Act in order to
permit resales of such Registrable Securities pursuant to Rule 144A.
SECTION 7. MISCELLANEOUS
(a) Remedies. Each Holder, in addition to being entitled to
exercise all rights provided herein, in the Warrant Agreement, in the Purchase
Agreement or granted by law, including recovery of liquidated or other damages,
will be entitled to specific performance of its rights under this Agreement. The
Company agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of the provisions of this Agreement
and hereby agrees to waive the defense in any action for specific performance
that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company will not on or
after the date of this Agreement enter into any agreement with respect to its
securities that conflicts with the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof. The rights granted
to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Company's securities
under any agreement in effect on the date hereof, except where a waiver with
respect thereto has been obtained prior to the date of effectiveness of any
registration statement required under this Agreement.
(c) Amendments and Waivers. The provisions of this Agreement
may not be amended, modified or supplemented, and waivers or consents to or
departures from the provisions hereof may not be given unless the Company has
obtained the written consent of Holders of a majority of the outstanding
Registrable Securities, and the consent of the Holders of a majority of the
outstanding Registrable Securities shall be binding on every Holder of
Registrable Securities.
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(d) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, first-class
mail (registered or certified, return receipt requested), telex, telecopier, or
air courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the
records of the Warrant Agent under the Warrant Agreement, with a copy
to the Warrant Agent under the Warrant Agreement; and
(ii) if to the Company:
MGC COMMUNICATIONS, INC.
0000 XXXXX XXXXXX XXXXX
XXX XXXXX, XXXXXX 00000
TELECOPIER NO.: (000) 000-0000
ATTENTION: GENERAL COUNSEL
WITH A COPY TO:
ELLIS, FUNK, XXXXXXXX, XXXXXXXX & DOKSON, P.C.
0000 XXXXXXXX XXXX, XXXXX 000
XXXXXXX, XXXXXXX 00000
TELECOPIER NO.: (000) 000-0000
ATTENTION: XXXXXX X. XXXXXXXX
ALL SUCH NOTICES AND COMMUNICATIONS SHALL BE DEEMED TO HAVE
BEEN DULY GIVEN AT THE TIME DELIVERED BY HAND, IF PERSONALLY DELIVERED; FIVE
BUSINESS DAYS AFTER BEING DEPOSITED IN THE MAIL, POSTAGE PREPAID, IF MAILED;
WHEN ANSWERED BACK, IF TELEXED; WHEN RECEIPT ACKNOWLEDGED, IF TELECOPIED; AND ON
THE NEXT BUSINESS DAY, IF TIMELY DELIVERED TO AN AIR COURIER GUARANTEEING
OVERNIGHT DELIVERY.
COPIES OF ALL SUCH NOTICES, DEMANDS OR OTHER COMMUNICATIONS
SHALL BE CONCURRENTLY DELIVERED BY THE PERSON GIVING THE SAME TO THE WARRANT
AGENT AT THE ADDRESS SPECIFIED IN THE WARRANT AGREEMENT.
(e) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders of Registrable Securities; provided, however,
that this Agreement shall not inure to the benefit of or be binding upon a
successor or assign of a Holder unless and to the extent such successor or
assign acquired Registrable Securities directly from such Holder.
(f) Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
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(h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE CONFLICT OF LAW RULES THEREOF.
(i) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
(j) Entire Agreement. This Agreement together with the other
Operative Documents (as defined in the Purchase Agreement) is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein with respect to the registration rights granted by the Company with
respect to the Registrable Securities. This Agreement supersedes all prior
agreements and understandings between the parties with respect to such subject
matter.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
MGC COMMUNICATIONS, INC.
BY:
-----------------------------------------
NAME:
TITLE:
BEAR, XXXXXXX & CO. INC.
BY:
----------------------------
NAME:
TITLE:
XXXXXX XXXX LLC
BY:
----------------------------
NAME:
TITLE:
